Top 6 Challenges in HRM You Should Know

Employees are the backbone of any organisation as they drive growth and revenue through their expertise. The key to an organisation performing well is happy and satisfied employees. It is a two-way street – if an employer treats their employees well, they feel motivated to do better and remain loyal to their company. Issues between employers and employees or within departments can negatively impact employees and the company’s work culture. 

Similarly, other challenges in HR concerning employees like attracting top talent, retaining the talent and training the workforce can also significantly impact the growth of an organisation. Since HR is the connecting point between the employees and employers, human resources must face several issues. This blog discusses a wide range of challenges in human resources and suggests ways to overcome those.

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What is HRM?

Human Resource Management or HRM is the foundation of any organisation. It is a practice or system of recruiting and managing employees, training them and deploying those that do not fit in. The definition of HRM encompasses a broad range of activities at workplaces. From the recruitment process to the selection and induction of employees, their orientation, training and development, performance appraisal, salary negotiations, maintaining employee relations, and ensuring workplace safety – all constitute an integral part of human resource management. 

The four essential components of management – planning, organising, directing and controlling also come within HRM functions.

Top Challenges of HRM

The following is a list of the most common challenges in HRM:

1.Change Management:-

As they say, change is inevitable in every sphere of life. In the business sector, changes are constantly happening, whether in the form of new competition in the market, new leadership, merger or acquisition of a company, changes in organisational culture, or implementation of new technology. Unfortunately, many employees have a tough time adapting to the changes in the workplace, which eventually impacts their productivity and work efficiency. It also disturbs communication in a workplace, increases employee resistance, and stagnates an organisation’s growth. 

Some of the best strategies for change management in HRM include conveying clear goals to the employees and explaining the reasons for various changes, improving communication with employees, and asking for feedback and suggestions.

2. Staff Training and Development:

It is quintessential for companies to constantly upskill their employees to stay ahead of competitors and increase revenues. Also, from an employee’s perspective, working professionals today are focusing more on growth, learning opportunities and job satisfaction. However, many organisations often struggle to develop practical training strategies or adequate employee training and development resources. Some organisations also consider training and development exercises as a waste of resources. 

So, upskilling the workforce is a daunting task in HRM that negatively impacts an organisation’s growth. HRs should analyse employees’ performance to understand their strengths and weaknesses and help them accordingly.

3. Attracting Top Talent:-

Recruiting is a crucial but challenging HRM task. HRs put in much effort to hire candidates with the right skills and attitude, teamwork mindset, and someone capable of fitting in with the organisational culture. 

The key for organisations to overcome this challenge is to focus on talent building and not solely on talent hiring. For example, HRs can consider hiring employees with base skills whose interests align with the company’s culture and provide training and development after hiring them instead of searching for candidates based entirely on skills. Also, HRs should clearly convey the company’s missions and values while hiring employees and set clear job descriptions.

4. Talent Retention:-

Once HRs hire suitable candidates, talent retention becomes another tough challenge. Decreased employee engagement is one of the biggest reasons employees leave an organisation. Also, thanks to the huge market competition, people are constantly looking for better growth opportunities and higher salaries. So, they often switch to jobs that promise better growth and earning opportunities. 

The best way to retain talent at the workplace is to provide them with adequate perks or incentives to increase motivation and work satisfaction. The most efficient strategies for talent retention are creating flexible working conditions, providing financial incentives, aligning industry-relevant upskilling programs, etc. Some other methods that HRs adopt to increase employee engagement include providing skill development opportunities to employees, encouraging them to suggest new ideas or processes for projects, and conducting regular surveys or asking for regular employee feedback.

5. Ensuring Employees’ Physical and Mental Well Being:-

Making workplaces safe for employees is one of the biggest challenges in human resources. It is a moral duty and a legal responsibility of employers to take adequate precautions to make offices safe. There are numerous labour laws and legal compliances that organisations must follow to help their employees.

For instance, companies can have an open-door policy so that employees can freely discuss stress or anxiety issues. Several companies even encourage their employees to go for therapy to deal with work-related stress and offer to pay for the same. 

6. Ensuring Diversity and Inclusion:-

HRs must constantly strive to make the workplace diverse and inclusive because it facilitates enhanced work culture while increasing the efficiency and growth of the organisation. However, ensuring diversity and inclusion is not as easy as it seems. Communication and language barriers, misunderstandings due to cultural gaps, differences in perspectives among employees, and discrimination are the most common obstacles that HRs often encounter while making workplaces more diverse and inclusive. 

HRs can deal with these challenges by organising support groups and promoting mentoring initiatives, standardising interview procedures, conducting regular analyses or audits of inclusion strategies, partnering with a resource group, and encouraging employee collaboration.

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HR analytics can help resolve the challenges mentioned above to a great extent. It is a data-driven approach to tackling human resource issues at workplaces. HRs can use various tools to connect and analyse data to gauge employee performance, take advanced decisions related to employee promotion and salary hikes, assess employee engagement and increase employee retention, and measure training and learning outcomes at workplaces. 

If you want to upskill yourself or are looking for higher HR positions, you can learn HRM analytics by completing a Professional Certificate Programme in HR Management and Analytics offered by upGrad.

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