Human Resource Management (HRM) has been defined in various ways by different authors and institutions. However, all definitions converge on the idea that HRM is a systematic way of managing people and resources within an organization to achieve both individual and organizational goals (Armstrong & Taylor, 2014). While there is often confusion between “Human Resource Management” and “Personnel Management,” some scholars argue that HRM is an evolution of Personnel Management, integrating more strategic, people-oriented practices (Bratton & Gold, 2017). This paper discusses the similarities and differences between the two concepts, focusing on their impact on organizations, employees, and management strategies.
Historical Background: Personnel & Human Resource Management
The roots of personnel management can be traced back to early human societies, where the head of the household assigned tasks based on individual skills, a practice akin to modern talent management (Marchington et al., 2020). During the Industrial Revolution, the shift to large-scale factory production required a structured workforce, leading to the appointment of supervisors with authority over workers. The strict control over labor was a hallmark of early Personnel Management, where the focus was primarily on administrative functions like hiring, firing, and compensation (Blyton & Turnbull, 2004)
By the early 20th century, the growing complexity of organizations led to the formal establishment of Personnel Management departments (Bach & Edwards, 2013). However, ideas about managing workers evolved over time, influenced by management theories like Taylorism, which viewed workers as primarily motivated by monetary rewards (Taylor, 1911). Later, the Human Relations movement emphasized the importance of psychological and social factors in the workplace, which eventually shaped modern HRM practices that focus on the development and well-being of employees (Budd, 2016).
HRM has evolved into a broader and more strategic function, where employees are considered valuable assets to be developed and empowered. This shift has created new roles for HR professionals, who now require expertise in areas beyond traditional administrative tasks (Salvatore et al., 2005).
Differentiation of Personnel Management & Human Resource Management
The main distinction between Personnel Management and HRM lies in how employees are viewed and managed. Edwin Flippo defines HRM as “the planning, organizing, compensation, integration, and maintenance of people for the purpose of contributing to organizational, individual, and societal goals” (Flippo, 1984). This comprehensive view contrasts with the more transactional nature of Personnel Management, which traditionally focused on administrative functions without emphasizing employee development.
Key differences between Personnel Management and HRM can be seen in several areas:
- Planning: Personnel Management focuses on fulfilling immediate staffing needs, while HRM involves long-term planning for employee development and retention (Armstrong & Taylor, 2014). HRM views employees as integral to achieving competitive advantage, planning their professional journey within the organization (Kane, 2019).
- Organizing: Personnel Management views employees as a resource to be controlled for cost efficiency. In contrast, HRM treats employees as the most valuable resource and seeks to invest in their development (Guest, 2011).
- Compensation: In Personnel Management, compensation is often unrelated to broader organizational goals. In HRM, compensation is strategically linked to achieving both individual and organizational objectives (Kipkemboi, 2015).
- Maintenance: HRM invests in training and development as a means to retain employees and align their growth with organizational goals. Personnel Management typically focuses less on long-term development (Salvatore et al., 2005).
- Integration: HRM prioritizes integrating employees into the organization’s culture, while Personnel Management is more concerned with functional staffing needs (Storey, 2007).
Core Elements of Human Resource Management
The three core elements of HRM are the organization, the people within the organization, and the management of those people. Organizations require a careful evaluation of their manpower needs, not just for short-term goals but also for long-term sustainability (Ulrich, 2013). Effective management ensures that these elements work harmoniously to achieve organizational success.
Future Organizational Management Challenges in Healthcare
The healthcare industry faces unique challenges, particularly in the wake of the COVID-19 pandemic. Workforce shortages, compounded by economic difficulties, have led to a significant outflow of healthcare workers. According to the World Health Organization (WHO), between 80,000 and 180,000 health workers worldwide died from COVID-19 between January 2020 and May 2021, exacerbating workforce shortages (WHO, 2021).
In the Philippines, economic pressures and inadequate compensation have driven healthcare workers to seek employment in other countries or industries with better pay and working conditions (Janssen et al., 2021). To address this, HR managers in healthcare must adopt innovative strategies to attract and retain talent, focusing not only on financial compensation but also on providing career growth opportunities and intangible benefits like job security and work-life balance (Kuhlmann & von Knorring, 2021).
Human Resource Management has evolved from the more limited functions of Personnel Management to a strategic role that integrates employee development with organizational goals. This shift is particularly relevant in industries like healthcare, where workforce challenges require innovative HR solutions. Moving forward, HRM must continue to adapt to meet the dynamic needs of organizations and employees.
References:
- Armstrong, M., & Taylor, S. (2014). Armstrong’s handbook of human resource management practice. Kogan Page Publishers.
- Bach, S., & Edwards, M. R. (2013). Managing human resources: Human resource management in transition. Wiley.
- Blyton, P., & Turnbull, P. (2004). The dynamics of employee relations. Macmillan International Higher Education.
- Bratton, J., & Gold, J. (2017). Human resource management: Theory and practice. Palgrave.
- Budd, J. W. (2016). The thought of work. Cornell University Press.
- Flippo, E. B. (1984). Personnel management. McGraw-Hill.
- Guest, D. E. (2011). Human resource management and performance: A review and research agenda. The International Journal of Human Resource Management, 12(7), 1045-1060.
- Janssen, M., Groeneveld, S. M., & Van der Voet, J. (2021). The COVID-19 crisis and public sector human resource management: Responses and lessons from the Netherlands. Public Personnel Management, 50(3), 356-376.
- Kane, G. C. (2019). The technology fallacy: How people are the real key to digital transformation. MIT Press.
- Kipkemboi, J. (2015). Compensation systems and their relationship with organizational performance. GRIN Verlag.
- Kuhlmann, E., & von Knorring, M. (2021). The healthcare workforce in times of COVID-19. The Lancet Public Health, 6(5), e252.
- Marchington, M., Wilkinson, A., Donnelly, R., & Kynighou, A. (2020). Human resource management at work: People management and development. Kogan Page Publishers.
- Salvatore, D., & Rees, W. (2005). Human resource management in health care. Jones and Bartlett Publishers.
- Storey, J. (2007). Human resource management: A critical text. Cengage Learning.
- Taylor, F. W. (1911). The principles of scientific management. Harper & Brothers.
- Ulrich, D. (2013). Human resource champions: The next agenda for adding value and delivering results. Harvard Business Press.
- World Health Organization (WHO). (2021). Health workforce. https://www.who.int
