HRM vs HRD: 10 Key Differences With Definitions

Dilanka -

Human Resource Management (HRM) is a formal system designed to oversee people within an organization. Its core responsibilities include staffing, managing employee compensation, and defining and designing work roles to ensure optimal organizational efficiency.

Human Resources Development (HRD) refers to uncovering and nurturing latent talents within individuals in an organization. This enables them to perform new tasks efficiently and benefit both themselves and the company.

HRM deals with overall personnel management, whereas HRD specifically focuses on strategic planning to build a successful organization. Understanding the differences between the two will enable businesses to implement targeted policies and ensure that employees are managed as well as developed.

The following explains the basic meanings and definitions of HRM and HRD while we understand their key similarities and differences in detail.

What is HRM or Human Resource Management?

HRM or Human Resource Management is the process of acquisition, development, and retention of skilled employees to achieve organizational objectives proficiently. It focuses on the process of hiring individuals, nurturing their abilities, and using and compensating their services.

According to Statista, 47% of large organizations reported having an on-premise Human Resources Management System (HRMS) with a license.

HRM fosters the alignment of the employees’ skills with both job and organizational needs. The main aim of it is to support the goals of the organization, individuals, and society as a whole.

Definition of HRM

The human resource management refers to the philosophy, policies, procedures, & practice related to the management of people within an organization.
– Wendell L French
HRM is a process consisting of the acquisition, development, motivation & maintenance of human resources.
– Stephen P Robbins

Evolution of HRM

The concept of Human Resource Management (HRM) has evolved through distinct periods. Let’s have a brief look at it.

Pre-Industrial Revolution:

  • Limited crafts, apprentices assisted craftsmen.

Industrial Revolution (1750-1850):

  • Shift to an industry-based economy.
  • Departments for wages, welfare, and housing were established.
  • Labor unions emerged, leading to industrial relations departments.

Post-1850 Evolution:

  • Frederick W. Taylor: Introduced scientific management principles.
  • Hawthorne Studies: Shifted focus to worker satisfaction.
  • Douglas McGregor & Abraham Maslow: Transitioned to dynamic HRM, viewing workers as valuable resources.

Today:

  • An integral part of core business functions.
  • Involves recruitment, motivation, training, and performance appraisals.

Functions of HRM

The functions of Human Resource Management can be broadly divided into managerial and operational functions. The activities that are included in it are as follows:

Managerial Functions

  1. Planning: Formulating strategies and programs in advance to meet organizational goals, including HR requirements, selection, and training.
  2. Organizing: Structuring tasks, defining relationships, and integrating activities toward common objectives within the organization.
  3. Directing: Activating employees and maximizing their contributions through effective direction, motivation, and tapping into their potential.
  4. Controlling: Monitoring and comparing actual employee performance with plans, implementing control measures when deviations occur.

Operative Functions:

  1. Job Analysis: Studying specific job roles and responsibilities.
  2. HR Planning: Ensuring the availability of qualified personnel to meet organizational needs.
  3. Recruitment: Searching for prospective employees and encouraging them to apply.
  4. Selection: Selection process includes Assessing applicants’ qualifications and suitability for the job.
  5. Placement: Matching selected candidates with suitable job roles.
  6. Induction & Orientation: Helping new employees adjust to the organization’s environment, policies, and people.

The recent trends and advancements in human resource management revolve around the increasing focus on employee engagement and motivation. Companies are continuing their efforts to improve work culture to retain the best talents.

A survey of these trends points toward the respective importance in percentages.

  • Hybrid work model: 32%
  • Change management: 18%
  • Healthy organization: 15%
  • Continuous learning: 15%
  • Flexibility: 12%
  • Focus on employee retention: 6%
  • Organization based on skills: 2%

What is HRD or Human Resource Development?

Human Resource Development (HRD) is the systematic process of enhancing the skills and abilities of individual employees, teams, and the entire organization. Its goal is to align personal growth with organizational objectives, fostering a culture where teamwork and collaboration thrive.

It promotes strong relationships, professional well-being, motivation, and pride among employees, ensuring they contribute effectively to achieving the organization’s goals.

Definition of HRD

Nadler (1970) described HRD as structured activities aimed at producing behavioral change within a set timeframe. In his revised definition in 1984, he defined HRD as organized learning experiences within a specific period to enhance job performance and personal growth opportunities.

Evolution of HRD

  • Early Industrial Era (Late 19th to Early 20th Century):
  • Focus on labor management and efficiency.
  • Limited emphasis on employee development.
  • Post-World War II Era (1940s – 1950s):
  • Rise of scientific management principles.
  • Emergence of training programs for skill development.
  • 1960s – 1970s:
  • Shift towards humanistic approaches in management.
  • Introduction of behavioral sciences to understand human behavior at work.
  • Emergence of training and development as formal functions within organizations.
  • 1980s – 1990s:
  • Integration of HRD with organizational strategy and planning.
  • Focus on Total Quality Management (TQM) and continuous improvement.
  • Introduction of concepts like organizational learning and knowledge management.
  • Late 1990s – Early 2000s:
  • The advent of technology-driven learning and development.
  • Growing emphasis on e-learning and virtual training programs.
  • 21st Century (2000s – Present):
  • Increased attention on talent management and succession planning.
  • Expansion of HRD to include career development, mentoring, and coaching.
  • Integration of diversity and inclusion initiatives in HRD practices.
  • Rise of data-driven HRD with the use of analytics for decision-making.
  • Current Trends (2020s):
  • Emphasis on agile and innovative learning methodologies, incorporating adaptive and personalized learning techniques.
  • Integration of artificial intelligence and machine learning in HRD processes for enhanced efficiency and personalized skill development.
  • Focus on employee well-being and mental health support as part of HRD initiatives.

Functions of HRD

1. Training and Development (T&D)

T&D focuses on improving the knowledge, skills, and attitudes of individuals. Training involves providing employees with specific skills needed for tasks, while developmental activities prepare employees for future responsibilities and enhance their current capacities.

T&D activities start with new employee orientation and skills training, evolving into coaching and counseling as employees become proficient. Coaching emphasizes employee responsibility and goal achievement, while counseling addresses personal issues affecting work goals.

2. Organization Development (OD)

OD aims to enhance organizational effectiveness and member well-being through planned interventions based on behavioral science concepts. Macro changes focus on overall organizational improvement, while micro changes target individuals, small groups, and teams.

HR professionals function like change agents in an organization. They advise and facilitate interventions, such as implementing employee involvement programs to reshape work expectations, reward systems, and reporting procedures.

3. Career Development

Career development is an ongoing process involving career planning and management. Career planning assesses an individual’s skills and establishes a realistic career plan, often with counselor assistance.

Career management involves taking steps to achieve the plan and focusing on what the organization can do to foster employee career development. Training programs can play a role in implementing career plans.

Recent advancements in HRD

Human Resource Development (HRD) has undergone significant transformations to keep pace with evolving needs. These changes reflect the profound impact of globalization, digitalization, and shifting organizational priorities.

Here are some recent trends:

1. Globalization

With the rise of global markets, HRD focuses on developing cross-cultural competencies and understanding diverse work cultures to effectively manage international teams and expand businesses globally.

2. Strategic HRD and Talent Management

HRD aligns closely with organizational strategies, identifying and nurturing key talents. Strategic planning ensures the right skills are developed, and talent is managed to achieve long-term business goals.

3. Electronic, Mobile, and Social Learning

HR development leverages digital platforms, mobile apps, and social media for training and learning initiatives. This approach enables employees to access training materials anywhere, anytime, fostering continuous learning.

4. Management and Leadership Development

HRD invests in programs to cultivate effective management and leadership skills among employees. These initiatives focus on enhancing decision-making abilities, communication, and team management skills.

5. Performance Consulting

HR professionals act as performance consultants, analyzing organizational challenges and recommending training interventions. These advancements are used to improve productivity, efficiency, and overall performance.

6. Career and Performance Management

HRD supports employees in their career growth, providing resources for skill development and career planning. It also integrates performance management systems, ensuring employees’ goals align with organizational objectives.

7. Proactive Learning

Human resources development anticipates future skill needs and provides proactive learning opportunities. It emphasizes staying ahead of industry trends, enabling employees to adapt to changing job roles and technologies.

8. Learning Design and Structure

HRD focuses on designing engaging and effective learning experiences. This includes structuring training programs, incorporating interactive elements, and utilizing various formats to cater to different learning styles. This ensures maximum knowledge retention.

Key differences between HRM and HRD

Human Resource Management involves applying management principles to oversee the organization’s workforce. On the other hand, Human Resource Development focuses on continuous improvement efforts to enhance the performance of employees within the organization.

The 10 key differences between the two have been mentioned below according to various aspects.

1. Nature

HRM operates as a vital component within the broader management framework, falling under the overarching function of organizational management. In contrast, HRD functions as a subsidiary of HRM, intricately linked to the management of human resources but with a specific focus on development and growth.

2. Focus

HRM centers its attention on overseeing the organization’s human resources, including administrative tasks, policies, and procedures. It ensures the efficient management of employees and addresses immediate concerns within the organizational structure.

Conversely, HRD concentrates on the enhancement of employees’ skills, knowledge, and capabilities, fostering individual and organizational growth. It is geared towards building a proficient workforce to achieve long-term success.

3. Scope

Within HRM, tasks encompass recruitment, compensation structuring, managing employee relations, and ensuring compliance with laws and regulations. On the other hand, HRD’s scope is broader, involving training programs and talent management initiatives. It also fosters a culture of continuous learning within the organization.

4. Purpose

HRM’s primary purpose lies in aligning employees with the organization’s business objectives, ensuring they are in suitable roles and efficiently managing their day-to-day tasks. In contrast, HRD focuses on enhancing individual and organizational performance.

It achieves this by investing in employee learning and development, fostering personal and professional growth, and building a skilled and adaptable workforce.

5. Time Horizon

HRM primarily deals with short-term goals, addressing immediate staffing needs and short-term employee issues that arise within the organization. In contrast, HRD operates with a long-term perspective, concentrating on strategic planning and preparing employees to meet future challenges successfully.

6. Orientation

While HRM is geared toward ensuring organizational efficiency and optimal resource management. Meanwhile, HRD’s orientation is firmly rooted in employee growth, engagement, and career advancement within the organization.

HRD activities are geared towards empowering employees to achieve their full potential.

7. Dependency

HRM functions independently, comprising various sections such as recruitment, retention, HRD, compensation, and performance appraisal management. HRD operates as an integral part of HRM, drawing functions, attributes, and processes from the broader HRM framework, indicating a close interdependence between the two.

8. Formality

HRM functions are typically formal, involving structured methods like classroom or laboratory training to ensure standardized implementation. In contrast, HRD functions can be informal, often involving mentorship and coaching from superiors, particularly managers. It indicates a more personalized and adaptive approach to employee development.

9. Process

HRM follows standard procedures, executed whenever the need arises. In contrast, HRD processes are continuous, focusing on ongoing learning and development initiatives. It reflects a proactive and adaptive approach to employee growth within the organization.

10. Priority

Human Resource Management prioritizes the overall growth of the entire organization, while Human Resource Development places exclusive focus on individuals

Moving On

In the years 2023 and 2024, Human Resources’ main focus will be on employees, emphasizing their well-being and creating better work environments, including virtual spaces. The future of HR is expected to bring pleasant surprises for employees as the next year unfolds.

The new year shall bring in trends like hybrid work models, virtual work environments, flexible work culture, Artificial Intelligence, etc even more strongly. Evidently, 74% of U.S. companies (Zippia) are either using or planning to adopt a permanent hybrid work model.

Furthermore, there has been a lot of focus on well-being discrepancy. There is a 22% (McKinsey Survey) gap between employer and employee perceptions of well-being at work, highlighting a disparity in understanding. Gaps like these ought to be opted out as the modern workforce has no room for toxic work cultures.

For example, Employee Resource Groups (ERGs) for women, veterans, LGBTQ+ employees, people of color, individuals with disabilities, and working parents, offer safe spaces within organizations.

The above points to a direction where human resource management and development are at the peak of their evolution. Hence, HR professionals are bound to stay updated on current and future trends.

In 2024, we can expect a significant focus on technological advancements and a more employee-centric approach in businesses. This shift aims to enhance various HR functions, ensuring improved efficiency and effectiveness within organizations.

IceHrm streamlines HR tasks, fostering team success and compliance. Elevate your HR practices with IceHrm today!