Human Resource Management Impacts on Organizations

HRM -- HR -- Impacts on Organizations

What are the best strategies for Human Relations Management (HRM) and Human Relations professionals (HRPs) to improve the performance of their employees? There are several important strategies that relate to that question, and they are reviewed in this paper.

The impact of Human Resource Management (HRM) on organizations is the subject of a peer-reviewed article in the International Journal of Human Resource Management (Dyer, et al., 1995). Dyer poses the questions at the outset as to whether several human resource strategies -- called "internally consistent bundles of human resource practices" -- actually make a contribution to organizational effectiveness. "Maybe" they do, Dyer responds to his own question. The background he alludes to shows that: a) in terms of labor productivity, bundles do show more effectiveness than single HR components; b) not all bundles are equally helpful, but some "configuration" of bundles do lower employee turnover and boost the quality of the product; c) because the bundles that Dyer writes about do not all perform similarly, it makes it tough to devise a strategy based on bundles; and d) there is no "convincing evidence" that the bundles that work best for one organization are effective just because of the strategy employed, or organizational context (Dyer, 656).

So, given these uncertainties as to why certain strategic human resource management (SHRM) tactics work well (as a bundle) in one context and not in the next, it cries out for deeper investigation. Dyer (p. 656) explains that two possible explanation are the "intense global competition" and the search by alert organizations for sources that will provide a "sustainable competitive advantage." Why bundle HR strategies? For one, Dyer (657) points out that since the performance of employees is based both on "ability and motivation," it makes good sense to devise strategies and practices that enhance both ability and motivation. And secondly, by employing several ways of contributing to the development of skills (like on-the-job training) and offering incentives (non-monetary rewards) through bundling is known to maximize employee performance. That having been pointed out, Dyer (661) makes clear that not all bundles are "created equal" and moreover, organizations have to find their own best bundle match depending on their work environment and organizational structure.

A more recent scholarly piece suggests that research into the dynamics of human resource management (HRM) brings out the fact that human resource professionals (HRPs) can play a far greater role in making their organization a success. That greater role entails creating policies and systems that are "…aligned" with the "values, goals and mission" of their organization (Caldwell, et al., 2011, p. 171). That may sound like an obvious goal, but Caldwell goes a step further, suggesting that the HRPs should raise the standards of their organizations by creating "implicit ethical duties" (171). Basically the authors are saying that human resource professionals need to adopt "an ethical stewardship framework" in order to help their organizations develop "transformational leaders" that can meet today's global competition head on with not just an outstanding product or service, but with values that satisfy the needs of employees and hence, make the organization more productive (171).

Caldwell (172) points out that in the past HRPs have not been given adequate training in order to design and set in motion "systems and policies" that seamlessly interlock with the mission and goals of their organizations. But, Caldwell asserts (172) that there is empirical evidence that when HRM systems are in high gear, they indeed have a "significant positive impact on overall financial performance" and they reduce turnover at the same time. "Strategically crafted HRM systems" -- that embrace ethical standards as well -- can produce "enormous economic returns" (Caldwell, 172).

Much of what Caldwell and colleagues have crafted in this scholarly piece is based not just on previously instituted HRM strategies, but also on the "post-Enron era" need for: a) the creation of "trust cultures" that look out for the best interest of stakeholders; b) ethical stewardship that honors the values of society, of employees and of stakeholders; c) a policy that treats employees as "owners and partners" rather than as subservient workers; and d) ethical stewards that help transform their organizations into "human and humane communities" that embrace "inclusion, shared partnership, empowerment and leadership trustworthiness" (174).

A piece in the journal Human Resource Management (Lopez-Cabrales, 2009, p. 485) shares ideas along the same lines as the Dyer article; that is, a company can enjoy higher profit levels, can achieve impressive gains in employee knowledge, and can devise effective, innovative capabilities -- all through creative human resource management practices. There are no hidden secrets in the concept of innovating, and it is not rocket science to say that an organization needs to innovate to stay competitive and productive. But Lopez-Cabrales breaks innovation down to three separate meanings, all of which are mutually compatible.

One, the authors explain that innovation is a "discrete element" that helps drive the development of programs, services, and products (engineers, designers, and others come up with creative ideas and those become the substance that makes the company's offerings attractive). Secondly, innovation is simply a "process" -- or a "stage" -- within the larger developmental strategy that produces goods and services. And number three, innovation can be described as "an organizational capability" (i.e., a given company has a knack for innovativeness, coming up with new products and services through its innovative capabilities) (Lopez-Cabrales, 486).

Taken as a singular concept, innovation is the driver behind new and attractive products, and the companies that innovate in their marketing strategies as well tend to be ahead of the competition. The salient point is that HRM practices must be designed to give the company's best creative employees the knowledge required in order to innovate (Lopez-Cabrales, 488).

The concept of "green" has taken on a popularity that few could have predicted just ten years ago -- and it doesn't always specifically allude to organic food or reducing one's carbon footprint. To wit, authors Muster and Schrader explain that "Green HRM" can live up to its "full potential" if employees are seen as consumers and producers, and are treated professionally by taking into account their private environmental values and their workplace conditions (Muster, 2011, p. 140). What the authors stress in this piece is that Green HRM policies that only focus on an individuals' role in the workplace "are insufficient" (141). A more "holistic" approach to HRM is emphasized by Muster, which means companies embracing Green HRM should be aware of employees' patterns in their everyday lives and with that knowledge, Green HRM should tap into the collective and individual capabilities "to bring about green behavior" (142).

When Green HR policies are in place, and workers are respected for their personal, off-hours cultural / ecological values, an environmental corporate culture can be formed, Muster writes on page 143. Within that culture, an increase in motivation and communication -- both linked to green policies that are instituted by Green HRM -- can be predicted and expected (143). The bottom line for Muster (143) is that Green HRM could fail to reach its full potential if the focus is only on employees in their role as workers, and not on their environmental values in private life.

Olivier Herrback and colleagues explain in the journal Human Resource Management that they have come to two conclusions vis-a-vis HRM practices. One is, when high quality training opportunities are presented to employees, "most favorable outcomes" can be expected (Herrback, 2009, p. 895). That is, good quality training can bring a level of commitment to the organization that Herrback alludes to as "higher effective" and "high-sacrifice" levels of commitment (895). Moreover, competent company training also tends to lead to a "lower lack of alternatives" (in other words, employees are not seeking job alternatives because they are so well prepared and comfortable through training they wish to remain on their current jobs). The second conclusion this article reaches is that by assigning "older workers to new roles" (possibly a coach or a mentor) does not have positive results that might be expected (895).

The results in Herrback's first conclusion are not surprising at all, especially for those that have studied the relationship of training and preparation and job competency and job satisfaction. But the second conclusion (older people unable to adapt to new assignments) is a bit of a surprise. Still, Herrback points out (897) that companies' HRM departments can get the most out of older people by recognizing: a) if their needs are being met their commitment is usually strong; b) if their skills are respected, and if they are respected by co-workers (that may be younger), they are more productive; and c) when they are given "continuing education" opportunities, they are more motivated, committed, and indeed happier on the job.

Another article in Personal Management applies cognitive-social theory to Green HRM; it centers on the "initiation and maintenance of green HRM behaviors" (Zoogah, 2011, p. 117). Those "green behaviors" that need to be instituted by HRM include: "managers' encodings, expectancies, affects, goals and values, self-regulation," and HRM interactions with "each other" and with the "green HRM-relevant information" (Zoogah, 117). What are the most important green behaviors HRM can embrace today? That is the gist of this article. On page 120 Zoogah explains that "green signatures" relate to "green decisions" and "green behavior." The author suggests that green managers play a powerful role in terms of the attitudes, values and goals of environmental management (EM) in the workplace.

According to this article, Green HRM leadership (green decisions and behavior) entails: a) integrating sustainable environmental policies into the organization; b) using knowledge management and HR practices (involving employees) to "produce environmental improvements" for the company; and c) using some risk-taking behaviors (innovations that can enhance the quality of the workplace and reducing costs); d) employing "preventative behaviors" (what should not be done) and "cooperative behaviors" (what should be done) to create an environmentally sustainable and healthy environment (Zoogh, 122).

Part B

"In the current career climate characterized by change and turbulence, employees may demonstrate limited psychological attachment to their employers… [but] organizations can elicit psychological attachment from employees by reinforcing perceptions of organizational membership and demonstrating care and support for them…" (Ng, et al., 2009, p. 289).

This section looks at the practical measure that HR can introduce to support the ideas presented above. In the Academy of Management Journal (Martins, et al., 2002, p. 399) the authors present evidence through their research that because the recent changes in the demographics of the American workforce, HR people (more than ever before) are obliged to take into account employees' need to balance family life and workplace experiences. Hence, Martins and colleagues' objectives in the article are twofold: a) to "empirically test the negative relationship between work-family conflict and career satisfaction"; and b) to examine a number of factors that will help in understanding the work-family conflict juxtaposed with career satisfaction (Martins, 399). The authors use several hypotheses to flush out the values attached to the above-mentioned competing dynamics. One, the greater one's perceived "work-family conflict" the "lower will be their career satisfaction" (Martins, 400). This was supported by the empirical research Martins and colleagues conducted. Another hypothesis that received strong support in the research was that gender will come into play in the outcomes of work-family conflict. Indeed, women place family needs higher than workplace attendance, hence women experience higher levels of work-family conflict than men do (403). A third hypothesis that was supported in the research literature by Martins was that "Age will moderate the relationship between work-family conflict and career satisfaction" (400). In fact, the career satisfaction of older workers is "more strongly affected by work-family conflict" than the career satisfaction of younger workers (403).

Another of Martins' hypotheses that found support in the literature was that the negative relationship between work-family conflict and career satisfaction "will be stronger for individuals belonging to the minority gender in their work groups" (405). In other words, what the authors found is that women, minorities, and older people are more conflicted with regard to balancing work and family life then men, Caucasians of European descent, and younger people. What this all means is that HR must come to terms with these findings and be empathetic and supportive of the family responsibilities and obligations that women, minorities and older people deem highly important and desirable. As Martins writes on page 407, the research findings are helpful to HR people because HRPs can design work-family programs that take into account gender and age issues. Moreover, HRPs should "devise mechanisms" that will link the minority gender to other minorities in the company "from whom they can derive social support" (in other words, HR can help minorities network with other minorities of their same ethnicity within the company) (Martins, 407).

In Chapter 12 ("Strategies for Improving Competitiveness: Quality, Productivity, and Quality of Life") the authors (Bernadin, et al., 1998) continue the theme of improving and enhancing organizational capability through more effective HR programs. In order to understand what specific innovations and policies the HR departments need to launch the problem must first be diagnosed. On page 336 the authors note that poor productivity can be traced to a number of factors beyond the competencies of workers. Some of those include: a) poorly trained employees; b) outdated equipment; c) workloads that are unpredictable; d) "inefficient work flow"; e) "inappropriate job design"; f) "low employee ability, or effort" (Bernadin, 336).

There are many kinds of incentives that HR people can use to encourage employees to perform better, feel more secure, and enhance the company's bottom line in the process. One incentive is for a company to offer an "internal quality award"; this award can go to a vendor outside the company but it can just as easily go to an outstanding employee within the company. There is also the Malcolm Baldrige National Quality Award, which gives awards to companies and promotes "…the importance of total quality management" and uses "leadership" and "human resource development and management" as important criteria (341).

Also in Chapter 12, authors offer a number of "participative interventions" that HR professionals can use to support a quality workforce. For one thing, simply involving employees in the decision making processes of the company is a big step towards enhancing company dynamics and relationships, top to bottom. Also employees should be involved in "problem identification, problem solving, and decision making through… quality circles, task forces, opinion surveys and suggestion systems" (346). The authors aren't talking about the ubiquitous "suggestion box" here, where a token effort is made by management to seem to be soliciting workers' opinions. The authors are alluding to real, tangible input that HR professionals can institute vis-a-vis involving employees in the company's decision-making processes. Also, when job responsibilities are linked to a "team-oriented work design" positive changes can be made in the organizational structure of the company, the authors continue (346).