An organization consists of a group of people (employers and employees) who work alongside one another to achieve a common goal, which is the fulfillment of organizational objectives. It is only possible to accomplish this when all of the people working in the organization are managed in an effective and efficient manner. Two main approaches are used by employers to manage those working under them in their organization, which are personnel management and human resource management.

The term personnel management has been in use for a long time, long before human resource management was used. It is more commonly referred to as traditional personnel management, which managed the tasks of staffing and payroll. The emergence of human resource management mainly occurred as an extension of traditional personnel management.

Definitions and explanation

Personnel management

The term personnel management is more traditional, and was used in the earlier times to signify the different activities related to the workforce, such as payroll, staffing, contractual duties and other administrative responsibilities. This suggests that personnel management includes all those tasks that pertain to the management of workforce.

Personnel management is essentially an administrative function, and the key responsibility of a personnel manager is to make sure that the requirements of their employees are fulfilled. Personnel Management makes sure that the right personnel are performing the correct organizational task. This approach of managing employees concentrates on following the rules and policies of the organization.

Human resource management

Human Resource Management is an organized and distinct part of management that pertains to acquiring, developing, maintaining, using and coordinating the workforce in a way that they perform to their highest potential in the organization. It involves a systematic process in which planning is carried out for the needs and requirements of human resources, as well as their recruitment, training, remuneration and performance evaluation.

The process of human resource management is continuous in nature that makes sure that the right persons are assigned the right responsibilities. It is basically an art of making the most efficient and effective use of human resources of an organization. Several activities are part of Human Resources Management, including the following:

In recent times, resource-centered organizations have emerged that focus on putting people first, while also attaining the management objectives of maximizing returns. This is the focus of modern HRM, that is to make sure that management objectives are achieved, while also fulfilling the needs of the resources. Hence, the scope of HRM is much broader than that of personnel management.

Differences between personnel management and human resource management

The key differences between personnel management and human resource management are discussed below:

1. Meaning

Personnel management is a traditional approach of managing employees within an organization, whereas human resource management is a modern approach that concentrates on the most efficient use of human resources in the organization.

2. Nature

Personnel management is a routine function, while human resource management is a strategic function.

3. Priority

Personnel management gives priority to efficient management, while treating workers as tools. On the other hand, human resource management gives priority to human needs and requirements, considering human resources as assets.

4. Remuneration

Personnel management provides remuneration to its employees on the basis of job evaluation, while in human resource management, performance evaluation is carried out to provide remuneration to employees.

5. Key functions

The main functions of personnel management include personnel administration, employee welfare and relations with labor. The main functions of human resource management are acquiring, developing, using and maintaining human resources.

6. Viewpoint

Personnel management considers the employees as being the fundamental input needed to achieve the required outcomes, while human resource management considers the workforce to be strategic and a very important resource to achieve the required outcomes.

7. Fulfillment of job requirements

The basis of job design in personnel management is division of labor, while in human resource management, teams or groups are formed to carry out any task.

8. Stress upon

The stress in personnel management is on following rules and policies of the organization, while human resource management stresses on integrating the competencies and skills of the workforce.

9. Oriented towards

Personnel management is aligned towards discipline, control and direction, while the orientation of human resource management is towards development, where space is given to the employees for performing and growing.

Personnel management vs human resources management – tabular comparison

A tabular comparison of personnel management and human resources management is given below:

Personnel management vs Human resource management
Traditional approach of managing different employee-related activities within the organization Modern approach focusing on the most efficient use of human resources
Involves routine functions Involves strategic functions
Efficient management, where employees are considered as tools Human needs, where employees are considered as organizational assets
Based on job evaluation Based on performance evaluation
Personnel management, employee welfare and labor relations Acquisition, development, employment and retention of human resources
View point
Employees are the main input required for attaining organizational outcomes Employees play a strategic part in accomplishing organizational outcomes
Fulfillment of job requirements
Job design is based on division of labor Job design is based on formation of groups or teams
Stress upon
Adopting rules and policies of the organization Incorporating the skills and expertise of the workforce
Oriented towards
Discipline, control and direction-oriented Development-oriented

Conclusion – personnel management vs human resource management

Human resource management was developed as an extension of personnel management, with the objective of fulfilling the gaps present in the traditional approach. It is very important for organizations to incorporate human resource management because there is very high competition in the present times, and it is imperative for every organization to give priority to employees and their needs.

Companies today find it very difficult to retain hard-working and efficient employees because they are fully aware of their rights within the organization. Hence, human resource management is vital as it makes sure that the rights and requirements of employees are taken into account and aligned with the objectives of the organization.