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Why is HR an Important Function in an Organization?

Why human resources are important

Table of Contents:

- What exactly are human resources and why are they important?

- Basic functions of HR

- Why are human resources important to run a successful business?

- What is the importance of human resources management?

- Conclusion

- FAQs

What exactly are human resources and why are they important?

Why Human Resources are Important in the corporate world. The pillar of a company is its human assets and the election of the right asset for the company is very essential. In this case, the Human Resource of the company comes to play. Human Resource is the brick that builds the company and helps the company function with the right employees.

Traditionally, Human Resources comprised only hiring and firing along with a normal salary-paying cycle. However, the market today has changed and rather shifted its focus from the traditional human resource to a wider human resource chain. The importance of human resource management is well explained in this blog. If you are an HR professional this write-up will surely benefit you in understanding the pivotal role of human resources.

Basic functions of HR include:


- Recruitment

- Onboarding

- Managing payroll

- Employee benefits

- Holiday management

- Training and development

- Employment law compliance

- Safety compliance

Apart from understanding the importance of human resources management, one of its primary functions is to create a positive work culture and improve employee relations along with productivity. HR also takes charge of employee wellness and development.

Why are human resources important to run a successful business?

Many businesses today overlook this aspect, especially the ones just starting from the ground. The owners of the business mostly take charge of the hiring process in this case. However, managing a force of staff takes effort and expertise. HR is a niche in which expertise is lacking by many business owners.

Regardless of talent, the importance of HR in business isn't always obvious. When it comes to the people they hire and manage, business owners feel like they have their finger on the pulse with just a small staff. But while the business grows, the owners often don't have the time to deal with day-to-day HR activities, which include people management and recruitment. They lose track which leads to an improper working environment. This mistake can be a huge loss for the firm as it affects employee satisfaction, working culture, and long-term goal accomplishment.

Imagine a situation where the working ethics are bad, salaries are delayed and working hours are often extended. Well, just like you no one would like a working environment like this. Hence, the importance of human resource management comes into effect to avoid situations like these that tamper the company's reputation.

What is the importance of human resources management?

Here is why one should know the importance of Human Resource Management and what role it plays in sustaining a company.

1. Strategic Management

With its understanding of how human capital affects organizational success, HR helps the company's bottom line. HR strategic management experts are involved in corporate decision-making that supports current staffing assessments and forecasts for future workforce requirements that are based on business demand.

2. Salaries and payroll

HR pay specialists create fair compensation plans that make corporate wages competitive with those at nearby rival organizations, those in the same line of work, or those seeking the same talent. To keep compensation expenditures to the organization's expected revenue and existing financial situation, they perform in-depth pay and salary studies.

3. Implementing the best employee benefits

Benefits experts can lower the cost of turnover, attrition, and hiring replacement employees for the business. They are crucial to the business because they can negotiate group benefit plans for employees while staying within the organization's budget and taking into account current economic conditions. They are also knowledgeable about the advantages offered to employees that are most likely to keep them. This can lower the expenditures the business incurs due to employee attrition, turnover, and replacement hiring.

4. Minimizing Liability Issues

The exposure and responsibility of the company to claims of unfair employment practices are reduced by HR employee relations professionals. They detect, investigate, and address workplace problems before they get out of hand and land the company in legal trouble for violating local and national anti-discrimination and harassment legislation.

5. Training and Development

An important first step in building a solid employer-employee relationship is new employee orientation, which is coordinated by HR training and development specialists. Aspiring leaders can receive training that supports the business's fair employment policies and employee development from the HR department to get ready for management and supervisory positions.

6. Employee Satisfaction

By finding strategies to improve the employer-employee relationship, employee relations specialists in HR assist the firm in achieving high performance, morale, and satisfaction levels among the workforce. They carry out focus groups, administer employee surveys, and ask for feedback on how to improve working conditions and job satisfaction in the workforce.

7. Recruitment and Onboarding

HR recruiters oversee all aspects of the hiring process, including reviewing resumes, setting up interviews, and processing new hires. Typically, they examine which applicant tracking systems are most suited for the requirements of the firm o find the most efficient techniques for recruiting candidates.

8. Hiring Processes

To make wise hiring selections that meet the demands of the organization's workforce, HR experts collaborate closely with hiring managers. To ensure that the business extends offers to qualified individuals, they offer to coach managers who are unfamiliar with HR or conventional hiring procedures.


Overseeing all these departments, the question of why Human Resources are important should be answered. The importance of human resources management becomes a very vital department for an organization. However, many choose to outsource this department. As it makes their workload lighter and also can focus on other aspects of their business.

The importance of Human Management is slowly becoming a new trend with the increase in high-quality workplace requirements, Hence, Human Resources has become a department of a business that not many can ignore. In case you are looking out for a staffing agency that can aid the HR departments with both temporary and permanent staffing solutions, reach out to us at the website link below.


Q. What are your thoughts on the importance of human resources management?

Ans. Human resources today is a very crucial part of a business. It helps sustain and grow a business with its power of recruitment, engagement, retention, and many other factors. Choosing the right set of human assets for a company is vital as they are the pillars that function as the different sources of the company. One rotten apple will definitely spoil the entire bunch of fruits. Hence, whether be it a start-up or a multinational business, having a team of Human Resources that drives the company is very important.

Q. Can a business owner himself manage all these functions of Human Resource Management?

Ans. No, managing a business comes with many other responsibilities let alone Human Resource Management. A business owner needs to manage supply, sales, marketing, finance, and many other functions. Hence, overlooking all the aspects may not necessarily be possible. In such times having human resource management in place will help the owner get the right resource for the right field, not only would this ease the load off the business owner, but it will also help the business grow with the right skill set. 

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