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10 reasons why human resources is important in a business

Human resources (HR) management plays a crucial role in every organization. Without competent HR management, businesses would not be able to attract and retain top talent, grow and improve their operations, and preserve a positive and accepting workplace culture. The administration of HR is so crucial to businesses that many refer to this division as the heart of an enterprise; HR takes care of all the essential employee-centric needs, ensuring the process continues to run smoothly, and that everyone is aware of the rules and regulations of the company.

What is HR?

HR used to be primarily concerned with hiring, firing, and the conventional yearly salary review, but now has moved away from its typical hire-and-fire role to place a greater emphasis on employee engagement, management, and all of an organization’s various elements. Payroll, benefits, compensation, talent acquisition, training and development, and employee relations are just a few of the divisions and activities included within HR. Basically, the HR department of a company wears many hats, from management and conflict resolution, to health and safety, legal compliance, and finances.

The ultimate goal of HR is to reduce risk and bring value to the organization. A company will always have a competitive advantage over other businesses of a similar nature when it possesses valuable, uncommon, and distinctive HR. Many highly effective organizations are aware that their employees' knowledge and skills are what make them successful. Employees are the cornerstone of every prosperous company, and that’s why HR is crucial for corporate success for small and large firms.

10 reasons why HR is so important

Due to the wide variety of tasks HR plays within an organization, this division is of the highest importance. Understanding the roles played by the HR team is vital to respond to the question, "Why is HR important?" Here are 10 reasons why a company might require an HR department.

1. To recruit the right people

To fill a position in an organization, recruitment entails locating the best personnel at a specific time. An organization can gain from hiring the appropriate people by increasing productivity and, perhaps, income.

Because this directly impacts the expansion and development of an organization, it is crucial for HR professionals to be able to choose and interview the right individuals.

2. To train and develop employees

Every time current employees of a company take on new positions, training is required. They can learn what to anticipate in their new jobs and the new behaviors expected of them during the process.

3. To resolve conflict among employees

There is always a chance that coworkers would differ because an organization employs people from a variety of backgrounds. Therefore, every organization should take conflict resolution seriously because it has an impact on the environment at work. The HR division must make sure that disputes among employees are resolved amicably.

4. To enable an organizational culture

The shared ideals, attitudes, and behaviors of employees within an organization are included in organizational culture. Such a culture should be upheld because it can foster a supportive workplace. A strong organizational culture must first be established, which is the responsibility of the HR department. They might accomplish this by retraining current employees or onboarding new personnel. The retention rate of an organization can be raised by having a good corporate culture.

5. To carry out disciplinary actions

Employees occasionally disobey business policies. HR is also in charge of enforcing sanctions in these situations. The HR staff must manage these difficult circumstances with tact, attempt to comprehend the employee's perspective and come to a mutually acceptable arrangement.

6. To onboard new hires

Onboarding is important, so new employees must go through the onboarding process before they can effectively join the team. As part of the onboarding process, new hires are instructed on appropriate behavior, workplace culture, safety protocols, remuneration, and perks.

7. To manage compensation and benefits

Although the benefits that employees get are not directly under the HR department's control, they must be managed. The department is in charge of keeping track of benefits, and making sure that workers receive them when they are due. In addition, they are in charge of explaining these advantages to workers, typically at the time of the employment offer.

The HR division is also in charge of making sure that an employee's pay and benefits are reasonable and market-based. To make sure their employees receive the best value, HR also collaborates with the companies that supply benefits for their company.

8. To ensure employee satisfaction

An organization should prioritize employee satisfaction because it will probably result in lower turnover rates. Given the hiring procedure and training requirements when a new professional joins the organization, turnovers can be highly expensive. An organization with a strong HR department can increase satisfaction and lower turnover.

An organization's HR department can guarantee employee satisfaction in a number of ways. For instance, the HR division can guarantee that workers are fairly compensated for their efforts. Putting employee health and wellness first is another strategy.

9. To help with budget control

Budget planning may fall under the purview of the HR, and if this is the case, the budget is likely to contain costs for salary, benefits, and training. In order to maintain salary and benefits parity for various professions, the department must also keep track of employment patterns.

Finding the best solutions to lower employee costs can fall under the purview of the HR department in situations where an organization has to reduce expenditures. The HR division needs to convey these adjustments when it temporarily lowers employee wages.

10. To ensure compliance with local employment laws

A company is regulated by local employment laws. HR is in charge of informing senior managers of these rules and making sure they are aware of them. They must also make sure that their company complies with them.

Importance of HR in today’s growing organization

The way in which HR functioned abruptly changed as a result of COVID-19, where the pandemic broadened the definition of HR because it can be more challenging to lead, grow, and manage remote staff. As a result, HR has transitioned from its traditional tactical role to a more strategic one, where an organization's success or failure depends greatly on its efficacy.

Considering that remote job positions will bring into the company different people from different cultures and languages, it is important to also think about the meetings with people that have different languages, so the contracts and regulations are to be done in their own language, as well as in English.

The need for language services such as translation is one of the more overt repercussions of labor globalization. Foreign-born workers who speak various languages frequently have to travel to meet or communicate with others within the company.


HR is an important component of any business, from risk management to enhancing employee well-being. It aids in increasing the effectiveness of an organization by raising company morale, creating strategies to ensure high-performance standards, resolving employee problems, and ensuring a company stays within its budget. A successful business, no matter its size, is built on a happy workforce, and HR management is the glue that contributes to tying it all together.



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