Human Resource Practices Linked to Organizational Performance: An Investigation of the Black Box Problem over the Past Three Years

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Contents
TOC o “1-3” h z u Chapter 1: Introduction PAGEREF _Toc438954367 h 4Introduction PAGEREF _Toc438954368 h 4Problem Statement and hypotheses. PAGEREF _Toc438954369 h 5Contribution of this paper PAGEREF _Toc438954370 h 6Chapter 2: Theoretical Framework PAGEREF _Toc438954371 h 72.1 Contingency (Best-fit) school PAGEREF _Toc438954372 h 72.2 Configurational approach PAGEREF _Toc438954373 h 82.3 Best-practice models PAGEREF _Toc438954374 h 92.4 AMO model PAGEREF _Toc438954375 h 102.5 Resource-based view PAGEREF _Toc438954376 h 10Limitations of the theories PAGEREF _Toc438954377 h 12Chapter 3: Definitions and measurements PAGEREF _Toc438954378 h 133.1 Introduction PAGEREF _Toc438954379 h 133.2 Recruitment and Selection PAGEREF _Toc438954380 h 133.3 Employee engagement PAGEREF _Toc438954381 h 153.4 Managing employee turnover PAGEREF _Toc438954382 h 183.5 Measurement Complexities: The Black-box problem PAGEREF _Toc438954383 h 213.6 The role of the line managers in the implementation of HR practices PAGEREF _Toc438954384 h 223.7. Organizational Performance. PAGEREF _Toc438954385 h 233.8. Employee Well-being and Performance. PAGEREF _Toc438954386 h 243.

8.1Improvement of employee performance of an organization PAGEREF _Toc438954387 h 24Chapter 4: Methodology and Analysis. PAGEREF _Toc438954388 h 264.1 Rationale for methodology. PAGEREF _Toc438954389 h 274.2 Sector PAGEREF _Toc438954390 h 314.2.1 Sample PAGEREF _Toc438954391 h 334.3 Measures. PAGEREF _Toc438954392 h 394.3.1 Organizational performance variables. PAGEREF _Toc438954393 h 394.3.2. HRM policies PAGEREF _Toc438954394 h 394.3.3 HRM outcomes. PAGEREF _Toc438954395 h 404.3.4 Business strategies. PAGEREF _Toc438954396 h 404.3.5 Control Variables. PAGEREF _Toc438954397 h 414.4 Survey instrument consistency. PAGEREF _Toc438954398 h 424.5 Statistical Analysis. PAGEREF _Toc438954399 h 42Chapter 5 PAGEREF _Toc438954400 h 445.1 RESULTS. PAGEREF _Toc438954401 h 445.2 ANALYSIS. PAGEREF _Toc438954402 h 455.2.1 Trompenaars implicit model. PAGEREF _Toc438954403 h 455.2.2 Johnson and Sholes power role model. PAGEREF _Toc438954404 h 475.2.3 Human resource management plan strategies. PAGEREF _Toc438954405 h 485.2.4 organizational culture framework of an organization. PAGEREF _Toc438954406 h 51Chapter 6 PAGEREF _Toc438954407 h 53DISCUSSION PAGEREF _Toc438954408 h 536.1 Organizational culture. PAGEREF _Toc438954409 h 546.2 Staff management. PAGEREF _Toc438954410 h 546.3 Monitoring the effectiveness of human resource management PAGEREF _Toc438954411 h 566.4 Communication strategies in human resource management. PAGEREF _Toc438954412 h 566.5 Human resource management challenges. PAGEREF _Toc438954413 h 586.5.1 Resistance to change. PAGEREF _Toc438954414 h 586.5.2 Dealing with workforce shortages. PAGEREF _Toc438954415 h 586.5.3 Training. PAGEREF _Toc438954416 h 596.5.4 Management of information. PAGEREF _Toc438954417 h 59Chapter 7 PAGEREF _Toc438954418 h 60CONCLUSION. PAGEREF _Toc438954419 h 60References PAGEREF _Toc438954420 h 61
Chapter 1: IntroductionIntroductionDespite the contemporary market changes, the regulatory reforms and the rise in automated business processes, the human factor can never be neglected. And wherever humans are involved, distinct feelings, complexities and conflicts of interest are embraced. Therefore in the organizational context, the personnel managers take on the critical role to provide the appropriate incentives to acquire a capable workforce and respectively motivate, engage, develop, retain and likewise create a friendly environment that promotes effective collaboration amongst the employees. Accordingly, adding value to the employee well-being needs to be aligned with meeting the business objectives and vice versa. The latter exemplifies the challenge of the HRM department to prove their strategic position as a source of value creation within organizations.
The critical responsibility of human resource management is still vague and often underestimated within distinct industries. Furthermore, there is still no agreed set of practices that presumably reinforces organizational performance (Paauwe, 2009). Despite the growing interest among research communities over the relationship between HRM and firm performance, still there are no clear evidence of HR practices driving performance (Wright et al., 2005). Apparently the findings of the current studies over the existence of a causal relationship linking HRM and performance have created a notion of ambiguity among researchers and practitioners: “…after over twenty years of extensive research, there are no answers to core questions about the relationship between human resource management and employee performance” (Guest, 2011, p. 3). In the business context many practitioners still neglect its importance and perceive it as another control mechanism or a tool for minimizing costs and administering financial stability: “contemporary organizations, particularly the more researchable and supportive giant publicly quoted multi-national corporations (MNCs), mainly focus on organizational effectiveness, often narrowly defined as short-term financial success” (Boselie and Brewster 2013).
However, the majority of the most notable studies that will be analyzed in this paper commonly agree on a necessary shift from control to commitment approaches (e.g. Walton, 1985; Arthur, 1994; Legge, 2005). The main assumption of this paper is that employees should be viewed as valuable assets and managed to perform properly, to stick to the values of the organization and encouraged to enhance the fulfillment of the business goals. The basic hypothesis will be that acquiring the appropriate personnel in both lower and managerial positions and engaging them effectively to the organizational culture can be crucial for the viability, competitiveness, and prosperity of an organization.
Problem Statement and hypotheses.
The endeavor of this paper is to contribute to the ongoing research linking HR practices to organizational performance. The field of HRM is relatively recent if we acknowledge the 1984 notable publication of Beer and Fombrum along with Guest’s 1987 normative model as the date of emergence. However, thirty years later, there is still no clear consensus among researchers and practitioners regarding an optimal constitution of human resource systems that clearly define the role of HRM and measure its impact (Paauwe, 2009). As a matter of fact, since the 1990s, a remarkable amount of studies in this area have been published with an articulated plethora of distinctive theoretical and methodological perspectives. Notably, various contradictive perceptions have been cited over the contribution of HRM to the achievement of business objectives and whether their added-value effects can be adeptly evaluated; in either financial terms; such as productivity and low levels of turnover, or in professional and societal context, such as job satisfaction, employee well-being and low absenteeism. All these dimensions will be delineated in the next sections of this report. Several authors of the aforementioned studies propose different HR systems, including bundles of practices that ideally lead to a series of positive outcomes.
However, in this paper it is argued that the three pillars that could constitute common ground amongst most of these studies rely on attracting the right people, engaging them effectively and retaining them inside their company borders. Precisely, there will be an attempt to investigate if the adoption of thorough hiring, engaging and retention strategies can be employed as a lever to organizational performance in large multidivisional corporations. Additionally, the impact of those practices on different management levels within an organization will be examined. The ongoing progress of the empirical body of research of the last three years will be critically analyzed, evaluated and compared. In the following, I intend to determine whether the studies since 2013, on the relationship between HRM and performance, have improved. This issue was first introduced by Guest in 1987. The variables that stand for the linking of HR activities and performance is also known as the “black-box problem” (Becker and Gerhart, 1996).
Therefore, the research question of this study is formulated as:
“Human Resource Practices Linked to Organizational Performance: An Investigation of the Black Box Problem over the Past Three Years.”
Contribution of this paper
In this study, the current theoretical literature regarding the strategic importance of HRM will be articulated; including traditional approaches such as the resource-based view, the best fit model, the configurational approach along with the universal approach. This paper attempts to summarize the most prominent systems in the sector of HRM and the methods by which they add value to various organizations. Apparently, contrary to the extensive amount of empirical research in the U.S. up to now, this particular subject did not gain the same popularity among European researchers (Stavrou and Brewster, 2005) who opted to focalize more on debates over the likely imminent threat of HRM towards trade unions (Paauwe, 2009).
Based on the research forum of Becker and Gerhart (1996), several empirical and conceptual bodies of research conducted especially during the nineties (e.g., Arthur, 1994; Huselid, 1995; Macduffie, 1995) verily indicate that the role of Human Resources can indeed be crucial towards performance. Additionally, it has been argued that HR systems can be used by both, line and senior HR managers, as a useful tool to improve corporate performance; in other words, human resource decisions should be aligned with the strategic and operational aspirations of a company (Becker and Gerhart, 1996).
My intention in this report is to draw on the formula of the AMO model, P=f (A, M, O) (Boxall and Purcell, 2011) by using the variables: CP=(H,E,R); literally: Corporate performance as a function of hiring practices, engagement, and retention. However before reaching this point, central questions need to be answered. First of all, what is organizational performance and how is it measured? How is it linked to individual performance? What is the main responsibility of the HR department? After all, it is just downsizing along with controlling the existing human resources as well as ensuring the viability of the organization or it can go further and contribute to longer-term outcomes? Does the context in which they operate matter or are there any commonly agreed sets of practices that ultimately lead to success? What is the responsibility of the line managers in enforcing the HR activities? How is employee engagement associated with performance? All these core queries are going to be delineated based on the normative and conceptual approaches along with the empirical data published during the last three years. Their research methods, the validity of their findings are going to be critically evaluated inclusive of my perceptions about their reliability.
Chapter 2: Theoretical Framework
The publications of Michigan and Harvard were some of the first which investigated the link between HRM with strategy and corporate performance, stimulating an extended body of research over the following decades, along with ongoing debates about the merits in the relation to those approaches (Boxall and Purcell, 2011). Below, the most prominent theoretical frameworks will be outlined under the prism of various notable research reviews of the last decades.
2.1 Contingency (Best-fit) school
The Forum et al. (1984) study was one of the first which highlighted the strategic importance of the HRM field. The Michigan academics proposed the ‘matching model,’ which implied that HR systems along with the organization structure should be adjusted in a way that is aligned with the business strategy, as well as the external environment. According to Clinton and Guest (2013), the context in which a company operates is a key determinant of the HR practices employed. The adjunct ‘matching’ was depicted to emphasize the need for HRM decisions to be ‘matched’ to the generic organizational strategy. The marching model, often doubled as contingency theory, encompassed the basic principles of the “best-fit” school. One of the most fundamental components of those approaches is the influence of vertical integration. “Best fit can be perceived regarding vertical integration or alignment between the organization’s business and HR strategies” (Armstrong and Taylor, 2014, p. 23).
Early studies distinguished the contingency approach as a hard form of HRM (Guest, 1987; Storey, 1989) which conceives human capital merely as another resource of the organization. The basic idea behind is that there is no universal way of doing things and that HR should be utilized and deployed as a strategic lever of meeting corporate objectives. “The main assumption is that organizational effectivity depends on there being a tight ‘fit’ between human resource practice and business strategies” (Hiltrop, 1996). It can be assumed that a system that can be effective in a specific context may have undesirable effects in another.
Additionally, the hard label is occasionally mirrored as a tool for minimizing costs and downsizing (Beardwell and Thompson, 2014). For these reasons, Karen Legge (1995/2005) described the hard version of HRM as ‘utilitarian instrumentalism’, based on notions of tight strategic control and aiming solely for financial gains for shareholders and top management. “Contingency theorists note how some HRM practices are consistent with different strategic positions and how these practices relate to firm performance” (Stavrou and Brewster, 2005, p. 190).
2.2 Configurational approach
Configurational models constitute a variation of best fit. The proponents of this approach insist that competitive advantage and the strategic role of HRM require not only vertical but also horizontal fit to be embedded effectively into organization strategy; where horizontal fit reflects the “internal consistency of the organization’s HR policies or practices” (Delery and Doty, 1996, p. 804). The configurational theorem advocates that distinct configurations of human resource systems can be evenly effective (Clinton and Guest, 2013).
The emphasis in this holistic approach is given on the essence of aligning HR practices with a corporate strategy so that they are unified and structured to complement and assist each other and at the same time fit the external environment of the company (Delery and Doty, 1996).
2.3 Best-practice models
Best practices represent the ‘soft’ variants of HRM, intending to enhance the commitment, quality and flexibility of the employees (Beardwell and Thompson, 2014). The Harvard model or what was called ‘Map of the HRM territory’ acknowledged that HRM policies should meet the interests of a wider range of stakeholders, including shareholders, management employees, unions, community, and government (Beer et al., 1984, p. 15).
This figure is focused on the premise that there exists a universal set of HR practices that every firm should employ to prosper and excel; that is why it was also labeled as universal perspective (Armstrong and Taylor, 2014). Additionally, 30 years after the publication of the original Harvard framework it is stated that the value creation within companies is reflected with respect to multiple dimensions, both in financial terms through organizational effectiveness along with individual well-being and long-term societal merits (Beer et al., 2015).
Some years after the inspiring publication of the Harvard academics, new terms were conceived to embody the soft HRM, namely ‘high-commitment management,’ ‘high-involvement management’ and the combination of them (along with HR practices) was labeled ‘high-performance work practices’ (Beardwell and Thompson, 2014).
Armstrong (2014) defines high-performance work systems (HPWS) as “bundles of HR practices that facilitate employee involvement, skill enhancement, and motivation”.
Walton (1985) introduced the term High-Commitment Management (HCM) as an alternative to tight control systems based on compliance. This shift from control to commitment was also depicted in Legge’s publication, examining the likelihood that when employees are treated as valuable assets within an organization, in exchange they adhere to the corporate values, structures, policies and the business objectives (Legge, 2005). This type of practices implies that the trade-offs of encouraging commitment between the employees and the organization outweigh the traditional control-oriented management systems (Walton, 1985). Such systems may include
However Legge questioned the universal applicability of those systems, arguing that actually “what is defined as ‘best practice’ is going to be influenced by national culture and institutions” (Legge, 2005, p. 31).
2.4 AMO model
The AMO model (Ability, Motivation, Opportunity) combines elements of both best-fit view and best-practice models (Beardwell and Thompson, 2014). It is a high-commitment approach introduced by Appelbaum et al (2000), emphasizing the importance of competencies of the workforce, the degree of motivation and the opportunities to engage in reflection to the organizational performance. “This framework suggests that HR practices can influence the skills, competencies and abilities of the workforce to provide a strong human capital base” (Paauwe et al., 2012). The initials of this model refer to ability, motivation and opportunity respectively (Appelbaum et al., 2000). All these factors have been stated to be crucial towards the embracement of discretionary behavior among the employees, which in turn was displayed to be linked to organizational performance (Appelbaum et al., 2000). The flexibility of the AMO model rests upon the fact that its variables are employed in all the HRM models in both individual and group level (Boxall and Purcell, 2011).
2.5 Resource-based view
Another popular strategic approach towards HRM is the resource-based view that was cultivated at the beginning of the 1990’s by the Professor Jay Barney (Barney, 1991). The premise of this perspective was that the distinctive internal resources constitute a key source of organizational success (Paauwe and Boselie, 2005) or as it was later stated the fact that “investment in people increases their value to the firm” (Armstrong and Taylor, 2014).
The key difference of the resource-based view in comparison to other fashionable models is the principal focal point of internal resources; incoherently to external factors, and their deployment towards the creation and preservation of competitive advantage. From Barney’s (1991) analysis it can be implied that firms can benefit by drawing on their internal key resources while counteracting external threats. Competitive advantages refer to the differentiation of strategies in comparison to the ones adopted by the primary competitors, aiming at value creation. Respectively, economic rents appear when the value generated from the existing resources goes beyond the initial expectations of the owners (Dagnino, 2012). Barney (1991) maintained, granted that these resources are valuable, rare, not easily replicable and non-substitutable; they may underlie a source of advantage regarding competition.
The VRIO framework is a tool that evaluates the capacity of the human capital as a working source of competition advantages and consequently superior performance on the grounds that the Barney’s criteria are fulfilled (Value, Rarity, Inimitability, Organization) (Beardwell and Thompson, 2014).
Source: ADDIN EN.CITE <EndNote><Cite><Author>Dagnino</Author><Year>2012</Year><RecNum>49</RecNum><Suffix>`, p.121</Suffix><DisplayText>(Dagnino, 2012, p.121)</DisplayText><record><rec-number>49</rec-number><foreign-keys><key app=”EN” db-id=”e0drreaawxp909efrso5erx9ftvpps5xrr9s” timestamp=”1446166048″>49</key></foreign-keys><ref-type name=”Book”>6</ref-type><contributors><authors><author>Dagnino, G.B.</author></authors></contributors><titles><title>Handbook of Research on Competitive Strategy</title></titles><dates><year>2012</year></dates><publisher>Edward Elgar Publishing</publisher><isbn>9780857938688</isbn><urls><related-urls><url>https://books.google.dk/books?id=7fH-7gkish8C</url></related-urls></urls></record></Cite></EndNote>(Dagnino, 2012, p.121)
However, albeit the fact that many notable academic studies urged for a refinement of HRM approaches, in the form of moving from control to commitment in the workplace (Walton, 1985) or from human resource management to human resource management (Legge, 2005), still the hard approaches seem to be more popular within the organizations (Wood, 1999). And the latter can be rationalized by Armstrong’s (2014) acknowledgment that “the best fit model seems to be more realistic than the best practice model”.
Limitations of the theories
Contingency (Best-fit) school: It embraces the notions of tight control and is therefore perceived as too managerialist, serving the interests of small groups of stakeholders (Legge, 2005). Both Legge (2005) and Armstrong (2014) imply that it neglects the impact of basic institutional factors on HRM. Additionally, Armstrong (2014) characterizes best fit as “static” on the basis that it is not easily adaptive to procedural changes.
Universalism (Best-practice school): It has been argued that the ongoing research on the relationship between high-performance work practices and performance and the measurements in several of those studies do not indicate a clear causality, “though a fair number of the studies claim to support universalism, their claims are not always unequivocally supported by their research evidence, and it is premature to conclude in its favor” (Wood, 1999, p. 367). Additionally, especially during the first decades, there was an intensive discussion about a prospective anti-union nature of HRM. Since they promise reciprocal benefits for both employees and managers, then there is no need for the state to intervene (Purcell, 1999). Furthermore, the biggest challenge of universalism is that it is often characterized as too complicated and multidimensional, even a utopia to be applied in practice (Purcell, 1999). This is the reason that even though numerous eminent theorists’ studies favored these approaches, still probably the contingency models probably still are more popular in the business world (Wood, 1999).
AMO Model: Although the AMO framework gained broad recognition, there is no consensus about a specific set of practices that should be employed (Paauwe et al., 2012).
Resource-based view: Yet it was depicted that the resource-based view was empirically tested to be in fact a source of competitive advantage in financial terms, there were other empirical studies that expressed critique against the narrow economic impact, i.e. cost deductions in the bottom-line and that questioned the criterion of sustainability, whilst proposing a focus on value creation ,
“although traditional sources of competitive advantage such as natural resources, technology, economies of scale, and so forth, create value, the resource-based argument is that these sources are increasingly easy to imitate, especially in comparison to a complex social structure such as an employment system” (Becker and Gerhart, 1996, p. 781).
Chapter 3: Definitions and measurements
3.1 Introduction
As it was mentioned in previous sections, the chosen bundles of practices that will be examined in this paper are recruitment and selection, employee engagement and retention. Guest on his study that is perceived as a point of reference with respect to linking HRM and performance, insisted that “… The pursuit of policies designed to ensure the recruitment and retention of high-quality staff to undertake demanding jobs, supported by competent management will result in high-performance levels” (Guest, 1987, p. 515). In this part, the selected practices will be outlined along with their linkages to organizational performance. But before specifying the mentioned practices, it would be useful to address first of all what is organizational performance, how is it measured and who takes on the role to implement the HR activities. Additionally, the importance of the concept of psychological contract in the employment relationship will be delineated.
3.2 Recruitment and Selection
First of all, it would be convenient to discern between recruitment and selection practices. Recruitment strategies refer to attracting talents with the appropriate competencies, thus attempting to create a decent pool of applicants, whereas selection practices are about assessing their profiles and eventually deciding whom they should appoint (Boxall and Purcell, 2011; Armstrong and Taylor, 2014).
The common assumption, that employing the right people is a key to success was depicted by Paauwe in his publication about HRM impact on corporate long-term viability and effectiveness: “HRM activities that are involved in getting the right person on the right spot (employee skill and organizational structures) contributed to higher productivity and increased market value of the company” (Paauwe, 2004, p. 73).On the contrary, Pfeffer had previously argued that “simply hiring the ‘best and the brightest’ may not make sense in all circumstances” (Pfeffer, 1998, p. 71), thus it would be suggested to first clarify which the relevant attributes are that bring success in the particular industry, to create a large pool of applicants and sort the candidates not by focusing on skills that can be obtained through training, but by assessing if they fit in the culture of the organization (Pfeffer, 1998).Pfeffer is drawing on selected studies mentioned “selective hiring” as one of the main seven high-performance work practices for bringing success to an organization. However, he confirmed the paradoxical phenomenon that in many corporations selection processes were seen as ‘waste of resources’ and hence are not addressed thoroughly (Pfeffer, 1998).
Various recruitment methods have been suggested aiming in the attraction of qualified applicants including social media (e.g. LinkedIn) and corporate websites, advertising (i.e. through the press), recruitment agencies, job centers, notice boards or even from personal contacts. (Lazear and Gibbs, 2009; Beardwell and Thompson, 2014).
Similarly, the significance of recruiting a decent amount of applicants has been also denoted in Huselid’s (1995) inspiring study about the impact of high commitment practices in numerous U.S. organizations he examined: “Recruiting procedures that provide a large pool of qualified applicants, paired with a reliable and valid selection regimen, will have a substantial influence on the quality and type of skills new employees possess” (Huselid, 1995, p. 637).One of the most frequent threats while recruiting is the problem of adverse selection, which appertains to the propensity of job hunters who do not possess the required qualifications to apply for a position offered (Lazear and Gibbs, 2009).
The first step suggested in selecting talents lays on shortlisting them by thoroughly assessing their CV’s and categorizing them –by matching their profiles with the job prerequisites- as probable, possible or unsuitable. (Beardwell and Thompson, 2014)
Appropriately, the prominent solutions to counteract adverse selection problem may comprise searching for credentials (i.e. previous working experience, quality of education), formal testing, multiple interviews, psychological profiling or a most expensive approach could entail offering them a paid trial period at work (Lazear and Gibbs, 2009).
3.3 Employee engagement
The efficacy of highly skilled labor will be constricted if employees are not fully engaged in the organizational climate and needs. According to Armstrong (2014), engagement takes place on the grounds that people are committed to their responsibilities and the organization and are motivated to accomplish soaring levels of performance. There is a close resemblance between the notions of commitment and engagement that in business context refer to the identification or attachment with the company (Armstrong and Taylor, 2014).When employees feel they are important assets of an organization and their skills are exploited optimally this will be most likely reflected their performance. Gallup’s (2010) research in 8 different corporations highlighted an array of positive outcomes of employee engagement practices, regarding performance, innovation, high levels of perceived well-being and lower turnover rates (cited by Beardwell and Thompson, 2014).
In this section, the ways in which employees are engaged are going to be outlined. In practice, drawing on Guest’s 1987 normative approach, it can be assumed that employee engagement lies substantially on deliberate job design and optimal utilization of the workforce through assigning challenging tasks and responsibilities to the quality employees. Accordingly, it has been argued that job satisfaction may be linked to organizational commitment, job involvement, organizational citizenship behaviors along with mental health (Armstrong and Taylor, 2014). Also, impartial appraisal and goal setting may be crucial whereas the appointment of routine tasks to key employees could bear adverse effects (Guest, 1987).
Almost two decades after his influential study, Guest (2014) attempted to review the current research body over the concept of employee engagement. He pursued to analyze its nature, its essential features, its enduring quality and its impact on the performance of the employees and the organization. Additionally, he summarized various measurement approaches proposed in prominent studies along with their limitations. One approach that gained broad recognition was the attitudinal engagement measurement scale introduced by a team of industrial psychologists in Utrecht University (Schaufeli et al., 2002). In this study, the conflicting natures of burnout and engagement were analyzed and measured separately, based on a sample of university undergraduate students and employees of Spanish private and public companies. Their opposite impact lies on the fact that “burnout is characterized by a combination of exhaustion (low activation) and cynicism (low identification), whereas engagement is characterized by vigor (high activation) and dedication (high identification)” (Schaufeli et al., 2002, p. 74). However, it could be argued that the attainment and encouragement of assertive, energetic, inspired, enthusiastic and concentrated workforce are not enough towards the accomplishment of the core business objectives. It is narrowly focused on measuring individual work related aspects, whereas the strategic goals of the organization are neglected. This may be one of the reasons that Guest (2014) insisted that it is important to distinguish employee engagement in two types, specifically work and organizational engagement. Work engagement is related to employee well-being and health related issues. On the contrary, organizational engagement is mainly concerned with the optimal utilization of the workforce, the achievement of business objectives as well as the improvement of organizational performance (in terms of higher levels of productivity, profits and competitiveness).
Additionally, another piece of work that is considered to be fundamental regarding employee engagement is the MacLeod Review. In this case four driving forces of employee engagement were outlined, namely effective leadership, engaging line managers, employee voice, and organizational integrity (MacLeod and Clarke, 2009). In specific, leadership refers to a solid strategic narrative expressing the vision and mission of the organization and the distillation of the cultural values at all levels. Secondly, line managers are required to perform the appropriate actions to motivate, empower and support their stuff instead of tightly controlling and confining them. The third dimension, employee voice is mirrored in the perception of involvement in the decision-making processes. The employees need their personal viewpoints to be seriously taken into account and valued as important within the organization: “Being heard reinforces a sense of belonging to an organization and a belief that one’s actions can have an impact” (MacLeod and Clarke, 2009, p. 93)
Ultimately, integrity refers to the satisfaction of the promises given to the employees and ensuring that their behaviors are consistent with the corporate values.
However, from Guest (2014) review, it can be implied that work and organizational engagement are not mutually exclusive because of their overlapping definitions and characteristics. Therefore, they could be combined towards the establishment of human resource practices that enable employee engagement.
Guest (2014) blended a series of important findings of the current literature along with the MacLeod review and the Utrecht Work Engagement Scale (UWES) and exhibited a research agenda with ten practices that presumably reinforce employee engagement. Briefly, this agenda includes:
 selection of workforce with an inclination for engagement
 training employees for engagement
 investment in human resourcing and resourcing
 (re)-design jobs to optimize employee autonomies, challenges, varieties, skill utilization and scopes for learning and developments
 provision of proper organizational support
 reward and promotion of managers by use of their capacity to engage employees as key criteria
 insurance of fair treatment and trust in the governance sector, using a range of voice mechanisms to achieve this
 insurance of an extensive two-way communication
 creation of a method that reinforces job securities and flexible working
 adoption of a strategic human resource method that reflect values of engagement
(cited by Guest, 2014, pp. 153-154)
A complexed aspect of employment relationships that needs attention is the ‘psychological contract’. Schein highlighted the importance of aligning corporate needs with employee needs and thus described psychological contracting as “a set of unwritten reciprocal expectations between an individual employee and the organization” (cited by Boxall et al., 2011).
If a hardworking employee feels that certain terms of their psychological contract are ignored; e.g. due to perceived unfair treatment or broken promotion promises, this may lead to a declining level of engagement (Boxall and Purcell, 2011).
Finally, another question that subsequently arises is who embraces the role in encouraging employee engagement and what kind of attributes should be rendered. BlessingWhite (2013) online survey of 7000 individuals across the globe, illustrated that manager-employee relationship is a key factor when it comes to engagement (cited by Beardwell and Thompson, 2014). The results of this research acknowledged a range of attributes and processes performed by managers that appeared to promote employee engagement. In business context those include managers who paid attention to diversity, took responsibility for both success and failures, performed problem-solving decisions, displayed integrity and honesty, were passionate for success, were respectful and caring towards the employees, endorsed realistic goal-setting and infused an environment of trust and engagement (Beardwell and Thompson, 2014).
3.4 Managing employee turnover
CIPD (2014) defines employee turnover as “the proportion of employees who leave an organization over a set period (often on a year-on-year basis), expressed as a percentage of total workforce numbers”. Accordingly, retention refers to “the extent to which an employer retains its employees and may be measured as the proportion of employees with a specified length of service (typically one year or more) expressed as a percentage of overall workforce numbers” (CIPD 2014).
From previous decades, the threat of the increasing job mobility has been recognized as an emerging challenge of attracting and retaining talents (Hiltrop, 1999) which nowadays is very topical if we bear in mind the increase in the demand for skilled workers. Respectively, especially companies operating in competitive industries do not wish to lose the expertise of high-quality employees and bear the costs of recruiting and training their substitutes.
Recent empirical analysis of a large food service organization found that HRM practices were interrelated to employees’ affective commitment to the firm, their willingness to exhibit discretionary behavior and their intention to remain in the company (Kehoe and Wright, 2013).
Indeed, it has been stated that the decisions over recruitment are inextricably linked to turnover, for example, the construction of job descriptions should be precise and explicit enough to fit the skills of the candidates and meet their expectations, otherwise, in the long-run this is going to be reflected in high turnover, drop of morale and consequently of productivity levels (Lazear and Gibbs, 2009).Hiltrop’s (1999) research interviewed HR managers and officers in both multinational and local firms to identify sets of HPWPs that enhance the attractiveness of organizations and their retention levels. The number of HR components identified such as teamwork, participation in decision-making, training, and the development offered and easy accessibility of information were addressed as essential in outcompeting their antagonists (Hiltrop, 1999).
The key employees that companies wish to retain have been observed to be the ones with higher probability to leave (Armstrong and Taylor, 2014) and if the fact that they constitute a major source of value creation, or innovation is taken into account, they should be considered as valuable assets of the organization and thus treated as partners (Lazear and Gibbs, 2009).However, appreciation is not only reflected in financial earnings (through a possible salary increase). There are additional aspects that have to be considered which reinforce and secure the quality of employee well-being. First of all, they need to feel that there is an environment of trust and that their efforts are rewarded (Boxall and Purcell, 2011). The managers are advised to evaluate employees objectively in a fair manner and fulfill their promises as “reducing the extent to which employees are treated arbitrarily can reduce turnover problems” (Lazear and Gibbs, 2009). Pfeffer uses the example of well-established professional services corporation as a point of reference, who invest in recruitment and selection practices and the establishment of strong cultures to retain the most qualified members of their workforce (Pfeffer, 1994).
Paauwe et al. (2012) in their publication reviewed the wide body of the ongoing research over the relationship between HRM and performance in conjunction with the mainstream measures employed in an in both micro (individual) and macro (organization) levels. The results indicated a “predominance of non-financial measures of firm performance” (e.g. absenteeism, employee turnover, employee satisfaction and product innovation) (Paauwe et al., 2012).
Turnover rates may vary among different age groups. Similarly, Boxall and Purcell (2011) attributed this phenomenon to the perpetual change of employee needs, depending on the phase of their career (early, midway, and late). According to Armstrong (2014), young workers mainly aim at the advancement of their careers ( through learning opportunities), middle-aged focus on satisfaction (through recognition and reward of their efforts) whereas senior employees are more security-oriented.
Armstrong provided some insight over the main causes that drive employees to leaving, which include “more pay; better prospects (career move); more security; more opportunity to develop skills; unable to cope with job; better working conditions; poor relationships with manager/team leader; poor relationships with colleagues; bullying or harassment; personal – pregnancy; illness ; moving away from area” (Armstrong and Taylor, 2014).
Retention strategies may entail re-design of work to meet the workers’ tastes, more flexible working hours, early promotion, new responsibilities through job enrichment and training sessions for upgrading the skills of the workforce (Lazear and Gibbs, 2009).
Indeed, Arthur’s (1994) empirical research on 30 U.S. steel minimills and Huselid’s (1995) study on 968 U.S. corporations agree on an evident correlation between “High-Performance Work Systems” (HPWS) and turnover levels besides firm productivity.
3.5 Measurement Complexities: The Black-box problem
Even though several empirical studies that were mentioned verily indicate an association of HR systems with firm performance, still there could be other factors and stages between the two that mediate the causal chain.
Becker and Gerhart’s (1996) study was one of the first to address the issue of causal ambiguity in the HR – performance relationship. In their research forum, they called for an inclusion of some “intervening” variables that they marked as key determinants in approaching “the black box between a firm’s HR system and the firm’s bottom line” (p.793). They argued that future research should focus more on how positive organizational outcomes are accomplished and on what lies between the incorporation of HR practices and firm performance. They suggested that it would be more convenient to investigate more direct outcomes of the HR systems concurrently, precisely measuring their impact on the business unit processes.
Additionally when it comes especially to financial outcomes it has been argued that it is not easily plausible to ascribe them directly to HR practices as “… so many other variables and ‘events’, both internal and external, affect organizations that this direct linkage rather strains credibility” (Boselie et al., 2005). Therefore, it was suggested the adoption of more proximal performance indicators, such as productivity and service quality, verily influence more directly the employees (Boselie et al., 2005).
Furthermore, during the last decades, it has been recommended that employee voice or what the “workers’ perceive and reaction in understanding the relationship between HRM and performance“ should also be considered as a key mediating factors between HRM and performance (Guest, 2011).
Indeed, Messersmith et al. (2011) concluded that employee attitudes and behaviors constitute a fundamental aspect of the black box problem. They described the role of HPWS’s as a catalyst for the elicitation of discretionary employee behaviors and ultimately for departmental performance. Based on the data they collected from the employees of public Welsh organizations they found that discretionary behaviors depend on three concrete attitudinal variables: job satisfaction, organizational commitment, and employee psychological empowerment. Valued, involved
3.6 The role of the line managers in the implementation of HR practices
From the CIPD (2015) report, during the last years, the personnel management responsibilities of the line managers have expanded. Several core activities that were traditionally performed by the HR department now encumber line management. One basic reason for this shift was reported to be the tendency of many corporations to outsource their transactional HR activities to external partners, thus delegating the administration of several routine HR tasks (e.g. the submission of payroll reports) to the authority of the line managers. Another reason is that the employment relationships have become more individualized and subsequently, line managers undertake the burden to engage, appraise, train, coach, guide, reward, control the workflow and ensure/sustain the employees’ well-being. A key challenge of this emerging trend is the establishment of rapport between the individuals and the line managers which will presumably be mirrored in “… high levels of job satisfaction, commitment, and loyalty – which are in turn associated with higher levels of performance or ‘discretionary’ behavior” (CIPD, 2015). Discretionary behavior has to do with the diligence of the workers on their duties which leads to higher levels of efficiency and productivity.
However, the discretionary behavior is not addressed solely to employees. CIPD (2015) factsheet highlights that line managers should likewise receive the appropriate input from the senior management. Their relationship with their managers is crucial regarding their attitudes towards the teams they supervise. They need to feel respected and be encouraged to apply their personal management style. Line managers should, in turn, be rigorously selected, demonstrating their capacity to successfully manage individual behaviors and infuse the organizational values to their subordinates. Similarly, Boxal and Purcell (2011) suggest that senior managers should invest in the thorough selection, coaching and performance appraisal of the line managers. The anticipated discretionary behavior of the line managers positively affects the performance of their subordinates if they experience: satisfying working affairs with their foremen, a positive work-life balance, provision of solid career opportunities, space for involvement in decision-making processes, open organizational culture that encourages them to express their grievances or personal concerns and finally a sense of job security (CIPD 2015).
Boxal and Purcell (2011) arguments concede with the CIPD acknowledgments. Precisely they maintain that a supportive relationship between senior and line managers is inextricably linked the effectiveness of both individual and work unit functions. The HR specialists need to confer with the line managers before introducing new policies – especially performance appraisal, communication and involvement policies – as the latter are the ones who are going to implement them after all (Boxall and Purcell, 2011).
3.7. Organizational Performance.
Organizational performance means the comparison between the actual results of a given organization versus the intended objectives. It encompasses three areas of firm outcomes namely product market performance, financial performance and shareholder return (Richard et al. 92). Among the many things that can have a proper impact on the performance of an organization, high-commitment, and high-performance work system has the most impact. Both of the approaches are of the view that Human Resource policies should be designed to enhance the capacity of employees and motivate employees. The difference between them I that HPWS is much broader scope as it lays emphasis on the competitive advantage that such human resource gain. Based on previous research, it has been proven that Organizational performance maximizes the competitive advantage of the employees. Organizational theorists assume that organizational performance substantially contributes to the performance of the workers through causal routes that are interrelated in one way or the other. It teaches employees to work together with each other to achieve the given goal/objective. For a company to have increased performance, the existing human resource set up has to be modified to increase the performance of the staff at every level by keeping up with the upcoming trends in human resource. Every level of the human resource should also own up to their respective tasks, leading to proper functionality and maintenance of the company’s image from all angles of business production. Accordingly, the company’s human resource department will greatly increase the company’s production and is, therefore, ought not to be treated as a minor field of focus. Moreover, the existing human resource should function in ensuring that a proper working environment is carried out in all the stages of production. The impact of organizational structure on the company has been the major contributor to the movement of many company’s sales in the market; business periods where the company is at a perfect state of the organization have enhanced the company’s sales trends into greater levels.
Performance appraisal is another important exercise in the industry that has led to the employees increased effort in their respective tasks in the company as well as production levels. This practice involves granting of extra salaries to those employees that show great improvement in their jobs. The human resource team in many leading companies are often in constant communication with the workforce and clearly demonstrates their individual performance level trends. This, in turn, assists the company to set goals for each of the employees statistically. This helps the company in the long run regarding growth and debunking problems that have recently come up or could not be located. This strategy also assists in the determination of the company’s extreme potential since this can be gauged by determining the maximum potential of each and every employee in all fields. Most companies view this practice as a regular way of motivating employees over the fact that it is a critical method of improving the company’s performance at all levels.
3.8. Employee Well-being and Performance.
3.8.1Improvement of employee performance of an organization
There exist numerous ways to improve the employee performance of any organization. The most effective way is through giving employees more power over their work. Once the employees have a moral code and more control over their work outcomes, they are sure to justify trust handed over to them as well as in making the right company decisions. Empowering of employees in an organization also reaps the company benefits on job performance as well as solving challenges in the business sector. They become more ethical and, in turn, become more innovative.
Improvement of communication is another major way of improving the ethical climate of an organization. It comes through the development of policies and procedures involved in the communication process of a firm. There is always a critical need for the smooth flow of information throughout an organization often through the managers at hand. Managers create room for the integration of the expected ethical behaviors in the organization.
Discipline plays a significant role in all this just because all employees are supposed to comply with the group policies involved within the ethics category. With discipline, the ethnic codes are enforced as consequences for violations of the standards are spread evenly on the whole workforce. It also caters for the delegation of duties to the organization just as well as employee termination.
Taking a look at employee behaviors and the enforcement of ethical policies, the trends of employee misbehavior come to view quite quickly. This always caters for the improvement of the existing ethnic policies as well as getting rid of some. This happens if the ways by which certain tasks are carried out are in the focus on improving efficiency just as well as company profits. Sadleck, (1995).
The Human Resource department of this company is also involved in the maintenance of the work atmosphere which greatly influences the performance of individuals working in the company. An effective human resource team as the existent one in the company benefits the employees by granting them with good conducive working environments. The working environment of most companies is maintained to be safe despite the presence of all the working machinery involved in performing tasks thus the minimal chances of accidents in the blue collar areas. The environment is also clean and healthy exhibited by the presence of medical care facilities to deal with the staff in the company. The purpose of the maintenance of these conditions is to provide the staff with a sense of belonging and the feel of being privileged to work in the company. This has greatly contributed to the high satisfaction levels of the work team.
The management of disputes within the company is also a task undertaken by the human resource team of the company. For many companies, the existence of minor and major conflicts has led to the establishment of procedures for dealing with these challenges. In the case of any arising issue among the staff, a particular procedure of bureaucracy is undertaken by the company to settle it. The issue is first presented to the immediate supervisor who takes it to a higher working employee in cases where it has been too much to be handled at that level. Settlement of conflicts in most organizations involves a fair and just procedure where each conflicting party is given the chance to present their points of view before the final decision is made. In other cases, the company may subject the work team concerned into a voting practice so as to settle a matter down. The human resource benefits the company in this area by dealing with matters quickly before they get out of hand where the individuals can resolve to sue the whole company at large.
The development of better public relations in various organizations has been assisted greatly by the human resource team. The establishment of a well-oiled public relations department involves the organization of major business meetings to be held by capable and well-trained employees in that field. Seminars and other important gatherings lay in this category. The human resource department assists in the selection of appropriate employees to perform tasks in marketing and planning during this events. This assists the company in achieving set goals during this gatherings. Say, fundraising activities in this company mostly generate ample funds such that the set goals are over run. This occurs mainly because of the maintenance of the company’s public image. This is all due to the valuable work done by the human resource department.
For any successful company, human resourcing is a department that not only benefits the employer but the employee as well, therefore measures are always undertaken to ensure that human resource management is embarked upon in all processes of achieving any particular goal (Human Resource Excellence, 2015).
“, the greatest returns to an individual’s hard work is supremely determined by what it makes of them and not from the gains they extort.” (John Ruskin)
Chapter 4: Methodology and Analysis.
This part of this paper will cover his methodology that was adopted in this study to elicit empirical evidence on the linkages that had been assumed in the above-stated hypotheses. First, the methodology’s research was discussed. It is concluded that the qualitative approach is adequate for recognizing the human significance of managing human resource cognition as well as investigating the hypotheses.
4.1 Rationale for methodology.
In the investigation of the processes through which Human Resource Management enhances the result performance of an organization, most studies have adopted a positivist methodology. Such positivism nomological-analytical research, often called the quantitative study, usually commences with the formulation of hypotheses that make assumptions about the ‘real world’ properties. The method then continues by subjecting empirical tests that can either be refuted or supported. On the other hand, phenomenological and interpretive research, often referred to as qualitative study, does not normally commence with specific and specific hypotheses, but the formulation of authentic experiences in the enquiry field about the empirical evidence that is sought after and focuses on meanings that are subjective as experienced by the selected social actors (Katou & Budhwar, 2006). Qualitative research proponents often have the objective to be led by ‘openess.’ What is meant by this word is that an individual should never approach the enquiry field by ideas that are preconceived as can be manifested by hypotheses that might be the result of the researcher’s orientation and the start of theory building activities as highlighted by Glasser & Strauss (1967) the ‘grounded theory’ system of approach. On the other hand, Easreby-Smith (1991) list an overview of some key features that are often associated with phenomenological and positivist paradigms as shown in the table below:
POSITIVIST APPROACH PHENOMENOLOGICAL APPROACH.
Basic beliefs External and objective world.
Independent observer.
Value-free science. Subjective and socially constructed world.
Observer part of the observations.
Human interest is what drives science.
Researcher should Facts oriented.
Search for fundamental as well as causality laws.
Come up with hypotheses and test the hypotheses. Meanings oriented.
Aim at finding totality in every situation.
Yield ideas through totality of every situation being observed.
Preferred method Operationalize concepts to enable measurement.
Collecting large samples. Using many methods to come up with various phenomena views.
Small amount of sample are examined in depth over a relatively longer period of time.
Table SEQ Table * ARABIC 1-Key Features of phenomenological and positivist approaches.
Nonetheless, this method of crude equalization of paradigms that are interpretive in nature with ‘qualitative research’ in one sector and structured, positivist inclination and ‘quantitate methodology’ in the other sector, is not cogent. This conclusion comes from a fact that researchers, as well as theorists that assimilate interpretive paradigms, could also use quantitate methods and the other researchers that use nomological-analytical approaches can as well resort to qualitative methods as a method of generating data. Accordingly, the apparent sharp distinction between the two sides is replaced by a research-based perspective that pragmatically assimilates elements of both sides, thus substantially contributing to a much better understanding of the phenomenon being studied (Lee & Miller, 1999).
The vast number of quantitative empirical research that is survey-based have accrued a vast amount of knowledge on Human Resource Management organizational performance questions but lacked to penetrate deeply beyond the study phenomenon surface, particularly questions such as the means by which HRM contributes to the overall performance of an organization. This is caused by both the lack of a body that is established and explains theories on HRM performance relations and the use of surveys that have been theoretically derived (through limited theoretical scope and cross-sectional surveys, low levels of response and mostly relying on individual respondents who have a low probability of producing results that are ultimate and accurate, in regard to the position of the respondents. An example of a perfect illustration of this challenge is a Huselid’s et al. (1997) method of issuing oral interviews with HR managers and asking them to provide him with an estimate of the percentage of the company’s sales that was produced from marketing positioning strategies of the generic nature.
On the other hand, Yin argues that case studies are more appropriate for conducting research on causal phenomenon rather than the common questionnaire surveys. Accordingly, many researchers in the Human Resource Management research area are adopting this line of thinking and consider qualitative studies as their primary method of choice for studies that are trying to progress in HRM. Nonetheless, there are also studies that imply that questionnaires, if administered correctly, can be an economically as well as accurate method of collecting data needed for research. One such specialist is Bulmer (2004). His book was the foundation for the formulation of our questionnaires as will be discussed in the next subtopic.
The theoretical positions that dominate the HRM area, as well as organizational performance, are instituted by a vast lack of discussions on how design and implementation decisions on employment practices are made and who makes them and by the common assumption of rationality in assimilation and implementation of these practices. One method that has been demonstrated to be useful in informing research within the management are in question is the ‘managerial cognition’ perspective (Stubbart, 1989). This method has also been identified as a highly relevant and effective method for studies of HRM as a whole and its performance as it delves deep into the matter and investigates mental models that are involved in the implementation of key managerial decisions by key decision makers such as the people who are on top and in line with HR managers. As discussed in the preceding chapters, focusing on HRM in the Greek sample industries that are in the manufacturing sector and are recognized by ICAP Group where my research was conducted, line managers are vital in the delivery of Human Resource Management in the Industrial field. These important decision makers are sometimes expected to administer HRM policies’ predicted effects on their workers and performance. Accordingly, studying manager’s perceptions is crucial to progress research in Human Resource Management and this consideration is vital for the methodology rationale in this thesis. A reflection of the emphasis on the perception by managers, the thesis, is predominantly interpretive and quantitative in nature.
The choice of a qualitative approach in this study does not necessarily imply that the procedure was interpretive and unstructured in design. There also exists strong evidence for the strong association between Human Resource Management policies through the adoption of thorough hiring, engaging and retention strategies and procedures on an organization’s performance from previous research. In light of these evidence, it would be unproductive and unwise to disregard this information and the empirical evidence that has already been established from past research related to the hypotheses. Accordingly, qualitative methodology with an orientation that is interpretive and is based on preconceived evidence and utilizes this evidence as a departure point for application in previously suitable methodology. Prior evidence recognition is highlighted in the establishment of hypotheses as well as structured design during research. Before moving on to problems encountered during research design, one has to clarify epistemological and ontological positions in this study.
Ontologically, the matters that are of particular interest in this research are organizational performance, HRM practices, processes by which Human Resource Management could affect an organization’s performance and the economic environment of a business. Operalization of the latter stated issues is outlined in the next topic. On the other hand, epistemological issues relate to the question of what knowledge constitutes the phenomenon under questioning and differ from more precise questions on the generation of data. This question refers to methods of data generation rather than much broader questions on the elements of knowledge.
Epistemologically, the study involves what could be simplified and called subjective and objective evidence, that is, research that refers to data that is objectively available such as statistical data acquired from a secondary source, performance indicators of a financial firm, and data that is subjective such as Human Resource managers’ accounts of HRM policies evolution as well as organizational performance managerial accounts that is subjective. As a matter of fact, with the exception of HRM data over time whereby practically there was no other choices but to resort to accounts by people who are considered to be professionals and knowledgeable, all another phenomenon that is ontological have both subjective and objective epistemological “informants.” The reason for this conclusion is twofold.
First, as talks with professionals of the chosen industries indicate, due to high levels of competition between similar sectors in the industry, it was very unlikely that I would get maximum cooperation and a willingness by the people answering the questionnaire due to their sensitivity on the matter. This problem is exaggerated by the fact that these different sectors are often heavily researched meaning that the companies have already spent a lot of money doing their research and would be unwilling to share this information with every person that needs it. In light of this predicament, I found it more reasonable to use this approach instead of placing a lot of emphasis on one source of information. Second, it is evident that the subjective accounts of important professionals would promise to be a major source of valuable knowledge on the ‘black box’ content. Therefore, these accounts that are subjective in nature would be another focus of this thesis, the primary one being questionnaires.
4.2 Sector
Having made a decision on a questionnaire approach, a choice was needed in the industries and the geographical locations that the study would utilize. It was concluded that industries that are in the country and those that are recognized by ICAP Group were selected. Industries that are in very proximity to each other were an added advantage during selection to achieve a high level of standardization of relevant factors that can manifest themselves in both the labor market domain as well as product market domain. Moreover, standardization of other factors could be achieved by concentrating on a few sectors only, particularly those that would compete in markets that are labor intensive as well as those with similar products. The logic behind the selection of institutions that are competing in the same labor and product markets automatically gain an upper hand for external factors that participating institutions would be subjected to. Moreover, and of very high importance and interest in the Human Resource Management sector, there is a lot of evidence that various Human Resource systems compete among on another for labor, clients among other things. In turn, this increased the opportunity for Human Resource effectiveness analysis.
Nonetheless, even upon realization of all the later stated points, there could exist various production techniques and product ranges that could reduce the comparability between the different cases and decrease appreciation of the processes involved. Therefore, an organization that has a well-defined product range or has a single product would be very ideal as one field of investigation for the study. Also, as organizations that are much larger in nature have a much higher probability of having Human Resource Management policies compared to smaller organizations. Accordingly, it was much more desirable to select some medium sized enterprises which would cancel out other organizations that are small. 23 Greek industries that are in the manufacturing sector were selected. This figure was narrowed down from 600 organization that were selected out of the man Greek directory, which is the ICAP Group. The ICAP Group is the only company in Greece that acknowledged by Greek Bank as an External Credit Assessment Institution and includes limited liability and incorporated organizations.
Additionally, these Greek industries that were selected bears the benefit, from a researcher’s point of view, that they are very automated and labor-intensive as well as capital intensive and are very likely to bias Human Resource Management sophistication or the effect on the industries’ performance estimated. As the unionization level in the industry is very low. Moreover, the manufacturing service industries have been less thoroughly studied compared to the labor service industries and despite their differences to other non-similar sectors, it would still be very suitable for conducting the study.
All of the selected Greek industries were initially contacted for basic data such as the size of the institution in square feet, the number of workers among others. For industries that had this data readily available, this data was collected from secondary sources where this information had been chosen. As earlier discussed, it would not be easy to acquire data from most of these companies due to their high competitive nature. The representatives will also be issued with information sheets that will provide clear and brief details on the important aspects of the study. This will include information on what the study is concerned with, the condition under study, the things that will occur during and after the study, the voluntary involvement nature, potential risks, and their responsibilities as participants among other relevant information. Moreover, the sheet will contain details on the participants’ right to withdrawal from the test at any time before filling in and submitting their questionnaires as well as their right to either accept or decline the terms in the informed consent form. Moreover, no personal data will be collected from the participants consequently eliminating electronic trails or tracks that would lead back to data’s origins.
4.2.1 Sample
An adequate questionnaire survey that covered 23 Greek industries that are in the manufacturing sector was conducted. In the research, a sample of exactly 600 organization was utilized out of the man Greek directory, which is the ICAP Group. The ICAP Group is the only company in Greece that acknowledged by Greek Bank as an External Credit Assessment Institution and includes limited liability and incorporated organizations. The stratified method was employed to enable the sample to be obtained. As of the case above, the strata utilized were twenty-three industries in the Greek manufacture field including those companies with over 20 employees. The total number of these organizations is approximately 3000. From this number, 20 percent of the total were randomly selected from each of the directory strata. The questionnaires were delivered to the industries by use of personal connections-samplers. A total of 178 usable questionnaires based on completeness of the questionnaires were received. Mathematically, this was a response rate of 30 percent of the total number of questionnaires sent.
Bulmer (127) recommended that for a company to administer questionnaires properly, the company must first answer a set of questions that were highlighted in his book. Accordingly, before the commencement of the study, we answered those questions and had presented the questions and answers below.

1. Briefly describe the procedure that participants will engage in
The participants will be provided with questionnaires listing the questions outlined in the problem section. The questionnaire will be computerized as the subjects will receive emails of the questionnaire and allotted a maximum of two weeks to reply; the questions will be closed. The questionnaires will be of the filling nature where the participants were provided with spaces to fill the answers to these questions.
2. How long will the procedure take?
It is expected that the participants will take approximately 15 to 20 minutes to complete the questionnaires.
3. Does it involve deception? If yes, explain.
The procedure will not involve any form of deception as all the subjects will be presented with the informed consent paper that they will read and either accept or deny it; all the details in informed consent paper will be thoroughly explained in the paper by use of additional information after every topic.
4. How will you debrief your participants?
After completion of the survey, a final screen will be conducted. This process will inform the participants how their data is stored, confirm its anonymity, and provide contact details of the survey organization for further inquiries.
5. How many participants?
500 participants will be selected by simple random sampling method.
6. How were the sample sizes determined?
As outlined in the answer to question 5 above, the sample size will be determined by simple random sampling. This method is a statistical population subset whereby each subset member has the same probability of being selected. Therefore, it is an unbiased representation of a particular subset.
7. How will they be recruited?
The subjects were recruited by through email invitation to participate in the study.
8. How will participants know of their right to withdraw?
The informed consent paper will include details on the participants’ right to withdrawal from the test at any time before filling in and submitting their questionnaires.
9. How will participants give informed consent?
The members will be issued with an informed consent form that they were requested to accept or decline through a tick box; they tick the box to confirm their decision accepted on the terms in the informed consent form. The language used in the form will be one that is readily understood by the participants.
10. Information sheet – what will it tell your members?The information sheet will provide clear and brief information on the essential aspects of the study. This will include information on what the study is concerned with, the condition under study, the things that will occur during and after the study, the voluntary involvement nature, potential risks, and their responsibilities as participants among other relevant information. Moreover, the sheet will contain details on the participants’ right to withdrawal from the test at any time before filling in and submitting their questionnaires as well as their right to either accept or decline the terms in the informed consent form.
11. How will you anonymise data?
No personal data will be collected from the participants consequently eliminating electronic trails or tracks that would lead back to data’s origins.
The distribution of the organizations being sampled about the industrial sector had similarities to the population organization’s distribution. Below is a table of the main activities of the industries chosen in the population and sample..
INDUTRIES SAMPLE COMPANIES POPULATION COMPANIES WITH OVER 20 EMPLOEES INCLUDED IN THE ICAP DIRECTORY. Frequency Percentage Frequency Percentage
Beverage 11 5.7 77 2.6
Food products 32 17.4 528 17.8
Tobacco products 0 0.0 7 0.3
Tobacco 0 0.0 18 0.7
Textiles and textile products 13 6.7 230 7.8
Wearing apparel 21 11.1 303 10.4
Linen 3 1.2 22 0.8
Wearing apparel 22 11.3 304 10.4
Leather products 2 1.1 47 1.7
Pulp and paper 3 1.2 73 2.5
Wood and cork 3 1.2 50 1.8
Petroleum products 3 1.2 11 0.3
Pharmaceuticals 7 3.8 85 2.8
Chemicals 10 5.3 89 3.0
Rubber and plastic products 12 6.3 165 5.7
Basic metal industries 4 1.8 19 0.6
Non-metallic mineral products 22 11.9 301 10.2
Metal products. except machinery 13 6.9 271 9.2
Office machinery and computers 9 4.6 116 3.9
Machinery and equipment 7 3.6 87 2.8
Electrical machinery 3 1.3 62 2.2
Electrical equipment 4 1.8 79 2.8
Office machinery and computers 9 4.6 116 4.0
Furniture 7 3.5 104 3.6
Other 4 1.6 113 3.3
185 100 2948 100
Table SEQ Table * ARABIC 2-main activities of the industries chosen in the population and sample

A large percentage of the questions in this survey were acquired from international surveys in Human Resource Management already in existence such as Hall and Torrigton (1998), and Proce Waterhouse Project Survey (Brewster & Hegewisch 1994). The questionnaires were originally in the English language, but they were translated into Greece, and back to English for the purpose of this survey. The final copy of the translated documents was then piloted in 10 industries. It was also handed to the Financial Officers, Personnel Officers, or the CEO of the selected sample organizations. This occurred due to lack of Greek Correspondents to fill and send the questionnaires back and because the employees were overwhelmed with questionnaires. Nonetheless, the survey was filled by one representative in the selected industry who was responsible for the Human Resource Management function. I acknowledge this to be one limitation to the study. However, through the utilization of the Harman single factor test to all of the variables that are relevant to the stated model, applying the Eigenvalue criterion of greater than one, highlighted by seven factors, not just a single one. The first of these factors explained 26.7 percent of data variance. This value is relatively not very high. Based on this experiment, if a statistically significant percentage of the relevant variables of the method will, in turn, generate one factor that covers most of the variances. Therefore, I am of the opinion that the bias in the common method was comparable limited.
4.3 Measures.
Al of the variables that were utilized in this study is highlighted in table 2 column one. These include:
4.3.1 Organizational performance variables.
In the study, multiple organizational performance variables were used (Chenhall & Langfield 2007). These variables were measured on a five-point scale based on perceived rating philosophy of the organization performance. The five scale range that was used ranged from 1 which represented very bad to 5 which represented very well. Being aware of the potential problems that self-report measures bare, to ensure that the indexes are valid and reliable and to reduce anomalies and random fluctuations in the date, the sample respondents were required to report their performance over the last three years. The specific items that constitute the performance paradigm are: “efficiency,” when an organization utilizes as little resources as possible but still accomplishes its objectives; “effectiveness,” the organization has met all its stated objectives; “development,” if the institution is improving in its capability to capture future opportunities as well as challenges; “innovation,” for processes and products; “Satisfaction,” of all the participants in the study (customers, employees, and stakeholders); “quality,” high-quality products per cent.4.3.2. HRM policies
For precise evaluation of the relationship between Human Resource Management and performance, valid and reliable assessment of Human Resource policies is vital (Chenhall & Langfield 2007). Accurate evaluation and measurement of HR policies will set out the “black box” in the relationship between performance and HRM policies. Consequently, the study respondents were not questioned on whether HRM policies existed or not, but rather were asked its effectiveness, also measured on a five-point scale that ranged from 1 which represented not effective to 5 which represented highly effective. These ratings were based on the overall performance of HR practices (Chenhall & Langfield 2007). Nonetheless, although there exists a countless number of HRM policies combinations that might lead to the same outcomes in different organizations (Chenhall & Langfield 2007). Moreover, although identifying the exact policies that were combined was very fruitless (Katou & Budhwar 2006), the objects utilized to constitute HRM policies refer to the common four key area that are recruiting, development, rewarding, and relations, whereby HR policies can be developed (Armstrong 1996). These facets go in line with the paper’s theory that employees should be treated as valuable assets and managed to perform optimally, to adhere to the values of the organization and encouraged to contribute to the accomplishment of the business goals.
4.3.3 HRM outcomes.
Multiple HR outcome variables that were measured based on the perceived rating philosophy on the five scale range mentioned earlier that ranged from 1 which represented very bad to 5 which represented very good. The HRM outcome construct constituted of the following items: competence, the cooperation of employees with employees and management; commitments, satisfactions as well as the motivation of workers; employee attitudes, presence, retention, and their behaviors. The cooperation of the employees is normally highlighted in skills section based on Batt (2002). He also suggested that employees collaborate to use their skill along other employees in the organization and to argue that although the level of competencies is normally assumed to be primary to the improvement of organization’s performance, this is not possible unless the workers are cooperated/coordinated (Armstrong 1996).
4.3.4 Business strategies.
These strategies were also estimated on a five-point scale that ranged from 1 which represented not significant to 5 which represented highly essential. Utilizing factorial analysis the eight items in question were cut down to 3 business strategy paradigms, labeled quality, cost, and innovation (Armstrong 1996). The quality paradigm comprises customer care and service, brand image, distribution channels, and quality enhancement; the cost paradigm constitutes the reduction of cost of the item; the innovation paradigm incorporates improvement of goods, a variety of products, and innovation (Armstrong 1996).Constructs/ Variables Cronbach Alpha Variance explainec percentage
HRM Policies
Recruitment, Training & Development, Compensation, Employee Performance Appraisal, Incentives, Promotion, Participation, Work design, Communication, Involvement. 0.93 70.17
HRM Outcomes
Cooperation with other workers, cooperation with management, motivation, presence, retention, commitment, competence, satisfaction 0.95 74.93
Business Strategies
Innovation, Quality enhancement, Cost reduction 0.58 56.82
Organizational Performance
Quality, Effectiveness, Development, Efficiency, Innovation, Satisfaction. 0.93 80.81
Controls.
Capital Intensity, Size, Unionization degree, Industry Table SEQ Table * ARABIC 3. Survey Instrument Variables
4.3.5 Control Variables.
The control variables utilized in the analysis of the above data are outlined below: “capital intensity” (natural log of total employment by total assets); size (incorporates natural log); “industry” that is identified by two variables, 78 of the organizations are classified as being the traditional organizations focused on the fact that the main raw materials required for their production come from agricultural produce; agriculture is Greece’ traditional sector. Organizations in this sector include those dealing with textiles, beverages, food products, leather products, wearing apparel, and linen among others. On the other section, the 100 industries were considered to be non-agricultural because the main raw materials for their production do not come from agriculture. The organization under this group include electrical equipment, chemical, metallic products among others. The ‘unionization degree’ is represented by a potion of employees that are trade union members.
4.4 Survey instrument consistency.
Construct internal consistency was confirmed by utilization of Cronbach alphas (1951). Figures that are in Table 2 highlight that the instrument that was utilized for the survey was reliable based on the fact that it was adequate for confirming the models that were presented in figure 1. This is because all Cronbach alphas are substantially higher than 0.8, but there is an exception of ‘business strategies’ paradigm (Huselid et al. 1997). Nonetheless, considering that values as low as 0.34 have still been used and found acceptable when used together with other precautions (Huselid et al. 1997), the values obtained were used although there might exist low reliability. The validity of the constructs underwent evaluation by evaluating the total explained variance values (Torrington & Hall 1998). This was done for every dimension by use of Confirmatory Factor Analysis (CFA) as well as utilizing LISREL. Total variance explained values percentage shown in table 2, are substantially higher than 50% showing that the survey instrument was valid (Torrington & Hall 1998). Notwithstanding, before the Confirmatory Factor Analysis (CFA), it was preferred that an expletory analysis of the factors to not be carried out to identify possible formations prior, but rather rely on the validity of the content, consequently, ensuring that the measure includes a representative and an adequate number of items. These items should be able to tap the content (Glaser & Strauss 1967).
4.5 Statistical Analysis.
Latent variable models and structural equation models (Glaser & Strauss 1967) via maximum likelihood estimation and LISTREL were utilized to test the hypothesis on the best framework that had been raised. SEM are highly effective when being utilized to test path analytic models with variables that are mediating and also include latent constructs being measured along multiple items (Torrington & Hall 1998). MLE was used because of the fact that tests that depart from normality, kurtosis and skewness for all the variables lay within the acceptable statistical limits with the exception of union and industry intensity. Moreover, this tests sample size being 178, it ranges between 100-200 thus MLE procedures can be used. One must also note that in this experiment, the variables of union and industry intensity were used although they don’t lie in within the acceptable limits. The latter stated decision might have reduced MLE procedures effectiveness, but it was later discovered that all controls were not very significant and were, therefore, not utilized for the final estimation in the study.
During the study, the overall model fit was also assessed in accordance with Brewster & Hegewisch (1994) recommendation in the determination of multiple indices. This was done because sometimes one model can be adequate to be used in one fit but be inadequate in another fit or even many others. The study used the normed chi-square and chi-square tests, an examination of the root mean error of approximation and goodness of fit index (GFI) (Glaser & Strauss 1967). A chi-square that is not significant that is p is greater than 0.05 shows that the model that had been proposed is an adequate representation of the entire relationships set. Nonetheless, in cases of a high degree of freedom numbers and significant chi-square, the normed chi-square value should be utilized. The normed chi-square is acquired by dividing the chi-square value acquired by degrees of freedom. In normal situations, the normed chi-square value should not be acceptable when it is greater than 5, but in this study, a normed chi-square value that was greater than 3 was not acceptable. This was done with the aim of increasing accuracy (Chenhall & Langfield 2007). On the other hand, in complex models cases, the GFI should never go lower than 0.7 and should not be accepted if it does so (Glaser & Strauss 1967). In the RMSEA model, the model’s fit is acquired through dividing population covariance with the correlation matrix. The RMSEA value should also not be less than 0.08 for a good approximation. Furthermore, the comparative fit index (CFI) and the normed fit index (NFI) are also utilized in this study (Brewster & Hegewisch 1994). These indexes were used to investigate the best fitting structure to empirical data. These two indexes are not supposed to go lower than 0.90 but ins some complex indexes, the lowest acceptable comparative fit index (CFI) and the normed fit index (NFI) can go as low as 0.80 (Hart 241).
Chapter 5
5.1 RESULTS.
The approximation of the path diagrams for the linkage performance framework is well accounted for in the second diagram. The boxes stand for independent variables while the circles represent the relationship between the variables. Light arrows are for the variables that were observed constituting related latent variables. Bold arrows are for the structural variables and their relationship to each other. The numbers representing each row show the important elements of estimates from the standard coefficients. It is of important notice that for the purpose of simplifying the model without loss of its validity, a follow up on Paawue and Richardson revealed that not grouping the human resource policies into their respective areas of resourcing, developing, rewarding, and relaxing to their sectors of skill attitude and behavior was necessary. All the possible paths of linking the control with the present strategies in the organization, the human resource policies, the human resource outcomes as well the organizational performance were attempted. However, the results on the contingencies were not significant to the contribution.
The following [points were founded from the table.
1. In link with the business strategies, the cost strategies have a directly negative effect on the human resource policies. On the other hand, the quality, as well as the innovation strategies, have positive and direct effects on the human resource policies supporting the first hypothesis.
2. The human resource policies have a directly positive effect on the outcomes of the management system. This, in turn, supports the second hypothesis.
3. The human resource outcomes have a directly positive effect on all the organizational performance that gives support to the third hypothesis.
4. The policies involved in human resource management directly and positively affect the organizational behavior and performance. This statement concurs with the fourth hypothesis.
5.2 ANALYSIS.
5.2.1 Trompenaars implicit model.
The Trompenaars implicit model is a framework used for the communication across cultures in the human resource management of organizations. The model has seven dimensions all which are in the running of an organization. One side simply deals with time while the other participates with the environment in which the organization is upon. The first deals with universalism that is the belief in a particular idea, much so that it can be to a given operation of production.
Particularism deals with the circumstances that define the possibility in which a given idea can be in an action. It involves the use of questionnaires.
Individualism affects a culture in that many persons with an interest in a given scenario view themselves as individual beings while in communitarianism the individuals see themselves as a part and parcel of a community and both of these vary the change in culture.
Neutrality in culture arrays itself in that emotions of people are held at par with the decisions made in an organization while emotionality in culture shows the emotions of individuals and communities involved, all out in the open. Instances, where individuals have ample space to share with each other or small spaces where they can only do this with lesser individuals due to privacy, are entrenched in a particular culture of the organization. On the other hand, where both of this are similar in size depicts a diffuse culture.
Achievement culture is where individuals are graded into status by their performance while an ascription culture entails its basis on who or possibly what a person is before their acts are (Trompenaars, 324).
Hofstede trompenaarsindividualism Collectivism individualism Collectivism
Power distance
High Power distance
Low universalism particularism
masculinity Femininity neutral Emotional
Uncertainty avoidance strong Uncertainty avoidance
Weak diffuse Specific
Long term orientation Short term orientation achievement Ascription
sequential Synchronic
Internal control External control
Organizational culture is as values and behaviors that take part in the modeling of the uniqueness of a social and psychological environment in an organization.
A subculture is a group of people possibly part of a larger culture but has differentiated itself from the other part of based on the modes by which it handles its activities.
A professional culture is one whose existence is characterized by the confidence in informality and at the same time in agreement with the practice of efficient procedures.
Models are used to explain the relationship between human resource management and the work force in relation to improving the working culture and environment in an organization.
Models in organizational culture assist in the understanding the values of a corporate culture in an organization. Also, they also cater for the improvement of common practices in the organization (Trompenaars, 348).
5.2.2 Johnson and Sholes power role model.The model demonstrates the power effect of human resource management on both the inside and outside of an organization dependent on the current culture state of the community as well as the employees in the organization (Bass, 158).

The Johnson and Sholes model of cultural web identify six interrelated elements of focus that are in the makeup of a paradigm. It involves concepts that individuals take up inside and also on the outside of the organization about the company. Rituals and routines affect the daily behavior of the people of a particular group and are of great assistance when it comes to predicting situations. Symbols also represent the organization’s logos when it comes to formality and dress codes while the organizational structure defined by charts and unwritten lines of power is in this model. The control systems affect the routes by which the organization’s efforts are into just as the power structures own up to the real sources of energy of the company such as the executives (Bass, 160-169).
5.2.3 Human resource management plan strategies.Every workable human resource business plan caters for all the critical factors of production activities of a company. Below are some of these factors that circulate within effective human resource strategies of a healthy organization.

Capacity modelling
Human resource department of this company is greatly involved in the determination of production capacities at every level of production. This is mandatory because the capacity modelling of the human resource team is to be able to cater for the factors affecting the company’s product shift in demand (Peetz,213-220). Therefore the determination of the maximum and minimum amounts of work to be done to reach a particular target in a determined period is made note of. This is despite the amount of challenges that are inevitably going to be experienced or are already being experienced by the company.
This is to deal with the issues of not being able to satisfy all customer demands due to factors underlying in the inefficiency of the company. In cases where the company cannot allocate any more funds to particular departments, ultimate utilization of the individual department capacities are to be initiated. Other ways of increasing capacity levels in the organization would be to introduce new techniques of handling tasks, purchasing of late versions of equipment and materials used in the company and the increment of the numbers of working shifts and schedules of the staff.
Competition manipulation
This is the mode by which the company human resource department will handle the upcoming and current competition challenges in the business market. The plan of increasing the company’s growth in the future is to curb competition from other companies by providing customers with items that are unique to this particular company in terms of the length of servicing of the particular item (Peetz, 252). The products offered are to meet all customer needs and carry with them advantages over other products from other companies. The items provided are expensive hence, should be long lasting and require fewer maintenance costs than most companies in the market. Lastly, the pricing of all products should be more attractive to the customers than other products in the market.
Skill requirements
These should be increased so as to better the company’s performance than it already is in. The skills used to perform particular tasks in the company should be enhanced through training facilities in the company (Peetz, 263). Failure to acquire the skills required in a particular level of production, the employee is to be suspended from the task until acquisition. Those staff members with ample knowledge of a skill in a particular task should face an increase in their salaries as well as their shift work periods (Ivancevich, 23).
Demographics and psychographics
Making a note on what products suit a particular group of people in the market, the products should be increased to meet the demand in the market. The plan is to determine the kind of products that have been ignored regarding volumes of production and focus as to whether there have been statistical changes in the market concerning its demand and making changes to the company’s production as well. There should be actions undertaken to increase or decrease production activities for cases where some products of this company are manufactured to deal simply with the elite and upper-class market or the middle-class market (Peetz,274). Colors of the products on sale should be increased in range because this has been affecting the products marketability.
Succession planning strategies
The best among the working staff in all fields of production should be considered as the next owners of leadership positions in the respective fields. This includes using performance charts in coming to decisions as to which employees to pick from. The strategy will also involve picking any staff member who shows appropriate and great skills in handling customers for particular marketing positions occupied by less performing employees (Ivancevich, 137). Old positions may as well be replaced by a new and fewer positions in other departments so as to decrease the size of the company’s salary funding.
Resource reallocation
The human resource department will be involved in assigning different departments’ tasks to the respective and rightful employees. This will depend on the qualifications of individuals according to their target jobs during hiring (Truss, 58). The distribution of salary and wages money allocated to departments should be made known to all staff members to offer motivation.
Company costs management
The human resource department will be involved in the management of funds being allocated to different departments of the company. This is important since the fund usage will be accounted for in books of records made by a hired staff to deal with the process. In turn, company costs will be estimated and regarded by the finance department (Truss, 68). The management of costs in this company will also involve automated online platforms that will be used to assess and permanently record information fed into them by accountants in the company.
5.2.4 organizational culture framework of an organization.
Frameworks can be used to analyze an organization’s operational activities in the determination of how the needs and requirements are catered for. The below framework is used to meet a client as well as employee needs in the organization. It vertically focuses on the balance between stability and flexibility of operational activities in the organization as to meet desired outcomes. Discretion and control of these activities also fall into this category.
Horizontally, the framework caters for both internal and external focuses on the integration of new trends as much as the differentiation of operational activities in the organization.

Aspects of culture can be improved through the use of an open culture where everyone in the company feels included and is given a chance to share their views and new ideas, mostly done the use of an open plan office. Empowered workforces also contribute significantly to the teamwork conducted in an organization. Moreover, the use of integrated systems that encourage a creative climate brings forth benefits of working together (Truss, 164).
The forms by which ideas are in the organization play a role in building trust. This is mostly done through the use of a suggestion box and the allocation of free time to the workforce each week or so in the act of developing new ideas for the organization.
Sharing knowledge amongst employees and fellow colleagues plays a massive part in building mutual trust and respect. Having a proper internal and external network of contacts with open lines of communication is another way of improving the aspects of culture. Thompson, (2014).
Chapter 6
DISCUSSION
The results in the second figure of the research support the entire hypotheses that were formulated earlier on in the research. However, there exist two main subjects that ought to be differentiated in this particular study.
1. The intervening steps in the human resource relationships
2. The variables that moderate the endpoint variations in the relationships.
According to the first findings of the research, the human resource management outcomes vaguely mediate the relationship between the human resource policies and the organizational performance that at the end indicate the existence of both an indirect and direct linkage between the organizational policies and the performance.
The crucial factor to be considered in the relationship is how much the human resource management performance relationship shapes discretional behaviors amongst the staff and the customer body. This factor includes the choices made on the quality of work that the staff will produce regardless of the requirements and the expectations of the company. In this case failure to perform a particular duty in a given way does not lead to any consequences and neither will the opposite of the actions lead to the claim of an award. All these factors are transmitted in the determination of the organization’s performance. The AMO theory is acclaimed to be the core of strategic human resource management in the point that organizations that are looking to improve performance develop the proper policies in the domain of outsourcing, developing, compensating and making incentives. Further on the involvement, as well as job designs are meant to shape positively the discretion behaviors of on organization are included in the theory. The human resource outcomes found in the employee skills, attitudes on their commitment, motivation and satisfaction, and employees’ behaviors that concern their retention and presence integrate the organization’s policies and discretion. There other authors who have argued that the human resource management performance casual chain outcomes do not affect the organizational performance, but there may exist a series of causes from the focus on employee skills. Moreover, the human resource management performance casual chain focuses on the attitudes and behaviors that eventually affect the organizational performance. However, it ought to be noted that the human resource management outcomes affect the organizational performance as well. To bring the fourth improvement in the organizational performance and other levels of satisfaction, the commitment and motivation of the employees is critical (Paauwe & Richardson, 1997).
6.1 Organizational culture.
The organizational and culture of the employees in an organization are sourced from the human resource management body policies. The relationship between the two arrays significantly in the context of transferability of management techniques by the organization itself. Managers at a particular level of the organization, duly aware that culture has a critical impact on effectiveness, vary the transfer of operational techniques and theories between parts of the continent with the change in worldly trends.
The basis of organizational culture focuses on the value of actions practiced in the organization. The focus on corporate culture entails the collective programming of minds. The organization as well as its surrounding of which, in this case, is in a continental spectacle plays a prominent role in the organization’s professional and individual culture. Just because this encompasses the society’s look and acceptance of the body much more in that the culture is shared and acknowledged amid them.
On the other hand, national culture, being a higher level of culture significantly corresponds to primary socialization. This means that it consists of those values and beliefs acquired earlier in the lives of the staff members. The organization’s outset has much to do with this simply because the first impact of values that are integrated into the structure, although deep-seated are still present in the overall social view. The influence of a dominant culture explains the extreme and favorable bias towards the countries involved in the organization’s professional atmosphere (Trompenaars,413- 433).
6.2 Staff management.
The Human Resource department of this company is also involved in the maintenance of the work atmosphere which greatly influences the performance of individuals working in the company. An effective human resource team as the existent one in the company benefits the employees by granting them with good conducive working environments. The working environment of most companies is maintained to be safe despite the presence of all the working machinery involved in performing tasks thus the minimal chances of accidents in the blue collar areas. The environment is also clean and healthy exhibited by the presence of medical care facilities to deal with the staff in the company. The purpose of the maintenance of these conditions is to provide the staff with a sense of belonging and the feel of being privileged to work in the company. This has greatly contributed to the high satisfaction levels of the work team.
The management of disputes within the company is also a task undertaken by the human resource team of the company. For many companies, the existence of minor and major conflicts has led to the establishment of procedures for dealing with these challenges. In the case of any arising issue among the staff, a particular procedure of bureaucracy is undertaken by the company to settle it. The issue is first presented to the immediate supervisor who takes it to a higher working employee in cases where it has been too much to be handled at that level. Settlement of conflicts in most organizations involves a fair and just procedure where each conflicting party is given the chance to present their points of view before the final decision is made. In other cases, the company may subject the work team concerned into a voting practice so as to settle a matter down. The human resource benefits the company in this area by dealing with matters quickly before they get out of hand where the individuals can resolve to sue the whole company at large.
The development of better public relations in various organizations has been assisted greatly by the human resource team. The establishment of a well-oiled public relations department involves the organization of major business meetings to be held by capable and well-trained employees in that field. Seminars and other important gatherings lay in this category. The human resource department assists in the selection of appropriate employees to perform tasks in marketing and planning during this events. This assists the company in achieving set goals during this gatherings. Say, fundraising activities in this company mostly generate ample funds such that the set goals are overrun. This occurs mainly because of the maintenance of the company’s public image. This is all due to the valuable work done by the human resource department.
For any successful company, human resourcing is a department that not only benefits the employer but the employee as well, therefore measures are always undertaken to ensure that human resource management is embarked upon in all processes of achieving any particular goal (Human Resource Excellence, 2015).
“, the greatest returns to an individual’s hard work is supremely determined by what it makes of them and not from the gains they extort.” (John Ruskin)
6.3 Monitoring the effectiveness of human resource management
The effectiveness of human resource management can be clearly seen if the company’s performance is faring well while a decrease in performance simply shows a faulty link in the human resource sector. Regardless of any task involved in a company’s production, the human resource department is always involved in the running of this operation (Peetz, 236). For instance, the finance department will link with the human resource department regarding first hiring the required personnel qualified for the jobs. Methods of monitoring the department are numerous and involve a series of changing trends due to modernization factors that affect the operations.
An example would be the use of proper records on all activities undertaken by this department. This way if any faults arise in the future a method can easily be scrapped off the previous procedures of doing tasks. In instances where a surprisingly excellent result comes from a previous procedure, the methods can be recycled over and over to achieve the same goals. Another way of monitoring the human resource department would be to uptake the new technological methods of survey and supervision in a given company. Such include the use of cameras linked with blogs that record all the employee activities in a given company. This can be used as future evidence and gauging the amounts of improvements made in a company.
6.4 Communication strategies in human resource management.
Since communication is characterized by appearance, relation with each other tends to shape their mode of message interpretation. The most effective ways of dealing with communication barriers in an organization are to be accurate, well-reasoned, confident, supportive, expressive, and forceful (Peetz, 312). The model below represents different communication styles in an organization as of an effective human resource management tool.

Effective communication strategies are a critical factor to consider while taking a glance at the organization as a whole. For instance, the promotion of a bonding team spirit amongst the staff is vivid in the organization. On so, the existence of numerous communication managers in the branches of the organization is a sign of effective communication strategies (David,326).
Dealing with cultural barriers in an organization ought to be carried out in a well strategic manner as well as to maintain the organization’s reputation in its field. First of all the diagnosis of the cultural barriers in the organization should be treated as a major issue with the expectancy of coming up with quick solutions to dealing with this. Further on, research is carried out so as to address the challenge as fairly as possible towards all the employees in different branches. The consideration of sociological factors should be included in the research because this is what is entailed by the colleague to colleague communication behaviors in the organization as a whole. This is because culture is said and proven to create the basis for social interaction and decides how knowledge and information will be passed on to any organization.
6.5 Human resource management challenges.
The human resource department faces challenges in the process of working to meet set goals in every company. Some of the challenges faced by this company as listed below
6.5.1 Resistance to change.
Technological changes in the company can cause resistance among employees due to anxiety. Some of the new strategies enforced may raise anxiety among the employees who feel threatened by missing the ability to handle these new machines. The employees might envision losing their jobs due to this introduction of new machinery (Vance, 244). This is because over the years many companies have been noted to lay off employees because of the introduction of automated machines set in place to perform tasks that were earlier handled by humans (Vance, 207). The machines also hold a higher efficiency advantage over humans who are subjected to wariness and need to take breaks between work shifts. Resistance among the employees to change can be handled by assuring them of their worth to the company. Assisting them to understand that these new machines are being integrated into the company’s tasks to assist them and not replace them is another way of settling the working environment.
6.5.2 Dealing with workforce shortages.
It is difficult for a human resource department to deal with workers who plan to leave the company without notifying the employers in advance. The shortage of workers may be camouflaged in the existence of few skilled employees in the midst of many employees. This causes the company to experience a lag in the performance advancement stages. Only the human resource can deal with this challenge in the company. The challenge can be dealt with by two mandatory actions. Through training activities for all employees to keep up with the changes occurring in technology in the firm and conducting adequate motivation and encouragement practices among employees who bring their best (Vance 219). This brings the employees to understand what is required and valued highly in the company. Holding conferences to deal with employee issues would bring a mutual understanding to the company as to why the work team is not working to its ultimate best.
6.5.3 Training.
Training is an important strategy undertaken by human resource team in companies although it faces challenges in the process of its implication. These challenges come about when employees assume that since the training practice is being enforced on them, the company is in no position to replace them due to having inadequate skills. The employees, in this case, view themselves as valuable assets of the company and can lead to a drop in their performance since no action can be taken on them regardless (Vance, 233). However, this challenge can be dealt with simply by singling out the employees who are need of this training facilities instead of subjecting the whole work team. Another way would involve the employees in this training activities while they are on work leaves as other skilled new employees are given part-time employment.
6.5.4 Management of information.
Due to all the technologic advances in companies the management of information has become very challenging and discrete information may be easily leaked in a firm. This may lead a variety of reactions among the employees leading to disputes and conflicts. Company privacy may be breached where the information containing future strategies can travel to other companies that are huge competitors of the firm privacy and security systems in the company ought to consider the changes in the technology and ways to keep up with protection strategies in the company’s running course (Vance, 258).
Chapter 7
CONCLUSION.
Many researchers have found that there are various relationships formulated while attempting to understand the human resource strategies and organizational performance. There exists neglect in the investigation of meditating mechanisms mainly known as the “black box” of which the human resource policies are known to affect organizational performance. There lays a critical need to test the policies and strategies used in the management of the human resourcing process. Although very little is known about the black box that lays on the relationship between human resource management and performance, the black box is treated as a meditating stand point.
The operational model of the above study advocates that the human resource policies directly have an influence on the human resource outcomes in areas such as collective skills attitudes and cultures. Most companies have an online platform with which the organizations’ activities are aired and discussed upon. Reviews and salaries are major components of the platform. Seemingly, employees experience advantages and challenges while working for any company. Reduced amounts of work load make the duties to be less stressful while, at work, the medical care system of any company is also a critical point. Most organizations have a good system with which procedures are undertaken, the only challenge to this is the time it takes the system to deal with pending issues. Accountants, assistant managers, and advisors all receive proper salaries in this company.
Individual organizations are involved in the setup of skill enhancement centers in different regions. These are to cater for the provision of extra marketing services to the customers. Most of this enhancement centers are provided for particular items from the company. Say, automobiles.
The organizational business plans involve mainly marketing plans among others. This plans play a major role in pricing and also financial management strategies in the company. Various companies also involve staff planning where every field in the production stage has the ability to handle respective tasks all with the help of adequate numbers of employees.
The existing human resources set up are modified to increase the performance of the staff at every level by keeping up with the upcoming trends in human resource. Every level of human resource, owning up to their respective tasks, has also led to proper functionality and maintenance of the company image from all angles of business production. Companies’ human resource departments have increased greatly the company’s production and is therefore not treated as a minor field of focus. The human resource functions in ensuring that a proper working environment is conducted throughout all the stages of production. The impact of organizational structure on any company has been the major contributor to the movement of the company’s sales in the market. Business periods where the company has been in a perfect state of organization enhance the sales trends into greater levels.
ReferencesInternet Sources
https://www.cipd.co.uk/hr-resources/factsheets/employee-turnover-retention.aspx#link_0 (Revised in November 2014)
http://www.cipd.co.uk/hr-resources/factsheets/role-line-managers-hr.aspx (Revised in June 2015)
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