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EssayHRM works at achieving high performance by increasing employee commitment andeliciting positive attitudinal response towards the organization and its objectivesThe human resource management practices, models, theories are the organizational activities thathelp in managing the pool of human resources, and they ensure that the resources of thecompany are employed towards the fulfillment of the goals of the company (Mathis, 2016).HRM is implemented in the form of a set of policies and practices that are designed andimplemented for ensuring that the human capital of the company is contributing to its maximumfor achieving the objectives of the business. In terms of its strategies, policies, and processes, thehuman resource management is universal. It has replaced the traditional personnel management.But, the management and development of the human resources are considered as a centralchallenge. The organizations today are going global, and it is very difficult to manage theworkforce in the multi-national enterprises. The concept of human resource management istheoretical as well as practical. The theoretical part can be considered as universal, but thepractical part is not universal. The theoretical part of human resource management has describedthe way in which the organizations must be structured, but the way they are actually structured isvery different. In the banking sector, the role of HRM is very crucial because most of thebusiness of banks is target based and they have to change things as per the changes in theenvironment. So, HRM helps the banks in ensuring that the employees maintain theirperformance and dedication during these times and their level of commitment does not fall. The purpose of this essay is to determine that to what extent the HRM works at achieving highperformance by increasing employee commitment and eliciting the positive attitudinal response1
in the commercial/retail banking industry. This examination will be made using the theories ofHRM that suggest how an organization should be structured. The rhetoric and the reality inconsideration of the traditional banking setup will be discussed, and then the comparisons will bemade using the models of HRM in relation to the psychological underpinnings of HRM,recruitment and selection, reward, employee voice, managing the performance, etc.Firstly, the theories of HRM will be discussed that suggests how an organization should bestructured. Several theories have been developed in the past that explain the rationale behind theformation of the structure of the organizations. Some of them are classical theories like thescientific management approach, the Bureaucratic approach by Max Weber, and theadministrative theory (Troitzsch, 2013). Then, there are neo-classical theories and the modernorganization theory. Some of these theories form a base for HRM and for the structures of theorganizations. One of the theories that relate to HRM is the neo-classical theory that recognized the importanceof the individual and the group behavior and emphasized on the human relations (Shafritz, 2015).These theories were developed from the Hawthorne experiments, and they place emphasis on thehuman and social relations among people. It is argued by this theory that if the relationships areconsidered, then the productivity can be determined and by making some changes in the workingconditions of the people, the productivity can be enhanced further. The theory believes that whenthe people have the high level of motivation, they become more productive (Child, 2014). Theirmotivation level is affected by the amount of individual, personal and the intimate attention thatthese workers receive. So, as per this theory, the structure of the organization should be such thatthe individuals are not treated as mechanical tools, but they are treated as distinct social beings.The organization where I used to work earlier, used to follow this theory as the individual2
differences of the employees were respected in there, and were made to interact with the socialand economic factors affecting the company.Also, this theory suggested that the informalstructure should coincide with the formal structure. It emphasized on the concept of ‘groups’ inthe organizations and the synergistic benefits (Millar, 2016). This theory of HRM is relevant andshould be applied in the present organizations because it has the ability to encourage the conceptof participative management in the structures of the organizations in which the workers arepermitted to take part in the decision-making process. By this form of management, the increasein the productivity is ensured. This neo-classical theory is very much implementable in thebanking sector because here the employees are a main part of the organization. They take care ofthe cash, deal with the public, grant loans, handle the clients, maintain the reserve, take care ofthe mortgages, etc. So, here the concept of HRM plays a very important role. Therefore, thestructure of these organizations must incorporate the HRM theories.The theories and models of HRM are particularly important in increasing the performance of theemployees by ensuring they are highly committed to the organization in which they work. Oneof them is the AMO theory which suggests that the independent work system consists of threecomponents that shape the characteristics of the employees; they perform better and hencecontribute to the success of the company. The interests of the organizations are best served bythe HRM system when it attends to the ability of employees, their motivation and provides themthe opportunity for contributing towards the company. This view applies to thecommercial/retail banking industry as the employees of the banks are compulsorily trained for aparticular period of time so that they build up and improve their knowledge and skills for doingthe tasks, most of the employees are given incentive based pay for the number of sales they makefor the bank and for the business that they bring to the bank which motivates them and they are3
also given opportunities in the form of off-site meetings, transfers, etc. so that they are able totake decisions for the banks, meet new people; propagate their abilities in front of clients, etc.When the AMO theory is practiced in banks, they not only improve their performance, but theyget the motivation to work, they become committed to the banks. This also helps in reduction ofthe rate of attrition; the company saves costs of new recruitment and positivity in the banks helpsin to meet its objectives on time (Zaman, 2016). Then, another important model of HRM is the soft HRM model which in my opinion helps thebanks in achieving high performance by increasing employee commitment and eliciting positiveattitudinal response towards the bank and its objectives. The model of soft HRM treats theemployees of the company as their most important and valuable resource, and in this, the peopleare viewed as the source of competitive advantage. In the banks, the long term goals andplanning play a very important role because they have to plan as per the forecasted changes inthe external environment as the rate of inflation, change in government policies, etc. (Farouk,2016). So, accordingly, they focus on the long-term workforce planning strategically, theymaintain strong and regular two-way communication; they design their pay structurecompetitively, and they add the suitable performance related rewards in it. This ensures thatpeople perform as per the plans, remained motivated and committed to their work. Bath gave a model of people and performance which suggests that when the managers of thecompany and the organization itself invest in the people of the company, they listen to theconcerns that people face and make efforts to address those concerns in a timely manner, thenthe possibility that the employees care about and focus on the organization and its goalsincreases (Bratton, 2012). I think that the managers should continuously take care of theemployees by focusing on the things that lead to the increase of the performance of employees,4
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