Human Resources Organizational Structure

The human resource (HR) department is responsible for many functions in a company. It manages the employees at all stages, including search, screening, interviewing, recruiting, and firing. It guides employees and creates an environment for growth, including training and skills development. HR department protects the company's interests, ensures the satisfaction of employees, and provides them with all needed to perform their job. It controls compliance with all labor laws and implementation of employee benefit programs and compensations, health and safety, monitors the employees' satisfaction. In addition, it manages employees' relations, problems and conflict resolution. HR department inspires employees to be productive and improve their skills and performance.

HR department is beneficial for a company of any size because the correctly recruited staff influences the efficiency of any company and contributes to its success. The talent management process, the ability to attract, engage and retain top HR talents impacts the business productivity and efficiency. However, the HR department structure can vary. When creating the HR department, consider the HR budget, HR staffing plan, organization staffing plan, the long-term and short-term needs. The size of the company, type of industry, business climate, and other factors are also relevant to the HR department structure.

Human resources organizational structure defines the hierarchy in HR department positions, roles and relationships, priorities, HR team competencies. It shows how the responsibilities of each employee fit the overall system, indicates who reports to whom, and how the information flows between levels within the company. It makes the operation of the HR department more efficient and helps in the allocation of responsibilities and payment for the employees.

The creation of HR organizational structure matters for a company. The clear, correct, and visual organizational structure of the HR department matters for any business. It clears key company functions and needs, measures success, and greatly impacts business functions.

HR organizational structure shows a model of a department structure and establishes either decision-making is centralized or decentralized. The centralized HR structure has a defined hierarchical chain of command and decisions flow from the top down. The top HR management supports activities for the whole company. The lower levels report to upper management. In a decentralized HR structure, HR functions are distributed across different units of the business. This ensures a high level of communication between employees and improves working relationships. Decision-making is distributed among the levels of the organization, different departments, geographical areas, etc. Different departments take an active part in the decision-making before the HR department makes a final one.

Organizational structure has a great positive impact on the business and leads to success and business growth, provides clarity for everyone at every level, and allows companies to remain efficient and focused. The structure gives a look at the best way to develop a company, move ahead and achieve its main objectives.

Example 1. Human Resources Organizational Structure

Different ways to structure the HR department are used:

• Hierarchical organizational structure is the most used HR organizational structure. This structure looks like a pyramid with a vertical chain of command, the high management is at the top, and the decrease of power flows from the top down. The information is also passed from the top down.
• Functional organizational structure includes both communication with an immediate supervisor and employees from the same level (horizontal sharing of information). It is a good solution for large companies with a lot of departments. Direction is at the head.
• Matrix structure combines the centralized and decentralized structure. HR employees can report to their designated HR managers and other departments in the company. It is a more complex and rarely used structure. However, it may ensure faster access to information and faster response in critical situations.
• Outsourced structure supposes hiring an outside agency to perform HR functions in the company. This structure is used by small companies with a limited number of employees, helps to focus on business processes and save time.
• Divisional or multidivisional structure divides the company's leadership team based on the projects they implement or products they produce. All business units operate as individual companies.
• Flat or horizontal structure is an innovative structure. It offers employees freedom and flattens the hierarchy and chain of command. All employees operate equally and everyone is involved in decision-making. This structure is used in small enterprises with few people in the middle management.
• Circular structure is the hierarchical structure but formed as concentric rings. High management is at the center and concentric rings expand outward.

Choose a structure that meets your goals with considering the HR department's size in your company.

Example 2. HR Department Library — Design Elements

ConceptDraw DIAGRAM vector charting software provides powerful HR Flowcharts solution to develop human resources organizational structure for a company of any size and direction. This solution is rich for the samples, examples, and predesigned vector element libraries. 7 libraries with 350+ objects are included:

1. HR Symbols
2. HR Flowchart
3. HR Workflow
4. HR Department
5. HR Professions
6. HR Steps
7. HR Arrows

Example 3. Human Resources Flowchart — Recruitment Model

The HR Charts you see on this page were created in ConceptDraw DIAGRAM software using the extensive drawing tools of the HR Flowcharts Solution and visually show hiring process on the HR Flowchart. They successfully demonstrate the solution's capabilities and professional results you can achieve. An experienced user spent 10-15 minutes creating each of these samples.

Use the powerful tools of the HR Flowcharts Solution for ConceptDraw DIAGRAM software for effective hiring process and for quick and easy creating professional-looking HR Flowcharts. Use successfully the created diagrams in your work and personal activity.

All source documents are vector graphic documents. They are available for reviewing, modifying, or converting to a variety of formats (PDF file, MS PowerPoint, MS Visio, and many other graphic formats) from the ConceptDraw STORE. The HR Flowcharts Solution is available for all ConceptDraw DIAGRAM users.