Organizations are multifaceted. Coping with business complexity necessitates a strategic approach to the management of the employees, who separately and jointly contribute to the achievement of the strategic objectives of the organization. Human capital is the most important asset of an organization, so the proper use of a potent asset can construct a prevailing and resourceful organization. Human capital can make or break a strategy, an objective or the organization per se.

Human Resources Management (HRM) views the employees as an intangible asset, assuming they have own mental maps and perceptions, own goals and own personalities and as such they cannot be viewed as an entity. Working as the link between the organization and the employees, HRM employs both individual and group psychology to attract, retain and develop employees. In addition, HRM motivates and commits the workforce to the achievement of organizational goals through continuous motivation and organizational learning.

HRM objective is primarily to identify the core competencies and individual skills required for organizational success and then use this knowledge to develop tools to capitalize on the return on investment from human capital, while minimizing financial risk. HRM is responsible for conducting recruitment, selection, training and development, performance evaluation, promotions, career development, and redundancy of employees in an effective, legal, fair and consistent manner. Also, HRM echoes social responsibility to the needs and challenges of society by minimizing the negative impact of such demands upon the organization. Organizations should be able to use their human resources towards the benefit of the society. In addition, HRM aims to assist employees through motivation and empowerment - in achieving their personal goals, provided that these goals enhance individual contribution to the organization.

The importance of HRM is reflected on all organizational aspects. A firm should first become aware of the employee needs, and then understand and evaluate these needs in order to instill in the employees the feeling that their work is part of their life and not just a routine obligation. When top management expects employees to take the extra mile, it should have first laid the groundwork for employee motivation and loyalty.

Of course, challenges do not cease for HRM. Recruiting and selecting the best employees is a very difficult obligation, particularly in today's dynamic, competitive environment. Moreover, with the increase in competition, organizations need to be more adaptable, flexible, agile, and customer-centric to succeed. Within this environment, organizations must have the competencies and the tools to capitalize on the full potential of each employee in order to employ business-driven functions and influence key decisions and policies with a thorough understanding of the organization's big picture. Today and in the future.

Learn more about this author, Christina Pomoni.
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