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In the Beginning There Was Human Resources … Although They Called It “Personnel”

By HappyOrNot

Believe it or not, there was a time when there was no such thing as Human Resources.

It may be hard to imagine in a world where we’re constantly focused on recruiting, hiring, and finding ways to better engage employees, but the first HR department (or and it least something like it) didn’t come around until the beginning of the 20th Century.

Most believe that the first human resources department was established by The National Cash Register Company in 1901 following several strikes and employee lockouts.

Although it was referred to then as “personnel,” the new department’s role, as established by NCR leader John H. Patterson, was largely focused on compliance, record keeping, workplace safety, wage management, and handling employee grievances, as well as training for supervisors on new laws and workplace practices.

The development of Personnel Administration

Although the trend of managing “personnel” didn’t take off immediately, it slowly grew as more and more companies realized that they had to do more to help manage their workers. For example, in the 1910s, Tata Steel and the Ford Motor Company introduced a then unheard-of labor practice — the 8-hour work day.

That was also slow to spread.

By the 1920s, Personnel Administration emerged as a clearly defined field throughout the U.S. and was largely concerned with the technical aspects of hiring, evaluating, training, and compensating employees. Personnel was viewed as a “staff” function in most organizations, and it didn’t really focus on how various employment practices impacted an organization’s overall performance.

Labor unions were also growing during this time, and the Personnel Department helped to resolve both wage-related issues and other differences between the union and management.

Two men also stood out in the first half of the 20th Century for their contributions to workplace management.

Enter the “Father of Scientific Management”

One was Frederick Taylor, known as the father of scientific management, and he played a huge role in the development of the Personnel Department in the early 1900s.

In his book, Shop Management, Taylor advocated the “scientific” selection and training of workers, and he is credited as one of the first to make a business case for better management of employees. The key principles of scientific management include:

  • Using the scientific method to determine the most efficient way to work.
  • Matching workers to a task they are suited for.
  • Proactively monitoring performance and providing feedback,
  • Allocating planning tasks to managers so workers focus on the task at hand.

These principles probably sound familiar to anyone in Human Resources today. In fact, Taylor advised business owners and managers on how to better manage their people for better results. You might say he was focused on employee engagement long before anyone had put their finger on what that was.

Maslow’s “Hierarchy of Needs” a precursor to engagement

The other big contributor to the 20th Century development of human resources and employee management was Abraham Maslow, who developed his famous “Hierarchy of Needs” that helped managers understand how to better motivate, recruit and retain employees.

According to Maslow, all people have needs that must be satisfied, and Maslow used a pyramid to describe and categorize those needs, and the needs on the bottom of the pyramid must be met before needs on the next level can be addressed.

  • Level 1: Psychological Needs (bottom of the pyramid) — People need air, food, water, sleep, and other basic elements to survive. So, how does this relate to employee engagement? Employees need a comfortable work environment.
  • Level 2: Safety Needs — People must feel that not only they, but also their family, their property, and their other personal resources, are safe. In the workplace, if employees are worried about their personal safety (like being sick or getting hurt at work) or their professional security (such as losing their job), morale will suffer.
  • Level 3: The need to love and belong — Having a strong sense of belonging is key to building an engaged culture. Employees who have good friends at work are more likely to be engaged than those who don’t. And companies with a history of social activities have higher degrees of employee engagement than those that don’t.
  • Level 4: The need for Esteem — This is an employee’s belief that they are not only doing a good job but that their contributions are being recognized. People want to feel that they’re achieving, and if employees believe they are — and believe (thanks to employee recognition) that others they work with believe in them — they’ll be more engaged and productive.
  • Level 5: Need for Self-Actualization (top of the pyramid) — Self-actualization is the belief that someone can maximize their potential on the job. Employees want to be the best at what they do, and the job of a good manager is to help them realize that. With self-actualization, employees feel trusted and empowered — in other words, in control of their job AND their future.

It’s easy to see how much of Maslow’s theory drives our workplace management of today, particularly the development of a strong workplace culture and employee engagement. In fact, many believe that Maslow’s Hierarchy of Needs not only built on some of the work of Frederic Taylor but is a precursor to our 21st Century employee engagement practices of today.

HappyOrNot is proud to play a role in the ongoing development of smart employee engagement practices. Not only do we embrace the historical underpinnings of Human Resources, but we have the tools and experience to help you stay connected to a high-performing and engaged workforce but understanding the Employee Experience.

Just reach out to here to let us know how we can help you improve your overall performance.

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