Evolution of Human Resource Management

 

The current economic and social climate has resulted in numerous changes to the human resources (HR) department. The factors that most directly affect strategic functions include globalization, the demand for innovation and sustainability, the diversity of generations, and technology (Warsono, 2017). According to Hariandja (2002), These adjustments impact roles and duties as well as standard operating procedures and practices, necessitating the use of professionals with change-oriented abilities and the capacity to collaborate with a variety of teams. Embracing change presents an excellent chance for the organization's Human Resource Management.

Figure 1 – Evolution of HRM

From the earliest days of businesses, one of the most crucial components has been the human resource base. Over the years, this resource has undergone numerous transformations and phases of administration. While human resources management (HRM) was once thought of as an extension of personnel management, it has since evolved to a position where it surpasses personnel management, gains a strategic component, and even transcends it to become the focal point of the organization. The competitive environment, digital transformation, industrial revolution, and globalization are thought to be the most significant of these factors.

According to Tortop (1999), An ancient system of slavery gave rise to the employee-employer relationship. Serfdom, or land work, was the next stage of slavery and was widespread by the Middle Ages. In 18th century was the beginning of the groundwork for modern employee-employer relations. Human resources techniques were typically handled simply by the family elders in the form of personnel administration at this time because the economy was focused on agriculture, ethics and craftsmanship, or small family businesses. As a direct outcome of the Industrial Revolution, the first applications appeared. Jobs predicated mostly on an employee's physical strength, or muscle power, underwent a substantial transformation in the 1770s, prior to the industrial revolution (Oge, 2022).

Figure 2 – Evolution and development of HRM

Personnel Management

Personnel management departments were formally established in organizations during the 1940s. Initially these departments perceived as departments that handle employee record keeping. These departments were tasked with maintaining records pertaining to wages, leaves, absenteeism, and the number of days’ employees were late (Ducker, 1999; Deringol, 2010). As the only department in an organization that deals with human factors, the personnel department has not progressed beyond processing payroll and other routine personnel transactions. During this time, several organizations did not have a personnel department, and all personnel transactions were handled by an accounting staff member (Kocak, 2006). Since the 1960s, human resources management has taken over in place of personnel management, mostly due to the adoption of human-oriented techniques. As a result, the employee began to be viewed as "human resources" rather than "personnel" and was treated more like a capital asset than a simple cost component ( Bingol, 2013).

Figure 3 – Personnel Management Vs Human Resource Management

 

Human Resource Management

During the 1960s, the human factor started to gain prominence in organizations due to various factors such as the industrialization-related shift in the employee profile, the rise of knowledge workers, learning organizations, and the total quality management approach that promotes quality transfer from the highest to the lowest level. Over time, human resources departments replaced personnel departments as their official term (Kocak, 2006).

According to Allahverdi (2006), the HRM department is responsible for carrying out the following primary HRM procedures: human resource planning, job analysis and definition formulation, employee recruitment and selection, employee training and career development, performance evaluation, job evaluation and compensation, monitoring worker health and safety at work, and handling personnel records. Human resources management involves a wide range of tasks, such as assessing the need for workers, creating job ads, choosing qualified candidates, adapting them to the workplace culture, motivating staff, assessing work output, resolving conflicts, maintaining relationships and communication between individuals and groups, restructuring, creating a positive work environment, fostering a sense of community within the organization, and providing training and development opportunities for staff members (Findikci, 2000). 

Table 1 – Similarities and differences of Personnel Management and Human Resource Management

Electronic Human Resource Management

The human resources department started using information technology in the 1980s for managerial tasks, mostly payroll processing. Later, the company extended the range of HR procedures to include performance management, talent acquisition, and compensation management (Esen and Erdogmus, 2014).

EHRM provides several strategic advantage for the organization, following are such advantages for the organization:

·         Delivering a wide range of information about the company and offering effective and advanced        human resources services to the internal clients of the organizations.
·         E stablishing an optimal timeframe for human resources practitioners to concentrate on strategic human resources services and procedures.
·         EHRM reduces the administrative burden and help to improve the quality of human resources activities and increase the accuracy of results.
·         Encouraging human resources employees to work within the company and advance their careers.
·         Minimizing expenses and streamlining internal administrative procedures.
·         Establishing a communication-friendly atmosphere for human resources inside the company.

Figure 4 – Electronic Human Resource Management

Strategic Human Resource Management

The year 2000 and thereafter corresponds to the concept of strategic HRM's practical acceptability. Strategic human resource management (HRM) involves aligning HRM practices with strategic goals and objectives to create an organizational structure that fosters adaptability and creativity, thereby enhancing the organization's performance. According to Dessler (1997), Globalization, technology advancements, shifts in the nature of work, and workforce diversity are a few of the factors that have contributed to the effective growth of strategic HRM. Globalization has made the competitive landscape more intense, forcing human resources managers to approach the field from a strategic standpoint. Human resource methods have evolved as a result of technology. In order to implement strategic structuring in human resources management, pre-existing borders with state rules must be removed. Likewise, to optimize the utilization of human resources, internationalization and the resulting heterogeneity of the work force necessitate strategic HRM strategies. 

Figure 5 – Strategic Human Resource Management

Digital Human Resource Management

Human resource management functions, ranging from training and development to performance evaluation, have been impacted by digitalization and transformation. Consequently, a comprehensive shift from traditional to digital has become necessary in terms of human resource policies and strategies, as well as the way practices are implemented. As a result, digital HRM essentially uses technologies, applications, and the internet to manage all HRM activities. On the other hand, in the current digital era, innovations should be implemented into human resources practices to recruit, reward, and evaluate employees (Halid et al., 2020).

 With the rise of digital HRM, traditional HR functions have seen numerous adjustments and transformations. As a result, organizations can now take advantage of digital technologies to make the most of human resources in order to stay competitive and keep up with the digital transformation. This involves using a variety of digital technologies, such as artificial intelligence, big data, cloud, blockchain, and virtual and augmented reality, to be able to quickly and accurately make decisions about human resources functions, policies, and practices. These technologies can be applied to a variety of contexts, from business analysis and evaluation to performance management and training and development, from human resources planning to training and development, and from supply, selection, and orientation to training and development (Yilmaz, 2023).

References

Idrus S. et al. (2023)., ‘The evolution of human resource management: The necessity of facing the industrial revolution 4.0’, Jurnal Ilmiah Manajeman, 4 (1), 91-96. Available at: https://www.researchgate.net/publication/368680456_THE_EVOLU TION_OF_HUMAN_RESOURCE_MANAGEMENT_THE_NECESSITY_OF_FACING_THE_INDUSTRIAL_REVOLUTION_40  (Accessed 3^rd April, 2024)

 Kadam S. et al. (2022)., ‘Evolution of Human Resource Management – A Review Article’, Journal of Pharmaceutical Negative Results, 13 (8), 212-218. Available at: https://www.pnrjournal.com/index.php/home/article/view/2516/3190 (Accessed 3^rd April, 2024)

Yilmaz A. (2023), ‘The Evolution of Human Resource Management in Managerial Thinking’, Journal of Society, Economics and Management, 4 (1), 35-47. Available at: https://dergipark.org.tr/en/download/article-file/3110909 (Accessed 3^rd April, 2024)