We often come across a lot of misconceptions and confusion between the terms Human Resource Management and Personnel Management. Some management experts consider it as the “same wine in the new bottle”, however other veterans go with different scopes and orientations.
The term Personnel Management has been used a long time before they coined the term Human Resource Management. It is most commonly referred to as the practice of managing staffing and payroll in an organisation. However, Human Resource is an extension of it with enhanced roles and responsibilities. Let’s dive in.
Personnel Management is a branch of management that is concerned with employees and their relationship with the entity. It includes workforce-related activities such as staffing, payroll, contract management, and administrative decisions. It includes all the tasks that are required to run an organisation smoothly.
A personnel manager’s job is administrative in nature. These managers work towards fulfilling the needs of a workforce and immediately resolving their concerns. They ensure that the organisational responsibilities are assigned to the right personnel and no compromises are made.
Personnel Managers act as a mediator between employees and senior management. They work towards meeting the organisational goals along with maintaining the rules and regulations of an organisation.
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For the last two decades, technology is getting advanced and machines are replacing humans. Similarly, Personnel Management has also evolved and been replaced by Human Resource Management.
Human Resource Management is a branch of management that ensures the effective use of manpower in an entity. HRM includes several activities like acquiring, maintaining, developing, and coordinating between employees and motivating them to work at their best potential and deliver results.
It involves training, learning and development to usher employees towards achieving organizational goals. HR professionals ensure that the right resources are recruited, they undergo training, and receive fair remuneration. Also, their performance is evaluated from time to time.
A Human Resource Manager’s job is persistent in nature. They continuously need to fill the skill gap in the organisation. Human resource is nothing less than the art of utilising the skills of the resources at different levels of the organisation. Their roles and responsibilities include the following:
HRM has now evolved. New age organisations focus on the “people-first” approach while attaining the organisational goal and achieving the highest returns. This signifies that HRM has a much wider horizon than Personnel Management.
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Personnel Management holds the following importance in shaping an organisation:
Motivate Employees: One of the primary aspects of personnel management is that it keeps the employees motivated so that they perform their best. It is essential that employees see the hidden potential in themselves. Personnel managers identify the problems and solve them. If an employee is doing exceptionally well in their role, managers motivate them by offering rewards, bonuses, perks and promotions.
Manage People: Employees in any organisation come from diverse backgrounds and each one of them has an individual perspective. Personnel managers individually look after every employee in an organisation. It manages the staff working at every level, like clerical, administrative, senior management, line managers, etc.
Keep them up-to-date: Personnel managers conduct regular development and training programmes to keep their employees up-to-date in this fast paced environment. They make sure that employees working within the organisation are rapidly adapting and contributing to the organisation’s objectives.
Competent workforce: Personnel managers create a competitive workforce that works with complete dedication to meet organisational objectives. They identify the potential in employees and align them in such a way that they achieve personal growth. It also results in gaining competitive advantage.
Human relations: It emphasises on the 7Cs of communication; Clear, Correct, Complete, Concrete, Concise, Consideration, Courteous.
Human Resource Management is directly related to the welfare of the company. It holds the following significance:
Meet organisational goal: Human Resource Management plays a crucial role in aligning the growth strategy and achieving short term and long-term objectives. It reviews the current situation, analyses the future demand and takes actions to fulfil it.
Advocate for employees: Every workforce is bound to have conflicts, miscommunication, opinions and conflicts and resentments. With so many bright minds working together, it’s natural for tension to make its place. In these cases, HR professionals come forward to advocate for employees and ensure grievance management.
Upskill employees: Human resources play a major role in helping employees nurture their skills. They organise workshops, training sessions and keep the workplace up to date with technology. When employees possess the skills and resources to perform well, they work more dedicatedly.
Meeting Compliance Regulations: HRM makes sure the company abides by all the governmental and industrial laws. This includes filling up the necessary paperwork and managing rosters and employee work hours based on laws and regulations.
Perform regular audits: HR managers perform regular audits to determine a safe workplace while managing the risks involved. Regular audits help them minimise liability, manage hazardous situations, and protect the employer from false allegations. The role of HRM is evident in every department of the organisation.
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The following is the tabular representation of the difference between Personnel Management and Human Resource Management.
| Basis | Personnel Management | Human Resource Management |
| Meaning | Personnel Management is concerned with the workforce and their relationship with the entity | Human Resource Management the effective use of manpower in an entity |
| Nature | A personnel manager’s job is administrative in nature | A human resource manager’s job is persistent in nature |
| Approach | Traditional approach | Modern approach |
| Nature | Follow routine functions | Follow strategic functions |
| Management Role | Transactional | Transformational |
| Mode of Communication | Indirect | Direct |
| Decision Making | Comparatively slower | Comparatively faster |
| Treatment of Workforce | Like tools and machines | Like assets |
| Job Design | Division of labour | Team/Entity |
| Growth | Based on the evolution of job | Based on the evolution of performance |
| Stress Upon | Adapting to organisational rules, regulations and policies. | Nurturing the skills and talent of the workforce. |
| Orientation | Oriented towards Discipline & control | Oriented towards development and growth |
Conclusion
HRM was developed as an extended form of personnel management. The objective was to fulfil the gaps present in the traditional approach. In today’s highly competitive world, human resource management is a basic need of every organisation because it focuses on strengthening the skills of the employees and considers them as the most important asset of the company.
With modern-day organisations adopting all possible means to attract the top skillforce, retaining the best talent in your organisation becomes challenging. Therefore, HRM is crucial as it takes into account the interest of employees and aligns them towards achieving organisational objectives.
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FAQs
The primary difference between personnel and human resource management lies in scope and orientation. The scope of personnel management is limited to an inverted approach where the employees are considered as machines/ tools for getting the job done. They can be replaced when they are worn out.
Human Resource has a wider approach, where employees are considered as the primary asset of the company. It promotes growth and mutuality. It forces on upskilling and overall performance growth of employees.
Despite the fact that personnel management and human resource management are considered different, they do have some similarities:
1. Both emphasize the importance of individuals in developing competencies and contributing towards organisational goals.
2. Both focus on placing the right talent at the right place.
3. Both approaches aim to protect the interest of employees.
4. Both are aligned with the overall business strategy
Personnel administration is a senior-level function where HR policies are framed. It is a strategic function mostly used in the public sector. On the other hand, human resource management is a mid/lower level function where HR policies are executed. It is a continuous function mostly used in the private sector.
Related Categories: HR Software | Payroll Management Software | Leave Management Software | Workforce Management Software | Recruitment Management Software
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