In a company, there are many coexisting functional areas that make business work properly: management, finances, administration, production/operations, quality, marketing, human resources, project management, process, logistics. In order to reach its organizational objectives, it is vital that all these areas have the same purpose and business strategy.
Next, we are going to delve into the Human Resources area: what is it, which are its main functions, its biggest challenges, etc.
Definition of the Human Resources area
The Human Resources area can be defined as the area that is exclusively in charge of the staff, their relationships, their problems, their rights, their obligations, and everything else that promotes the recognition of employees as the most important asset for the right functioning of the company; this is why this area is vital for every business that seeks to make the most of its resources. The Human Resource area is a type of process that seeks to organize and maximize the productivity and performance of human capital.
The importance of the area at present has a main role since, even though it is part of the administrative area in general, its field of action and goals are very accurate. Usually, this task is carried out by specialists in the subject and their goal is to encourage the personal development of the staff so the personal interests of each employee are in accordance with the company, producing one shared strategy between the company and the workers.
Its tasks within the administrative area
We already know that administration is in charge of organizing and coordinating efforts to achieve a particular goal. Even though the tasks of the managers of the Human Resources area are administrative, their main task is to define the requirements for hiring workers, they carry out interviews, they assess them, they hire the most qualified applicant and they deal with the creation of the area.
It is important to mention that its labor is more than just hiring new employees; the HR area is also in charge of accompanying them throughout their development inside the company. The bigger the company, the bigger will be the details it will have to take into account; however, in general, the following guidelines are present in every company: improving and making the most of workers' abilities, creating healthy and motivating relationships among the staff members, producing a constant communication environment so that employees feel that their superiors pay attention to their needs, renewing and changing work positions according to whom is best for them, among others. All these tasks justify its separation from the administrative area.
Understanding the importance of good communication and having some notions of psychology are the pillars on which the task of the manager of the area is based; this is learned (and grasped) in his/her academic education. This is why not everybody can take this role and their labor demand has increased exponentially.
A short history of its development and evolution over time
As with every other area in a modern company, the development of the HR area found its inflection point at the beginning of the 20th century, when the constant growth and the complexity of productive tasks demanded the creation of a strategic organization that adapts to the needs of the time.
In the 1950s, concepts such as "staff administration" emerged to satisfy the legal needs of the time. Similarly, the main practices of the past (such as Taylorism) started to be replaced by new theories that combined business strategy with occupational psychology, thus, making them more humanistic.
In the 1970s, the concept of "Human Resources Administration" emerged and meant a change in paradigm since workers were seen as the most important resource to make the company work; the capital was useless if the company did not have people to implement its plans.
The globalization, the increasing competition, and the great impact of the capitalist commerce with no borders made that this area became vital to assure the achievement of the following goals: getting a high-quality product and a highly qualified staff. This, together with the constant demand for innovative products (on the part of consumers) established the idea that workers were more than the workforce, they were human beings, with feelings, ambitions and concerns that if were taken into account, they could result in innovative ideas for the company.
Now, we can list a number of important moments (non-exclusive) that marked the evolution of this area:
- Industrial Revolution: the first antecedent for the creation of this area was during the First and Second Industrial Revolutions. They developed in Europe and the USA and introduced the mechanization of processes in order to close the greatest number of sales possible. This brought about some discomfort among workers because there were not good working conditions nor possibilities to grow inside the factories. In order to solve this problem, the "Welfare Department" was created as the antecedent of the HR area.
- First half of the 20th century: From 1910 until 1950, companies started to pay special attention to the workers. The "Staff management" area was created to provide solutions to the workers' problems but it ended up controlling and monitoring employees. It was focused on controlling their schedules, absences, sanctions, and bad habits. Eventually, this would change with the incorporation of new theories such as Maslow's and McGregor's that wanted to humanize the tasks.
- Second half of the 20th century: business managers embraced new staff policies. At this point, Psychology, Sociology and Anthropology became paramount by suggesting that an excellent working environment would result in better sales and products. The HR area as we know it today started to be shaped.
- 21st century: the arrival of the internet, globalization and the first management software tools became important. Technology automates processes and allows workers to focus on specific tasks; the emphasis here is on searching, choosing and hiring the best-qualified workers for that task. Eventually, the tasks of the area started to be defined: accompanying the staff became imperative and their constant training starts to provide great results. Agile, iterative processes together with efficient communication becomes the role model.
At present, artificial intelligence also has an important role when concepts such as Business Intelligence (B.I.) start to work in the HR area. This way, B.I. turns data into information and information into knowledge and constant learning; so, managers who make important decisions can base them on real information free of human errors.
Functions of the Human Resources area
The functions of this area are varied and are influenced by the type of activity that the company develops. The following classification of its tasks is not unquestionable:
- Functions related to the job: in this section, we can find all the activities related to recruitment, training and evaluation of the staff; therefore, it is in charge of planning a form, defining the profile looked for at the company, describing the available positions for the applicants, recruiting applicants, their training, their insertion in the workplace, etc.
Once the tasks are fulfilled, it will also be in charge of suspensions for any cause that could lead to dismissals if tasks are unfulfilled.
- Functions related to the administration of the staff: even though these tasks are more administrative, the activities this area carries out are the composition and formalization of the contract to be signed, procedures related to social and working insurance, presenteeism control, absences, schedules, and everything else related to the discipline of the worker, other areas management, such as vacation, leaves of absence, overtime, sickness absences, causes for absence, etc.
- Remuneration functions: also called evaluation and reward functions. They are in charge of studying the performance of employees and if their salaries are in accordance with their tasks. They also study the contingencies that can promote greater development such as diets, trips, days off, rewards, etc. It also deals with promotions and relegations and everything related to the incentive policies each company has.
These types of tasks justify the specialization of the area. Its psychological and encouraging nature is the result of scientific academic training and not just mere expectations or decisions taken with no reason. The motivation of its manager is very important at this stage.
- Functions of problem-solving: also known as labor relations functions. They are in charge of solving the problems that may arise from a working relationship. This specific task aims at paying attention to the complaints of the staff who express their concerns through their representatives; they can be related to raises, discipline policy, working conditions, work time, etc.
The main goal of this function is accomplishing a harmonious environment to work. Through negotiations, it tries to balance inequalities that may arise and achieve a nice working environment.
This area also deals with the prevention of occupational hazards; it could be done by hiring specialists in the subject (a graduate in safety and hygiene) or by specific training. By doing this, the company seeks to achieve an adequate level of health protection for the staff.
- Functions of staff service: Even if they are provided by the company or outsourced by external organizations, they are one of the characteristics of the area and its commitment to the staff. Through these functions, the area tries to improve the image that the employee has of the company since they will feel accompanied and pampered by different actions such as: daycare centers, vacation homes at low cost, collective insurance and specialized medical services, sports clubs, leisure centers, reading rooms, scholarships, dining areas, anti-stress services, equipment like computers, tablets, backpacks, etc.
- Communicative functions: these functions will assure constant feedback between managers and employees. To achieve this, communication both internally (formal and informal) and externally will be organized to spread useful information. Depending on each company, we can name three types of communication: descendant, from managers to workers; horizontal, communication among peers (managers or employees); and ascendent, from employees to managers, especially for recommendations, complaints and concerns.
- Disciplinary and controlling functions: Even though the activities that are carried out by the HR area are, in general, "positive", it is also in charge of controlling and monitoring the staff. In the same way, an employee is rewarded for working well, someone who is not fulfilling their tasks should be corrected. Through different levels of sanctions, managers will call the employee at fault and will communicate him/her displeasure with his/her performance. Sanctions should be in accordance with the mistake made or offense and, generally, they are progressive. The first time, it will be a verbal or written warning; the second time, it will be a suspension and the last warning will be justified firing when the worker does not change his/her ways. This way, the HR area will sanction him/her and, eventually, will communicate his/her dismissal.
Motivation as its main task
As was said before, the tasks of the HR area are varied and motivation to the staff deserves a different section.
This is due to two factors: on the one hand, some theorists stated that there is potential growth in the company when they studied certain behaviors in motivated employees (in contrast with those who are not motivated). For instance, workers that produce a constant feeling of belonging to the company they work for will provide high-value ideas to their superiors, they increase business productivity by producing more sales, reducing the desertion possibilities to go to other companies that make them feel comfortable; this will produce a positive image for the company that may attract future buyers and workers, among others.
On the other hand, it is widely known that the company's image is very important to keep or boost the sales of products or services; this is why you have to take into account that if the staff has just their salary and no other motivation, they will create a bad working environment. This, together with a possible voluntary resignation for a better job opportunity (or even a dismissal), will have a short-term or long-term impact on the company's image.
Now, we can define motivation briefly as those actions or decisions that have an impact on the subjectivity of the worker, encouraging (or not) to do something. Within the working environment, motivation will be seen in the workers' intentions to do their job in the best way possible. Moreover, motivation will depend on two factors both internal and external: as regards the internal factors of motivation, we can mention pride, responsibility, personal ambition, intentions to grow, etc, depending on each worker; regarding the external factors, they are related to the motivation that can be dealt with in the area and that is related to working comfort, adequate salary, good relationship with the rest of the team, services offered to workers, etc.
The HR manager should coordinate both internal and external motivational factors to get the expected result.
This is why thinkers developed the "Motivation theories". It was Elton Mayo who developed the "Human relations theory", trying to provide a humanistic perspective and democratization of labor, contrary to how it was at that time. Before, through the application of strict methods of working, they wanted to increase productivity at all costs, and as a result, the "human-machine", a worker used as a means to get profit and not seen as a person with feelings and ideas emerged.
In general, motivational theories have focused on the idea that people try to satisfy their own interests and by coordinating them with those of the company, you can get better results.
It was Maslow who published in 1943 his studies about the subject and presented the "Maslow's hierarchy of needs" as a response to the prevailing order. In his theory, he states that people would do everything to satisfy their needs and you can mold their motivation if you know those needs.
A few years later, McGregor publishes his work "The human side of organizations" (1960), in which he introduced his theories called "Theory X and Theory Y". Here, he talks about two ways of thinking about managers, being the "Theory X" the obsolete model of dehumanizing labor, and the "Theory Y" the current model to boost workers' motivation.
At present, the prevailing way of working has to do with a company that has managers and co-workers that appreciate, pay attention to and recognize the labor of workers in order to get better short-term as well as long-term results. We can suggest three levels of motivation:
- Basic motivation: encompasses appropriate salary, adequate working hours, good security and hygiene conditions, social insurance, etc.
- Personal motivation: to be in a position in accordance with the abilities of the worker, possibilities to grow inside the company, continuous training, etc.
- Transcendental motivation: focuses on the possible positive effects that will be brought about by the good functioning of the society that we live in, values, cultural factors, life quality, etc.
Having said this, there are many ways in which the head of the department can know and accompany workers; at present, companies usually use anonymous surveys where they can know what their employees think without upsetting their superiors and workers can provide a more faithful opinion about their situation, satisfaction, commitment, etc.
Another very common practice is the use of a personal record: a group of documents organized chronologically with all the information about employees such as when they started to work, tasks developed, promotions or relegations, sanctions, rewards, among others. In general, it is organized in files alphabetically and it is a tool that can be used in case there is a new HR manager so he/she can know the history and profile of a worker.
The modern business model has an area (or at least a manager within the administrative area) that focuses on accompanying the staff, from their recruitment with their contracts and selection to their daily performance and their possible promotion.
Appreciating human capital is paramount nowadays for every company. This, together with technological tools and artificial intelligence provide a lot of opportunities to adapt to every company, even if it is small, medium, or large-sized.