Complete guide to setting up HR department

Whenever anybody imagines a company or a big business organization, the HR department is always considered to be a crucial part of it. Organizations create this department to deal with manpower related procedures, legal issues, inter-organizational procedures, etc. Hence, an HR department needs to be handled by professionals.

If you are a budding business organization or you’re restructuring your HR department, here is a guide to follow. It will help you understand how to set up the HR department in the organization, its importance and more.

Let us start with understanding what Human Resources mean?

HR is an individual or a team of professionals who take care of everything related to the manpower working at the organization. It manages all the resources related to the staff/employees. HR’s activities include hiring, recruiting, checking legal compliances related to HR, work satisfaction, and many more. Human Resources is actually an umbrella term under which the HR personnel has to take care of everything. Hence, the person working at this position has to be a good communicator, listener and should be available to the staff and the managers whenever the need arises.

This is one of the reasons why every small or medium-size business organization also has an internal HR department that manages its employees and related operations. Your business needs HR for multiple reasons, apart from hiring and recruiting people. HR is the glue that connects you to your employees. Below you can read the importance of the HR department to the organization.

Why the Human Resource Department is Important?

1. Let us not waste time in a wordy introduction and get directly to the point. Below are a few reasons for which your organization needs an HR department.
2. Organizations need an expert to take care of the recruitment processes.
3. There must be somebody who can hire the best talent for the company. Because it is employees who are going to make your projects a success.
4. HR personnel will maintain a positive rapport with the employees and help them adopt the company culture or policies.
5. Employee management is one of the critical jobs done by the HR department.
6. Hiring is not enough. Candidates and existing employees need to be trained as per the assigned projects, changing market, and company policies.
7. All the paperwork, right from the offer letter to the leaving letter, everything is taken care of by the HR.
8. As seen above, HR takes care of the employees related to legal compliance of the company.
9. HR plays an important role in PR. As it is the HR who meets a candidate first, so whatever image the HR creates last in candidates’ mind for a long time.
10. HR helps in manpower planning and higher productivity.
11. Support in expansion and diversification by hiring the right talent at the right time.

The above mentioned are a very few benefits of having an HR department. You must have got an idea of the role it plays and the importance it holds in any organization.

Once you are convinced of the importance of having an HR department for your organization, you must know how to set up the HR department:

10 steps you should follow (not necessarily in the same order) to build an efficient HR department for your organization.

Think about the company as a whole.

You need to come up with a company-wide plan in terms of staffing. It will help you define all the job positions your company would require to fill and what type of talent you need to hire. In this, you might end up listing more positions than your budget, but you can take the help of the HR and accounts team to come to the right hiring number.

Consider every criterion for building the HR department

You’ll need to set a budget for your human resources department. You will have to think of every factor like salary, infrastructure cost, the cultural attitude of the person you will be hired as an HR. His/her abilities to communicate and deal with people, etc. HR is usually one of the first few employees you appoint for your business.

Create a payroll system & define the job role

Before you go and start the hiring process, you must be ready with the payroll software for every employee of the company. Employees would surely want to know their salary, incentives if any, payment cycle, paid/unpaid leaves, holidays, hike, etc.

Apart from the monetary side of the employment, you must be ready with what you are expecting from each employee. Whenever you post a job ad on social media platforms of employment websites, you are supposed to write a clear Job description. Candidates read this description before applying. It helps them as much as it helps you. Once you hire an efficient HR, he/she will help you with this.

But, for that to happen, you should at least know what to mention in the job ad for HR.

Create an employee handbook

This is a crucial step. This handbook will be a one-stop source of answers for all the basic queries of the employees. The handbook will mention culture, work policy, workplace behavior, login/logout procedures, health, safety, etc. An attractive handbook with to the point & crisp information would engage your employees.

Infrastructure

Employees will be working in the office for around 8-9 hours. Hence the workplace has to be clean and tidy. Clean washrooms or a refreshment corner will be necessary. The arrangement has to be done in such a way that reaching employees becomes easy. One can think of a pleasant interior to maintain a cheerful and positive work environment.

Go through administrative records

It would be great if you build a structure where you (personally) go through all the administrative records. There will be sure plenty of documents to take care of, but you can choose a critical few and prioritize accordingly, such as employee benefit plans, tax documents, payroll details, etc.

Performance & appreciation

Every company runs on the efficiency and dedication of its employees. Hence, appreciating their efforts and awarding their efficiency is a crucial part of employee engagement. Companies that praise their employees tend to grow more and last longer.

If the employees are satisfied, it is easy to retain them.

You can also build a performance feedback process where the real talk happens about the productivity of the employee and the employee gets a platform to talk about his/her expectations from the company.  If conducted well, this session can bring out the best in both parties.

While you take care of all the things mentioned above, you should not forget to involve technology in the process. Have you heard of Human Resource Management?

StackHX is built to boost business efficiency, add to the culture and productivity. Its all-in-one cloud-based structure makes the HR process smooth & safe.  Know more about the product here.