The human resources and personnel management department of an organization is a critical part of the company. They are responsible for ensuring all employees are happy, productive and engaged in their work. A strong personnel management team can help employees be more valuable to the company so that the organization can achieve its goals.

The Role of Personnel Management in Small Business

Personnel management is a subset of human resources, where the focus is on hiring, training and developing employees. There are many roles that personnel management employees play. In smaller companies, these roles may all be played by one person. In larger companies, they may be taken on by several different employees.

In a small business, the employee in charge or personnel management may:

  • Determine what skills and expertise the company needs that they don’t already have.

  • Write and post the job ad to fill the role.

  • Conduct interviews and make final decisions on hiring with senior management.

  • Offer training and development opportunities to the new employee.

  • Meet state and federal employment laws and health and safety regulations.

The organization of personnel management duties will depend on the size and needs of the company. The role may also oversee human resources issues such as compensation and benefit plans.

Structure of a Personnel Management Department

There are several roles within a personnel management or human resources department. Depending on the size of the company, these roles may be combined into fewer roles or split into several roles.

  • VP of Personnel Management or Human Resources: This role oversees the strategy for the department and aligns it with overall business goals.

  • Director or Manager of Personnel Management or Human Resources: This leadership position is more involved in the day-to-day management of the employees on the team, providing processes and resources as required.

  • Business Partner: This role works with the company’s leadership team and helps them achieve their business objectives.

  • Recruitment: This role is in charge of assessing the company’s personnel needs and writing job descriptions and posting them on strategic job boards. They also conduct initial interviews and may work with management on deciding whether or not to hire an employee.

  • Compensation and Benefits: This role ensures that the company is paying its workers a competitive wage to attract the best talent. This role will also oversee the medical and health benefits, retirement benefits and other indirect compensation the company offers. This role may also include payroll.

  • Employee Training and Development: This role is tasked with ensuring all employees have the knowledge, training and expertise they need to complete their duties. This role will also work with employees to understand their career paths within the company and help them create a plan to achieve those goals.

  • Compliance: This is a critical role that oversees the company’s compliance with state and federal labor laws, health and safety regulations and other guidelines. They handle any noncompliance complaints and institute processes to improve the working conditions at the company.

  • Engagement and Advocacy: This role fosters employee empowerment and creates a working environment where all employees are happy and fulfilled. They focus on reducing turnover and increasing loyalty.

Best Practices of Personnel Management in Small Business

It’s important for personnel management employees to keep clear lines of communication with the company. They should create a "structure of personnel department" PDF and send it to all employees so they know whom to contact if they have a question about a particular matter. This shows employees that the personnel department is focused on employee interests.

Resolving conflicts among employees is an important component of any personnel management role. It’s best practice for these employees to have training in conflict-resolution strategies so they can help employees to see eye to eye and get engaged in their duties. This helps them work together to achieve the company’s goals.