4 Human Resources Decisions That Affect Your Company

HR decisions that affect your company

HR professionals typically are responsible for a myriad of business and employee-related functions and how they handle those functions can impact a business significantly — for good or for bad. 

When structured correctly, HR leaders are essentially the “culture keepers” of the organization, said Todd Davis, senior consultant and thought leader at FranklinCovey. 

“The chief people officer or CHRO should be in lock-step with the CEO regarding her/his vision for where the organization is going,” Davis told us. “When that happens, all recruiting, hiring and employee development is done through the lens of this vision and has a significant impact on the growth and success of the organization.”

Although numerous decisions HR managers make day in and day out can affect your company, here are four major ones to consider.

1. Deciding who to hire

Your HR department is mainly responsible for deciding who to hire. While the ultimate decision may fall to a particular leader, HR professionals are the ones who go through résumés, evaluate candidates and recommend the best applicants for the job. When the recruiters on your HR team identify the top person for the role, your company reaps the rewards. You get a new employee who is qualified and eager to contribute to your organization.

However, when a new hire doesn’t work out and either leaves voluntarily or has to be terminated, this can cost you a lot of money. The resources already spent on hiring and training are lost, with more money going on the line to hire the next recruit. These are not the only costs, either. Morale and productivity also suffer as other employees must put their work aside to cover the missing person’s duties. If the terminated employee dealt harshly with customers, some of those customers may never return. In other words, the person your HR department recommends you hire can make or break your business.

2. Deciding how to hire 

Before your HR department can point you in the direction of which candidates to hire, they have to make a set of decisions to set up a system that will find you the ideal applicants. If your hiring process is aimed at filling positions quickly rather than carefully, you may be hiring for the same job over and over. If your job listings are too generic and don’t describe exactly what skills and characteristics you’re looking for in detail, you may get bombarded with résumés from all the wrong people. The extra costs of using assessment testing or even hiring an external recruiter may ultimately save money, especially for higher-level jobs.

Your HR professionals should be able to point you to the best HR software equipped with recruiting and applicant-tracking tools. Once a solution is chosen and implemented, they can use the system to streamline operations – but the hiring process doesn’t stop there. A skilled HR professional should direct each new hire through employee onboarding as well. This process can impact the longevity and success of each new hire at your company drastically. 

“During the onboarding process with new hires, HR professionals can help new employees feel welcome and adapt to the company culture,” said Leila Saad, CEO of Common Impact. “HR departments can leverage tools and training for skills-based volunteering programs to enhance talent management, compliance and organizational development.”

How well they carry out these procedures can impact your company’s success. For example, they can boost employee engagement and align corporate social responsibility with talent development, leading to a more motivated and committed workforce.

3. Deciding benefits packages

Another responsibility that often falls on the HR team is determining the kinds of benefits that attract the best candidates. Although most employees desire popular perks like mental health support, flextime scheduling and professional development opportunities, other important benefits may depend on the demographic your employees fall into.

For example, companies that have a large number of younger employees might want to offer tuition reimbursement and other education benefits while businesses that employ mostly parents and families would likely find value in providing fringe benefits like life insurance, child care or elder care, paid parental leave and family planning services.

Your HR department will know your current employee demographics best as well as the target workers you’re hoping to attract. They can build packages that meet those workers’ needs, improving employee recruitment, satisfaction and retention. 

4. Deciding company rules

A company’s HR rules can make employees’ work lives either productive and smooth or disrupted and unhappy. In some cases, a work environment can be outright hostile to someone’s well-being. It usually falls to the HR department to craft a good employee manual that clearly describes the company’s rules for professional behavior. Putting your policies and the consequences for not following them into black and white lays the groundwork for a respectful company culture and may even prevent some lawsuits down the road.

Your HR professionals should use their expertise and training to develop the right guidelines for your organization. For instance, decisions about company fraternization rules need to be made with special care. While romances between workers and their superiors can have destructive consequences, not all office romances do. Skilled HR workers can make policy decisions that promote an inclusive and productive company atmosphere.

“In well-structured, high-performing organizations, it is the responsibility of the HR department to ultimately determine and implement company policies and procedures,” said Davis. “When the HR department works to become true partners with the leaders of the organization vs. ‘policy wonks,’ the implementation of policies and procedures are seen and received as a way to benefit and not hinder the growth and success of the organization.” 

How an HR department benefits your company

Whether you’re hiring your first HR person or employing an entire HR department, having internal HR professionals on staff can bring many benefits to your organization. 

“HR professionals play a crucial role in creating and sustaining a positive work environment, directly impacting productivity and employee retention,” said Saad.

This is because an internal HR team knows the ins and outs of your organization. They understand your company culture, standard operating procedures, legal risks and best practices. They have insider knowledge of the specific HR needs of your business and employees, even as those needs evolve.

In addition to making the decisions highlighted above, here’s what an HR department can do for you:

• Develop accurate, unbiased job descriptions that attract the right candidates to each open position.
• Recruit and hire skilled employees who are right for their respective roles.
• Implement an effective onboarding process that successfully integrates new employees into your organization long term. [See the onboarding best practices that will impress new hires.]
• Develop and maintain a strong company culture that aligns with your mission and values.
• Maintain employee happiness, satisfaction and engagement.

• Strategically handle employee conflict in a way that best serves the employees and your organization.
• Build and administer competitive employee compensation, benefits packages and professional development opportunities that aid in employee recruitment, satisfaction and retention.
• Track and manage employee performance and attendance.
• Develop and enforce procedures that help you maintain HR compliance with federal, state and local employment and labor laws.
• Assess your organization and mitigate potential legal risks.

These are just a few of the many ways an HR department can benefit your business. You and other business leaders at your organization should work closely with your HR team to ensure HR policies and procedures are in line with your needs. When everyone is in sync, HR decisions can keep your company moving in the right direction.