People management is an activity to increase the working efficiency and the growth of professionalism by training, motivating and directing employees to their works. The reason why it is so important because by having a good people management, a company can increase their productivity and efficiency on their works and resulting a good working environmental, where the workers can work with their maximum potential and focus. The key components of people management are employee engagement, compensation and benefits, training and development, recruitment and selection, performance management, and work-live balance.
I completely agree with your answer, especially the part of "After all, the strength of a company lies in the strength of its people."