What are the key roles of human resources? In this article, we will list the 15 key Human Resources roles. In addition, we will go over these roles and explain how doing them right will create benefits for both the people and the organization.
Background of Human Resource Roles
For a long time, Human Resources Management (HRM) has been viewed as a cost to be minimized. This fit into the traditional view of HRM as a caretaker for the business. Employees needed to be managed at (preferably) low cost. In line with this, HR was seen as a potential source for efficiency gains (Becker & Gerhart, 1996).
This meant in practice that if companies were able to save time and money managing their personnel, they would save money. There wasn’t much focus on the effectiveness of HR.
But if you don’t see an HR department as something that adds value, why would you focus on the value that it added?
In the late nineties, this idea started to change. Research indicated that HR decisions could influence organizational performance. This research was done by assessing the sophistication of the HR architecture and relating it to business performance.
The following figure, by Huselid and Becker (1995) shows this impact. As the HR architecture becomes more sophisticated, the market value per employee increases.
Once we know that HR practices increase organizational performance, the next question is: What are the key roles for HR? And (how) do these roles lead to superior performance?
That’s what we will explore in the remainder of this article.
15 Key Human Resources roles
The roles we are talking about here are so-called “high-performance work practices”. HR adds value if these practices, or roles, are realized.
Let’s go over these roles one by one. They are based on an overview of scientific literature by Becker & Gerhart.
How are these roles executed in your organization?
1. Hiring from within and from outside
Hiring is one of the key Human Resources roles. An important distinction is that between hiring from outside vs. hiring from within. Through employee training and smart succession planning, companies can create a so-called talent pipeline.
Internal hiring is preferred as it enables a company to fill jobs with internal talent that already knows the company and is ready for a challenge. A lot of companies can improve their internal hiring practices. If the right talent isn’t available internally, HR needs to hire external talent.
2. Attraction and selection
When hiring an external candidate, attracting and selecting the right people is crucial. It is HR’s role to maintain a good selection ratio. The selection ratio is a recruitment metric that refers to the number of hired candidates divided by the total number of candidates. It is up to HR to make sure that sufficient candidates are attracted and eventually the right people are hired.
Hiring the right people involves employment testing, another key Human Resources role.
3. Employment testing
Employment testing is the responsibility of HR to test how suitable candidates are for a job. Although this is something that is often outsourced to professional testing-providers, the process should be managed by HR.
While vendors will try to sell you all kinds of assessments (of course), scientific literature shows that only a few are truly effective. These include IQ tests, work test, conscientiousness tests, the structured interview, and assessment by colleagues.
You will find a brief overview of these measures below. For a full overview, check Schmidt & Hunter’s 1998 paper with a full overview of personnel measures.
4. Formal performance appraisal
Employees are tested to make sure that they will perform to the best of their ability in their new role. Performance appraisal also called performance review or evaluation is a method to evaluate the job performance of the employee. In most companies, this is an annual or bi-annual event.
Although the performance appraisal cycle is something that a lot of employees and managers are unhappy with, it still is a very effective tool to improve results when done right.
Although it seems to be in fashion, getting rid of appraisals is not the solution. Increasingly, companies are opting to go for more continuous feedback as an alternative, which may have some merit. However, an official moment to review performance is still widely considered a best practice and one of the key roles for HR.
5. Compensation and contingent pay
Fair compensation is a key Human Resource Management role. Work is not done for free. Compensation that is seen as fair will motivate employees to do their best and to stay with the company. In our article on HR best practices, we closely examine contingent compensation.
6. Employee benefit management
Employees work for more than just pay. Creating the right benefits for employees is crucial in retaining key talent.
We know from the literature that at a certain point extra pay doesn’t make employees happier. However, the right benefits might. Common benefits are extra holidays, a learning and development budget, extra paternity leave, a childcare budget, et cetera.
The easiest way to select the right benefits for your employees is to just ask them. Some employees value learning and development, others look for extra pension plans, and a third group may want company-organized childcare.
By accommodating these needs, HR can create tremendous value for individual employees that leads to increased motivation, satisfaction, productivity, and retention.
7. Promotion rules
In line with hiring from within, setting rules for promotion is also one of the responsibilities of HR. Promotions are usually based on merit and/or seniority. They are part of an effective succession planning and are a great way to retain top performers who are eager to learn and develop themselves.
It is up to HR to put in place procedures that enable the internal movement of talent through promotions. Promotions should not be handed purely based on current performance but should also account for predicted future performance.
This is illustrated by the Peter Principle, which states that people tend to rise to their “level of incompetence”. This relates to the idea that good performers will always be promoted until they reach a function in which they stop being good performers. They then have become incompetent in their new function and will be stuck there for the rest of their career.
8. Problem-solving groups (also called quality circles)
These are groups of employees who are actively involved in problem-solving. Groups are composed of volunteers that meet a few hours every week or two to look at productivity and quality problems. These groups have a special type of leader or facilitator.
9. Total Quality Management
A more structured approach to quality circles. Total Quality Management (TQM) is an organization-wide effort to create a climate in which employees continuously improve their ability to provide products and services that customers will find valuable.
10. Information sharing
HR has a central place in sharing information with employees. This can be via a simple newsletter to keep everyone up to date with the latest. It also entails work safety procedures, announcements of layoffs, mergers, or an acquisition, or any other impactful event that is relevant for employees.
Clear, transparent, and timely information sharing is crucial in building and maintaining support and successful organizational change.
Another key aspect of information sharing is internal knowledge sharing.
This is often referred to as know-how (experience), know-what (knowledge), and know-who (finding the person to help solve the problem). These three elements are crucial to solving problems quickly and effectively.
HR has a key role in facilitating this as well, especially in large organizations.
11. Job analysis and job design
Job analysis is about gathering and analyzing information about the content and requirements of a job.
Whenever a new job is created (or when an old job opens up), the first step to hiring the right person is to define what the ‘right person’ will look like. This is done in the job analysis. The University of Nebraska has a great step-by-step guide on job analysis.
Job design is similar to job analysis.
Any job should have a variety of skills and tasks. In addition, a job should be significant and the holder of the job should have a degree of autonomy.
Job design is related to job rotation, job enlargement (giving more responsibilities to the employee), and job enrichment (increasing the employee’s autonomy over their work).
12. Job rotation
Job rotation is the practice of moving employees between different tasks. This promotes experience and variety for employees and works well for all employees.
Job rotation can be a good method to retain employees who are at risk of leaving by giving them new and challenging assignment’s that they haven’t done before through a horizontal promotion.
For factory workers, job rotations have traditionally been used as a way to keep employees motivated and happy, and to broaden their knowledge.
13. Attitude survey
The annual engagement survey is one of the most recognizable HR efforts in an organization. Surveying the attitudes of employees helps to understand where the organization is at, what the attitudes of employees are, and how productivity can be improved through better people management.
Measuring employee engagement isn’t easy. The link shows you a great step-by-step overview of how to approach this challenge.
14. Grievance procedure
Grievance procedures have never been more relevant as shown by the Harvey Weinstein scandal and the #metoo movement. HR has a crucial role in handling grievance procedures.
In case of reported or suspected abuse, theft, misusing company funds or time, and other unethical behavior, HR is in the lead to bring this to a solution.
Best practices are to have predefined structures in place, communicate everything in writing, and, if possible, apply mediation to solve problems in an amicable way.
15. Conflict resolution
The final role of HR is conflict resolution. Spotting conflicts early on and resolving them swiftly and effectively pays a tremendous dividend in the long term. Successfully resolving conflicts is the final key responsibility of HR.
This brings us to the end of the overview with the 15 most commonly recognized Human Resources roles. When managed well, these high performing work practices will lead to motivated employees and superior organizational performance. This is what good Human Resource Management is all about: creating organizational value through engaged employees.
It goes without saying that these HR roles should align with each other. It is hard to hire the right people if you do not compensate them fairly. Or, you will run a big risk if you have a grievance procedure but can’t effectively resolve conflicts.
The greatest value will be created by bundling these roles into a streamlined whole.
To create a better overview of these roles, we have included an infographic. It shows the three categories of Human Resources Roles: Traditional HR responsibilities, production optimization, and managing employee attitudes.
If you found this overview useful, don’t forget to subscribe to our newsletter, or check out our full courses on the DHRT academy!