Difference Between Personnel Management and HRM – Why You Must Know

The main difference between personnel management and HRM is that personnel management is administrative and is mainly concerned with employees and how they can adapt to the organisation. In contrast, HRM is a modern approach integrated with strategic management that centres around the efficiency of human resources including employees and HR operations in the organisation. 

Explore:

1. Difference between personnel management and HRM
2. Personnel management – Definition and Approach
3. HRM – Definition and Approach

Difference Between Personnel Management and HRM

Here are the critical differences between personnel management and HRM. 

Parameters	Personnel Management	HRM
Function	Administrative tasks and maintain relationships with employees	Strategic tasks concerned with optimising human resources and employees
Approach	Employee productivity results in job satisfaction; traditional	Employees are the main assets; modern
Objective	Meeting organisational policies	Utilisation of employee’s competencies
Orientation	Making employees adopt company rules	Developing the competency of each employee
Pay based on	Job evaluation	Performance evaluation

Personnel Management – Definition and Approach

Personnel management is about hiring the right employees and maintaining a healthy workforce in an organisation. But a lot happens behind the scenes. 

In the book, Principles of Personnel Management (1984), the author, Edwin B Flippo offers this definition. 

“Personnel Management is the planning, organising, directing, and controlling of the procurement, development, compensation, integration and maintenance and separation of personnel to the end that individual, organisational and societal objectives are accomplished.”

Functions of Personnel Management

According to Flippo, the personnel manager requires a background in psychology, sociology, economics, philosophy, and management. 

Related: Psychology courses

There are two main functions of personnel management 

• Managerial – The personnel manager fulfils the essential functions of management. As defined by Luther Gullick and Lyndall Urwick, these functions are clubbed under the acronym, POSDCORB. POSDCORB stands for Planning, Organizing, Staffing, Directing, Coordinating, Reporting, and Budgeting.   
• Operative – These functions are related to maintaining a healthy workforce and are done routinely. The operational activities include procurement, training and development, maintenance of health and safety, etc. 

While you must read on What is Administration?, do check on the concept of staffing in management for a better understanding of the diffferences.  

Approach in Personnel Management 

Personnel management is more traditional in that it replaced the concept of labour management in the 1940s. The approach to personnel management is more or less based on the Hawthorne research project of the 1920s, which concluded that employee productivity was directly related to job satisfaction. 

Related: Principles of Management 

HRM – Definition and Approach

HR management deals with optimising the human resources in the organisation. That means it is concerned with managing HR operations along with the workforce to meet organisational goals. 

Related: Functions of HRM

In Armstrong’s Handbook of Human Resource Management Practice, HRM is defined as 

“HRM is the managerial utilisation of the efforts, knowledge, capabilities and committed behaviours which people contribute to an authoritatively co-ordinated human enterprise as part of an employment exchange (or more temporary contractual arrangement) to carry out work tasks in a way which enables the enterprise to continue into the future.”

Goals of HRM

• Supporting the company objectives by executing human resource strategies that are part of the business strategy
• Cultivating a high-performance culture
• Ensuring the company has a skilled and talented workforce
• Creating trust among senior management and employees
• Encouraging an ethical approach to managing employees

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Approach in HRM 

HRM can be considered as a modified version of personnel management. According to Armstrong, in HRM practice, ‘the key resource is people.’ HRM is also considered more ‘holistic’ in that employees in the organisation are considered as ‘assets’ and not as ‘variable costs.’

Explore HR Management courses

Parting Thoughts

In conclusion, personnel management is traditional, while HRM is fairly modern. This forms the primary basis of the difference between personnel management and HRM debate. You may also check out the top human resources courses if you plan a career or want to upskill in the domain.