Why HR is Important
Having come a long way since traditional “personnel,” HR is a critical business function that helps companies succeed in hiring employees, keeping them engaged, and supporting their growth and development. Given the many activities in the workplace that are impacted by HR, there’s a good chance that there are some that not everyone knows about. Here are 10 key reasons why the human resources department is important to the success of any organization:
1. HR is at the Crossroads of a Business’ Success
While company leaders and front-line managers support employees and help them accomplish their goals, HR takes a holistic view of how to ensure the company has the talent required for the organization to perform.
The importance of HR management is also demonstrated in all the ways HR supports the needs of employees at various stages of their career. HR ensures employees have the tools, resources, and leadership they need to perform to their potential, which is no small feat when you consider that each employee has different needs in the workplace.
The HR department also focuses on improving the employee experience at each point in the employee lifecycle. As The Balance Careers describes, “A good HR department is critical to an employee-oriented, productive workplace in which employees are energized and engaged.”
HR not only owns talent management activities, but it also supports the development of a positive workplace culture.
2. HR Contributes to the Bottom Line
Because HR touches virtually all aspects of the employee experience, it has an impact on a range of business outcomes, including:
- Employee productivity: HR works with the business to identify the company structure and tools that support higher employee productivity and performance.
- Turnover rates: HR supports the development of a positive workplace culture that helps the company retain employees.
- Training participation: HR identifies training and development programs that build employees’ knowledge and skills.
Your HR department should deliver strong ROI in the form of risk mitigation, ensuring your company remains in compliance with employment laws such as FLSA, ERISA, and more.
HR also manages employee relations issues and aims to resolve them with minimal risk to the company. Considering that the average employment claim costs companies $125,000 to defend, HR both saves companies money and protects their reputation.
3. HR Helps Develop an Engaged Workforce
Though an estimated one in every three employees is not engaged, perhaps more than any other department, HR can shape the workplace to build engagement in the workforce. From hiring activities that identify the right people for each role to programs that give employees more ways to collaborate and communicate, the human resources department supports employee morale and helps employees develop a deeper commitment to the company and its goals.
HR also addresses employee satisfaction by helping managers become more effective leaders. HR connects managers with coaching, training, and valuable feedback that equips them to lead their teams and support their people.
4. HR Builds Strong Relationships with Employees
Although it’s true that HR is often tasked with monitoring or enforcing adherence to company policies, it doesn’t need to be viewed as the company police. Rather, a healthy employee-HR relationship is one in which both recognize that HR is a help and not a hindrance to an engaging, rewarding work experience.
It is important that HR ensures employees have the support they need to achieve optimal performance and realize their career goals. Whether by introducing a new wellness program, helping two employees resolve a conflict, or introducing new technology that helps employees get to know one another better, HR can act as an advocate, a counselor, and a rich source of information for employees.
5. HR Introduces Technology for the Workplace
According to Gallup research, only three in 10 employees strongly agree that they have the materials and equipment they need to do their work right.
HR supports the workforce by identifying and implementing technology and other tools that help employees collaborate, get information, and communicate with one another. An interactive org chart is an excellent example of modern technology that helps improve work environments by connecting coworkers and supports a range of other HR programs, from workforce planning to employee engagement and collaboration.
Other digital tools that HR typically brings to the workplace include:
- Online learning platforms that allow employees to select courses that appeal to them
- Self-service employee benefits and payroll solutions that give the workforce greater access to their own employment information
- Pulse surveys that ask employees for feedback about their experiences in the workplace
6. HR Leads Recruiting and Employee Onboarding
A survey of HR professionals found that improving the onboarding process results in increased employee engagement, a better workplace culture, and increased employee performance.
As the central figure in company recruiting activities, HR shepherds candidates through the interview process and, once they’re hired, ensures that each employee gets the thorough introduction to people, processes, and tools they need to hit the ground running.
HR can also ensure a highly effective onboarding program by giving new hires access to the company org chart so they can learn more about the individuals on their team and understand how they fit into the organization.
7. HR Assists Managers and Team Leaders
The importance of HR management is often demonstrated in the behaviors of company leaders.
Managers have the potential to develop a special relationship with HR in that they can partner with HR on hiring for their team, resolving any performance issues that arise, and providing guidance on compensation and promotion opportunities. Given that managers and HR have one big thing in common—wanting the best for their people—there are many opportunities for them to work together on initiatives that benefit employees.
HR is also uniquely positioned in that it has a broad perspective of the company and can advise managers on approaches that will help them develop into more effective leaders.
8. HR Helps Employees Achieve Their Career Goals
HR counsels employees about career paths within the organization, but it also provides tools that help employees decide which path to pursue.
By designing internal training and identifying external training providers, HR pros develop a curriculum that helps employees build on their strengths and address areas for development. HR also helps employees make connections, for example, by giving them access to an interactive org chart.
An interactive org chart shows the different roles within the company and offers employees a new way to learn about the various career opportunities that exist within the organization. Understanding a company’s structure can motivate employees on their path to land their dream job.
9. HR Supports Company Growth
Often, when there is a merger, acquisition, or major expansion, HR is a strong strategic partner for company leaders, helping to identify individuals and teams that may need to be reorganized, may need a new leader, or could be merged with another. These workforce planning activities can go smoothly as a result of HR’s knowledge of current employees’ capabilities as well as the challenges and opportunities associated with certain staffing decisions. Some of the actions HR takes to support company growth include:
- Conducting succession planning and company talent reviews
- Implementing workforce planning software that helps the company develop long-range staffing and reorganization plans
- Identifying high-potentials who can take on expanded roles as the company grows
10. HR Supports Organizational Alignment
According to one study, only 44 percent of employees strongly agree that they can see how their work goals connect to the organization’s overall goals.
HR helps connect the dots between individual and team responsibilities and those of the rest of the organization. This is not done simply by creating a static org chart that shows reporting relationships. Rather, HR helps teams stay aligned by ensuring hires are matched with the right roles, and that each team is aligned with the company’s overall mission and values. Examples of how HR supports alignment include:
- Ensuring new hires are optimally aligned with open positions during the recruiting process
- Designing effective performance management programs that align team goals with company goals
- Introducing tools such as an interactive org chart, which illustrates how various teams fit together
Why HR Is Important
The human resources department is essential in any company, and HR professionals often touch more areas than recruiting, training, and pay.
The HR department is also critical in shaping company culture, employee engagement, and managerial effectiveness. These 10 areas help explain why the human resources department is important to company success, and the myriad ways employees and managers benefit from working with HR.