Employee experience

10.02.2023

When did human resources start and who created it?

Human resources (HR) departments play a vital role in modern organizations, managing personnel and organizational aspects while fostering positive employment relationships.

In this article, we’ll explore the following:

What is a human resources department?
A brief history of human resources
Who created human resources?
When did human resources start?
Which company had the first HR department?
The timeline of human resource management
Personnel management vs. human resource management

What is a human resources department?

A human resources (HR) department is a vital component of modern organizations, responsible for various personnel and organizational management aspects.

As a strategic business partner, the HR department focuses on fostering positive employment relationships and ensuring the well-being of employees. They handle employee retention, training programs, and performance appraisals while complying with company policies and anti-discrimination measures.

A brief history of human resources

Let’s look at how human resources started and evolved over the years to become one of the most important departments of top-performing organizations.

Who created human resources?

The origins of human resources can be traced back to the early 20th century, with the establishment of personnel departments in organizations like the National Cash Register Company.

However, the significant changes brought about by World War II and the subsequent industrial revolution propelled the transformation of personnel departments into modern human resources departments.

When did human resources start?

In the early 20th century, as industrialization and the rise of large organizations brought new challenges, the first personnel departments emerged. These departments, also known as personnel administration or personnel management departments, were responsible for tasks such as record-keeping, employee grievances, and ensuring compliance with new laws.

However, during the latter half of the 20th century, the field of human resources management (HRM) truly took shape. As modern organizations needed to manage employee relations, workplace safety, and strategic initiatives, HRM evolved into a business function that aligned people management with organizational goals.

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.

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.

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

Which company had the first HR department?

The first HR department can be attributed to the National Cash Register Company, which established a personnel department in the early 20th century. This pioneering personnel department laid the foundation for modern HR practices.

Over the years, HR professionals have evolved into strategic business partners responsible for human capital management, employee engagement, succession planning, and more. Today, HR departments are integral to the functioning of most organizations, working closely with managers and employees to ensure the well-being and success of the workforce.

The history of human resource management – a timeline

The history of human resource management is a fascinating journey that reflects the evolution of organizational practices and the changing role of HR departments.

From establishing the first personnel management department to the modern era of strategic HR leadership, this timeline highlights key milestones and significant changes that have shaped the field.

Early 20th century: Establishment of the first personnel management department, addressing working conditions and industrial welfare workers.
1920s: Emergence of trade unions and welfare workers associations, influencing labor relations and employment practices.

1910-1930: Introduction of scientific management principles, focusing on efficiency and productivity in the workplace.
1940s: Impact of the war effort on HR work, with a strong focus on recruiting and onboarding new hires.
1950s-1960s: Rise of industrial psychology and the development of HR leaders who prioritize employee well-being and engagement.
1970s: Introduction of anti-discrimination policies and establishing of the Chartered Institute of Personnel and Development.
1980s-1990s: Integration of new technologies and information technology in HR operations, revolutionizing HR work in many organizations.

2000s: Expansion of HR responsibilities to include strategic initiatives, people operations, and supporting global growth.
Present: HR departments ensure employee satisfaction, foster a positive work environment, and contribute to the organization’s market share.

Personnel management vs. human resource management

Personnel management, often associated with the early 20th century, was the first department to manage employees. It primarily dealt with administrative tasks such as record-keeping, compliance with labor laws, and handling industrial relations and unions.

In contrast, human resource management (HRM) emerged in the latter half of the 20th century and evolved in response to the changing dynamics of the modern organization. HRM places a greater emphasis on strategic planning, talent acquisition, employee development, and engagement.

Conclusion

From addressing employee grievances and ensuring workplace safety to managing employee engagement and talent acquisition, HR professionals have emerged as strategic partners in organizational management.

Today, HR professionals and departments play a vital role in managing personnel, developing talent, and aligning organizational goals with effective people management strategies. The human resources journey continues as the field responds to the challenges and opportunities presented by the ever-evolving world of work.

Frequently asked questions

What is a human resources department, and how has it evolved?

A Human Resources (HR) department is responsible for managing people within an organization from hiring and training to performance management and employee well-being. Historically, HR started as Personnel Management in the early 20th century, focused mainly on record-keeping and compliance. Over time, it evolved into a strategic business partner that drives employee engagement, culture, and organizational growth. Today, tools like HappyOrNot complement HR by capturing real-time employee feedback, ensuring HR teams can respond quickly to workforce needs.

When did human resources begin, and who created it?

Human resources began in the early 1900s, when companies like National Cash Register (NCR) established the first personnel departments. Influencers like Frederick Taylor (the “Father of Scientific Management”) shaped the early discipline by promoting systematic worker training and performance monitoring. While HR’s origins were about efficiency and compliance, today’s HR emphasizes employee experience and engagement. HappyOrNot helps HR teams continue this evolution by measuring how employees feel about workplace culture, leadership, and change initiatives.

What is the difference between personnel management and human resource management?

Personnel Management: Primarily administrative, dealing with hiring, payroll, compliance, and industrial relations.

Human Resource Management (HRM): A broader, strategic approach that emphasizes talent development, employee engagement, organizational culture, and aligning people strategies with business goals.

HappyOrNot brings real-time feedback into HRM, enabling organizations to go beyond administration and proactively shape employee satisfaction and retention.

How can employee feedback improve HR and organizational success?

Employee feedback is a vital tool for HR to understand workplace challenges and opportunities. With HappyOrNot’s feedback solutions, organizations can:

Track employee sentiment across departments in real time
Identify issues like low morale, workload stress, or communication gaps
Recognize high-performing teams and best practices
Build a continuous improvement cycle that strengthens retention, culture, and productivity

This ensures HR fulfills its modern role as a strategic partner in employee experience and organizational success.