Role of Human Resource Management in Business


Role of human resource management in business similar to the role of foundation in a building. Employees are important strength of an organization and give power to the organization. Human Resource Management poses different challenges to management and is more difficult to manage then other resource of the firm. Researchers have shown that management of people is a tough task than management of other resources. In organizations, human resource management specialists often need to mange diverse work groups which can belong to different personality types, cultures and nations. Besides managing the core functions of human resource, the management often needs effective communication and management relationship with in the organization’s employee structure for optimum delivery of the expected management goals.

One of the major goals of Human Resource Management practices is management of the human capital in the organization to ensure increased performance at individual and organizational level. Human resource includes every person involved in workforce of an organization from top management to the lowest levels. In the contemporary work environment, human work has been replaced by technology and machinery. Human effort has been replaced by automation in many disciplines. But despite the rampant and ubiquitous automation in organizations all around the world, employees are still backbone of any organization no matter what the extent of automation . Since people are usually the most valuable resources in any organization, effective management of people is an important quest for every organization. Employers continuously yearn for an organizational culture and environment that ensures having the right person at the right place.


Role of human resource management in business can actually be much more than visible to a layman. Human capital is one of the most important resources of an organization without which development of organization’s culture and organizational processes are not possible to be effective. Human resources provide competitive edge over other resources (Wood 2009). It has the aptitude to convert technological resources or money resources into finished product. Ayesha maintains that effective Human Resource Management is a very effective tool in the hands of an organization for gaining competitive advantage over the competition in terms of employing expert work group for right positions through different set of approaches.

Human Resource Management helps in improving the capabilities and performance of workforce through enhancing their organizational behavioral factors . Strategic process can consider all such managerial and organizational decisions which have the potential of influencing the linkage between organization and its personnel. Role of human resource management is thus more important than it might appear to a casual observer.

  • Paul, A.K. and Anantharaman, R.N. 2003. Impact of people management practices on organizational performance: analysis of a causal model. International Journal of Human Resource Management 14(7), pp. 1246-1266
  • Gelade, G.A. and Ivery, M. 2003. The Impact of Human Resource Management and Work Climate on Organizational Performance. Personnel Psychology 56, pp. 383-404.
  • Storey, J. 2007. Human resource management: A critical text.Gardners Books.