Human Resources

The term human resources (HR) generally refers to the administrative department in an organization that manages employee affairs. This group is often thought of as a maintenance cost: a necessary but [Page 239]expensive entity that spends money but does not bring in any of its own. Whereas it is certainly true that HR serves as the bureaucratic heart of most established organizations, the function and strategy of HR in new organizations is substantially different. In fact, the constraints of a strong bureaucracy in an established organization would likely prevent that organization from engaging in the flexible HR practices necessary to leverage employee skills and knowledge in the way required by the dynamic and uncertain environment of a new venture. Whereas employees are a source of ...