Running Your Business

How to Build and Establish Your HR Department Structure


  • When your business starts to grow, the need for a larger HR force grows as well


  • Most companies have at least one dedicated full-time HR person per 100 employees


  • Make sure your HR department is full of people who understand your business inside and out


Posted by April 18, 2019

Human resources is the backbone of any well-run business. And just as a spine needs to be properly aligned in order for everything else to work, your organization’s HR department structure needs to be firmly in position for the business to run smoothly.

Of course, every company is different—so if you’re looking to build an HR team at your organization, it’s a good idea to evaluate different options. Here are insights into why HR is so important, how to set a team up for success and how to determine the manpower your small business really needs in the human resources department.

Why You Need an HR Department

Hiring someone with HR knowledge is one of the first things any business should do upon its founding. You need someone to take charge of recruiting, onboarding, paperwork, development, benefits and general compliance, among a million other tasks. And this shouldn’t all fall on your plate—you’ve got a business to run, after all!

Speaking of compliance, this type of support can’t be provided through one quick chat with a consultant. It really should be ongoing. The more employees you have, the more complex the laws become. For instance, at 15 workers, your business must abide by federal discrimination laws; at 50 employees, you must honor the Family Medical Leave Act. These rules can be complicated to administer, so having an expert on board is a necessity.

Developing Your HR Department Structure

Human resources reports up to the CEO or owner, so it’s critical that your organization hires a head of HR who feels comfortable and empowered to speak on behalf of the entire department. On a more practical level, HR leaders can’t effectively investigate sexual harassment cases or make recommendations for raises if they’re not part of the executive team. So make sure they can—and do—report to the C-suite regarding all HR matters.

Your HR head will also play a key role in shaping and upholding the culture of your workplace. So, during the hiring process, make sure you pose questions that’ll help you gauge the candidate’s values and beliefs. This can be achieved through behavioral interviewing, where you ask a candidate how they would act in a certain situation. This is a chance to bring up true-to-your-office scenarios to see how interviewees would handle them, and whether their methods are in line with your workplace culture.

If your business is very small, outsourcing some HR tasks may be the right move. According to Inc., outside firms can provide assistance on a variety of tasks, from creating training materials to overseeing social media management and updating benefits administration to maintaining regulatory compliance (among many other services). Oftentimes, it’s a matter of whether or not the price is right, and if your in-house staff are able to handle these tasks.

Why HR Must Grow With Your Business

The Society for Human Resource Management notes the average business has roughly two HR representatives for every 100 employees. But as a business grows to more than 1,000 employees, that number tends to drop to around one HR professional per every 100 employees.

This is due to the fact that within larger companies, each HR person can be specialized, and thus more efficient. For instance, it makes more sense for a bigger company to have one HR rep focused on all things recruiting, another concentrating solely on benefits and yet another to deal with employee relations—as opposed to three generalists who would just get in each other’s way.

Ensuring HR Understands the Business

Workplace conflicts happen every day, across all businesses. To a degree, this is to be expected—but your organization’s culture (and products) can make your company different. So make sure you take the time to staff a human resources department that understands your business in addition to your culture.

Think of it this way: Your HR team members will typically be representing the company during recruiting efforts like job fairs and campus visits, and are they’re often the first (and last) representatives that candidates interact with. That’s why these professionals must know your organization inside and out. Otherwise, you could risk losing out on top talent.

At the end of the day, your HR department is there to support you and your colleagues, so it’s crucial to make sure you have the right people—and the right number of them—to navigate everything with precision and care.

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