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The Big Picture of HR: Acquiring and Deploying Talent
Principles of Management · Chapter 13: Human Resource ManagementSection 13.1 · lesson 83 of 11713 min · free with a free account
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In this lesson
The map of the HR function, and who really makes its decisions.
- Describe the functional areas of human resource management
- Explain how HR responsibility is shared with line managers
- Describe workforce planning and how staffing needs are found
- Distinguish the dimensions and costs of turnover
Transcript
Everything said in the video, section by section (1,732 words). Read along, or search it.
Human Resource Management
The Big Picture of HR: Acquiring and Deploying Talent
Every organization runs on its people. This chapter is about how they're acquired, developed, rewarded, and kept. This first section is the map for the whole chapter. We'll define human resource management, and lay out its nine functional areas. We'll see who really makes most HR decisions. The answer surprises many managers. We'll connect workforce capability to strategy, and walk through workforce planning. We'll look at the four ways to close a staffing gap, and the questions to ask before filling a vacancy. We'll measure turnover precisely, and put an illustrative price on a single departure. And we'll meet a manager who tried to replace a departing employee a little too quickly.
HRM, Defined
The Function Responsible for People
Human resource management is the function responsible for an organization's people. It acquires them, develops them, rewards them, and works to retain them. It's also responsible for the employment relationship itself. That's the ongoing set of mutual obligations between an organization and each person who works for it. Notice the word mutual. The obligations run in both directions. This chapter develops the function across its full span. And this subchapter is the map that every later subchapter fits into. So it's worth getting the shape of the whole clear, before we go into any one part.
Figure 13.1.1
9 Functional Areas, and Where Each Is Covered
Human resource management spans nine functional areas. Figure thirteen point one point one maps them. Workforce planning forecasts staffing needs. It's covered in the rest of this subchapter. Recruitment and selection finds and chooses people. That's Subchapter thirteen point two. Onboarding brings a new hire to full contribution, in Subchapter thirteen point three. Training and development builds capability, across Subchapters thirteen point four and thirteen point five. Performance management measures and guides contribution. That's Subchapter thirteen point ten. Compensation and benefits rewards that contribution, in Subchapter thirteen point eleven. Employee relations governs the ongoing relationship, including its end and its collective dimension. That's covered in Subchapters thirteen point nine and thirteen point twelve. Compliance keeps the organization within its legal and ethical obligations, in Subchapters thirteen point six through thirteen point eight. And health and safety protects the people doing the work. It's covered mainly in Subchapter thirteen point six. Nothing in this chapter falls outside these nine areas. When you need to get your bearings, come back to this map.
The Shared Responsibility Model
Most HR Decisions Are a Line Manager's
If you take one point from this subchapter, take this one. Most HR decisions are made by line managers, not by the HR function itself. HR's actual role is to build the process, supply expertise, and maintain the guardrails. Those guardrails are the compliance boundaries covered in Subchapters thirteen point six through thirteen point eight. Now consider a manager who believes that HR handles people problems. She has misunderstood her own job, in the same sense Subchapter one point one established. Managing people isn't a specialist function she can delegate away entirely. It's the substance of what a manager does. Think about the decisions involved. Who to hire. How to onboard a new team member. When a performance conversation is needed. How to handle a conflict. In the overwhelming majority of cases, the line manager makes those decisions herself. HR supports her judgment. It doesn't substitute for it.
Table 13.1.1
Who Owns What, and the Cost of Blurring It
Table thirteen point one point one splits six HR activities between the manager and HR, and shows what goes wrong when the split is unclear. In hiring, the manager owns the final selection decision, and the working relationship that follows. HR owns the process design, the legal guardrails, and the administrative steps. Blur that, and a manager who defers entirely to HR ends up with a hire she never actually wanted. In performance conversations, the manager owns ongoing feedback, and addressing shortfalls directly. HR provides the appraisal framework, and the documentation standards. Blur it, and feedback never happens, because the manager assumes an annual HR process covers it. In onboarding, the manager owns role clarity, relationship building, and early confidence. HR owns administrative setup and orientation logistics. Otherwise, the new hire gets paperwork, but no real integration into the team. With a conduct concern, the manager notices the issue, and has the first conversation. HR advises on process and legal exposure. If she waits for HR to act first, a minor issue can go unaddressed for months. On pay, HR builds and maintains the pay structure. The manager recommends where a specific person should sit within it. A manager who assumes pay is entirely HR's decision never advocates for her own team. And in workforce planning, the manager identifies the actual staffing gap in her own area. HR supplies data, tools, and coordination. Without that split, a vacancy gets requisitioned reflexively, and no one asks whether the gap is real.
Workforce Planning
Capability, Strategy, and the Gap
Workforce capability isn't just a resource that supports whatever strategy leadership happens to choose. It's a genuine determinant of what strategy an organization can actually execute. Subchapter seven point three established that structure must fit strategy. The same holds for people. A strategy that needs capabilities the workforce lacks, and can't plausibly acquire in time, isn't really available at all. Subchapter fourteen point one develops that link further. Workforce planning is how an organization sees a staffing gap coming. It uses two separate forecasts. Forecasting demand works from the business plan. What the organization intends to do determines the capability and headcount it will need. Forecasting internal supply works from the current workforce, and its expected attrition. Attrition is the rate at which people leave, through resignation, retirement, or other departure. The supply forecast projects how many of today's people, in which roles, will still be there when the demand arrives. The gap between the two forecasts is exactly what workforce planning exists to find.
Closing the Gap
4 Responses, Not 1
Once a gap is identified, four responses are available. Recruitment is only one of them, though it's frequently chosen by default. Recruiting means bringing in new people from outside. Developing means building the needed capability in people already there. Subchapters thirteen point four and thirteen point five cover it. Redesigning the work means changing how a job or process is structured. The existing workforce can then meet the demand without more headcount. That connects to the job design techniques in Subchapter eleven point nine. And reducing demand means asking a harder question. Does the business activity driving the gap really need to happen at the scale assumed? So why is recruitment the default? It's the most visible, most familiar response. But reaching for it without weighing the other three has a cost. Organizations routinely hire to solve problems that development, redesign, or a genuine demand question might have solved without adding anyone.
The Requisition Decision
4 Questions Before Advertising
Before a vacancy is advertised, there's a formal step: the requisition. It's the request to fill a position. A good requisition answers several questions directly. First, should this job exist in its present form at all? Or has the underlying work changed since the role was last defined? Second, could the work be redistributed among the existing team, rather than needing a dedicated replacement? Third, is the timing right, given what else is happening in the organization? And fourth, does the job description still reflect reality? Or has it simply been copied forward from whoever last held the role, without being reexamined? Each question is a chance to choose something better than an automatic replacement.
Turnover, Measured Precisely
3 Dimensions, Not 1 Number
Turnover is the rate at which people leave an organization. It's easy to collapse into one number. It should be measured along three separate dimensions instead. The first is who initiates it. Voluntary turnover is initiated by the employee. Involuntary turnover is initiated by the organization. The second is who leaves. Functional turnover is the departure of a lower performer, or someone genuinely replaceable at low cost. Dysfunctional turnover is the loss of a strong performer, whose departure genuinely hurts. The third is whether it could have been prevented. Avoidable turnover stems from factors the organization could plausibly have addressed: pay, management quality, growth opportunity. Unavoidable turnover stems from factors outside its reasonable control: a spouse's relocation, a health circumstance, retirement. Here's the point worth stating directly. Some turnover is desirable, and zero is not a target. Functional turnover makes room for fresh perspective and internal advancement. In most organizations, no turnover at all signals stagnation, not health. The genuine concern is dysfunctional, avoidable turnover. Losing strong performers, for reasons you had the power to prevent.
The Cost of Turnover
What 1 Departure Can Cost
Turnover's cost builds up across several distinct categories. The figures here are constructed for this exercise, not drawn from any real source. Separation cost is the administrative expense of processing a departure. Call it roughly five hundred dollars. Vacancy coverage is the cost of covering the work while the role sits open. Roughly two thousand dollars, for a month's gap. Recruitment cost covers sourcing, screening, and selecting a replacement. Roughly three thousand dollars. Onboarding cost covers bringing the new hire to productivity. Roughly fifteen hundred dollars. Lost productivity covers the period when the new hire performs below an experienced person's level. Roughly four thousand dollars. Summed, these categories alone put a single departure at roughly eleven thousand dollars. That's why avoidable, dysfunctional turnover deserves real management attention. It isn't a routine, low-consequence event, even when it looks like one.
Case Vignette
Owen Requests a Replacement Without Asking the First Question
Here's a composite case, constructed for instruction. Owen, a department manager at a fictional logistics company, learned that a team member had accepted a job elsewhere. He immediately submitted a requisition to backfill the exact same role. He used the same job description that had been in place for several years. He wanted to avoid any gap in coverage. Before processing it, HR's workforce planning partner asked Owen a short series of questions. Had the actual content of the role changed since it was last defined? Could some of the departing employee's responsibilities be redistributed? Several team members had expressed interest in broader responsibility. And was straight recruitment really the right response? Might part of the gap be better closed by developing an existing team member? Owen hadn't considered any of these questions. His instinct was to replace the departure exactly as it stood, because that was the fastest visible action available. Working through the questions, he realized that part of the work had already shifted to a colleague, informally, over the past year. Redefining the role before advertising it would produce a better fit for what the team actually needed now. Next, Subchapter thirteen point two turns to recruitment and selection, from job analysis through the offer.
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