What does the HR department do?

Throughout my career I have always wondered what the HR department does. Like most people my interactions with them have been limited to the application process for a new role, payroll, submitting paperwork for taxes, medical insurance, benefits, leaving a company etc. So, from this perspective I have seen them as purely an administration function.

One memorable interaction with HR was when I was asked by a Head of a Department to apply for a role. We had a coffee to discuss the role, they wanted me for the role, and I wanted to have the role, so I submitted the application form to the HR department. A few weeks later the Head of a Department contacted me to ask why I had not applied; I was surprised as I told them that I had applied. But they did not have my application in the pile of submitted applications. So, I went to speak to HR and found out that they lost my application form. Plus, that they were going to spend 100k on consultancy to teach them how to file paperwork as it seemed that the loss of important paperwork was commonplace in the HR department. While this was the time of paper application forms instead of online forms it was an interesting experience that made me curious about what the HR department does.

It was during my MBA when I had a series on lessons on the world of HR and what in theory a HR department does. From this enlightening class I discovered the following –

The role of the HR department is to understand the strategy of the business and ensure that the business has the right people in the right roles with the right skillset and experiences to deliver the strategy.

I was totally surprised when I heard this, but it also made perfect sense. HR is not just an administration department. HR has a vital role in the success or failure of a business. As if the business does not have the right people, in the right roles, with the right skillset and experiences then the business will not make any money and it will go bankrupt.