Many small businesses believe that the only function of the human resources department is to recruit and dismiss employees. This is definitely not the case. When the key people in the company starts to find themselves taking on too much responsibilities and wearing too many hats, it might be time to look into setting up a proper HR department to handle these tasks.

Budget Control

Contrary to what a lot of people think, it is the HR department that handles the budget control of businesses and not the finance or accounts department. Finance only disburses funds while the accounts department gives accounts on how money is spent. The HR department ensures your business does not exceed its budget as it could affect the general cash flow of the business. If you spend more than the budgeted amount on advertisement, it will affect another area of your business.

Conflict Resolution

Conflict is bound to happen in every business. It could be between employees or between an employee and a manager. What matters is proper resolution without bias so that a positive working environment can be maintained. It is another responsibility of the HR department to resolve conflicts. Every conflict has to be settled with neutrality so as not to leave discordant tunes among employees.

Learning and Development

The department also determines the necessary training for different units of your business. The training is based on the industry standards. In addition, they also make arrangement for it. They will plan it in such a way that it won’t disrupt your business activities.

Workers’ Compensation

In several countries in Asia, government regulates workers’ emoluments. Your HR department will fix your employee’s pay based on government standards. They don’t just fix benefits arbitrarily. They also work on improving employees’ satisfaction to be able to retain good hands.

Promotions & Succession Planning

The human resources department also helps to facilitate the growth of your business by identifying exceptional employees and promoting them to handle bigger responsibilities. This sustains the company. Any business that finds it difficult to prepare employees for leadership roles may not last for long. This is why your HR department does regular assessment/appraisal for every employee.

When you carefully observe all the responsibilities of the HR department discussed above, one thing should be clear to you. Every one of them is geared towards making your company an employer of choice. You definitely want your business to be a dream company where people dream to work. Your HR department will make it possible. This is why it is important for every business to have an HR team.