Why Do Middle-Level Companies Use HR Mainly for Management's Benefit? Let's Discuss!

The Role of HR in Middle-Level Companies

In middle-level companies, the HR department is often used for the management's benefit. Why is this the case? HR has the challenging task of balancing both sides: Management & Employees.

In these companies, workers are often unaware of their rights, which can lead to an imbalance. On the management side, the focus is primarily on their own benefit. They may engage in activities that seem to show concern for employees, but in reality, their main focus is on profits.

If you, as HR, favor management, you are considered capable. However, if you advocate for employees to management, you may be treated as an adversary. Why does this happen? Can anybody explain why management retains HR primarily for their own status or benefit?

I agree with Mishra; it's true that HR plays a role as a management benefit in middle-level companies. Illiterate employees blindly trust their HR department for any problems, but they support management instead of employees. However, in some places, it's not the same, as most HR professionals act as mediators between management and employees to come up with the best solutions.

In every company, HR plays a vital role, so they should be fair to both parties. It's important to note that HR is also an employee of the management.

Thank you,

Clarifying Company Types and Legal Obligations

Obviously, what you are saying is right, but it mostly applies to private (PVT) companies, not limited (Ltd.) companies. What happens is Ltd. companies are focused on wealth maximization, while PVT companies aim for profit maximization. If the company is focused on wealth maximization, then it is mandatory to follow all legal rules.

Regards

Business Objectives and HR Policies

As far as I'm concerned, businesses (here Company) generally work with two main objectives:

1. Profit Maximization
2. Cost Minimization

Here, some medium and small-level companies are making use of these objectives by developing company policies in favor of their profits. Consequently, HR policies are also crafted to align with these objectives.

The reason behind this trend is that companies today primarily focus on profit maximization alone, as they may lack the expertise or knowledge to implement cost minimization strategies. As a result, these strategies are often applied to less educated and less knowledgeable employees to increase revenue.

Hope you understand this.

Sincerely,
Regards

I think in small and mid-size companies, the role of HR is mostly administrative rather than a Strategic Business Partner. It still operates like a personnel department where concepts such as employee advocacy, employee welfare, employee branding, etc., are not entertained. These companies have their own constraints of funds, infrastructure, etc.

In large-size companies, HR has a scope to grow in all these areas.

Regards,
Rashee

Yes, I also agree that in medium-sized companies, most of the workers are not aware of their legal rights. If someone from the HR department starts educating them regarding their rights, then HR may not be perceived as capable or meeting management expectations.

However, as an HR professional, I believe that it is beneficial for the organization if workers are educated about their rights. This would reduce the frequency of visits to the HR department for minor queries, allowing the HR department to focus on other tasks.

Indeed, it is the size of the company and management approach equation. Smaller organizations are generally closely held by families, and the management has a personal agenda. The owners of businesses want their own policies to be applied, and HR is used as a tool for that purpose. Any profit or gain is seen as a personal gain or loss, and the maximization of profit is the ultimate goal.

Having achieved financial stability, bigger enterprises work towards an additional parallel goal - company employee welfare. Here, the idea is optimization (and not maximization) of profit, which leaves a huge gap in approaches. This approach keeps employees motivated with a longing for the company and a commitment to work with passion, resulting in more profits by default and not pressure.

This difference is bound to remain because of the objectives and goals.

Regards,
Dr. Ulhas Ganu

I do not agree with the Nimmi Mishra agreement because the decisions are taken based on company policies, rules, and regulations. Sometimes, these decisions benefit management but not the employees. HR plays only a mediator/bargainer role, so it is important to note that several people think the HR department is used for the management's benefit.

First of all, hats off for starting the discussion; this is one main thing that keeps bothering me. Here, as an HR professional, we should be able to help both management and employees reach their goals as both are interrelated when we speak about wealth. For a company, an employee is an asset, and for an employee, the organization is an asset. Mutual benefits always lead to significant outcomes.

I am happy to be a part of this discussion.

When you join a family-run business, management often hesitates to make decisions in writing. They prefer to avoid any restrictions and do not want to inform workers of their rights.