Personnel department was the department that administered these essential staffing tasks. Nowadays the role has grown and with it has come a name change. In many organizations what was once the personnel department is now the human resources department and it handles a lot of essential functions for your company. Some of these functions are so specialized that some companies choose the out source their HR requirements to a provider with the specialist expertise to handle HR tasks.

So, what does the 21st century personnel department have to handle the modern HR department recognizes the key role of staff in a company’s success and manages the staff from entry to exit. That means that human resources officers will be involved in planning staffing strategy, recruiting and administering staff. In addition, personnel officers will have to keep up with the latest changes in employment law and reflect those changes in staff and company manuals. 

The reasons why personnel department are often referred to human resource department are as follows:-
1.                  For small businesses and large conglomerates alike, the human resources or personnel function can be helpful for much more than simply processing payroll or handling the open enrollment season once a year. Human resources plays an essential role in developing a company’s strategy as well as handling the employee centered activities of an organization.
2.                  Human Capital Value: Having an in house human resources function is important. An in-house human resources staff on a human resources expert on staff can increase the understanding of how important human capital is to the company’s bottom line. For small businesses, in particular, human capital is critical because so many smaller firms have employees who perform cross-functional duties with a smaller workforce, if just one person leaves.
3.                  Budget Control:- Human resources curbs excessive spending through developing methods for trimming workforce management cost, which includes negotiating better rates for benefits such as health care coverage. In addition, human resources ensures competitive and realistic wage setting based on studying the labour market employment trends and salary analysis based on job functions. As some small businesses have budget constraints, this human resources function is especially helpful.
4.                  Conflict Resolution:- workplace conflict is inevitable, given the diversity of personalities work styles, backgrounds and levels of experience among employees. A human resources manager or a staff person specially trained to human employee relations matters can identify and resolve conflict between two employees on a manager and employee and restore positive working relationship.
5.                  Training and Development: human resources conducts needs assessments for the organizations current workforce to determine the type of skills training and employee development necessary for improving stills and qualifications companies in the beginning or growth phases can benefit from identifying training needs for existing staff. It’s muchless expensive than the cost to hire additional staff or more qualified candidates.
6.                  Employee Satisfaction:- Human resources usually are charged with the responsibility of determining the level of employee satisfaction often an ambiguous measurement at best with carefully designed employee surveys, focus groups and an exist interview strategy, human resources determines what underlies employee dissatisfaction and addresses those issues to motivate employees.
7.                  Cost Savings:- The cost to hire new or replacement workers including training and ramp-up time, can be exorbitant for employees, especially small businesses with a well-constructed recruitment and selection process, the human resources function can minimize expenses regarding advertising job postings, training new employees and enrolling new employees in benefits plans.
8.                  Performance Improvement:- Human resources develops performance management systems. Without a human resources staff person to construct a plan that measures performance, employees can wind in jobs that a rent suitable for their skills and expertise.
Additionally employees whose performance falls below the employees expectations can continue on the payroll, thereby crating wasted money on low performing employees.
9.                  Sustaining Business:- Through succession planning that human resources develops, the company identifies employees with the promise and requisite capabilities to eventually transition into leadership roles with the company. This is an important function as it can guarantee the organizations stability and future success.
10.             Corporate Image:- Businesses want to be known as the employer of choice employers of choice are the companies that receive recognition for the way they treat employees, they are the companies for whom people want to work.                                                                 
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