HRM and performance

Introduction

 All businesses have a responsibility to perform well for their clients. They rely on every employee's excellence, commitment, zeal, knowledge, and talent to do this. The theme of the resource-based perspective is that HRM adds value and assists in achieving sustainable competitive advantage via the strategic development of the company's unique, difficult-to-replicate, and difficult-to-substitute human resources. "The distinguishing aspect of HRM is its concept that enhanced performance is delivered via the co-workers," as Guest (1997: 269) put it, distinguishing it from other management practices.

Therefore, it may also be argued that HRM will affect corporate performance if suitable HR activities are implemented.

This is starts with a summary of the data showing that HRM affects performance and the challenges researchers face in determining the relationship's nature and mechanism. The idea of a high-performance culture is then explained, along with how performance management and a high-performance work system may help to develop it.

How HRM makes an impact

According to Storey et al. (2009: 4),  The premise is that employing sound HRM procedures will improve output. The idea of "best practice HRM," which, as discussed are demonstrated by lists like Pfeffer's, supports this (1998). According to Bowen and Ostroff (2004), if a "strong" HR system is in existence, the relationship of performance and HRM is likely to be more significant. The basic tenet is that HR regulations in one way or another affect HR practices, which in turn influence employee attitudes and behaviours, which in turn influence service offerings and consumer perceptions of value. There's going to be an organisational atmosphere that promotes HR implementation where these are present. But they also highlighted the obvious point that having reasonable procedures is only sufficient if they are adequately put into effect. As Guest (2011: 6) observed, "What this does is shift the attention to line management." According to Nishii et al. (2008), perceptions about the purposes underlying the activities are equally as essential as their actual presence.

An in-depth analysis by Guest and Conway (2011) revealed that the consensus on the Ability to oversee did not support Bowen and Ostroff's (2004) claim that a robust HR system would significantly affect results. According to Guest and Conway's analysis, there is minimal consensus about the efficacy of human resources. A logical model of the Ability to oversee has three components, they concluded. The existence, implementation, and effectiveness of HR processes are required (ibid: 1700)

Uncertainties about the link between HRM and performance

As was already said, a lot of studies have shown that HRM and performance are related. But according to Guest et al. (2000b), it left questions regarding causality and effect. 'HR procedures seem to matter, reasoning suggests as much, and survey results corroborate it,' Ulrich (1997: 304) said. However, direct links between performance and adherence to HR procedures sometimes need to be more precise and depend on the chosen population and the metrics employed. In his conclusion, Guest (2011: 11) said, “After hundreds of research studies, we are still in no condition to state with any certainty that good HRM influences organization performance."

The identification of a relationship between HRM and business performance is impacted by two issues: "causal ambiguity" and "contingency variables." These assist in the so-called "black box" phenomenon.

Developing a high-performance culture

Organizations adopt work systems that help them achieve continuous high performance, but these systems are controlled and run by individuals.

Therefore, boosting performance via people is ultimately the goal of high-performance working. This may be accomplished by creating and implementing high-performance work processes and a high-performance culture, both of which emphasize performance management.

A culture that values high performance is one in which it is commonplace to attain it. Following are some descriptions of these civilizations' traits.

 

High-performance work systems

High-performance work systems (HPWS) are groups of HR procedures that promote employee engagement, skill development, and motivation. An internal consistency and coherence HRM system that is focused on resolving operational issues and putting the firm's competitive strategy into practice is what Becker and Huselid (1998: 55) defined as an HPWS. High-performance working is another name for the strategy utilized in an HPWS.

HPWS develops performance cultures that consider how companies’ performance may be enhanced. They are concerned with creating and executing collections of complementary practices that, when treated as a unit, will have a considerably stronger effect on performance than if they were treated separately. According to Appelbaum et al. (2000), HPWS encourage employee engagement, skill development, and motivation.

References

Guest, D E (1997) Human resource management and performance; a review of the research agenda, The International Journal of Human Resource Management, 8 (3), 263–76

 

Alvesson, M (2009) Critical perspectives on strategic HRM, in (eds) J Storey, P M Wright and D Ulrich, The Routledge Companion to Strategic Human Resource Management, Abingdon, Routledge, pp 53–68

 

Storey, J, Wright, P M and Ulrich, D (2009) Introduction, in (eds) J Storey, P M Wright and D Ulrich, The Routledge Companion to Strategic Human Resource Management, Abingdon, Routledge, pp 3–13

Bowen, D and Ostroff, C (2004) Understanding HRM – firm performance linkages: the role of the ‘strength’ of the HRM system, Academy of Management Review, 29 (2), pp 203–21

 

Guest, D E (2011) Human resource management and performance: still searching for some answers, Human Resource Management Journal, 21 (1), pp 3–13 Guest, D E and Conway, N (2011) The impact of HR practices, HR effectiveness and a ‘strong HR system’ on organizational outcomes: a stakeholder perspective, The International Journal of Human Resource Management, 22 (8), pp 1686–702

 

Nishii, L, Lepak, D and Schneider, B (2008) Employee attributions of the ‘why’ of HR practices: their effects on employee attitudes and behaviours, and customer satisfaction, Personnel Psychology, 61 (3), pp 503–45

Hodgson, J. (1915). North Country Diaries.

‌Guest, D E, Michie, J, Sheehan, M, Conway, N and Metochi, M (2000b) Effective People Management: Initial findings of Future of Work survey, London, CIPD

Introduction, in (eds) J Storey, P M Wright and Ulrich, D (1997) Human Resource Champions, Boston, MA, Harvard Business School Press.

 

Becker, B E and Huselid, M A (1998) High performance work systems and firm performance: a synthesis of research and managerial implications, Research on Personnel and Human Resource Management, 16, pp 53–101

 

Becker, B E, Huselid, M A, Pickus, P S and Spratt, M F (1997) HR as a source of shareholder value: research and recommendations, Human Resource Management, Spring, 36 (1), pp 39–47

Appelbaum, E, Bailey, T, Berg, P and Kalleberg, A L (2000) Manufacturing Advantage: Why high performance work systems pay off, Ithaca, NY, ILR Press

    

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