Human resource (HR) management, often called HR or talent management, comprises all the activities companies undertake to hire, develop, and engage the workforce. And because talent is any organization’s most precious resource, effective HR management is critical to organizational success and growth.
In this post, discover why HR management is necessary for organizations, the many roles HR professionals fulfill, and how to break into this challenging and rewarding field.
Why Is Human Resource Management Important?
Human resource management has become a function with extraordinary strategic value and a critical voice on company leadership teams. According to a recent BambooHR study, 74 percent of large organizations have a senior HR leader within the C-suite.
The importance of human resource management in most organizations comes down to having skilled and engaged people who are aligned with organizational goals. With enough of the right people, an organization can fulfill its vision and remain competitive. But to do that, it must have effective HR management programs and practices.
So why is human resource management important? Because it adds value to organizations in the following ways:
It supports employees through every stage of the employee lifecycle.
Human resource management comprises the programs and activities that support hiring, managing, and developing employees from recruitment to retirement.
It ensures profitability through effective cost management.
Labor costs—such as salaries, benefits, and payroll taxes—often represent the largest expense category in most organizations (up to 70 percent of the total company expense, according to one estimate). Via well-crafted policies, competitive pay and benefits, and people analytics that support better budgeting and decision-making, HR professionals help organizations keep labor costs manageable.
It helps create a positive work culture.
Programs related to training, development, work-life balance, and diversity and inclusion are all components of a well-run HR function, and they help create a culture that boosts employee engagement, retention, and performance.
It lowers compliance and other risks.
Effective human resource management helps organizations navigate the more than 180 labor laws governing how organizations hire and manage people. Aside from compliance support, HR teams also limit hiring and reputational risk through onboarding, employee communication programs, and employee surveys.
Functions of Human Resource Management
Over the years, human resource management has progressed from a function focused primarily on hiring, benefits management, and payroll to one tasked with managing and improving every aspect of the employee experience. Today, HR professionals can be generalists or specialists in one of the many disciplines of talent management.
Here is a sampling of the different roles HR professionals fill:
- Recruitment: Managing job postings, applicant tracking, interviewing, and working with hiring managers to fill open positions
- Employer branding: Using social media and other channels to create brand awareness among candidates and build engagement among existing employees.
- Onboarding: Creating experiences that help new hires adjust to their roles and learn about people, processes, and culture within the organization.
- Compensation, benefits, and total rewards: Crafting new hire offers and working with business leaders to create competitive compensation structures and benefit programs.
- Analytics and reporting: Utilizing HR data analysis platforms to measure HR key performance indicators (KPI) such as headcount, time to hire, and employee engagement levels.
- Training: Developing and delivering programs that support employee skill development and advancement.
- Employee relations: Helping managers and employees resolve conflicts and manage issues that impede team effectiveness.
- Diversity, equity, inclusion, and belonging (DEIB): Creating a work environment where all employees are valued for their unique perspectives and experiences.
Pursuing a Career in Human Resource Management
Depending on the area of specialty, HR careers can take many forms. But one thing many HR roles have in common is the potential for enterprise-wide impact. As one HR professional described: “... There is no other department in an organization with such a wide berth. HR … is involved in all levels of an organization, top to bottom, and in every function of the company.”
If you’re interested in daily opportunities to impact how employees work and interact, a career in human resource management may be an excellent fit.
Here’s what you can expect:
Opportunities to Gain Transferable Skills
Working in human resource management provides opportunities to build technical and soft skills you can use in HR roles across industries. You’ll also learn best practices for hiring, developing, and managing people. Examples of the knowledge and skills you can learn include the following:
- Problem-solving: You’ll gain proficiency in overcoming challenges ranging from budget management and talent shortages to internal conflicts and compliance.
- Digital talent management platforms: You’ll learn how to use HR software and people analytics for better reporting and strategic decision-making.
- Policy development: Human resource management is always evolving, requiring organizations to update existing policies and write new ones. Working in HR will provide opportunities to craft and implement new policies to meet employee needs.
- Influencing and advising: Most managers are empowered to hire and manage the employees on their team, but they need help from human resource professionals. Working in HR allows you to develop influencing skills that help guide managers in their roles as company leaders.
Options to Expand Your HR Knowledge
In addition to on-the-job experiences, pursuing a degree program in human resource management can provide the foundational knowledge necessary for strategic HR roles. An online program is an excellent way to continue working while you build new skills in HR management. Whether you already have a degree in HR or another major, you can select among three of MVNU Online’s accredited HR degree programs:
- Bachelor of Business Administration (BBA) in Human Resource Management: Get a balanced education in business administration combined with HR-specific coursework in areas such as employee relations, diversity, and strategy.
- Master of Business Administration (MBA) in Human Resource Management: Advance your business credentials with an MBA. In addition to corporate finance, leadership, and management classes, you’ll gain a deeper understanding of HR principles covering reward systems, training, and strategic programming.
- Master of Science in Management (MSM) with a concentration in Human Resource Management: Build your organizational management knowledge with extensive HR coursework in an MSM program you can complete in as little as 16 months.
Strong Earning Potential and Outlook
According to the US Bureau of Labor Statistics, HR professionals earned a median annual pay of $126,230 in 2021, with employment expected to grow by seven percent through 2031. Since HR skills and experience are transferable across industries, you can expect to find opportunities to boost your earnings as your career and education progresses.
Learn More About the Importance of Human Resource Management
The objectives of human resource management are many, ranging from hiring and training to compensation and workforce engagement. When you choose from among the many available HR career paths, you have opportunities to see first-hand the importance of effective HR management to an organization’s performance and profitability.
If you think an HR career is a potential fit, consider how an undergraduate or graduate degree program can help you develop the knowledge and skills to work in this exciting business function.