The Importance Of Human Resource Management

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Introduction

Human Resource Management (HRM) refers to the management of people in an organization. It involves the integration of Human Resource policies, activities and systems that focus on managing employees in an effective and efficient manner to achieve organization’s goal and success (Byars and Rue, 2006). The purpose of this report is to analyze the importance of HRM in sustaining competitiveness and contributing to the success of the organization. Subsequently, discuss on the main challenge of HRM in today’s rapid changing business environment. Last but not least, suggest and evaluate recommendations to overcome the challenge faced by HRM.

Importance of HRM

HRM is important to every organization as it concerns with the “people” dimension (DeCenzo and Robbins, 1996). Every organization uses a range of capitals to make their businesses function. These capitals can be in the form of cash, machineries, goods or facilities to generate revenues for organizations (Noe et al., 2014). Regardless of the industry of the organization, it must have people to make these capitals functional and generate revenues.
According to Gunnigle et al. (1997), people are assets of organizations. Human resource has the essential qualities of being valuable, unique and irreplaceable that helps organization to achieve sustainable competitive advantage (Noe, et al. 2014). Thus, organization with effective HRM can optimize the utilization of such organization assets through various
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