Roles and functions of human resource management in the digital age

People are the greatest asset of a business. Whether a business develops or not is determined by its human resources, the human value of that organization. Therefore, human resource managers play a very large role in managing people, helping to adjust and connect personnel with the collective. So, what are the functions of human resource management and how important is its role? Let’s find out in the article below.

I. What is human resource management?

Human resource management is the management of all activities related to people, such as: recruitment, training, performance appraisal, etc. From there, it provides direction for implementation and control of plans to use the company’s resources most effectively, bringing optimal results. It can be seen that human resource management plays an important role in achieving the company’s established strategies and goals.

II. What is the role of human resource management in a business?

Human resource management plays the backbone role in operating the organization, taking on the responsibility of optimizing labor, building corporate culture, and being the strong connecting thread between the leadership’s strategic goals and the actual interests of the employees.

1. Establishing policies for retaining and developing human resources

This is the department that directly manages all issues related to personnel and amends and supplements regulations to suit the business. From there, it provides training and development frameworks for the company’s human resources within the personnel development strategy.

2. A bridge between leadership and employees

Human resource management plays an important role in connecting leadership and employees. It helps leaders understand employees better and easily make the right decisions, adjusting policies appropriately in operational management. Because when they have a clear understanding of personnel information, actual capabilities, etc., it will help leaders assess abilities and assign tasks in the most suitable way.

3. Advisor to the human resources management department

The human resource manager acts as a consultant, providing the best strategies and solutions for the business to solve all personnel-related issues. Thereby, helping the business achieve all its set goals, and promptly handle and resolve all situations.

It is clear that the role of the administrator contributes significantly to building a business with a dynamic, enthusiastic team of personnel who want to stay with the company long-term, creating an ideal and comfortable working environment. Let’s explore the functions of human resource management in the content below.

>> See more: What is HRM Software? The Role and Importance of HRM in Business

III. Functions of human resource management

1. Human resource planning

The first HR function is all about knowing the future needs of the organization. What kind of people does the organization need, and how many? Knowing this will shape recruitment, selection, performance management, learning and development, and all other human resource functions. 

2. Recruitment and selection

Selecting and recruiting the best candidates is an important task that managers need to focus on in the human resource planning steps. Therefore, HR needs to attract people, which often starts with the employer brand. Becoming an attractive employer has many advantages – and disadvantages. 

With a strong employer brand and the right sourcing strategy, you are halfway there. After candidates apply, the selection process is an HR tool to pick the most competent candidates with the highest potential. The development of technology in recruitment is very fast, and as a result, there are many different types of recruitment tools for each part of your recruitment funnel.

 Try 1Office’s Online Recruitment Management Software

3. Performance management

Third, HR managers need to ensure that employees are responsible in their work, work effectively, and want to stay with the company. This is reflected in the leadership’s effective work management methods, goal setting, and work orientation. Good performance management will help bridge the gap between the workforce you have today and the workforce you want to have tomorrow. 

4. Personnel training and development

Enabling employees to develop the skills they need for the future is an essential responsibility for the HR department. This also relates to the first HR function we listed, where HR bridges the gap between the current workforce and the workforce needed in the near future.

5. Career Planning

The next function of human resource management is planning, guiding, and developing careers for employees, also known as career skills. Showing employees how their capabilities can fit into the company’s future will help attract and retain them. 

6. Labor Relations

Labor relations is an important human resource management function that plays a role in engaging and maintaining employee relationships between departments. This helps to quickly detect and resolve potential conflicts and is also beneficial during more difficult economic times when layoffs or other actions are necessary.

7. Benefits and Welfare 

Regardless of their job or position, employees are entitled to benefits from the company. Therefore, HR has the role of supporting and caring for employees when they encounter personal problems. Personal welfare is about supporting employees when things don’t go as planned.

Issues both inside and outside the workplace can negatively impact employee performance, engagement, and productivity. This, in turn, harms a company’s profitability. Your HR department must work on a direct communication level with employees and facilitate communication between teams and the company to ensure good personal well-being. 

8. Employee Recognition

Recognition & rewards, one of the many functions of HRM, is about appreciating employees’ efforts and retaining remarkable talent. Rewards and recognition make employees feel valued for their work, as appreciation serves as a motivator. These can be financial or non-monetary rewards.

9. Building HR Policies

Policies are the backbone function of Human Resource Management. An organization needs tried and tested policies as much as it needs updated and more sensitive ones. A logical and well-defined policy framework structure covers all the smallest aspects of a company and its operations. Policies can control activities such as better engagement, standardized methods, procedures & implementation, and appropriate communication, to name a few.

10. Employee Health and Safety Regulations

Every employer must comply with the health and safety regulations set by the competent authorities. Our labor laws require every employer to provide any necessary training programs, supplies, and information to ensure the safety and health of employees. Integrating health and safety regulations with company processes or culture is the right way to ensure employee safety. Making these safety regulations a part of the company’s activities is one of the important functions of HRM.

IV. Why is human resource management important in the digital age?

Technology is changing every field, and the human resources (HR) department is no exception. Today, human resource management is not just about recruiting and timekeeping, but also about optimizing processes with technology, managing data, and building an engaged, effective team.

1. Digital transformation and its impact on HR work

Digital transformation means applying technology to change the way we work — from manual to automated, from intuitive to data-driven.
In HR, this helps to:

• Recruit faster: use websites, social media, or online job boards.

• Train more easily: employees can learn online, without needing to attend classes.

• Store records securely and look them up easily: no more “digging through” paper files.

• Track work performance: data is automatically compiled, helping managers see clearly who is performing well.

Real-world example: A small business can use Google Forms to collect candidate applications instead of manually filtering through emails. This is the first step of digital transformation in HR.

2. Automating processes and managing HR data

Automation is about letting software handle repetitive tasks for people, such as sending interview invitations, calculating payroll, or tracking days off.

Key benefits:

• Reduce errors from manual entry.

• Save significant administrative time.

• Easily create summary reports and statistical charts.

However, businesses also need to focus on data security. Employee information such as salary, date of birth, or identification numbers is personal data and must be stored securely and in compliance with legal regulations.

3. The Role of Human Resource Management Software in Increasing Efficiency

Human Resource Management (HRM) software is a system that helps manage all employee information on a single platform.

Key benefits:

• Easily track records, leave, timesheets, and compensation.

• Save time compiling data for reports.

• Helps managers clearly see the performance of each department.

For example: Many Vietnamese companies now use software like 1Office, Base HRM, or Misa AMIS to automate HR processes, instead of doing them manually with Excel.

4. New Challenges for HR Managers in the Digital Age

Technology opens up opportunities, but it also brings many challenges:

• Staff unfamiliar with technology: many people are still used to manual paperwork.

• Information security: data is vulnerable to leaks if insecure software is used.

• Changing work culture: younger employees want more flexibility and freedom, requiring HR to adapt policies.

• Managing remote employees: difficult to assess performance without supporting tools.

Solution: Businesses should retrain their HR teams to use software and digital skills. At the same time, combine technology with the “human” element — because technology is only a support, while people are the core.

V. Future Trends in Human Resource Management

As technology, data, and human behavior change, HR practices must also adapt. Below are the major trends that will shape the HR profession in the coming years.

1. Application of Data and Artificial Intelligence (AI) in HR

Artificial intelligence (AI) is a technology that helps computers “learn” from data to make suggestions or predictions.
In HR, AI helps:

• Suggest suitable candidates during recruitment.

• Predict employees at risk of early resignation.

• Recommend suitable training courses for each individual.

HR data analysis (also known as People Analytics) helps managers make decisions based on data, rather than intuition.
For example: if the engineering department has a higher turnover rate than other departments, HR can investigate the cause to adjust policies.

2. HR Management Based on Employee Experience

Employee experience is the overall perception an employee has from the moment they apply until they work, get promoted, or leave the company.
If employees have a good experience, they will be more engaged and work more effectively.

Ways to improve the experience:

• Create a friendly work environment.

• Provide modern work tools.

• Have clear opportunities for learning and advancement.

The eNPS (Employee Net Promoter Score) is often used to measure employee satisfaction — that is, “would you be willing to recommend the company to others?”.

3. Flexible Work Models and Remote Management

Flexible (hybrid) work means employees can choose to work from home, at the office, or a combination of both.

Benefits: cost savings, creating work-life balance.
Challenges: difficult to monitor, easy to lose connection between teams.

Solution: Businesses should use project management software (like Asana, Trello, or ClickUp) to assign tasks clearly, track progress, and maintain cohesion among team members.

4. Focusing on sustainable development and total well-being

Future human resource management is not just about work performance, but also about the physical and mental health and work-life balance of employees.

For example:

• Allowing flexible leave.

• Organizing yoga, meditation classes, or wellness days.

• Providing insurance programs and psychological support.

This is the “total wellbeing” trend that helps retain talent long-term.

VI. Lessons and recommendations for modern HR managers

To keep up with the digital age, HR professionals need to shift their mindset—from “managing people” to “developing people.” Here are specific guidelines to get started.

1. Be people-centric

Employees are not just people who perform tasks; they are the company’s most valuable asset.
Design policies that cater to their needs: learning, development, and recognition.

Suggestion: create a mentorship program to help new employees integrate easily, or conduct regular surveys to listen to employee feedback.

2. Combine technology with the human element

Technology saves time, but the human element maintains engagement.
HR should use software to handle administrative tasks, freeing up time for more important work—like training, connecting with, and motivating employees.

3. Enhance leadership skills and inspire

HR needs to become a “change leader” within the organization.
This requires communication skills, coaching, and the ability to build trust.

Suggestion: Organize internal sharing sessions, soft skills training, or short leadership courses.

4. Measure HR effectiveness with specific metrics

You can’t improve what you don’t measure.
Set clear key performance indicators (KPIs), for example:

• Time to fill a position (Time to fill).</pThus, the content above has introduced users to the functions of human resource management in the 4.0 era. Hopefully, this article will provide you with useful knowledge to make the personnel management process easier and more effective. If you are looking for a solution to help manage and digitize your HR processes, then please leave your information for our experts at 1Office to contact you for a consultation. 

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