Human Resources Management: Definition, Responsibilities, and Importance for External Staff

Slobodan Rasic

September 16, 2026
7 minutes

Human resource management encompasses far more than just the administration of employees. It involves planning, recruiting, deploying, and developing the workforce. In the professional literature, human resource management is often used interchangeably with personnel management, human resources, or Human Resource Management (HRM).

However, the concept of human resources management is changing. Companies are increasingly working not only with their own employees but also with temporary workers, freelancers, service providers, and other external workers.

This raises an important question: Does external staff also fall under the purview of human resources management?

What Is Human Resources Management? A Definition

Human resources management refers to the totality of measures and processes a company uses to plan and manage its human resources.

These include, among other things:

Workforce Planning
Recruitment and
Recruiting
Staffing
Human Resources Development
Human Resources
Compensation
Human Resources Management

Simply put, the goal is to have the right personnel available at the right time to perform the necessary tasks.

Traditionally, the focus has been on a company’s own employees. However, modern workforce structures are making this distinction increasingly difficult.

Human Resources Management and External Staff

Today, a company can work with both its own employees and external workers at the same time.

For example, a project may be staffed by permanent employees, while additional specialists are brought in through a staffing agency. Freelancers may be hired for a specific project. Other services may be provided by an external service provider.

From the company’s perspective, all of these individuals or service providers meet a specific personnel or resource need, even if they are classified differently from a legal and organizational standpoint.

External personnel are therefore not automatically considered employees in the traditional sense of labor law. However, they can certainly be an integral part of a company’s human resources and workforce management.

This is precisely where an additional challenge arises: The company must not only know how many of its own employees it has on staff. It also needs an overview of which external resources are being used, where they are working, which suppliers provide them, and how long their assignment is scheduled to last.

What tasks does human resources management involve when dealing with external staff?

The specific tasks vary depending on the deployment model. However, some fundamental questions remain the same.

1. Plan staffing needs

The first question is: What resources are needed?

It’s not just about the number of people. Qualifications, duration of service, location, timing, and costs also play a role.

2. Recruit staff

If the need cannot be met internally, external sourcing channels are utilized. These may include, for example, staffing agencies, freelance platforms, or specialized service providers.

3. Organize Staff Assignments

Once the staff has been assigned, the assignment must be organized. This includes, for example, start and end dates, responsibilities, access, time tracking, and other organizational processes.

4. Keep an eye on costs and performance

Costs also arise in connection with external personnel, and these must be planned and monitored. At the same time, it may be useful to compare suppliers and external resources based on uniform criteria.

5. End or Extend Assignments

External assignments are often temporary. Therefore, it is important to take into account deadlines, extensions, and offboarding processes.

With a larger external workforce, this quickly becomes a management process in its own right.

Why External Staff Pose a Particular Challenge

When it comes to in-house employees, much of the information is centralized within the company. With external staff, however, it is often scattered among several parties, which can quickly make it difficult to keep track of everything.

A key question in modern human resources management is therefore no longer just:

“How many employees do we have?”

But also:

“Who are the employees working for us, and how are they assigned?”

This is particularly relevant when companies employ a large number of external workers.

Human Resources Management vs. Workforce Management

The terms are sometimes used in different ways.

Human resources management traditionally encompasses all aspects of a company’s human resources work, from planning to recruitment and deployment, through development and administration.

Workforce management, on the other hand, places greater emphasis on the specific planning and management of available staff or labor.

In modern workforce structures, both internal and external resources can be taken into account.

For companies with a large external workforce, this means that human resources management and workforce management can no longer be viewed as completely separate.

What role does a managed service provider play?

When companies work with a large number of external workers and multiple suppliers, managing external personnel can become a process in its own right.

A Managed Service Provider (MSP) can serve as a central point of contact between business units, HR, procurement, and external suppliers.

This involves, for example, the structured management of demand, suppliers, operations, data, and processes.

The MSP does not automatically take on the traditional responsibilities of a human resources department. Rather, it can centrally organize the processes related to the external workforce.

You can learn more about this in the Managed Service Provider section for Human Resources.

What role does technology play in human resources management?

The more complex a company’s workforce becomes, the more important centralized data and digital processes become.

For example, a Vendor Management System (VMS) can consolidate information about external workers, suppliers, assignments, and costs in one central location.

This allows companies to identify, among other things:

how many external workers are currently employed,
which suppliers are involved,
which assignments will end soon,
What are the costs involved,
and how the external workforce is evolving.

Technology does not replace human resources management. Rather, it lays the groundwork for making HR processes more transparent and easier to manage.

Conclusion: Human resources management does not end at the company's boundaries

The classic definition of human resources management refers to the planning and management of a company’s human resources. In modern workforce structures, however, the focus often extends beyond the company’s own employees.

Anyone who regularly works with temporary employees, freelancers, or external service providers must also plan and manage these resources in a structured manner.

As a result, external personnel become an important component of modern workforce and human resources management, with their own processes, data, responsibilities, and requirements.

Questions About the Definition of Human Resources Management

What is human resources management, explained simply?

Human resources management encompasses the planning, recruitment, deployment, development, and administration of a company’s human resources.

Is external staff part of human resources management?

External personnel are not automatically considered part of a company’s own workforce. However, managing external workers can be an integral part of a comprehensive workforce and human resources management system.

What is the difference between personnel management and HR?

In practice, these terms are often used interchangeably. HR stands for Human Resources or Human Resource Management and also refers to the systematic organization and management of personnel-related matters.

What is Workforce Management?

Workforce management involves the planning and management of the available workforce. Depending on the company, both internal and external resources may be taken into account.