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Human Resources Management (Hrm) And Organisational Performance

1935 words - 8 pages

Human Resources Management (HRM) have been increasing aware by Business Studies and Organisation Management approaches because it closely related to organisational daily and organisational performances (Kalleberg & Moody, 1994). Human resources practices are suggested have influences on improving organisational performances in most organisations. Basically, oorganisational performances refer to the outcomes of employees performances and daily working which reflect the ability of one organisation fulfil its objectives and goals, such as employee’s performances, productivities, employee’s job satisfaction, financial outcomes (Huselid, 1995).

In my opinion, HR practices can make positive ...view middle of the document...

Sels (2006) research on small firm’s performance showed that HRM has little obvious positive effects on productivity and labour turnover but it demonstrates the profitability has increased. Sels (2006) also mentioned that human resource management not necessarily needed for any types and sizes of company, as small-sized companies seems mostly hire low skilled employees which also consider human resources management as a cost need to be reduced as the result of the limited budgets and undeveloped management knowledge. However, A poor human resource management may cause low organisational performances and low coordination level, and it seems because of organisations apply the simplified employment management and paperwork system associated with low employement administration and communication which could fail to meet employees’ expectations and lack guides and supports to employees’ work (Hendry& Pettigrew, 1986). Moreover, most present researches and HR approaches demonstrate that the improvement of organisational performances are linked to the proper human resources management and practices conducted within organisations.

Positive research evidences and literature views
Human resources practices effect and develop almost every determinant factor and process related to organisational performances (Huselid et al., 1994). First of all, Human resources management requires companies design its hiring and selecting system based on business strategies and its development requirements to help companies find the ‘right’ employees and place them in the optimised positions within companies. By the selective hiring system companies could take maximised advantage of employees various abilities and interests which largely improve working effectiveness, efficiency and finally leads to higher organisational performances (Becker & Gerhart, 1996). Nienhueser (2011) proved that 78% of companies improved employees’ quality, employee turnover rate and even financial outcomes by applying the planned hiring and selecting system.

Secondly, HR practices always include the appropriate motivation and reward systems that consider both organisational financial aspects and employees’ needs. On the one hand, with the coordination between HR department and other departments, HR managers understand the goals and objectives of business as well as organisational limitations (in terms of financial and external aspects), which help HR department managers to design suitable management system to avoid budgets problems and cover its shortages (Huselid, 1995). On the other hand, HRM always help companies set up useful motivation system by fulfilling employees’ basic needs also named ‘hygiene factors’ and fringe needs (Pardee, 1990). Companies conducting HR practices are required to making formal contracts with employees about their physical needs like salary, reward, safety, working condition, etc., In addition to identify employees’ basic needs, most companies which apply HRM...

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