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Functions of Human Resource Management

With the increased regulation and emphasis on employee welfare, the Functions of Human Resource Management (HRM) have taken a central role in the day-to-day administration of all organisations. As businesses strive to adapt to changing environments and embrace new technologies, their human capital remains the driving force behind prosperity and sustainable growth. 

HR executives and managers in any organisation wish to develop effective leaders within their organisations. However,many of them are unaware of any leadership development approach. Therefore, if you are an aspiring HR professional, it’s crucial to familiarise yourself with the Functions of Human Resource Management to drive organisational success. Read below to learn more! 

Table of Contents 

1) What is HRM? 

2) Why is Human Resource Management important?

3)  What are the Functions of Human Resource Management?   

     a) Job design and job analysis  

     b) Recruitment and hiring  

     c) Compensation & benefits   

     d) Employee training and development

     e) Employee performance management  

     f) Managerial relations  

     g) Labour relations  

     h) Employee engagement  

     i) Personal support for employees  

     j) Succession planning 

4) Conclusion 

What is HRM? 

Human Resource Managment plays an important role within organisations. HR Managers assist various departments with personnel matters, including the following:

trends in HRM

a) Recruitment 

b) Employee management 

c) Policy formulation 

d) Compensation determination 

Recruitment involves advertising job vacancies, screening applicants, and conducting interviews to find the most suitable candidates. Human Resource Managers handle the paperwork and support the onboarding process. 

Employee management includes overseeing performance, providing feedback, and addressing issues. HR Managers also organise training programs to enhance skills and foster growth. Further, formulating policies ensures consistency and legal compliance. 

HR Managers also collaborate to establish guidelines for attendance, leave, and code of conduct. Determining compensation involves analysing market trends, job roles, and performance to set competitive salaries. HR Managers also administer benefits programs to promote employee satisfaction.

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Why is Human Resource Management important? 

Human Resource Management is vital in modern-day organisations, serving as a crucial link between management and employees. It encompasses numerous functions that contribute to the overall success, growth, and sustainability of the company. Here are some key reasons why HRM is of paramount importance: 

a) Talent acquisition and retention: An effective Recruitment Process ensures that the right talent is brought on board. While retention strategies, such as competitive compensation packages and growth opportunities, help keep employees engaged and committed to the organisation. 

b) Employee development and training:  Various training programs and workshops help enhance the skills and knowledge of employees. As a result, HRM contributes to a more skilled and adaptable workforce that can handle new challenges and opportunities. 

c) Performance management: Establishing a performance evaluation system helps measure employee performance against set objectives. This process helps identify top performers and provide constructive feedback. As a result, it helps align individual goals with organisational goals, ultimately enhancing overall productivity. 

d) Employee relations and well-being: Maintaining a positive work environment is crucial for employee satisfaction and well-being. Human Resource professionals ensure that employees’ concerns are addressed promptly, fostering a culture of open communication and support. Engaged and satisfied employees are more likely to be committed and productive in the organisation. 

e) Compliance and legal matters: Effective management of employees ensures that the organisation adheres to all relevant labour laws and regulations. Compliance with employment laws mitigates the risk of legal issues and reputational damage. 

f) Organisational culture and values: It promotes diversity, inclusion, and ethical practices. This creates a workplace that respects and celebrates individual differences while fostering a sense of belonging among employees. 

g) Change management: In times of organisational change, HRM guides employees through the transition process. By effectively managing change, they minimise resistance and ensure a smooth integration of new strategies and practices. 

h) Strategic alignment: It identifies the workforce's strengths and areas for improvement. Thus, contributes to the company's competitive advantage and long-term success. 

What are the Functions of Human Resource Management? 

The Functions of Human Resource Management encompass a diverse set of responsibilities to manage an organisation’s human capital effectively. HRM is crucial in nurturing a productive, engaged, and motivated workforce. Let’s explore the key Functions of HRM:

Job design and job analysis 

One of the primary Functions of HRM is job design and job analysis. Job design encompasses the process of outlining the tasks, responsibilities, and functions associated with a particular job role. +To make informed and rational hiring decisions, it is essential to establish the characteristics of an ideal candidate suitable for the job. This can be achieved by defining the skills and personality traits possessed by your top-performing employees. This exercise aids in pinpointing the specific qualities and qualifications you seek in a potential candidate, establishing the minimum requirements for the job. 

Job analysis, on the other hand, entails a comprehensive breakdown of the job prerequisites, encompassing skills, qualifications, and work experience. It involves a meticulous examination and detailed description of the crucial day-to-day responsibilities and functions associated with the position. This analysis serves as a foundational step in shaping the recruitment process, as it provides a clear understanding of what the job entails and what qualifications are necessary for its successful execution. 

Both job design and job analysis are essential Functions of HRM that pave the way for effective talent acquisition and management. Job design helps in envisioning the ideal candidate profile, while job analysis lays the groundwork by outlining the job's intricacies and essential qualifications. Together, these processes enable HR professionals to not only identify and attract top talent but also ensure that the selected candidates are well-suited for the demands of the role, contributing to the overall success of the organisation. 

Recruitment and hiring 

Recruitment stands as one of the fundamental Functions of Human Resource Management. The overarching goal of HRM is to procure and retain a cadre of competent and effective employees who can collectively work towards the accomplishment of the company's objectives and aspirations.

Human Resource professionals plays a pivotal role in the initial stages of identifying and sourcing the most fitting candidates for interviews and assessments. It serves as the bridge between the organisation's requirements and the available talent in the job market. A crucial phase follows, characterised by an exhaustive screening process designed to sift through the multitude of applicants and discern the most well-suited candidates. 

The selected candidates undergo a series of interview rounds. Each stage is meticulously designed to evaluate and analyse their skillsets, knowledge, and work experience relevant to the job position in question. These interviews serve as the crucible where the candidates' capabilities are honed and assessed to ascertain their alignment with the company's needs. 

Once the candidates successfully navigate the rigours of the interview rounds, they are then extended the coveted job offers corresponding to their respective positions. This step marks a crucial transition as these chosen individuals are poised to become the linchpins in the realisation of the company's overarching goals and objectives. 

Compensation & benefits 

Benefits and compensation constitute a substantial portion of an organisation's total expenditure. Balancing the need to control expenses while simultaneously offering competitive compensation packages to employees is a critical responsibility of HRs. In doing so, HRM involves shaping an enticing yet cost-effective benefits and compensation structure to attract top talent while maintaining the company's financial well-being. 

The management forms the framework that ensures fairness and equity in remuneration for all employees. This equitability includes financial considerations and broader aspects of employee well-being and satisfaction. HRs leverages benefits and compensation packages as a useful tool for enhancing employee productivity and fostering a positive public image for the organisation. 

A fundamental function within the HR department is the formulation and communication of comprehensive policies and guidelines pertaining to employee compensation and the benefits available to them.

These policies are crucial for creating a work environment marked by equality and transparency, fostering trust and confidence among employees and management alike. It is well understood that the level of employee satisfaction at work is intricately linked to the compensation and benefits they receive. 

HRM's role in managing benefits and compensation goes beyond just cost control. It involves delicately attractive remuneration, while safeguarding the company's financial stability.

Moreover, it serves as a mechanism for reinforcing fairness, boosting productivity, and shaping a positive organisational culture that resonates with the company's core values and objectives. By effectively managing benefits and compensation, HRM contributes significantly to an organisation's ability to attract, retain, and motivate a skilled and dedicated workforce.

Employee training and development

Development and employee training are some of the essential the Functions of Human Resource Management, contributing to organisational success and employee satisfaction. In Human Resources, training refers to imparting specific skills and knowledge to employees, enhancing their capabilities to perform their current roles effectively. On the other hand, development focuses on preparing employees for future responsibilities and career progression within the organisation.

HR professionals ensure that employees receive relevant training programs aligned with organisational goals. This involves identifying skill gaps, designing training modules, and implementing initiatives that foster continuous learning. By investing in employee development, HR contributes to talent retention and promotes a culture of growth within the organisation.

Moreover, practical training and development initiatives not only enhance individual performance but also contribute to the overall productivity and competitiveness of the company. HRs strategically align training programs with the organisation's objectives, ensuring that employees acquire the skills needed for current and future challenges. A robust training and development framework reflects the commitment of HR management to nurture talent, foster employee engagement, and drive the organisation's success.

Employee performance management 

Effective employee performance management is a crucial component of HR Functions, ensuring that employees' contributions align with and drive the organisation's goals and objectives.

Performance management extends beyond individual performance and encompasses the collective performance of teams, departments, and the organisation as a whole. HR's role in performance management encompasses several vital functions, including the following: 

a) Developing comprehensive job descriptions: HR's plays a pivotal role in crafting detailed job descriptions that outline roles, responsibilities, and performance expectations.  

b) Selection process: Initiating a rigorous and appropriate selection process is vital to ensure that suitable candidates are hired for specific job positions.  

c) Training and development: HR facilitates training and education initiatives aimed at enhancing employee skills and capabilities.  

d) Feedback and coaching: Effective performance management includes real-time feedback and coaching by encouraging open communication between managers and employees.  

e) Performance reviews: Conducting regular performance reviews, whether on a monthly or quarterly basis, is a crucial HR Function.  

f) Exit interviews: HR manages the exit interview process, which helps the organisation understand why experienced employees choose to leave.  

g) Appraisal and compensation systems: HR's designs and administers performance appraisal and compensation systems that recognise and reward employees for their contributions. 

Managing relations 

HRM fosters harmonious relationships among employees at all levels of the organisation. These efforts include various aspects, including conflict resolution, negotiation, and the provision of specialised training to equip employees with essential skills for effective workplace interaction. Here's a detailed explanation of these aspects:

a) Conflict resolution: Conflict is an inevitable indispensable part of any organisation, but effective Hhuman Rresource Mmanagement seeks to address and resolve conflicts promptly and constructively. HR professionals serve as mediators, helping parties in dispute find common ground, facilitating dialogue, and promoting understanding. By doing so, they prevent conflicts from escalating and disrupting the work environment. 

b) Negotiation: Negotiation skills are vital in creating positive outcomes for all parties involved. HR professionals often engage in negotiations related to employment terms, grievances, and workplace disputes. Their goal is to strike a balance that benefits both employees and the organisation, fostering promoting a sense of fairness and equity. 

c) Specialised training: To enhance employees' abilities to manage themselves effectively, HR may provide specialised training programs. These programs can encompass areas such as anger management, conflict resolution, mindfulness, or emotional intelligence. By offering these resources, HR equips employees with valuable tools to navigate challenges and interpersonal relationships in the workplace. 

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Labour relations 

The function of labour relations in human resource management entails the interaction between HR professionals and employees who are collectively represented by a trade union. In the workplace, employees often join forces and establish unions to collectively advocate for their interests, including matters related to wages, benefits, working conditions, and other employment-related concerns. The key aspects of labour relations includes the following:

a) Union representation: When employees decide to form a union, they elect union leaders or representatives who will engage in negotiations and discussions with the company's management or HR department. These representatives act as the voice of the union members and work to protect their rights and interests. 

b). Collective bargaining: One of the central activities in labour relations is collective bargaining. This process involves negotiations between the union representatives and the employer or HR Management to establish agreements, or labour contracts, that outline terms and conditions of employment. These contracts may cover a wide broad range of topics, including wages, working hours, benefits, dispute resolution procedures, and more. 

c) Conflict resolution: Labour relations often involve addressing and resolving conflicts that arise between the union and the management. HR professionals play a crucial role in mediating these disputes and facilitating constructive dialogue to find mutually acceptable solutions. 

d) Compliance with labour laws: HR teams must ensure that the organisation conforms to labour laws and regulations, which may vary by jurisdiction. This includes adhering to legal requirements related to union activities, collective bargaining, unfair labour practices, and other aspects of labour relations. 

e) Communication and engagement: Effective communication is vital in labour relations. HR professionals must maintain open channels of communication with union representatives, ensuring that concerns and issues are addressed promptly. Engagement initiatives can also help build positive relations and foster cooperation between labour and management. 

Employee engagement 

Employee engagement involves creating a positive work atmosphere and fostering connections amongst the employees. Initiatives like recognition programs, wellness initiatives, and feedback mechanisms contribute to this. Employee recognition programs recognise and reward employees for their contributions, boosting morale and a sense of belonging. 

Wellness programs prioritise physical and mental well-being, enhancing engagement. Feedback channels, such as surveys and suggestion boxes, empower employees to voice their concerns and feel valued. 

Successful engagement initiatives improve job satisfaction, reduce turnover, and enhance organisational performance. Encouraging employees to contribute externally is also effective. Employees can write blog posts showcasing their expertise, benefiting the company's blog and enhancing employee dedication. Leveraging employee knowledge not only enriches content but also fosters a sense of pride and commitment among employees, further strengthening engagement. 

Personal support for employees

During the COVID-19 pandemic, HRM expanded its traditional role to provide critical support to employees facing personal challenges. Beyond their usual administrative functions, HR departments played a pivotal role in helping employees navigate the unprecedented circumstances of the pandemic. 

One significant area of support was managing requests for extended time off. With the pandemic's uncertainties, many employees needed extended leave for health concerns, caregiving duties, or quarantine requirements. HR teams handled these requests, ensuring that employees received necessary accommodations without added stress. 

HR professionals also facilitated access to essential medical assistance. This involved guiding employees through healthcare benefits, aiding with insurance claims, and connecting them with telehealth and mental health resources. HRs became a valuable resource for employees seeking guidance on healthcare and health-related concerns during these challenging times. 

Succession planning 

Succession planning stands as a fundamental HRM Function focused on strategically developing and nurturing talent from within an organisation. This proactive approach involves identifying high-potential employees who have demonstrated excellence in their current roles and preparing them for future leadership positions. A few key rules to be followed during succession planning include the following: 

a) Identification of talent: Supervisors and HR professionals collaborate to identify individuals with the potential to take on more significant roles within the organisation. These promising employees are often referred to as "high potentials." 

b) Customised growth paths: Once identified, high-potential employees are provided with tailored development plans. These plans encompass training, mentoring, and experiences designed to enhance their skills and competencies. 

c) Employee engagement: Investing in the growth and development of high-potential employees fosters their engagement and commitment to the organisation. They recognise the company's dedication to their career advancement and tend to remain loyal in the long term. 

d) Challenging assignments: To ensure growth, high-potential employees are entrusted with challenging tasks and projects. These opportunities allow them to expand their capabilities and prepare for future leadership roles. 

e) Cost savings: Succession planning serves as a preventive measure against the disruptive and costly effects of unexpected employee departures. By identifying and preparing potential replacements, organisations reduce the impact of key personnel leaving. 

Industrial relations 

Industrial relations is are primarily applicable in production lines and manufacturing units where unions actively advocate for worker welfare. For companies operating in these sectors, fostering positive and ongoing relations with unions is essential for maintaining a harmonious workplace. The core objectives of industrial relations encompass various critical aspects within the organisation, some of which are as follows: 

a) Compliance with wage standards: Industry relations practices ensure that the company adheres to wage standards set by labour laws. This helps prevent disputes related to compensation. 

b) Conflict resolution: By promoting open communication and negotiation, industry relations aim to reduce the likelihood of strikes, protests, and labour disputes. 

c) Enhanced working conditions: Improving workplace safety and conditions is a key goal of industry relations. This not only benefits employees but also reduces the risk of accidents and related legal issues. 

d) Resource efficiency: Industry relations practices strive to optimise resource allocation, minimising wastage and production downtime. 

Advisory functions 

HRM plays a crucial advisory role within an organisation by guiding on various human resource-related matters. Here are two key areas where HRM offers advice: 

Advising top management: HRM acts as a strategic partner to top management by offering insights and recommendations on personnel-related programs, policies, and procedures. This advisory role helps senior executives make informed decisions in accordance with the organisation's goals and objectives. HRM assists in the development, evaluation, and refinement of strategies for managing the workforce effectively. 

Advising departmental heads: HRM extends its advisory services to departmental heads across the organisation. HRM assists department heads in assessing their staffing needs and planning for future workforce requirements. It also provides expertise in analysing job roles and designing positions that align with organisational objectives. 

By offering guidance to both top management and departmental leaders, HRM ensures that human resource practices are consistent, compliant with regulations, and conducive to the organisation's growth and success. 

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The Functions of Human Resource Management form the cornerstone of a successful and thriving organisation. By prioritising the management of human capital, the management empowers organisations to build a resilient, Agile, and people-centric culture. This helps guiding them towards sustained success in an ever-evolving business landscape. 

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Frequently Asked Questions

Can HRM impact employee satisfaction and retention? faq-arrow

Yes, effective Human Resource Management significantly influences employee satisfaction and retention. Effective HR practices, such as clear communication, employee development programs, and positive work culture, enhance job satisfaction, foster loyalty, and reduce turnover.

How can HR support organisational change management? faq-arrow

HR plays an important role in change management by facilitating communication, addressing employee concerns, and providing training. Creating a supportive environment, involving employees in the process, and offering resources for skill development are crucial aspects of HR's contribution to successful organisational change.

What are the other resources and offers provided by The Knowledge Academy? faq-arrow

The Knowledge Academy takes global learning to new heights, offering over 30,000 online courses across 490+ locations in 220 countries. This expansive reach ensures accessibility and convenience for learners worldwide. 

Alongside our diverse Online Course Catalogue, encompassing 17 major categories, we go the extra mile by providing a plethora of free educational Online Resources like News updates, Blogs, videos, webinars, and Interview Questions. Tailoring learning experiences further, professionals can maximise value with customisable Course Bundles of TKA.

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The Knowledge Academy’s Knowledge Pass, a prepaid voucher, adds another layer of flexibility, allowing course bookings over a 12-month period. Join us on a journey where education knows no bounds.  

What are the related HR courses and blogs provided by The Knowledge Academy? faq-arrow

The Knowledge Academy offers various HR Courses including Recruitment Training, Certified HR Manager training etc. These courses cater to different skill levels, providing comprehensive insights into HR Skills.

Our Business Skills blogs cover a range of topics related to HR Manager Job, offering valuable resources, best practices, and industry insights. Whether you are a beginner or looking to advance your HR Training expertise, The Knowledge Academy's diverse courses and informative blogs have you covered.

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