Human resources professionals are generally employed in one of two major arenas. In the first, they work for large or medium-sized companies in any kind of industry. Any organization with many employees, whether a bank, oil company, or fast food restaurant, needs personnel specialists. The second major arena is in personnel consulting firms that help other companies find qualified employees, both on a permanent and temporary basis. Such companies provide a service to both employers and those seeking employment. Employment agencies, executive placement services, temporary help services, labor contractors, and registries for chauffeurs, household workers, models, nurses, ship crews, and teachers are all examples of this type of service firm. Many human resource managers earn a certificate in Professional Human Resources Management.
Before a company or organization can make any decisions about personnel, its managers must come up with a game plan for the company itself. What are its goals for the future? Will it be developing new products? How much growth is expected, and how quickly?
Once these basic questions are answered, an organization can start planning for its human resources. A good first step is determining what needs to be done at every level of the organization. It is important to take future needs into account, as well. For example, if a company operates in only one city but plans in five years to have offices in 10 cities, in five years that company will need a manager with the skills to oversee the activities of 10 regional offices.
Once a plan is in place, management should evaluate the capabilities of the people already on staff to see how they fit into this plan. If they discover they do not already have the personnel needed, they must determine the best way to hire the appropriate workers.
An increasingly important part of this planning is human resources accounting, a relatively new field. Generally speaking, human resources accounting is a process of cost estimation, a mathematical way to determine the cost and value of people as resources. The role of the HR accountant is to help management understand the monetary implications of business decisions.
When a company has to decide between hiring from within the company or hiring a new employee, human resources accountants can provide figures related to the costs of acquiring and developing people for positions. When the person is already on staff, the amount of money it will cost to retrain that person is taken into account. If the person is an outsider, the cost to hire and integrate that worker into the company is considered.
In some cases, a company may save money by laying off people, but if those people get different jobs and don't come back, the company has to spend money to train new people. This may not result in a savings in the long run.
Human resources workers also help companies recruit, select, and hire new workers. The goal of this process is to bring the right people together to perform a job in the most effective way possible. HR professionals are responsible for finding the best workers to do a job. They accomplish this by knowing the right places to look for workers and by conducting good interviews with candidates.
However, there is more to acquisition than finding the personnel a company wants; making the company attractive to prospective employees is equally important. To get the employees it wants, a company might decide to offer benefits to employees, such as providing on-site day care, flexible schedules, and job sharing. HR professionals devise proposals that balance the needs of employers and workers to come up with employment packages that benefit both.
Human resources professionals help increase productivity by making people better workers. This involves various forms of training to enhance workers' technical, administrative, and interpersonal skills, either through formal programs or on-the-job training. Continuing education programs and training for employees benefit both the employee and the employer. The HR department plans these educational programs and may even lead the programs.
Allocation is the process of assigning people to various roles and tasks. Ideally, when a person is assigned to a particular job, three things should happen. First, the job should be done well. Second, the employee should learn more skills. Third, the employee should be happy (which relates back to getting the job done) with the situation.
Sometimes, assigning the most qualified person to a job may not be the right decision, because it keeps someone else from learning the task. Incorrect allocation can be costly because, in many industries, if workers don't develop skills, they become less valuable.
Utilization is the process of using human resources to achieve a company's objectives. If the aim of human resources management is to increase the value of an organization's workers, then task design, selection, role assignment, development, performance appraisal, and compensation are more than just a set of functions to be performed; they are a set of strategies that can change the value of human assets.
Conservation is the process of maintaining the capabilities of workers and the effectiveness of the work team developed by an organization. This can save a business money in the long run. If not monitored, the quality of human resources may deteriorate. If this happens, an organization has to incur the cost of retraining or replacing employees who no longer have the necessary skills.
Workers' productivity is often directly linked to their psychological well-being. A manager sometimes puts pressure on employees in order to increase productivity or reduce costs. It is important, however, that the effects of pressure on worker motivation and attitudes do not go unnoticed. Highly skilled employees may become dissatisfied and leave. Good human resources professionals are like good coaches: They keep workers performing well and feeling good about themselves.
One important element of conservation and retention has to do with individual workers' professional ambitions. Not everybody wants the same thing from a job. Some employees want to climb the corporate ladder, while others want to be teachers, consultants, or entrepreneurs. Human resources professionals need to develop different career paths and reward systems to deal with different types of people.
The areas of evaluation and compensation are also important ones for human resources professionals. Evaluation is the process of assessing the value of people to an organization. It involves measuring the performance of workers and determining how much they should be paid for their contribution. This is a very important function because it is directly related both to general productivity and to hard dollars. If a company pays an employee $60,000 a year and nobody notices that this employee is not doing a very good job, then the company is throwing its money away. On the other hand, if an employee's excellent work goes unnoticed and under compensated, he or she may leave the company. Then, not only will the company have to spend time and money training a replacement, but the replacement may not be as good as the original worker.
Clearly, then, accurate evaluation is an essential part of effective human resources management. HR professionals can facilitate evaluation by helping managers develop creative ways to assess their workers' skills and by reminding them not to take their workers for granted. Perhaps one employee could do more if given the chance; maybe another is simply not equal to a task.
Compensation goes hand in hand with evaluation. Compensation is defined as how workers are rewarded for their performance, and a savvy HR professional understands that there is more to compensation than salary. Some employees would prefer to have their entire reward concentrated in their salaries, but for others, benefits such as insurance, pension plans, vacation time, profit sharing, and general job flexibility are equally, or even more, important. It is up to the human resources team to determine the best way to compensate workers in line with both the company's and individuals' needs.