In this chapter, we examine the challenges military organizations face today in terms of their HRM policies and the effect of the institutional environment and strategy on these policies. We begin with an overview of the evolution of HRM over time, and how it is understood today, and will outline some general theories within the HRM domain. Today’s changes in, for example, the internal and external environment of military organizations pose important challenges for the military’s personnel policies and organizational fit. We will discuss the reactions by military organizations to these challenges. What trends do the challenges lead to in relation to the professionalization of the armed forces? Next, we elaborate on some of the more pressing challenges, such as motivating young people, the development in the field of talent management in relation to the organizational strategy, recent technological developments, labor market developments such as diversity in the workforce, but also private military companies, and of course the global security situation. We end this chapter with a short conclusion.