Human resources, or HR, is a broad field that covers people management, encompassing staff, contractors, casual workers and freelancers who provide a service to your small business. From recruitment and performance management to training and succession planning, HR is an essential component of any business with employees.
What falls under human resources?
The major areas that fall under human resources are:
- Recruitment: attracting talent, hiring process and probation period. One of the largest recruitment agencies in the world is Hays recruitment.
- Payroll, compensation and benefits: staff remuneration issues, from salary negotiation to payroll processing.
- Performance management: staff and team KPIs, appraisals, feedback and performance improvement plans.
- Training and personal development: workshops, team building, conferences, training, courses and online lessons to make employees more effective and valuable.
- Business/employee relations: employee relationship management covering dispute resolution between you and employees.
- Discipline and terminations: strategies, policies, corrective and punitive measures for employee misbehaviour and dismissals.
- Workforce planning: assessing and forecasting workforce needs, capabilities and dealing with gaps to mitigate risk.
- Succession planning: leadership succession to ensure business continuity and growth.
- HR outsourcing: certain areas of HR like payroll, recruitment and training can be outsourced at reasonable rates.
What is the purpose of human resources?
Human resources is about creating valuable business and employee relationships. This works both ways - it ensures that employees are productive and valuable members of the business, while also ensuring that the business treats employees fairly. Furthermore, there are laws to protect both employees and employers, governing wages, staff hours, non-performance and record keeping.
How to build a great HR team?
You can choose to build a great internal HR team, outsource certain areas of HR or outsource almost everything to HR companies. In order to build a great HR team, you must:
- Define the business purpose: part of HR's role is to ensure all employees are participating in the same business culture and working towards the same goal. This includes providing an employee handbook and conducting an induction session.
- Recruiting with value: if recruitment and benefits are done correctly, employees get a valuable and enjoyable workplace, which makes it more likely you will attract and keep the right people.
- Focus on training and professional development: employees should be given roles where they can thrive and learn to be better at their job while developing other professional skills like public speaking and negotiating.
- Instil good performance management: a business cannot succeed unless its employees are performing well. Part of HR's role in business is to assess and improve the staff by monitoring their performance and providing feedback and review.
- Motivation and deterrence: measures are typically put in place to incentivise results and productivity, and disincentivise unproductive or disruptive behaviours.
