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No one in your entire company knows the ins and outs of a given role better than the people who currently hold it. It’s no surprise, then, that when it comes time to recruit someone to fill a gap, expand coverage, or grow the business, turning to the people currently working for you can be an excellent resource. The most informal way to do this is to simply put out the word that you’re opening up a new position, and encourage your employees to share the job opening with people they know who might be interested in applying. For a more formalized effort, though, you can go through the process of setting up an employee referral program . What Does an Employee Referral Program Do? At its core, an employee referral program does one thing: it encourages your current employees to recommend people for open roles. The idea is that this gets you a pool of qualified candidates with recommendations for their skills or how they would fit into the role with less effort than other forms of recruiting. Employee referral programs can have varying levels of formality. One of the more informal examples is little more than a designated field in the application process to add in the employee’s name that referred them, if any. More formal programs can pay bonuses for successful hires or offer other benefits to the referring employee. There are a lot of different benefits and drawbacks to running an employee referral program, so let’s discuss them so that you can make an informed decision. The Pros of an Employee Referral Program First, let’s start with the benefits of an employee referral program. There are quite a few, and they’re quite powerful, which is why some businesses make use of such programs to gather candidates and hire new employees. Your employees have a deep insight into the requirements of a role. Your official description of a role might not cover all the bases, and a job posting written by an HR member might have requirements that aren’t really necessary for the job. Sure, some of this is necessary to filter out unqualified candidates, but not all of them. A current employee can refer people who would do well in the role as it stands in reality, not as it looks on paper. Your employees understand your company culture and fit. One of the hardest things to put into a job listing is company culture, and yet it’s one of the most important . We’re all familiar with the buzzwords and the empty platitudes, but from the boots on the ground perspective, all bets are off. An existing employee will have a better feel for your company culture in their role than anyone else and will be able to recommend potential candidates who will fit that culture better than most. Referred hires automatically come with a social connection, which benefits retention. One of the biggest roadblocks to keeping a new hire is making them feel at home in your office or with your company. When they come with a social connection already available, they have an automatic in with social circles and office banter and will feel more at home (and thus less likely to leave right away). They may also be more hesitant to leave for fear of alienating the friend who recommended them or reflecting poorly on them. You’re able to reach qualified candidates who you wouldn’t otherwise reach. Reaching passive candidates is difficult enough through normal channels, and there are thousands of excellent, well-qualified passive candidates you’ll never find. With the sheer number of social media platforms, job boards , and other resources out there, it’s impossible to be everywhere; you have to pick and choose the platforms you use and, just as important, those you don’t. By extending your reach through your employees to passive candidates they know, you can tap into an audience of great new hires you wouldn’t normally be able to find, let alone convince to apply to a position. You make your employees feel like a valuable resource for the company. When you tap your employees as a resource, and when the candidates they refer end up being hired, they feel like they’ve done something important for the business, for their team, and for their own well-being. They feel more secure in their value, which helps with their own morale, retention, and productivity. As a contributing member of a team, they may even feel more authoritative, which helps them be more ambitious in their role. Like-minded referrals may work better together as a team. This is both a pro and a con, and we’ll discuss more of it in the cons section. As a pro, when an employee refers a new candidate to the company, you know that they have some kind of connection. Usually, that connection is a social connection, and the two of them are likely to have a fairly similar outlook. They’ll have similar interests, which likely led to them finding the same community and social group, which is how they came to be a referral. They already mesh together as a pair, to some extent, and that means they’ll work better as a team than a potentially untested, potentially abrasive new hire. Granted, every new hire is a risk, no matter where they came from. Sometimes personalities simply clash, even if they seem like they should fit together well enough on paper. How your company handles a clash in employee personalities is a big part of your company culture and will affect retention as well. Referrals you don’t hire can still be candidates in your pool for another time. Just because the referral isn’t a good fit for the current role or the current time doesn’t mean the referral itself was wasted. If another position opens up in the future, the candidate might be a good fit later, or they might be in different circumstances and be willing to move into a different role. You can even still keep the employee referral on the table, so long as the appropriate data is tracked in your applicant tracking system. You may save the money that you would otherwise have spent on advertising the job opening. This is typically one of the more persuasive reasons to go for an employee referral program because it’s one of the most tangible reasons. The total cost of hiring a new employee, according to various studies , ranges from $4,000 to $7,600. Any money you save off the cost – including job board fees, pre-screening, outreach, and other hiring-related services – is money you’re saving when an employee simply refers a candidate to you directly. The Cons of an Employee Referral Program There are always two sides to any coin. While there are a lot of great benefits to running an employee referral program, there are a handful of potential downsides. It’s worth mentioning that, while there are quite a few of them listed here, you’re not likely to encounter all of them, and some of them can be mitigated through adjustments to your other hiring practices or your company policies. While the benefits are benefits regardless, these detriments can be minimized or eliminated. If you pay a signing bonus to the referrer, it can cost more than the savings. This depends, of course, on how much your successful bonus is to the employee who referred the new hire to you. Salesforce, for example, cites their referrals as their #1 best hiring secret , and have spent over $5.5 million on bonuses over the years. Of course, that’s spread out over a lot of employees and a lot of time. The typical referral bonus can range from $250 for entry-level positions all the way up to tens of thousands of dollars for executive roles . That means it’s cheaper for all but the highest roles, even with a good bonus in play. Really, it all depends on your company’s costs and the bonus you want to offer. It’s also worth mentioning that you aren’t required to offer a bonus, and if you choose to offer one, it doesn’t have to be money. Many companies have found other forms of bonus , from social recognition to charitable donations to expenses-paid vacations to be equally if not more effective. There’s a very real risk of nepotism, especially among management. Possibly the greatest risk of an employee referral program is it can lead to institutional corruption, clique-focused hiring, and nepotism. When good, qualified candidates are passed over because the CFO referred their brother for the position, you have a problem. Thankfully, this is a problem that is easily solved: simply don’t give the referral too much weight. The deciding factor on whether or not to hire a candidate should always come down to their talents, experience, skills, and culture fit, not their relationship to anyone who already works for the company. This relationship can be the deciding factor between two similar candidates, but that’s about it. A referral doesn’t automatically mean the candidate is well-qualified. Employees will tend to refer people who they know, either deeply or in passing. They want to help out their friends and acquaintances. They don’t necessarily have the best interests of the company in mind. That’s your job, to make sure to appropriately filter, screen, and test the candidates regardless of how they found your job listing. A reference doesn’t mean a deep personal connection. Many people who refer someone to their place of work are liable to do it via a Facebook post or a post on a community they frequent, like Reddit. The person they end up referring to you might be someone that they are barely familiar with as an acquaintance. This isn’t necessarily a bad thing, but it does mean that if you’re expecting an easy culture fit based on their friendship, you won’t get it. If a referral is passed over, the employee may feel slighted. This holds doubly true if they, objective or subjectively, believe that the person you hired is less qualified than the person they referred. There’s no great solution to this when it happens, unfortunately. If one of a pair chooses to leave, the other may follow. This is one common risk that you may face with an employee referral program. If the referrer and referral are both friends, and one of them chooses to leave, it’s possible the other will follow. One might get a new role at another company and invite the other, for example, or they both get to talking and decide they don’t feel at home with your company. You can often find that the connection between two employees can be a double-edged sword. The newer of the two might, for example, feel that they shouldn’t speak out of place or offer ideas that their friend doesn’t approve of, because a negative experience could reflect badly on the person who got them their job. Over time, referrals lead to stagnation of ideas. This is probably the most insidious and dangerous of the risks associated with an employee referral program and is the one we mentioned up above that we would discuss later. When you do your hiring through referrals, you end up with a workforce comprised of largely the same social cliques, political leanings, and even thought patterns. If a large enough percentage of your workforce fits into this mold, you end up lacking the diversity of ideas – and often diversity of employees – necessary to truly innovate. Thankfully, this problem has an easy solution: don’t do the majority of your hiring through referrals. Referrals are a good supplementary way to recruit, but they shouldn’t be the sole means of finding new candidates. You can also offer additional bonuses like what Intel does , for referring minorities and women who are then successfully hired: “Intel offered to double its bonuses for employees referring women and anyone from a minority group as part of their diversity hiring.” Encouraging diversity from the ground up helps combat the lack of diversity inherent in the system otherwise. Running an employee referral program is, nevertheless, an additional way to gain access to a wide range of passive and active candidates who might otherwise never know about your job opening. It can lead to some excellent new hires and long-term benefits to the company, and it may be worth exploring – you just need to be aware of any potential pitfalls before you dive in.

One of the biggest drawbacks of a remote workforce is the lack of team unity. Physical separation leads to mental separation, but the effects can be mitigated with the use of remote team-building exercises. In fact, Jeanne Wilson, professor of organizational behavior, has researched the subject. Her conclusion : “…Communication and shared identity within a team can mediate the effects of physical separation.” In a study of 733 work relationships across a variety of industries, Wilson found that “perceived proximity” was more important than actual physical proximity. The virtual collaboration environment puts some limitations on team-building, of course. It’s hard to arrange a trust fall when your team lives in different cities. On the other hand, technology allows for a variety of new, clever team-building exercises to explore. Remote team-building exercises have a number of tangible perks for your team. They help remind your team members that the people they’re working with are talented and collaborative and can support each other. They can restore a sense of wonder, excitement, or passion for the work they’re doing as a team. They can build trust, among peers and managers, to help the more independent members of the team feel more secure. What we’ve done for this post is compiled over 50 different team-building exercises you can put into use with your teams. They’ve been divided into categories based on their purpose, but many of them can be used in different ways, so feel free to take inspiration from or adapt items on this list for your own purposes. Icebreakers Icebreakers are great team-building exercises primarily because they’re flexible. They can be fun little games to start off the meetings for the day, or they can be introductory exercises for new teams to get to know one another. The Rose and Thorn. Life always has its ups and downs. Go around the table and ask each team member to say one good thing that has happened since their last meeting, and one bad thing. Have your team leader start off to set the tone. Show and Tell. We all loved the show and tell presentations as kids, so why did we stop as adults? Using the icebreaker phase of your meeting to go around the table and have everyone show and tell something meaningful to them, whether it’s a collectible, a sentimental item, a pet, or anything else. Lateral Thinking. Ask a lateral thinking question and discuss the solution amongst the team. Not only does this challenge your team to think outside the box, but it also gets the brain warmed up for the meeting and the workday. Snapshot Discussion. Have everyone on the team take a quick picture of something around them – or give them 5-10 minutes to go out for a pic in the garden – and share the photos for discussion. Stranded! Your team is stuck on a deserted island. Give them a list of tools and items, and tell them they can only pick three. How do they survive with what they’ve chosen? Zoom Background Games. Challenge your team to come up with creative Zoom backgrounds and see who creates the most interesting, zany, or theme-relevant background for a given meeting. Sell It. Ask each team member to pick a mundane, boring item from nearby and sell it to the team as if it’s the best thing since sliced bread. X or Y. Pick two things, and have your team decide which one they prefer and why. Cats or Dogs? Winter or Summer? Coke or Pepsi? Keep them light-hearted. Two Truths and a Lie. A classic icebreaker: ask each person to put together three statements about themselves, and challenge the team to figure out which one is the lie. Blind Drawing. Assign one person an image or object, and ask them to guide the others on how to draw it without saying what it is. Limitations (like only using simple shapes and lines) can make it more fun. Guess the Image. Pick a photograph and zoom in extremely close to one part of it. Ask people to guess what it is while slowly zooming out until someone gets it right. Who Am I? Assign each team member a historical figure and ask them to come up with ways to describe themselves until someone on the team guesses who they are. Geographic Facts. Ask team members to pick a geographic location somewhere in the world and share an unusual, little-known fact about it. Deeper Understanding Some remote team-building exercises are best as introductions, while others work better once your team knows the basics of one another. This selection of exercises serves to help your team get to know one another on a deeper level, so they can better understand each other and what they bring to the team. Virtual Quiz. Apps like QuizBreaker allow your team to input facts about themselves, and other team members to guess who is associated with which fact. Which team member can’t whistle? Which one won a paper airplane contest? The answers can make your team feel more like friends than just coworkers. Map Building. Start with a map and ask each team member to put in a pin in the place they were born and the place they currently live. Over time, expand the map by adding pins for favorite vacation spots, other places they’ve lived, and other location data. Day in the Life. To let your team get to know one another, each day, feature one of them with a “day in the life” or virtual tour of where they live and what they do each day. Introduce pets and children, show off entertainment setups or hobbies, the possibilities are endless. Big Issues Discussion. Pick a piece of big news or current events, share a news article about it with the team, and discuss it. Try to avoid anything too controversial or politically charged, though. Talent Show. Give everyone 1-5 minutes at the start of a meeting (picking a couple of people per meeting, if the team is too large), and have them do something. Read a poem, tell a joke, play an instrument, show off a hobby, anything goes. Pen Pals. Set up pairs of team members and start a pen pal program with them, complete with hand-written letters. Send everyone some envelopes and stamps to facilitate the process. PowerPoint Nonsense. Ask everyone to develop a quick three-minute presentation on a random topic (the more nonsense the better), and vote on the best presentation. Baby Photos. Ask everyone to find and upload a photo from their childhood and explain it, whether it’s a goofy school picture or a treasured memory. Try to be sensitive to those who don’t have much to draw from, though. 10 Things in Common. Get your team – or small divisions of a larger team – to spend some time coming up with 5, 10, or however many things they all have in common. Office Games Office games in an in-person environment range from fun and exciting to gimmicky and boring. Virtual office games can take advantage of technology in new and interesting ways, to let your team leverage their creative skills, collaborate, or challenge one another in friendly competition. Musical Throwback. Play music over your call or meeting, and challenge your team members to identify it. Picking songs from 10-30 years ago tends to have the best results, but you may want to adapt this to the average age of your team. Scavenger Hunt. Put together a virtual scavenger hunt. Ask your team members to compile a completed list by taking pictures of various household items, local flora, or city landmarks, depending on the scale you want to stretch your exercise. Pictionary. The time-honored game of Pictionary can be played quite easily through a variety of online platforms, including Skribbl and Drawize , or even just screen-sharing a paint program. Spreadsheet Pixel Art. By using Excel or Google Sheets, ask your team to fill in cells to create pixel art . Either give them a prompt and see what they come up with or let them design whatever they like. Zoom Bingo. Develop a bingo sheet with items like “wore pajamas on the call” to “accidentally left muted/unmuted” and issue sheets to each team member before the meeting. See who gets their bingo first. Gif Conversations. Using an embedded gif tool in a service like Slack, or Google searched gifs, challenge your team to have a full conversation using nothing but these short animated images. Werewolf/Mafia. A common party game, each player is assigned a role, and the game progresses until either the “good” team is killed off or the “bad” team is identified. A huge array of rule sets and tools exist for this game, so check it out . Virtual Escape Rooms. Escape rooms are a growing trend, but they’re hard or impossible with a remote team. A virtual escape room , with a guided storyteller and digital assets, is a powerful alternative. Virtual Holiday Celebrations. Each meeting day, pick a holiday ( every day is a holiday somewhere ) and celebrate it in a quick and respectful way. Virtual Murder Mystery Party. It is a game that requires online collaboration. It is usually played in a video chat format, where participants can communicate in secret and the host can share clues to solve the mystery. Find out some ideas for your virtual murder mystery party in this SnackNation article . Extracurricular Activities Sometimes you need more than a few minutes of time to prepare. These team-building exercises require more setup and investment, but they’re great for deeper than surface-level discussions and engagement within the team. Book Club. Putting together a book club requires getting your team to read on their own time, so try not to put too high a level of strain on their time. A chapter or two of a book is plenty. Discuss new chapters in each meeting. Movie Club. Similar to a book club, pick a movie everyone should have access to (free on YouTube, or verify everyone has Netflix/Hulu first), and have everyone watch it in advance. Discuss it at your next meeting. Origami. First, mail origami paper to everyone in your team. Then, using online instructions , have people put together origami items, from boxes to animals, and show off their constructions at the start of a meeting. Remote Meals. Taking the team out to lunch or dinner can be a great occasional team-building event, but it’s impossible for remote teams. Instead, issue everyone a budget and a simple recipe, or get everyone a meal box from a service like Blue Apron, and have a meal together remotely. Digital Pub Crawl. For the teams that like to drink together, do a virtual pub crawl. Pick noteworthy niche websites and visit them as a team, discussing their content over a drink for 15-20 minutes before moving on to the next. Just don’t do this as an icebreaker, or no one will get anything productive done at the meeting! Fitness Challenge. Particularly now, a lot of people are transitioning to working from home, and the lack of physical activity that accompanies it. Challenge everyone to set and strive to reach a fitness goal, and track progress at each meeting. Baking Challenge. Almost the opposite of a fitness challenge, give everyone a recipe and challenge them to make it. Maybe you’ll have a star baker, or maybe you’ll all nail it . Collaborative Storytelling. In a separate Slack channel or Teams room, start out a story prompt. Ask team members to go around each day and add one sentence expanding and continuing the story. Photography Challenge. Pick a theme and ask team members to spend a few days or a week photographing it. Share the best photos and vote for a winner. Slack Apps If your remote team uses Slack as their primary chat channel, you’re in luck. Slack has a wide range of plugins and apps to give it extra features, and some of them are designed to be team-building games and extensions. Set up a few of them and encourage casual participation throughout the day. Donut . This app semi-randomly pairs up two team members for a one-on-one chat, with guided topics and activities. Simple Polls . You’ll need a resource to come up with the polls to create, but this app allows you to make polls and post them for your team to vote. PlayPlay . This is a virtual platform for a few simple games, including ping pong, chess, pool, and tic-tac-toe. JukeBot . This tool, combined with Spotify, lets you put together a collaborative jukebox playlist for your team. Get everyone to contribute their favorite relevant songs. Lark Icebreakers. This app has a bunch of built-in icebreaker questions that let your team get to know one another without needing to set up a complicated guided experience. Tools and Resources This last section isn’t so much team-building exercises as it is resources. These sites and tools are available to use, often for a small fee, and provide a platform, ideas, games, and tools to set up team-building exercises like those listed up above. Check them out and see which ones work best for your business. TeamBuilding.com . This website offers a handful of virtual team-building exercises, ranging from office games to kits that include a tiny DIY campfire to a tea and coffee box with guided brewing and meditation. Petri . Petri is a team-building game platform that offers a wide range of activities, from tea talk and yoga to trivia games and language lessons. Jackbox . The Jackbox party pages have a wide range of party games that can be played digitally. You may need more tech setup to run some of them, but most of them are great and make for some fun collaborative challenges. Tabletop Simulator . For the teams that like board games, Tabletop Simulator is a virtual tabletop with a huge array of built-in games and a custom engine to play your own games. Buy copies for the team and have some fun. The Go Game . This company is a unique team-building platform that provides hosted meetings with games, activities, a live DJ, and a leader to guide it all. Treasure Mountain . This is another virtual escape room style experience, with a full digital game available for small teams to play in competition with one another. Conclusion  There you have it; a wealth of possible remote team-building exercises to help bring a virtual team together. This extensive list of over 50 remote team-building exercises and activities offers a diverse range of options to overcome the challenges of physical separation and foster a sense of unity and collaboration among virtual teams.  From icebreakers and deeper understanding activities to office games, Slack apps, and more. These exercises are designed to enhance communication, trust, and camaraderie in a remote setting.  Whether you’re looking to break the ice, deepen relationships, or simply have some fun, this compilation provides valuable resources and ideas to build a stronger, more cohesive remote team. If you need help hiring more employees, contact us today . We can help you recruit the best new teammates.

Many people don’t think about it, but there’s a cost associated with hiring new people to fill roles in any company. This applies regardless of whether you’re doing everything bespoke and in-house, or you’re hiring a company to handle recruiting for you . It counts everything from your talent management tools to the time of your hiring manager and beyond. It’s important to know how much it costs to bring on a new employee. Knowing the cost per hire from various marketing channels helps you justify the expense of using premium channels, or justify dropping channels that cost more than they’re worth. It also helps you estimate how difficult and expensive it can be to fill certain specialized roles. With so many different factors that go into the cost of hiring, it can be difficult to figure out where to begin . That’s what we’re here to help you with today. Calculating Costs The first thing you need to do is figure out where all of your potential costs are coming from when you’re hiring. These costs can be divided into two categories: internal costs and external costs. Before you begin calculating costs, you need to determine the period of time you’re looking at. This is important to calculate costs that recur on an ongoing basis, or that are one-time fees that may spike your calculation for particular time periods. It also allows you to determine the cost per hire because you need to know the number of hires in the same time period. The simplest possible equation for calculating your cost per hire is easy: ((internal costs) + (external costs)) / number of hires You add up the total costs for both internal and external channels, and you divide it all by the number of hires in that time period, to get an average cost per hire. Other considerations, like specific costs associated with specific hires that aren’t shared across all hires (like, say, the difference between paying for travel and accommodations for long-distance applicants versus not having to pay those for local applicants) can be used as well. You can divide up your equation; one with the costs and one without. Then make sure to set the “number of hires” to “number of hires with additional cost” versus “number of hires without additional cost.” So what are all those different costs? Let’s look. Internal Costs Internal costs are costs you spend within your organization. There is a wide range of possible costs here, so let’s look at some examples. When you’re compiling your own list, you’ll need to come up with your own set of costs. The cost of your HR, hiring, or staffing team. This includes the number of hours your staffing team worked in the given period, the average hourly salary they are paid, and any costs of training or continuing education they may have. Hardware costs. Do you have specific hardware for tracking your hiring process? The cost of that hardware should be included, though it can be amortized. Software costs. Any applicant tracking software, interview software, scheduling software, or other apps you use to manage your hiring process need to be calculated and accounted for in your given time period. Costs from accommodations offered to your hire. For example, if you’re flying in candidates for an interview in person after they have passed an initial screening, the cost of the travel and accommodations is a cost you need to add to your potential hires. Real estate costs. If you maintain a hiring office that is distinct from your company offices or locations, the cost of the hiring office should be included. Bonuses and benefits. If you give your employees a bonus for a successful referral, the cost of that bonus should be added to the cost per hire. You can also, if you want, calculate the cost of the lost employee that the new hire is replacing. The cost of institutional knowledge (such as projects that were left uncompleted, severance pay, or a cascade effect of other employees jumping ship) can all be calculated and added as part of this equation. Depending on your process, you may have relatively few internal costs, or you may have a lot of them. A small business where the CEO does the hiring directly might not have a lot of costs for a tracking system or for multiple salaries, while a large company with an entire hiring department may have a lot of ongoing costs. External Costs External costs are costs you pay to third parties for their services as part of doing business. These don’t include things like employee salary but rather include costs such as fees for a booth at a campus career fair or fees for a job posting on a third-party recruiting site. Some examples include: Costs for newspaper classifieds. If you advertise in local newspapers, national papers, magazines, or other print media, you can tally the costs here. Costs for web advertising. If you use paid advertising through a service like Google or Facebook, the cost of hiring-related ads can be tallied here. Costs for job postings. Listing a job on sites like Monster, Indeed, LinkedIn, or Craigslist has associated fees, which can be tallied up here. Costs for physical presence. The cost of setting up a booth at a career fair or a trade show can be calculated here, though if the booth serves more than one purpose that cost may be divided. This should also include travel expenses for the people you send to those locations. Costs for screening. Services like background check services or drug testing cost money, and those costs should be added to the cost per hire. Agency fees. If you hire a Emerge Talent Cloud or a recruiting agency of any type, the cost of contracting with that company should be included. Signing bonuses. If you’re using a signing bonus to attract candidates, the cost of that bonus is typically considered an external cost. External costs are often similar for a single role but can vary from position to position. A low-level position might have lower standardized costs, while a highly specialized position might have specific background check needs, relocation fees, or other costs associated with it. You can also do things like divide up the different advertising campaigns you pay for and look at your costs per marketing channel. All of these costs can be pooled into one general “costs” pool, or divided up into internal or external. They can also be split off into more categories, such as by software, by channel, or by adding a “candidate costs” section with costs like the signing bonus, travel, and background checks all added to that category. It really depends entirely on how granular you want your data to be. Using a Calculator There are a handful of different options you can use in terms of online tools that can tally and calculate your cost per hire. Many applicant tracking systems have this feature if you’re willing to add in all of your associated costs and keep that data up to date. Of course, if you let that data fall out of sync with reality, the cost per hire grows less accurate. Generation put together a thorough tool that is best for larger companies with complex hiring practices and a HR team. It has 11 pages of form inputs ranging from interviewing and training costs to advertising costs, recruitment costs, quality of work reviews, and more. If you keep a very close eye on all of your billable hours in multiple departments and utilize the help of a recruitment agency or paid ads, this will help you crunch the data on all of that information and leave you with an average cost per hire. This tool is still in it’s “beta” developmental stage, but we were able to test it without any issues. There’s another cost per hire calculator set up on GoodCalculators for you to use. You have to add in your advertising costs, referral costs, agency fees, relocation costs, travel costs, costs for recruiter time, and administrative costs, and it will give you a cost per hire. Again, it’s simple with no context, but at least it’s not sales-focused. Lastly, ApplicantStack has its own online calculator, available for free and without using any lead generation gateways in the way. They ask for the number of applications you receive per week, the number of hours your hiring staff spends per week looking them over, their average salary, your weekly budget (total costs for internal and external factors), and the number of hires per year you pick up. This data set will give you a calculated set of information with your labor cost per hire, your third party cost per hire, and your hire rate percentage. It has some analysis, and it’s meant to make their service look attractive (if you pay us X, we save you X+Y!). Still, if you can ignore the sales calls, it’s a calculator for the data you’re looking for. How to Use Cost Per Hire Now that you’ve calculated your cost per hire, how can you actually make that data useful? After all, data doesn’t do you any good if you don’t use it to make decisions. Compare yourself to industry benchmarks. You can easily find benchmarks for the average cost per hire in your industry. If your costs are much lower, you’re doing well, but you might be missing out on a premium tool that could make your life easier. If your costs are much higher, you may have a flaw in your recruiting plan that you need to solve. Analyze cost per hire per department or position. This way you can determine which roles are more expensive to fill and look at specific ways you can reduce those costs. This data is best analyzed when you calculate cost per hire per role. Analyze cost per hire per source channel. Where did your candidate hear about your job opening? Depending on the source, costs will vary. If you find out that, say, Monster.com’s hiring costs are much higher on average than Craigslist, you may want to invest more in CL and less in Monster. The same goes for different social, paid, and networking channels. Compare cost per hire with hire quality. If you find certain positions have a high turnover or seem to attract unqualified candidates, you can check to see if you’re under- or over-spending for recruitment for those roles. Comparing the cost per hire with the quality of that hire can also show you if you’re getting the value you expect to pay for. Calculate cost per hire over time. You can do two things here; track your costs to see if you’re spending more year over year, and check to see if there are certain months of the year (or certain seasons) that are cheaper to hire quality candidates. This helps you determine when you should put money and effort into your hiring efforts, and when it’s too expensive to be worthwhile. Calculate cost per hire per HR employee. It’s possible that some members of your hiring team are underperforming, and knowing if they’re actively costing you money can help you make decisions about how to train them or whether to keep them around. There’s a lot you can do when you have the data available to analyze. Keeping track of that data accurately is the hardest part of calculating cost per hire. That’s why spreadsheets or built-in calculators as part of your applicant tracking system are the best options.

Any time you have an open position for a company, and you need that position filled, you go through a particular practice. That practice of filling an open position is known as something, but the exact term used varies. Some people call it staffing. Some people call it recruiting. Some people call it hiring. Most use these terms interchangeably. Each of the three has a subtly different meaning and context, however, and using them properly can sometimes be the key to using the right processes the find the right person for the right role. So, in this blog post I will explain staffing vs recruiting vs hiring, and the difference between them. What is Staffing? Staffing is one way to fill open roles within a company or organization. You have a particular role or set of roles available, and you need people to fill those roles. The focus of staffing in particular is on short-term roles or specific projects. They may be hiring staff for an event, like a convention. They may be hiring for a project that is meant to go for, say, six months, or six weeks, or less. Staffing tends to focus solely on active candidates . That is, people who are actively seeking a job, rather than people who are skilled but comfortable in their current roles, or who are not actively seeking a different position. Staffing agencies also often need to work with limited budgets. The roles they need to fill are often not highly skilled roles and don’t have high requirements for candidates, but that’s not always the case. Most of the time, staffing is a practice used to fill a lot of low-level roles quickly. These roles include temp workers, unskilled labor, and other short-term workers for roles. Sometimes this involves contracting freelancers also, though that’s not always common. One advantage of staffing, is this process can ignore certain requirements of other role-filling practices, such as arranging company benefits, taxes, and sometimes even background checks beyond the most limited form. Since the employees will not be employed for long, may not be employed for full time hours, and aren’t going to be highly skilled members of the company, expectations tend to be lower. A good staffing agency will build up a candidate pool for various kinds of jobs. The agency maintains this pool with regular contact with the candidates, and many candidates work numerous jobs they find through the staffing agency. In this way, the agency maintains an active pool of qualified candidates for various roles. Passive candidates are often removed from the roster until such time as they express interest in becoming active again. What details does staffing focus on? Primarily those related to time and compensation. Candidates want to know how long a contract will last, whether there are any fringe benefits to the contract, what the compensation for the job will be, and whether there will be a chance of being hired on for further employment with the organization. What is Hiring? Hiring is similar to staffing in many ways. Like staffing, it is a way for a company or organization to fill open roles in their roster. However, some differences set it apart. The hiring process typically involves posting a job, receiving applications from candidates, filtering those candidates to generate a pool of qualified candidates, and interviewing those candidates until the role is filled. In most cases, hiring is aiming to fill higher-skilled roles than staffing. Positions tend to be longer-term, though they may have “temp to hire” plans or probation periods before the worker becomes a fully vested employee. Oftentimes, the number of positions that need to be filled through hiring is smaller. Staffing may have dozens of roles available for a short-term event or project, while hiring may have as few as one open role. Of course, hiring can work for many more roles, such as when a company expands dramatically, but that’s not a requirement. One characteristic of hiring is that the candidate pool is not always retained . Good human resources departments will save resumes and applications for potential future use, but little effort is made to keep those candidates fresh and interested. The candidates who are not hired will, of course, move on, and are often hired for other jobs by the time the next open position rolls around for which they would be qualified. Because of this, hiring can work with both active and passive candidates, but typically focuses on active candidates. Active candidates tend to have a faster response time to fill a role. What details does hiring focus on? Like staffing, compensation is a big one. Unlike staffing, hiring tends to assume an ongoing employee relationship. The job exists until downsizing or redundancy eliminates it, the employee leaves, or they get fired. As such, most hiring discussion revolves around job skills, compensation, benefits, and other details. What is Recruiting? Recruiting is perhaps the most unique of the three means of filling roles for a company. Rather than a process that is initiated upon needing new roles to be filled, recruiting is meant to be an ongoing process. Recruiting also tends to take a candidate-first approach. Rather than approaching a candidate with a role that is already defined and needs to be filled, recruiting approaches a candidate with a likely skill set and asks them to be part of the organization. As such, this is often how high-level employees in management and C-level positions are found. Candidates who are recruited for a company don’t just bring their skills and their experience, they bring their own management styles and systems. They are often given the power to make changes within the organization, with the aim of improving the overall company and its processes. Recruiting can focus on active candidates, but most often tends to aim for passive candidates . At a certain point, most people are assumed to simply always be on the lookout for upward mobility. Thus, recruiting means knowing what role needs to be filled, what compensation is available, and what kinds of candidates out there may be most suitable. A big part of recruiting is maintaining a candidate pool . This is where a lot of overlap with hiring comes in. The recruiting candidate pool is large and maintained, consistently feeling out potential candidates and investigating them for potential roles that may open up. A lot of it is speculation, with new roles created when an opportunity to hire a good candidate comes along, rather than the other way around. Among the three practices, recruiting is the most intimate, and the one that involves the most input from your organization. The candidate needs to fit in within their team and within the organization as a whole, particularly within upper-level management teams. These are the people in charge of the overall direction a company takes; recruiting the wrong person can steer an entire company in the wrong direction. What details does recruiting focus on? Because of its focus on important roles, candidates tend to be concerned with compensation, but also with details such as company culture. At this level, many candidates are already living comfortably, so a slightly higher salary or slightly better benefits might not be tempting enough to entice them to leave their current role. They concern themselves with professional and personal fulfillment, purpose, and their role within a team. The Matter of Overlap There is naturally some overlap between each of the three practices. Staffing agencies can find candidates who become long-term employees, acting as a sort of extended filter for the hiring process. It’s similar to an internship process in some ways, and the temporary position to full-time position transition is not uncommon. Meanwhile, there’s a lot of overlap between hiring and recruiting. They both operate in similar ways, and the hiring process can be used for upper-level roles just as much as the recruiting process can be used for lower-level roles. The primary difference between them, really, is whether they focus on the role first or the candidate first. Hiring starts with a role and looks for a candidate to fill it. Recruiting looks for a candidate and makes a role where they can fit. Which Process Should You Use? So which of these three processes should you use? The answer, as you might expect, is all of them. All three processes are complimentary, not exclusive. Staffing is best used when: You have a lot of roles that need to be filled in a short amount of time. You have roles of short duration that need to be filled. You have to expand for temporary projects but don’t have the capacity to hire anyone as a full employee. You have roles to be filled that don’t require detailed skills, lengthy training, or high levels of compensation. As such, the staffing process tends to be outsourced. Companies often decide that maintaining their own staffing candidate pool is too much effort, and turn to temp agencies and other staffing agencies to provide the contact information for prospective hires or contracts. Hiring is best used when: You have a few roles that need to be filled. You have plenty of time to fill roles that are open. The roles you have available are not short-term or contract-based. You have the budget and capacity to include benefits as part of overall compensation. Your roles have higher skill requirements or experience required for success. Hiring can be outsourced, or it can be done in-house. It’s the most broadly variable of the three processes, so there’s likely a company out there doing what you need done, or offering software to help you do it, no matter what your requirements may be. Recruiting is best used when: You are looking for fresh talent to help lead your team, spearhead a project, or take over upper management. You want to maintain a pool of qualified candidates. You want to draw in new high-level talent from your competitors or other related industries. You’re more concerned about culture and skills meshing with your team than you are about compensation. Recruiting can be outsourced or it can be handled in-house, and a lot of it depends on whether or not you’ve built a team with the skills and tools necessary to maintain and ongoing process of recruitment. Finding the right candidate and enticing them to join your team is a skill that needs to be developed, since tempting a passive candidate is much more difficult than hiring an active candidate. Conclusion  So, choosing the right process comes down to what roles you need filled, how quickly you need them to be filled, and how hard they will be to fill. It’s all part of the general spectrum of growing the employee roster of a company, after all. There’s no one answer for which process you should use; use the one that suits your needs, and the one you have the tools and resources to manage. Only by choosing the right process can you maintain high employee satisfaction, retention, and value. If you need help growing your team, contact us today and learn how we can help you!

Did you know that employee turnover can cost a company up to twice the value of that employee’s annual salary? Having a revolving door of workers is expensive and inconvenient for businesses. This is why it’s so important to make sure you hire the right person the first time. Among employers, the traits of a good employee are almost universal.  Of course, it can be hard to evaluate a candidate’s experience based on just a job interview. So how can you know what makes a good employee? Let’s take a closer look at 10 attributes to look for. 1. Potential for Growth With the Company When you need someone to work on a certain set of tasks right away, it can be easy to develop tunnel vision. In reality, when you are making a hire, you should be looking for someone who can meet both your company’s current and future needs. We all know the days of working at the same firm and retiring after forty years are gone. In fact, most workers will hold 10 jobs before the age of forty. So how can you identify someone who will stay with the company? The key is to find someone adaptable. A person willing to take on new tasks and challenges will be able to find multiple roles within your company. This will give them the experience of having different types of jobs without going to a different firm. Look for someone who advanced at their last job. Advanced degrees can also be an indication that a particular worker has an interest in learning new things. 2. Producing Results Many interviewers make the mistake of asking potential candidates task-based questions. Here is an example: “what did you do at your last job?” The problem with this approach is that most people can figure out how to perform a specific task they are told to do. What is harder to find is someone who can take initiative and produce results. Ask specific questions that require specific answers. Here are some examples:  How much income did you generate?  What processes did you develop at your last job?  How many clients did you bring? 3. Team Player While it is important to hire someone who can make things happen, it can be dangerous to bring someone on who cares too much about their own accolades. Instead, it’s important to look for candidates who are able to be part of a team, and who don’t need to have the spotlight. There are a couple of ways to gauge a person’s ability to work with a team. For instance, bringing them in for a panel interview will give you an idea of how they interact with your current employees. You can also ask references to talk specifically about their experience on teams. 4. Written and Verbal Communication No matter what your company does, the ability to articulate ideas in an understandable way is essential. This is why you should look for job candidates with strong written and verbal communication skills. There are several ways to evaluate a candidate’s abilities . Asking for a writing sample is a common option. Some employers may request for a candidate to give a presentation to demonstrate their speaking abilities. 5. Enthusiasm for the Work Even the best jobs have bad days. What keeps people going at their jobs is a genuine interest in and enthusiasm for the work. Look for a candidate who demonstrates an interest in what your company does. You can evaluate this by looking at their previous jobs, their involvement in professional organizations, or their educational journey. 6. Self-Starter There are few things more frustrating for an employer than having to constantly guide an employee to do simple tasks. Instead, you want someone who will not only do what they are tasked with doing but who will be able to identify the need for new projects. A good way to evaluate this ability is to describe the job to the candidate and ask them how they would approach it. Someone who is a self-starter will have ideas for new things to bring to the table. 7. Constant Improvement With the rapid development of new technology , it is important to hire people who are able to adapt quickly and improve their skills. A good way to determine a candidate’s aptitude for improvement is to look at their education history. Have they sought higher education or certifications? Do they attend conferences in their industry? 8. Attentive Listener In an interview, hiring managers usually focus on getting a candidate to talk about themselves. But it is also important to gauge how well a candidate is able to listen to and digest information. A good way to do this is to tell them information about your company, and then ask them specific questions. For instance, you can tell them about a challenge you had recently, and ask them how they would have responded. Make sure that the story you tell is long enough that it requires them to pay attention to what you are saying. 9. Tech-Savvy Depending on what your company does, there are certain technologies that you want your employees to be fluent in. To test this, many employers conduct technical interviews, where they require candidates to complete certain tasks to show their ability. 10. Trust Your Gut We all know the old saying, “Don’t judge a book by its cover.” But, while it is important not to jump to conclusions about people, it’s also important to keep in mind that first impressions matter. How an individual chooses to dress and conduct themselves at a job interview says a lot about their overall philosophy toward work. If the candidate is behaving in a way that seems to clash with your company’s culture , that is unlikely to change. Learn What Makes a Good Employee These traits are part of what makes a good employee, but they’re not the whole story. That’s why, if you want to hire the best people, it’s important to work with experts who know how to recruit top talent. Ready to get started? Contact us today to learn how we can help your team grow.

Employers must conduct staffing in accordance with laws and regulations at the federal, state, and local levels to avoid discriminatory hiring practices. Employment laws regulate hiring and firing, wage and hour administration, and employment practices such as giving employees breaks, minimum employment age, and safe work environment. Title VII of the 1964 Civil Rights Act banned discriminatory hiring practices in the areas of equal opportunity, affirmative action, and sexual harassment. These three important areas impact almost all human resource practices and everyone working in human resources should know about laws regulating them. The Recruiting Division discusses recruiter training in “ Best Resources for Recruiter Training in 2014 ” such as Society for Human Resource Management Conference (SHRM) and AIRS Training where recruiters can learn about employment laws among other important HR issues. Equal Employment Opportunity Applicants and employees are protected under Equal Employment Opportunity (EEO) laws from illegal discrimination based on their race, age, or gender. EEO laws ensure that everyone has an equal opportunity to get a job or be promoted at work. EEO laws protect broad classes of people from discrimination for the following characteristics: Race, ethnic origin, color (for example African American or Hispanic) Gender (women, including those who are pregnant) Age (people older than 40) Individuals with physical and mental disabilities Military experience (veterans) Religion Equal Employment Opportunity laws are designed to ensure equal treatment at work, and employers are required to take affirmative action, or extra effort, to hire and promote people who belong to a protected class. Affirmative action means taking specific actions to eliminate or prevent the current effects of past discriminations. EEOC Employees are also protected by the Equal Employment Opportunity Commission (EEOC), which was established by the 1964 Civil Rights Act, Title VII. The EEOC enforces the following laws: Civil Rights Act of 1964 . This law, signed by President Lyndon Johnson, prohibits discrimination on the basis of race, color, religion, national origin, or sex. Civil Rights Act of 1991 . This law, signed by President George H.W. Bush, strengthens the prohibitions of discrimination of the original act and permits individuals to sue in cases of intentional discrimination and puts the burden of proof on the employer. Equal Pay Act of 196 3. This law equal pay for equal work, regardless of gender. Pregnancy Discrimination Act of 1978 . This law prohibits discrimination or firing of women because of pregnancy alone, and protects women’s job security during maternity leaves. American with Disabilities Act . This law prohibits discrimination against individuals with physical or mental disabilities or the chronically ill, and requires employers to make “reasonable accommodations” so the disabled can work. Compliance with Title VII is required from all private employers of 15 or more persons, all educational institutions, all state and local governments, all public and private employment agencies, and all labor unions with 15 or more members, as well as joint labor‐management committees for apprenticeship and training. Sexual Harassment Sexual harassment can be a tricky concept to understand but compliance is important to avoid costly litigation. Sexual harassment is defined by the Equal Employment Opportunity Commission as “unwelcome sexual advances for sexual favors, and other verbal or physical conduct of a sexual nature,” and may include sexually suggestive remarks, sexual advances, requests for sexual favors, unwanted touching, and other verbal and physical conduct of a sexual nature. It may also include seeing and hearing these things happen to others. In 1993, the Supreme Court widened the test for sexual harassment under the civil rights law to include a hostile or abusive environment. Sexual harassment includes same‐sex harassment and harassment of males by female coworkers. Human resources staff must pay attention to instances of sexual harassment because of its affect on performance and because it exposes the business to liability. The company must respond to complaints of sexual harassment with prompt investigation and clear policies to avoid the appearance of being indifferent and contributing to a hostile work environment. Other Employment Laws Other employment laws impact human resources and workforce management, including the Fair Labor Standards Act that regulates minimum wage, overtime pay rules, and child labor law, the Age Discrimination in Employment Act which prohibits age discrimination against those 40 and older, and the Occupational Safety and Health Act to regulate workplace safety. While legal counsel can help companies with employment law issues, human resources staff need to know and understand employment laws for compliance and to be able to help management understand them.

Remember old school job search, in a bygone era long before applicant tracking software, scanning the Sunday classifieds with a red pen, circling jobs you want to apply for? Filling out paper application forms with a black ballpoint pen, and listening to the receptionist tell you “We’ll call you if they want to interview you.” Or driving from place to place, looking for help wanted signs in doors and windows. Printing and mailing dozens of resumes and cover letters addressed to “To Whom It May Concern?” Those days are gone forever.  Thanks to applicant tracking software such as iCims, Jobvite, and Taleo, applicants can go online and apply for a job across town, across the state, or across the country, right from their laptop or even their mobile phone. Before they do that, they can thoroughly research the company they want to apply to, read employee reviews about working there and benefits and compensation, and even talk to current employees by looking them up on LinkedIn. Many companies, and especially large national or global corporations, use applicant tracking software to streamline their recruiting processes. These let them store applications and resumes into databases searchable by keywords and sort them by position and/or skills, as well as other useful features. It’s turned paper applications and resumes into virtual candidate data that’s more easily accessible during the recruiting and hiring process. Great applicant tracking software for recruiters. Taleo: The Not-So-Great Applicant Tracking Software for Applicants Now, I have no ax to grind with Taleo. But applicants seem to hate it. It’s a very strange phenomenon, given the meteoric growth and seeming popularity of Taleo as shown by sales numbers. Many applicants just abandon the application when they see its Taleo. They go online and complain about Taleo. They feel it’s a black hole that is a frustrating waste of their time. A little sample of applicant comments about Taleo: When it’s Taleo, you know you’ll be completing a 45 min application. Taleo is just one of the resume black holes. You can apply all you want but you’ll never hear anything in most cases. It’s a clunky system full of stupid bugs, including when you click go back to search results when looking at a job you get kicked all the way back to the first page. And our favorite – the resume uploader that then requires you to enter your resume a second time, piece by piece, into certain special fields. Are you using Taleo as your applicant tracking software? Is it giving you the return on investment and recruiting effectiveness you need? Are your candidates abandoning your postings when they see the application is in Taleo? Taleo Hate This is how Taleo applicant tracking software is referred to online in different forums and sites: Taleo – Tool of Darkness Wow! Taleo still sucks beyond belief. (This sounds like a jaded applicant who has run into Taleo in a dark alley many times and it has not changed at all.) I wince in pain whenever I see Taleo. (Physical reaction to Taleo. Hmmm.) Taleo is my enemy. (It’s sad when the online application system is the enemy.) Taleo is the application software from the worst kind of hell. (That’s hating, but what exactly is the worst kind of hell?) Taleo is a stain on this world. (Ewww, icky visual.) If Taleo were a physical entity, I would give it a roundhouse kick and then set it on fire. (Um, violent huh?) So there’s a lot of hater hate out there for Taleo applicant tracking software. Sounds like a Taleo application is not a fun process. Takes a long time, buggy and frustrating, duplication of tasks applicants have to do to complete the applications. Why is anyone still using Taleo as their applicant tracking software? Oracle acquired Taleo for almost $2 billion, so there is a lot of value in their product, at least for employers and recruiters. Taleo has a feature called Talent Intelligence with embedded analytics, automatic information-gathering throughout the entire recruiting process , and many valuable ways to manipulate and extract recruiting data . Conclusion  While applicant tracking software like Taleo has revolutionized the recruitment process for employers, it’s clear that this technological advancement has not been universally welcomed by applicants.  Despite its popularity among corporations and its advanced features that benefit recruiters, Taleo has become notorious for its user-unfriendly interface and cumbersome application process. The overwhelming sentiment among job seekers is one of frustration and resentment, viewing Taleo as an impersonal, inefficient, and often defeating barrier to employment.  Are you looking to grow your team? Contact us today and learn how we can help you recruit excellent employees into your business.    #ApplicantTrackingSoftware #Taleo

Your job title is important. It’s important as an indicator of where you stand on your career path within your company. It’s important when communicating with others outside of your organization. It’s important if you leave your company, so the hiring managers at other companies know what role you held. There are, though, quite a few HR roles within the overall human resources field. There’s also a lot of overlap between them, and sometimes the definition will be different between two different companies. Add to this the all-too-common phenomenon of increasing responsibilities without increasing titles, roles, certifications , or pay, and you have a very muddled area of discussion. What we’ve done here is put together a list of HR roles, from the bottom-rung intern to the high-end director, with definitions to try to clear the air. While the exact definition of a role tends to be flexible and might not match your role – or the role you’re applying to take – it should be within the realm of possibility. Let’s dig into it! Entry Level Positions Entry-level positions are roles within the HR department that don’t need much or any previous experience. They’re not tasked with making high-level decisions but instead deal with the day to day minutia of managing the company from the inside. They handle administrative tasks and labor. Employees in these roles are expected to climb the ladder and be replaced relatively quickly, so they don’t tend to gain much institutional knowledge in the given role. HR Intern – The intern is the bottom rung of the HR ladder, the paid or unpaid assistant who does everything from fetching coffee to set up meetings. They tend to do the menial administrative tasks that the higher-ups don’t want to do, usually because they’re tedious, time-consuming, and boring. Interns are there to gain experience and insight into the HR department and are generally temporary positions lasting a year or less. HR Assistant – The HR Assistant role is very similar to the intern role, except they’re paid, and they’re long-term. An assistant tends to work directly with someone higher up in the HR ladder, handling day to day administrative tasks, but with less of the sheer grunt work of the intern. It’s the lowest rung of the HR ladder that is expected to stick around and grow within the company, rather than leave for further schooling or greener pastures. HR Trainee – Trainees are HR employees who are being specifically trained for mid-level roles, usually, through shadowing or one-on-one time with the person they’re going to either work with or replace. Trainees are entry-level but may also have some prior experience as a general assistant or intern. HR Associate – The associate is similar to the assistant, but there may be some connotations of a long-term role at the entry-level, as opposed to the quick mobility of the assistant. Associates are the rank and file, the generalists who handle whatever tasks come their way, but who aren’t making managerial decisions. HR Coordinator – Rarely do you see “HR Coordinator” as a role; rather, coordinators are generally administrative assistants that perform HR-related tasks. Coordinators help smooth the path between low-level employees, managers, and directors, and help with filing employee documentation, performing employee actions, sending notices to employees, and preparing materials for meetings. Recruiter – Recruiters are tasked with the day to day labor of recruiting for the company. They review and filter resumes and applications, they manage job postings, they schedule interviews, and they send cold contacts to passive candidates. They’re the first line of defense for the recruiters higher up the chain who make the actual hiring decisions. Analyst – Analysts tend to have an interesting role as an information broker. They deal in information and high-level thought and analysis, though they may not be empowered to make decisions based on that information. They take company data, particularly when it relates to employees, and analyze it to develop reports for the higher-level employees and directors to review. There are analysts at all levels, though the upper-level analysts tend to be outside consultants more than internal officers. Staff Coordinator – Staff coordinators are the upper crust of the low-level employees in the HR department. They’re on the verge of reaching mid-level management and may be considered managers of the interns, trainees, and individuals in the HR department. They help with recruiting, screening, and new hire orientation, but still have to do a lot of the daily grunt work the upper-level positions can delegate. Learn More About Our Recruitment Services Mid-Level Positions Mid-level positions in HR tend to be managers, team leaders, and specialists in specific roles. In small companies, these can be considered upper-level positions, especially in cases where an HR department is only a small handful of people. They’re in charge of other HR staff, but beholden to the upper-level managers and directors for the high-level decisions. Manager – HR Managers are a flexible mid-level role. They’re the people who manage the lower-level people, making overview decisions for the department but without the total perspective of the whole company that a director would have. HR managers act as the buffer between the HR associates who do the work, and the HR directors who guide the direction of the company. They’re expected to be good at communication, leadership, relationship building, and critical thinking. Sourcer – Sourcers are the high-level version of recruiters. They’re the managers who guide overall recruitment efforts and who put forth the effort on passive candidates to target, filter, and negotiate with them directly. Sourcers tend to be more aggressive with recruitment, but are empowered to make more decisions about that recruitment. Administrator – Like coordinator, administrators are a mid-to-upper-level role that guides the overall direction of specific efforts within HR. You’ll see HR Administrators as overall managers and decision-makers, but you’ll also see specific niche administrators. A benefits administrator makes upper-level decisions about benefits and can work with outside companies to organize those benefits. A training administrator helps set up and manage training for both HR employees and employees in other roles within the company and so on. Trainer – Trainers are a specialist within HR who focus on, as you might expect, training. They set up training procedures, manage an internal knowledge base and onboarding process, and help connect new hires with the people who can answer their specific questions. They take the people the hiring managers and sourcers recruit, and turn them into full-fledged employees. Generalist – HR Generalists are the associates of the mid-level HR department. They do a little bit of everything , they don’t specialize in anything, and they serve as the overall rank and file of HR. Generalists are often on a training path to become specialists in one role or another, though they may end up leaving the company to take that role at another if there’s no clear path of mobility within their own. HR Information Specialist – The information specialist is the higher-tier version of the analyst. Information specialists deal with all of the high-level analytics and reporting and tend to report directly to the upper-level management with their findings. Information specialists may also be tasked with auditing and compliance overviews, and guide the analysts on what they’re doing. Upper-Level Positions Higher-level positions are generally most common in large companies with extensive HR departments, but their roles also work in smaller companies. To effectively manage online sales platforms and advertising, some companies even partner with specialized firms such as an Amazon ppc Agentur, which assists in optimizing Amazon ads. Responsibilities and salaries can vary significantly depending on the size of the organization. The HR director at a small company might be equivalent to a middle manager at a large enterprise, for example. This illustrates how roles can scale differently across various types and sizes of businesses. HR Manager – HR Managers are the lowest of the high-end HR employees. They guide the overall direction of the department, they’re responsible for problem-solving, and the interface between the middle managers and the VP-level directors. A department manager may only have one or two people above them before the CEO, or they may be interchangeable with the VP in a smaller organization. Specialist Manager – Specialist managers within HR have specific titles that reflect their areas of expertise. You may have a benefits manager, a training manager, an information manager, a compliance manager, a recruiting manager, and so on. Specialist managers are the upper management for a larger HR department, each in control of their own sub-department, and reporting to the overall director of HR. Talent Acquisition Manager – The recruiting manager is a specialist manager who guides and oversees hiring for the organization. They work with managers of other departments to figure out what the company needs in their employees. They also work with the tools and outside companies the business uses to recruit. Business Partner – Business partners tend to be closer to consultants than managers in the HR world. They work both within and outside of the company to build relationships and business plans that guide the direction of the company. They form policies, oversee enforcement, or interface with a more stand-alone HR services center for an organization. Brand Manager – Brand managers for a company are part of HR, but could also be considered part of marketing. They are communications specialists and they strive to manage how a brand is represented, both within the company and without. They can help with overall company branding, intellectual property management, and public relations, among other things. HR Director – The overall director of HR is typically the highest level HR employee who oversees HR directly. They are either synonymous with the VP of HR or the C-levels (in smaller companies) or are the direct report and highest level beneath those roles. Their specific role and job duties depend on the company itself. HR directors may also be regional directors for large and distributed companies, reporting to an overall company-level director. Specialist Director – Specialist directors are typically only present in large enterprises. They’re directors of various sub-sections of HR, such as a recruiting director or a benefits director. In large companies with tens of thousands of employees or more, where a single specialty of the HR department could be dozens or hundreds of people, the specialist director serves as the interface between that section of the department and the overall director of HR. VP of HR – The Vice President of HR is the one-step-below the overall president of the company and is synonymous with the C-level HR officer. Again, their specific duties and considerations depend on the size and structure of the company beneath them. In large companies, the VP is often the one who manages the various regional directors. Chief Diversity Officer – A relatively new position, the CDO or Chief Diversity Officer is responsible for upper-level organizational efforts to ensure diversity and equality amongst the workforce . They handle overviews, auditing, and guidance for equitable benefits distribution, bias-free hiring practices, non-discrimination overviews in management, and other initiatives. They may report to the CHRO or to the CEO directly and could be part of the overall board of directors, depending on the organizational structure of the company. Chief Human Resource Officer – A part of the board and a direct report to the company CEO, the chief HR officer is the head of all HR for the company. They make high-level decisions, guide the overall efforts of the department, and provide updates and reports to the CEO and board of directors. This role may also be known as the Chief People Officer or CPO. Other Titles There are easily dozens if not hundreds of other specific titles for HR employees within an organization . Lists like this one will list out specialist versions of roles above, alternate names for certain roles, and roles that have been more or less created to give managers different, more important-sounding names. Different companies may name some roles in different things, though the responsibilities are the same. This is why it can be difficult to compare positions between companies, and why it’s important to keep a list of duties and responsibilities on hand for such comparisons. Conclusion It’s important to recognize that a role can be called whatever the company wants to call it. None of these definitions is truly set in stone, and it can vary a lot depending on the company, the region, the size of the organization, and even the personal whims of the C-levels involved. That’s not a bad thing, it simply means direct comparisons can be difficult. Learn More About Our Recruitment Services

Human Resources departments are often misunderstood and unfairly categorized, especially in TV shows and other stereotypical portrayals, as team members that should be feared and are primarily responsible for cutting costs and firing employees. The reality is, Human Resources departments have many valuable responsibilities, and they’re often caught in the middle of power struggles in a company. More importantly, they’re a critical asset when it comes to hiring, managing staff, and addressing disputes within a company. The human employee is the greatest resource most companies have. The value of a single good employee to an organization is growing year over year and has been since the ’90s. Thus, establishing a solid team of people to manage that human resource has been a growing fixture of companies for decades. If you’re considering a move to HR, or you’re on the outside looking in and just wonder what they do and how they can help, we’re here to enlighten you. So, what does Human Resources do? Let’s dig in. HR Manages Company Documents Paperwork is the blood in the veins of the organism that is a company. The modern era has led to an increasing amount of this paperwork being digitized, but it’s still all there – it’s simply processed and stored differently. Some organizations even still rely on physical paperwork, including medical facilities and older companies. Most of the actual paperwork is done by the HR department and sent to the appropriate groups – individual employees, groups of employees, managers, executives – to be read, signed, returned, and stored. In reality, much of the day-to-day work of an HR employee is managing paperwork. The exception is in larger organizations where HR teams can have specialized employees. A technical recruiter, for example, will handle paperwork related to recruiting but will leave most of the rest of HR to other members of the team. Likewise with Employee Placement Specialists, Interviewers, and other specialized roles. HR staff may graduate from a university with a degree in business, business management, or administration. They may also get an MBA in HR Management or a related degree. Additionally, HR professionals often pursue additional certification from organizations such as the Human Resources Certification Institute (HRCI) or the Society of Human Resources Management (SHRM). HR Enforces Company Regulations Compliance with policies, both internal and external, is of critical importance for most businesses. Policies include : Internal policies on employee ethics and behavior. Internal policies on conduct, dress, and attendance. Communications policies, both internally and externally. External industry regulations, such as HIPAA . External state or federal regulations, including anti-discrimination laws. Whether the policies in question are internally devised and thus flexible, or externally enforced, HR is typically the central authority within a company that handles compliance. They are responsible for educating staff on policies, including the penalties for violations. They are also responsible for handling complaints and violations, including delivering punishments. Whether this results in a reprimand, a firing, or a lawsuit, HR is the central organization responsible for managing it or facilitating internal or external auditors in their investigations. David Miller, an attorney, puts it plainly : “HR professionals are the absolute front line of defense for a company to make sure it treats people fairly, legally and keeps the business out of danger.” HR Investigates Internal Complaints Human Resources is often made out to be the enemy. Common advice during negotiations or discussions, from an employee’s end, is to “always remember that HR works for the company, not for you.” The truth is a little more nuanced than that. The HR department is usually caught in the middle. Yes, they work for the company, but it is in both the company’s and their best interests to handle and solve internal complaints in an appropriate manner. Internal complaints, whether they’re related to managers abusing their power, sexual misconduct in the workplace, harassment, cyberbullying, need to be addressed. There’s always a dark side to internal complaints. Abuse of power from someone high enough in the chain can disrupt the proper flow of HR resolution. The truth is, in a properly functioning organization, HR should be an impartial mediator, investigating the truth of a situation and handling it appropriately. From HG.org : “According to a spring 2020 report by Workhuman, only 47 percent of women and 66 percent of men report sexual harassment to HR. HR should be a department that employees trust with problems, and all employees should feel comfortable with reporting sexual harassment cases.” Any company large enough to have an HR department should strive to ensure that the department is trusted, impartial, and empowered to handle complaints and employee issues adequately, without any added pressure from above or fear for their job position. HR Administers Payroll and Benefits Systems While the actual distribution or disbursement of funds is likely handled by the finance team, administration of payroll, telling them who gets paid what and when is all done by human resources. HR is responsible for managing payroll, as well as benefits, both internal and contracted. Examples include: Managing payroll to ensure that all employees, old and new, get the appropriate amount of money each pay period. Managing one-time or inconsistent financial benefits, like periodic bonuses or bonuses for performance. Tracking and managing days off, vacations, and even benefits like free lunches for employees. Managing and administering internal benefit programs, from referral bonuses to comped travel and lodging on business trips. Directly managing certain types of financial benefits, including employee 401(k) and similar forms of investment matching. Serving as an intermediary for benefit claims, such as medical leave of absence claims. Other organizations may handle the actual implementation of these systems, but the HR team determines what is implemented, and when. HR Builds Hiring Objectives in Conjunction with Executives A truly empowered HR team is not subservient to the executive team. Rather, they are a guiding force in the overall direction of business development. As Ryan Ayers writes : “Modern human resource leaders frequently lead change initiatives for their organizations. As a result, current HR executives yield strong project management skills in their corporate toolboxes. The professionals are skilled at helping organizational stakeholders make the connection between change initiatives and strategic needs, minimizing change resistance and employee unrest.” HR has responsibilities from the top to the bottom of an organization. At the top, they work with executives and administrators to guide the direction of the business, serving to temper expectations and impose realistic boundaries on sky-high dreams. At the bottom, they work to build institutional buy-in, awareness, and hype for the direction of the organization as a whole. HR Assists Employees with Career Development While it may seem, in some organizations, that HR serves the company more than it serves the employees, the truth should be the opposite. When employees are the single greatest resource available to a company – and with the sheer expense of turnover rising the more the employee’s value rises – it’s no surprise that many modern HR departments are focusing on employees. Thus, an HR department may be focused on: Assisting employees in personal development. Assisting employees in professional development and training. Rewarding employees for their performance with bonuses and promotions. Offering training and support for employees, managers, and more. Adjusting roles and duties for accommodation, to facilitate the health and wellness of individual employees. Keeping employees happy, healthy, empowered, satisfied, and growing is all a key part of a holistic approach to modern human resources. As LucidChart says : “After all, employees are the single biggest asset to any organization. It follows, then, that protecting their well-being is of utmost importance.” HR May Assist With Recruitment and Staffing Depending on the size of an organization, hiring new employees may be an occasional duty or a full-time job. Every aspect of hiring, from creating a job posting to refining a candidate pool to conducting skills tests and interviews is under the purview of the HR department. Larger companies with larger recruiting and staffing needs might hire specialists and create individual hiring departments within their human resources department. Other organizations may work directly with recruiters, or contract recruiters like ourselves, to outsource the early phases of hiring and bring in highly qualified candidates. HR should also be acutely aware of opportunities for internal promotion as well as external hiring. When a job opening is created, either from an employee leaving or when a new role is created, the human resources department should look to see if any internal employees can fill the space. They should also be looking for new hires to step in and help fill that role. This also links up with their duties to offer career progression and advancement to employees. HR Provides Resources for External Employee Problems The boundary between home life and work life is thinner than ever before, especially with the past year’s focus on working from home for many organizations. Unfortunately, many home-life problems can affect work life. These may range from child medical issues to domestic violence. Human resources usually stand as employee advocates and can provide resources to help solve problems outside of work. These can include support or connections for therapy, resources for financial assistance, and flexibility in company policies to help with employee personal lives. In some instances, HR may also be required to report specific kinds of issues. In California, HR employees are mandatory reporters for child abuse, and they can provide an avenue for victims of domestic violence to speak out in a situation where they are less likely to be monitored or at risk. Again: the health and wellness of employees are both paramount for the success of a business, so providing every avenue of assistance possible is a good position for HR to take. HR Performs Employee Appraisals While managers are a big part of employee performance reviews, they often limit their review to the specific job duties and requirements of a team or a role. HR can take performance reviews into account as part of an overall employee appraisal. Part of good onboarding is feedback . Employees with feedback during onboarding are more likely to settle into their roles, knowing what they are and aren’t doing that meets expectations. Feedback should continue throughout an employee’s tenure and can continue to guide them in both personal and professional development. Routine performance reviews allow HR to help an employee guide their professional development, and can open up additional opportunities for continuing education, training, and experiences, all of which can lead to promotion. Bonuses can incentivize performance. Moreover, a performance review can catch and analyze problems, both within the workplace and outside it. Detecting issues, whether it’s bullying, violence, or simply burnout, is an important part of solving them. HR Maintains Employee Awareness Perhaps one of the most undervalued and overlooked duties of the HR department is keeping employees aware of developments within and without the organization. New policies need to be distributed so employees can be informed. Likewise, the removal of policies should also be distributed. This plays an important role within a business. It helps keep employees informed and engaged in the direction, vision, and structure of the business. It’s the avenue through which employee feedback reaches executive ears, and through which change can be implemented and feedback acknowledged. Many channels are available to the HR department for information distribution . Internal newsletters, flyers, and personal emails are all valid examples of this. Promptly informing employees of changes to their workplace can help to prevent sudden issues and conflicts within your team, among other problems. Wrapping Up The average Human Resources department has a lot more on its plate than many people might know. From every angle of the business, they help guide the direction of day-to-day activities, facilitating decisions, presenting feedback to executives, and pushing back against unrealistic expectations. From the bottom up, they keep employees informed, healthy, and happy. They help facilitate everything from career development to personal health to internal feedback. From the outside in they help bring in high-quality candidates and ensure that the organization remains compliant with industry and governmental regulations. From the inside out, they help guide and promote the company’s reputation, resolve issues that would otherwise become problems, and generally smooth over the wrinkles of a business’s public face. There’s a lot more to HR than meets the eye, which is why it’s such a crucial and indispensable part of a modern company. Are you considering hiring a human resource professional, either in-house or enlisting some outside help? Do you have any questions for us? Please let us know down below in our comments section! We reply to every comment and would love to hear your thoughts.

Most industries are made up of professionals, and those professionals often form organizations to help advance their fields. Those organizations often develop tests or examinations they can use, to judge the skills, knowledge, and abilities of people in their industry.  With a properly rigorous examination, a certification can become a valuable asset, and people who hold those certifications become more sought-after than their counterparts who have not passed the exam. In many ways, Human Resources isn’t very different. There are three primary certifications in the industry: SHRM-CP, PHR, and SPHR. If you’re looking to make yourself a valuable HR asset, you could probably benefit from acquiring certification, but which one should you focus on? Let’s examine these certifications and determine their quality. Who issues them? How rigorous are their standards? Are there any loopholes, flaws, or issues with the systems? Learn About the Benefits of Partnering With an HR Recruiter What Is SHRM-CP/SCP? SHRM-CP is a certification offered by SHRM, the Society for Human Resource Management. SHRM is a recognized authority in the human resources space, and their content is frequently cited on this blog and many others. They know what they’re talking about, and are one of the largest human resources organizations in the world. SHRM offers two certifications, of which -CP is the first. The other is SHRM-SCP, which we’ll discuss lightly as well. SHRM promotes their certifications as: Competency-based. Rather than testing your ability to memories facts and strategies, they test how well you’re able to implement them. The exams are updated routinely to include information about how these modern workplaces work, rather than an outdated view of how they should work. The SHRM certifications are applicable in any industry and any country, rather than within certain boundaries. Thousands of employers seek human resources employees with certifications, and SHRM-CP is often the certification being cited as “in-demand”. The exam is also accredited. According to SHRM: “The SHRM-CP and SHRM-SCP exams are accredited by the Buros Center for Testing, asserting that the HR credentials meet the highest standards in testing.” You can learn more about what this means here. What Are the Requirements of SHRM-CP? Before you can take an SHRM examination, you must meet certain requirements. These requirements depend on the exam you want to take and your education level. SHRM-CP (Certified Professional) requires: If your education is less than a Bachelor’s Degree and you are in an HR role: Three years of HR experience. If your education is less than a Bachelor’s Degree and you are not in an HR role: Four years of HR experience. If you have an HR-related Bachelor’s Degree: One year of HR experience. If you have a non-HR-related Bachelor’s Degree: Two years of HR experience. If you have a non-HR-related Master’s Degree: One year of HR experience. If you have an HR-related Master’s Degree: Current employment of any duration. The price of the exam varies as well; $300 for early bird members, $400 for early bird non-members, $375 for non-early members, and $475 for non-early non-members. SHRM-SCP (Senior Certified Professional) is similar, but all of the numbers are increased. You can read their chart here . The SHRM-CP examination is broken into segments covering core competencies, such as leadership techniques, ethical practice, relationship management, cultural effectiveness, business acumen, and critical evaluation. What Is PHR/SPHR and What Are Its Requirements? aPHR, PHR, and SPHR are three certifications offered by HRCI, the Human Resources Certification Institute. HRCI is not quite as large or as old as SHRM, though they are in the modern-day relatively comparable organizations, and they are both headquartered in the same city. In actuality, they offer many more than three certifications: aPHR: Associate Professional in Human Resources, aimed at newcomers to the HR industry starting their careers. aPHRi: Associate Professional in Human Resources (International), the same certification, aimed at international roles. PHR: Professional in Human Resources, aimed at established HR employees who want to progress in their careers. PHRca: Professional in Human Resources (California), a CA-specific variant for the test for local employees. PHRi: Professional in Human Resources (International), the upgraded version of aPHRi. SPHR: Senior Professional in Human Resources, aimed at established professionals looking to move into the upper ranks of HR executives. SPHRi: Senior Professional in Human Resources (International), the same thing for international roles. GPHR: Global Professional of Human Resources, a certification for top-level executives who primarily work with multinational corporations and who have globalized concerns. All of these different certifications have different requirements for education and experience levels. They all have a $100 application fee, as well as a fee to take the exam, ranging from $300 to $500 depending on the exam. You can view each certification here , and check each of their requirements individually. The breakdown of what each PHR certification covers varies from exam to exam. For example, the general PHR exam, comparable to SHRM-CP, has this breakdown: 39% Employee and Labor Relations 20% Business Management 16% Talent Planning and Acquisition 15% Total Rewards 10% Learning and Development HRCI is unique in that they offer the introductory certification aPHR, all the way up to high-end executive certifications in GPHR, with many options in between. SHRM does not offer quite as much variation. This is good, in that it gives a granular impression of the skills and abilities of the person with the certification. On the other hand, it means a professional in HR will need to progress through many more certifications and spend much more money doing so throughout their career. How Do These Certifications Compare? Each certification has its niche. They are all valuable, but which one is more valuable often depends on your goals as a human resources professional. SHRM certifications are broadly recognized. The organization SHRM is one of the largest in the field and has global membership. Their certifications test a lot of soft skills, and they are often well-rounded certifications that prepare you for a long career in human resources. SHRM-CP and SHRM-SCP are good certifications if you intend to work in a large organization with large HR teams, or dedicated teams for other related aspects of HR, such as legal and compliance.  Since the SHRM exams do not cover legalities, compliance policies, and specifics quite as much, they are better suited to generalists and administrators. The PHR certifications offered by HRCI are more granular, which means they are a better indication of the skill level of the prospective employee. When you have aPHR but not PHR, an employer knows you have basic skills and experience but haven’t reached a level of professional attainment they might want in an experienced hire. If you have PHR but not SPHR, likewise they know you’re experienced but not senior-level. PHR certifications are better than SHRM certifications in two ways. They cover more in the way of legality, compliance, and technical details. SHRM tends to test more soft skills and the application of management techniques, where PHR are generally more concerned with specific knowledge and compliance. They are better for international or global companies. PHRi or the GPHR certifications are designed for companies that operate in non-US countries or across borders, and thus have special concerns that domestic companies might not. PHR certifications also seem to be better regarded, though this varies from company to company and industry to industry. From UpstartHR : “My immediate supervisor is PHR credentialed. When I announced that I had earned my SHRM-CP credential, the response was underwhelming and I was left with the impression that they are not convinced that it is on par with the PHR credential.” Additionally, it seems that the industry broadly recognizes HRCI more than SHRM, at least in terms of certifications. Again, according to UpstartHR: “In terms of purely being recognized by the hiring community as a show of your professional skills, HRCI certifications are requested about four times as often as SHRM certifications.” It’s also worth mentioning that SHRM is a membership society, while HRCI is not. This means that members of SHRM can gain many benefits from the organization, without necessarily needing to take and pass their exams. It’s also worth noting that these certifications (while overlapping) are not mutually exclusive. You can take and pass both if you have the time and funds for it. The truth is, however, that a lot depends on the organization whether or not this will be valuable. Companies often tend to prefer one or the other, but the preference of which usually comes down to which one the head of the HR department themselves happens to have. Which Certification Should You Pursue? Several factors will influence what certification you should pursue. Consider the following questions to help you decide which of these certifications make the most sense for you and your profession. Are you new to HR and want a certification to kick-start your career? If so, go with the aPHR certification. The SHRM-CP certification is aimed at mid-level professionals. Unless you have an HR-focused Master’s Degree, you need several years’ worth of experience in HR to even qualify to take the test. Thus, the only real certification available to you as a newcomer to the profession is aPHR. How large is the organization you want to work for? Small companies often tend to prefer PHR certifications. This is because they tend to be broader and more applicable to various facets of HR, including legal issues. SHRM certifications don’t cover all of this. If your company is small and needs a “jack of all trades” HR professional, the PHR certifications are a better option. Conversely, if your company is large enough to have a dedicated legal/compliance team, you may not need that specialization that PHR provides. The SHRM certifications are generally better for putting your skills and knowledge into practice and can arm you with powerful techniques for managing a dedicated HR team. How global is your organization? As mentioned, PHR is often best for smaller companies, while SHRM is good for mid-to-large organizations. However, the largest organizations, the multinationals, and the global corporations tend to swing back in PHR’s favor. The international and global PHR certifications are extremely useful in these contexts and teach a lot of international, regional, and cultural facets of HR that SHRM might not. That said, not all major corporations care about certifications at that upper level. By the time you’re reaching executive and C-level human resources roles, certifications are less important than your experience and your track record. Companies will often care more about what other organizations you’ve worked for and what tangible results you’ve brought to them over any pieces of paper you’ve earned from a certifying body. Which certification does your organization prefer? This is not an objective factor. If your company prefers PHR certifications, earning a PHR certification is better than earning an SHRM certification. Conversely, if your organization prefers SHRM, a PHR certification may be less valuable. If you’re looking to leave your current organization in favor of a different company, it can be worthwhile to investigate the leaders of HR for that company. Look at their LinkedIn bios and their professional portfolios, and see which certifications they have earned. This can inform you which one will be better for applying to that organization. Some factors are not a real concern. For example, both organizations have similar continuing education requirements, and the pricing for exams is comparable enough to make no difference. The education and experience requirements for SHRM certifications are mirrored by their equivalent PHR certifications. PHR is more granular but offers more room for mobility. The long and the short of it is that neither certification is truly better than the other. They are comparable in many ways, and they are better than not having a certification at all. However, if you’re interested in specific areas of human resources, like international or legal HR, you may be more inclined to earn PHR certifications over SHRM. Conversely, if you’re in an organization that is a member of the SHRM and prefers its atmosphere, the SHRM certifications may be more valuable. Learn About the Benefits of Partnering With an HR Recruiter

The world of HR is filled with all manner of terminology, from the common to the arcane. Moreover, some of these terms are commonly treated as interchangeable, despite having their specific nuances. Many of them are practically synonyms; virtually identical in meaning, but with different connotations. The two specific acronyms that we’re referring to today are HRM and HCM. It’s common to see these two used to mean the same thing, but are there major differences between them? Or is it a matter of which culture you come from determining the acronym that you prefer to use? In this guide, we’ll define and compare the two to help you understand the differences between HCM and HRM. Let’s get started! Basic Definitions First, we’ll start with some simple definitions. What do the acronyms stand for in the first place? HRM stands for Human Resources Management. HCM stands for Human Capital Management. Both terms refer to the common human resources goal of achieving a stronger, better-managed company through the appropriate management of human workers at all levels of the organization. Decades ago, HR was typically management, handling paperwork, behind-the-scenes benefits, and other organizational functions. As technology has evolved, the duties of HR and the challenges they face every day have evolved with it. HR is no longer a facilitator of business success, but a core component of that success. From ADP : “The term human resources suggests something of limited quantity, whereas human capital implies an ongoing relationship of value.” Likewise, from EPAY Systems : “HCM is the more all-encompassing term, describing functions that are part of the strategic management of human capital in an organization from talent and applicant tracking to time and attendance and analytics.” Human Capital Management encompasses Human Resources Management, as well as more broadly-focused organizational management, integrated into the overall objectives of the business. Other Related Acronyms In addition to HRM and HCM, there are several other acronyms you may encounter in discussions of human resources. These include: Human Resources Management Systems. Human Resource Management encompasses all of the human resources fields, including tasks and tools, as well as the employees that manage those duties every day at work. HRMS is the systems those human resources employees use, as well as the processes involved. Often used interchangeably with HRIS. Human Resources Information Systems. This term is often used interchangeably with HRMS. In other words, HRIS and HRMS are the same. Human Resources Administration. This is a subset of overall human resources management and relates specifically to administrating the human resources department. HRA can involve the employees in human resources, specifically directors, the Chief Human Resources Officer, and other high-level decision-makers. Learning Management System. This refers to a sub-set of human resources management typically focused on the training and improvement of employees. This may be as simple as e-learning and an internal knowledge base for onboarding, or it might include everything relevant to employee growth, including the budget for external training and certification. The Society for Human Resources Management. One of several authorities on the overall human resources subject. The Human Capital Leadership Institute. One of several authorities on the topic of human capital management. As with many business applications, the world of HR has built itself up over decades to include a wide range of arcane terminology that may not be clear to newcomers and neophytes in the industry. Defining HRM Looking deeper into human resources management, we can see all of the core features of HR narrowed down to specific duties and responsibilities. According to ADP : “HRM is about hiring the right people, managing workforces effectively, and optimizing productivity. As a software application, it typically includes the following features, depending on the provider: Payroll, Benefits Administration, Time and Attendance, Recruitment, and Talent Management.” Looking at each one of those responsibilities in greater detail: The HRM system or platform typically is responsible for managing payroll and budgeting, whether hourly or salaried, for employees and contractors. The department or software system also manages bonuses, disbursements, and other irregular financial incentives for employees. The HRM system is responsible for managing benefits beyond financial compensation for employees. Benefits such as healthcare, childcare, leave, travel reimbursement, retirement investments, and ongoing training can all be covered in whole or in part by the HRM system. Managing time clocks, attendance reviews, check-ins, and other aspects of time and attendance is all part of HRM, typically using an automated time clock system. The duties of the HR department encompass recruitment and hiring for the organization. Software that encompasses HRM duties can include features for candidate management , from initial contacts to keeping cold leads warm to automatically filtering applications. Stand-alone platforms like Application Tracking Systems may be part of an overall HRM solution. Talent Management. The relationship with an employee does not end once they are hired. HRM encompasses talent management, reviewing and adjusting the relationship the company has with an employee over the years, adjusting for the changing needs and situations of both the company and the individual. While this may sound all-encompassing for a business’s human resources needs, the fact is that HRM tends to be the narrower and more focused of the two compared to HCM. HRM deals with immediate needs, short-term needs, and mid-term needs, and only serves to assist with some long-term decision-making. Defining HCM HCM is less consistently defined amongst major organizations. Most definitions find one source of commonality: the use of software and overarching data harvesting to make or assist in making, long-term, large-scale decisions for a company. HCM makes overall, strategic decisions, while HRM focuses more on day-to-day operations. ADP does not identify specific responsibilities of an HCM platform, but rather the overall challenges that HCM can assist in. Evolving workplace demographics. Managing an increasing number of contract-based workers. Assisting with compliance in increasingly regulated industries. Reviewing the dynamics of team-based work structures. Other definitions come from other sources. For example, the research firm Gartner offers this: “According to the research firm, there are four key areas of human resources that HCM solutions support: HR administration (payroll, requesting time off, etc.) HR service delivery (access to company policies, procedures, documents, etc.) Talent Management Workforce Management (time and attendance tracking, shift scheduling, absence management, etc.) More specifically, some of the features an HCM solution offers include all of the capabilities of an HRIS and HRMS solution, payroll, employee shift scheduling, employee time tracking, Applicant Tracking Systems (ATS), training, onboarding, budget planning, and absence management.” In other words, human capital management encompasses all of what human resources management does, as well as additional duties for organization-wide, long-term decision-making. HCM is higher-level and helps assist C-level executives in their strategic decision-making. Similarities Between HRM and HCM There are a lot of areas where HRM and HCM are similar or identical. For example: Both systems make use of modern automation tools to streamline responsibilities and assist in making decisions. Labor-intensive work such as managing payroll, tracking timekeeping, and even application tracking are all partially or fully automated with some level of human review to ensure the systems stay on target. Self-service. Modern HR systems are often designed to allow individual employees and contractors to log into a system and manage their details directly. They may be able to clock in and out, request leave, manage benefits, and perform other tasks directly without needing to contact anyone within HR, saving time and money. Artificial intelligence . The integration of modern AI systems helps HRM and HCM systems handle different aspects of human resources automatically. Chatbots can filter candidates, AI can review and filter applications, and more. Laws and regulations are generally rigid and can be codified in computer systems, which can then integrate with data harvesting and user inputs to automatically review your business compliance, and issue notifications when compliance is breached, so it can be identified before an audit and fixed before sanctions. Overall, the differences between HCM and HRM are very small. Both options typically differ more in scope than in responsibilities. Picking the Right System for Your Business Choosing between HCM and HRM is surprisingly tricky, particularly when the line between the two is often blurred, particularly by the companies selling their systems for managing one or the other. Indeed, choosing the right system comes down to answering specific, systemic questions about your brand. What is the size and scale of your business or organization? Typically, smaller businesses have needed more day-to-day management that comes part and parcel with human resources management (HRM) solutions. Small businesses tend to have problems of labor, where a human resources department may be understaffed and overworked with the need to manage the details of the entire rest of the company, including pay, benefits, timekeeping, and other bookkeeping tasks. Thus, an HRM platform that can automate, streamline, and offer self-service options for many of these duties frees up the time of the human resources workers, who can then contribute more to the overall analysis of the company, offer advice on strategic decisions, and identify shortcomings in existing systems. Conversely, HCM systems are generally required for much larger organizations. Larger organizations typically have problems with scale. It’s not a matter of setting up automatic management of payroll for a company, but keeping that automatic payroll on track in an organization of thousands or tens of thousands of employees, if not more. Challenges include identifying and watching for those who “fall through the cracks”, bugs or loopholes in the existing systems that can be exploited. Additionally, HCM typically offers more large-scale analytics, monitoring, and reporting on how the organization as a whole is performing. This information can be reported to the executives and c-suite teams that direct the overall path of the business, empowering them to make high-level decisions regarding hiring, payroll, budgeting, internal improvement, and more. What are the common problems you need a human management system to solve? The first step to determining whether or not your organization needs a new software solution, a new employee, or a new director, is identifying the problems you need to solve. Does your organization have issues with delays in management, inconsistencies in bookkeeping, a lack of self-service options for employees, or other day-to-day tasks? If so, chances are good that your organization can benefit from an HRM system. Does your organization have issues with scope and scale, the bulk management and analysis of employees and their behavior, or large-scale decision-making? If so, an HCM solution may be more appropriate. It’s also worth mentioning that HRM systems tend to be more specialized, and thus often cost less than an HCM solution. However, a company may end up purchasing and implementing multiple HRM platforms for different elements of management. For example, your business might have an application tracking system, a payroll and benefits system, and a timekeeping system, operating simultaneously. This introduces challenges with integrations between each platform. If they don’t export and import data nicely , this can introduce bugs and issues in the overall system. HCM systems tend to be larger and more comprehensive. One single HCM system might include application tracking, candidate management, payroll, benefits, timekeeping, reimbursements, analytics, KPI monitoring, and more, all in one centralized platform. This eliminates the concerns about integrations but introduces potential budget concerns. HCM solutions are typically aimed at enterprise-level organizations, national and global companies, and other large groups. Pricing is higher accordingly. What systems do you currently use to address your human management challenges? As a business grows, it can out-grow its current systems. These growing pains need to be navigated by talented HR specialists, particularly during shifts from smaller-scale and multi-part HRM platforms into more comprehensive HCM systems. Conclusion Discerning the differences between Human Resources Management (HRM) and Human Capital Management (HCM) is vital for any organization aiming to enhance its HR strategies.  The question of which is the ideal solution, between HRM and HCM, for your company, is a very individualized query. It takes a dedicated analysis of your current budgets, systems, workflows, and pain points to determine whether or not you need to adjust or upgrade to address your current issues. Choosing the right system—HRM for detailed management or HCM for comprehensive strategy—can significantly impact your company’s efficiency and success. If you are looking to grow your team, reach out to us today and learn how we can help.

Human Resources exists at a crossroads between sociology and business theory. There are many theories and a lot of science that contribute to new and ongoing models of HR practices. Some of these practices have been around for decades, while others are relatively recent developments in the field. As an HR manager or executive, it’s well worth your time to familiarize yourself with at least the basic details of these theories. By learning the theories and models , you can experiment in applying them to your business, finding the one that works best with your outlook and workforce, and optimizing how well your company performs. The Harvard Model The Harvard model of human resources is one of the oldest and most influential codified models. It was initially developed in 1984 by Michael Beer and refined over the years, including additions by other experts such as Paauwe and Richardson in 1997 . It is one of the most nuanced, flexible, and holistic approaches to HR currently in use. Traditionally, the Harvard model is composed of five segments. Stakeholder Interest. Stakeholders are any group that has an interest in the outcomes of the business. Traditionally, this includes shareholders and management, though modern stakeholders can also include employee groups, unions, and even governmental interests. The combined influence of stakeholders guides the development of HR policies. Situational Factors. Situational factors are elements of the workforce, environment, industry, or society that affect HR. These pressures affect the positions and influences of the stakeholders. For example, the c-suite of a company may be influenced by self-interest, societal values, legislation, or an adversarial worker union. HRM Policies. These are the specific policies, workflows, and processes implemented within the business. They encompass activities such as hiring, training, reward and feedback systems, and more. Stakeholder interest and situational factors feed into the development of HRM policies. HRM Outcomes are the results of the policies as developed by the above influences. Outcomes include aspects of business such as employee retention, commitment, competence, and cost-effectiveness. They are generally the tangible, monitorable key performance metrics for HR. Long-Term Consequences. This section is the final section of the Harvard model. It is the analysis of a company and its employees overall. It evaluates how the company is positioned within its market and society as a whole and measures the overall well-being of workers. The key to this model is that the long-term effects of HRM feedback into the three influential foundations of the model. Long-term consequences (and the data harvested about them) are used to adjust stakeholder interests, situational factors, and specific HRM policies. The feedback from long-term consequences helps improve the initial influences, which can then process through the system and result in new, ideally better, long-term outcomes. The Warwick Model The  Warwick Model  of Human Resources was developed in the 90s by Chris Hendry and Andrew Pettigrew, working at the University of Warwick. It used the traditional Harvard model as a base but refined it further. Like the Harvard model, it focuses on five elements of HR. Outer Context. These are macro-environmental factors that influence the HR policies of a company, including political, legal, technological, socioeconomic, and competitive influences. Inner Context. These are the factors within companies that can influence HR policies. They include a company’s structure, leadership, culture, technology, and business outputs that trickle back into the company. Business Strategy. These are the basic HR strategies in play within the company. It can include the business objectives, the overall company strategy, and influences of the product market. HRM Context. Context focuses on the ground-level policies, roles, and organization of human resources within the organization and the HR outputs. HRM Content. This section is about the specific policies, implementations, and systems involved in HR. They include reward systems, employee relations, work systems, and HR feedback, among others. In general, this model attempts to balance influences from the inner and outer context, especially when they are at odds with one other. The two contexts feed into the overall strategy, which trickles down into the context and content. The implementation of HR then feeds back into influencing both inner and outer contexts through direct feedback and indirect societal pressures. The primary weakness of this model is that there’s no defined feedback loop between internal HR practices and external business outcomes. Instead, feedback loops have to filter through the various contexts, which muddles them and makes it more challenging to determine which factors result in which influences. The Five Ps Model The Five Ps model, or 5Ps, is a strategic model developed in the early 90s by Randall Schuler, a renowned and recognized expert in HR,  currently a distinguished professor emeritus at Rutgers University . The model defined five P categories that influence the overall behavior of human resources. This is the organization’s mission, overall vision, and objectives in the business space. These are defined as the operational protocols chosen and set to achieve specific purposes within a business’s goals. These are the specific business and HR processes used in daily operation, including organizational procedures and architecture. These are the people involved in the business, from the leadership to the newest hires, and how they align with the three Ps mentioned above. This is the overall state of results, typically those identified as key performance indicators and measured, the observation of which feeds back into defining and adjusting the other four Ps. This model requires that all five Ps balance one another out. They all feed into one another, and the results of their interactions must be balanced to achieve the overall business objectives desired by the company leadership, the company workforce, and society as a whole. The Ulrich Model Developed in 1995 by Dave Ulrich and further elaborated by him in 1997, the Ulrich Model focuses on categorizing every influencer of a company’s HR policy into one of four roles. Strategic Partner Agent of Change Administrative Expert Employee Champion Additionally, the CEO and senior leadership play their role. With this model, the overall processes of HR take a back seat to the people of the organization and the roles that they play. This model is also known as the business partner model. There has been debate in recent years as to whether or not this model is still viable today. Modern sensibilities prefer that everyone within an organization has a voice rather than a few distinct “champions” and organization influencers. Still, the model can be a helpful way to think about HR in terms of the people involved rather than the processes and algorithms in use. The Standard Causal Model This model is a generalized conceptualization of numerous similar models developed throughout the late 90s and early 00s. It’s almost identical in structure to the Harvard model and documents the feedback between HR outcomes and strategies. The overall business strategy rests at the top of the structure. This strategy guides the goals and objectives of the business as a whole. The HR strategy is influenced by the overall business strategy and influences everything below it in the chain. HR practices are the specific processes, structures, and operating objectives in a business, guiding day-to-day operations. HR outcomes are precisely what they typically are within the Harvard model; the specific outcomes of the overall HR process. Internal Performance is the overview, monitoring, and adjustment of how the business performs with the existing HR practices that are in place. Financial Performance is the final result of all of the processes that come before it. After all, a business won’t survive very long if it doesn’t focus on the overall financial results of its operations. The results here are factored into the practices and outcomes to improve them and, thus, improve finances. As you can see, this is a very generalized model, and many specific models take this core and tweak it. Numerous HR experts use this as the foundation for their bespoke models designed for whatever company they work with. The 8-Box Model This model is a more  broad-ranging model  developed by Paul Boselie of Utrecht University; it considers more external factors than many other models. The 8-Box model consists of eight boxes of factors, one of which is sub-divided as the core of a business’s HR process. The “Configuration” box is the formative influence of a business and includes the history, culture, technology, and workforce for the business. It leads into: The “HR Strategy and Practice” box encompasses the intended HR practices, the actual HR practices of the company (if they differ from the intended practices), the perceived practices determined by how employees see them from the ground up, and the overall HR outcomes. This box feeds into: The “Critical HR Goals” box defines the overall goals of HR within the organization, including flexibility, cost-effectiveness, and legitimacy. This section feeds into the next one: The “Ultimate Business Goals” box; as you might expect, this section analyzes the overall goals of the business, such as viability and competitive advantage. These four boxes are fed by four other boxes of influences. These are the external general market context, the external population market context, the external general institutional context, and the external population institutional context. All of these feed into the core HR strategy and practice box, influencing both the actual and the perceived practices. Additionally, they feed into and affect one another. This model is one of the most complex HR models, and while it can be effective, it takes more specific thought, training, and analysis to put it into practice effectively. It is broadly more helpful as a theory than as an actual business practice. The ASTD Competency Model The ASTD Competency model is among the most recently developed models, created in 2004 during a conference for the American Society for Training and Development. The model has been tweaked and reworked twice, in 2009 and 2011. This model focuses on three foundational blocks for a business and its HR processes. To quote  6Q : “ The foundational level  includes essential competencies: personal, interpersonal, and managerial. The focus level  introduces Areas of Expertise (AoE) such as coaching, improving employee performance, social learning, career planning, and evaluating. The execution level  focuses on four crucial professional roles: learning strategist, project manager, business partner, and professional specialist.” This model is a people-focused one that encourages the identification of key players, the personal and professional development of those key players, and an analysis of the competencies and contributions they can bring to the organization. This model is also a valuable model for identifying how to replicate the success of key performers and how to train and provide for new hires similarly. The Advanced HR Value Chain Model This model is another generalized model, using the value chain model and adjusting it with contributions from various HR influencers over the course of decades. As such, it cannot be attributed to any one person or group these days. It consists of a chain of value. HR Enablers are the influential parts of a business that enable a good HR process, such as the processes, design, marketing, and budget of the HR mechanism. HR Activities are the specific tasks and activities involved in HR management. These include workforce planning, recruiting, development, and compensation . HR Outcomes are the standard measurement of metrics like retention, engagement, performance, cost, and talent monitoring for employees. Strategic Focus is an external analysis of overall HR strategy and feeds into both HR outcomes and KPI monitoring. KPIs are monitored in three distinct groups, including financial KPIs, customer-focused KPIs, and process KPIs. HR Outcomes serve this monitoring process, and the data from them feed into the outcomes. Overall, this model is sufficiently nuanced and product-focused that it is frequently used, in some form or another, throughout businesses. Modeling the Models It’s one thing to discuss theory and models, but it’s quite another to put them into practice. It requires sufficient institutional buy-in from executives and leadership to allow a dedicated HR manager to implement the monitoring and processes necessary to formalize any of these models. The results can be pretty powerful, but the model must be adhered to for it to work. Did you learn anything from any of these models? Do any of them seem similar to the models in place in your organization? If you have any comments or questions, we’d love to hear from you. Please share with us in the comments section below!