Personnel Management vs. Human Resource Management: What's the Difference?

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Significant difference exists between personnel management and human resource management in terms of scope, approach, and application.

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Human Resource Management is broader in scope than Personnel Management.

The scope of personnel management include functional activities such as manpower planning, recruitment, job analysis, job evaluation, payroll administration, performance appraisals, labor law compliance, training administration, and related tasks. Human resources management includes all these activities plus organizational developmental activities such as leadership, motivation, developing organizational culture, communication of shared values, and the like.

The human resource management approach remains integrated to the company’s core strategy and vision, and seek to optimize the use of human resource for the fulfillment of organizational goals. This strategic and philosophical context of human resource management makes it more purposeful, relevant, and more effective compared to the personnel management approach.

The personnel management approach tends to attach much importance to norms, customs and established practices, whereas the human resource approach gives importance to values and mission.

The personnel management approach also concerns itself with establishing rules, policies, procedures, and contracts, and strives to monitor and enforce compliance to such regulations, with careful delineation of written contract. The human resource management approach remains impatient with rules and regulations, and tends to relax them based on business needs and exigencies, and aim to go by the spirit of the contract rather than the letter of the contract.

An illustration of this difference in approach lies in the treatment of employee motivation. The personnel management approach holds employee satisfaction as the key to keeping employees motivated, and institute compensation, bonuses, rewards, and work simplification initiatives as possible motivators. The human resource philosophy hold improved performance as the driver of employee satisfaction, and devise strategies such as work challenges, team work, and creativity to improve motivation.

Another dimension of the difference is approach between human resources vs personnel management is the proactive nature of human resource management compared to the reactive nature of personnel management.

Personnel management remains aloof from core organizational activities, functions independently, and takes a reactive approach to changes in corporate goals or strategy. Human resource management remains integrated with corporate strategy and takes a proactive approach to align the workforce toward achievement of corporate goals.

For instance, while the personnel management approach concerns itself with a reactive performance appraisal process, human resource management approach has a more comprehensive and proactive performance management system that aims to correct performance rather than make a report card of past performance.

Personnel management is an independent staff function of an organization, with little involvement from line managers, and no linkage to the organizations core process. Human resource management on the other hand remains integrated with the organizations core strategy and functions. Although a distinct human resource department carries out much of the human resource management tasks, human resource initiatives involve the line management and operations staff heavily.

Personnel management also strives to reconcile the aspirations and views of the workforce with management interest by institutional means such as collective bargaining, trade union based negotiations and the like. This leads to fixation of work conditions applicable for all, and not necessarily aligned to overall corporate goals.

Human Resource Management gives greater thrust on dealing with each employee independently and gives more importance to customer-focused developmental activities and facilitating individual employees rather than bargaining or negotiating with trade unions.

Finally, in our discussion of personnel management vs human resource management, we find that personnel management lays down rigid job description with many grades and a fixed promotion policy - usually based on seniority and performance appraisal ratings. Human resource management on the other hand has relatively fewer grades and ranks, with broadly defined job responsibilities providing much scope for applying creativity and initiative, and plenty of career paths, with skills, talent and commitment the key drivers of career advancement.

1. Armstrong, Michael (2006). A Handbook of Human Resource Management Practice (10th ed.). London: Kogan Page. ISBN 0-7494-4631-5
2. Legge, Karen (2004). Human Resource Management: Rhetorics and Realities (Anniversary ed.). Basingstoke: Palgrave Macmillan. ISBN 1-403-93600-5.
3. Tripathi. P. C. (2002). Human Resources Development, Sultan Chand & Sons