Human Resource Management and Organizational Performance

This assignment delves into the intersection of human resource management (HRM) and organizational performance. Drawing from various sources like Aswathappa's 'Human Resource Management: Text and Cases', Aubry & Hobbs' 'A Fresh Look at the Contribution of Project Management to Organizational Performance', and other relevant texts, students are expected to analyze how HRM practices impact project management success, organizational structure and design, sustainability, and overall performance. The assignment encourages a critical examination of case studies, theories, and real-world applications to develop practical recommendations for enhancing HRM strategies within organizations.

HR: Value and Contribution
to Organisational Success

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Importance of organisational design theory......................................................................1
TASK 2............................................................................................................................................4
P2 Different approaches and techniques used for HR to create a skilled and dedicated
workforce................................................................................................................................4
TASK 3............................................................................................................................................7
P3 Use of contemporary knowledge to support evidence for emerging HR developments...7
TASK 4..........................................................................................................................................10
P4 Organisational design to adapt change management......................................................10
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Management of the personnel of a company is indispensable process which is managed
by HR manager. They play various function such as staffing, organising training and
development, rewarding and various activities with the purpose of managing employee relations
in the company (Berman and et. al., 2012). This help in increasing productivity of an
organisation as it contribute in gaining performance level of company. This report will discuss
the value of organisational design for render sustainable performance in McKinsey & Company
which is an international consultancy enterprise. It will analyse the need of motivation,
knowledge and experience to apply proper research to support company. This will also examine
the link between change management and organisational design.
TASK 1
P1 Importance of organisational design theory
Organisation design is the method of management that helps in achieving the exact and
specific combination of integration and differentiation of the company's activities ton response
the uncertain level of external environment. This is a process of step by step techniques through
which recognition of dysfunctional aspects of systems, structures, workplace flow or procedures
which is used for attaining goals of business and making the required changes in the
organisation. For various companies it can lead them toward effective designs and empower or
committee worker so as McKinsey & Company (Boxall and Purcell, 2011). Here are some of
benefits which this service render:
 Excellent consumer service.
 Raise the profitability
 educe cots of operation's
 Development in cycle time and efficiency
 Engaged worker and culture commitment
 Effective and clear growth strategy.
Types of Organisational Design
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There are two concepts of organisational design on which the entire suture or it relayed
on. various types of organisation use different designs according to their framework, culture and
system of working. There are are explained the major two categories of OD mentioned as below:
Traditional or Historical Concept
This is the most easiest AND understand types of organisation design which is soften
adopted by the small business companies or start-ups. The structure of this type is a pyramid
structure Along with the chief on top. The main CEO allocate their duties on the subordinates
which layer layer the entire work into different parts. This process is less flexible and the
decision making is made by the higher authority only and manager dominated the worker. It has
been delimited into few categorises which are mentioned here: Simple structure: This is also known as the term of departmentalisation, broad control
span, little formalisation and centralised authority. This is used by small business dan
there is no standardised process of policies in this. Functional Structure: This can refer to the the plan which group familiar and linked job
specialities together. This is approaches of function to departmentalisation executed to
whole company. Division Structure: This is formed for semi-autonomous body, separate company,
division or units. In it, there can be various division in one company but they contain
same purpose.
Contemporary Organizational Design
Contemporary organisation design is the complex process that require to change within
time span as well as flexible due to its structure. This is made to empower the worker, avoid
control to the central people or holds the duty level of company (The Importance of
Organizational Design and Structure, 2011). This is flexible which can be bend according to the
consequence. Here are some of its types: Team Structures: in this, the company make the team of worker and they help in attaining
the goals and objectives of the company. This is the most effective and quick process to
meet the outcome. Matrix Structures: this the one structure in which various specialist or experts are asked
to join together for attempting or meeting specific task. This includes various
professional of a company which can help the organisation in completing the work.
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 Project Structures: it is a project structures in which the worker constantly perform on
task. It is similar to matrix cater the team according to the skills.
McKinsey & Company use the contemporary style of working in their company for the
proper work performance and increase productivity if every performance they provide to render
satisfaction to the clients.
Impact on Organisation Structure
This is very important for a company like McKinsey& Company to maintain
organisational structures in order to manage the entire work in systematic and organised way.
This is required to have this for the changes in the structure which can be effectively executed in
the structure of respected company through the help of OD has it is large organisation spread all
over the world. This avail in allocation of work responsibilities in the structure on the grounds of
their work specialisation, chain command, duties and role in the company. It avail in managing
the various operative functions as well as eliminate the works structure by designing or planning
a structure on the grounds of its elements.
Impact on Organisation Strategy
As the companies require a roper and effective structure for proper implementation of
strategy in order to meet objectives and goals (Wehrmeyer ed., 2017). McKinsey& Company is
a global consultancy company which provide their service in every part the world. The
organisation have a large structure and employee group, it require and effective and systematic
design and structure of organisation for proper implementation and increase the effectiveness of
the implemented plan. Strategy is facilitated by the structure of design of organization as it
determines the ease and impact of the execution on the functional parts of a company.
Organisational design helps in attaining the goals and strategy of the company as well as
avail in determining the organised, systematic and effective structure for a company. There are
various theories of OD in which some of them are mentioned below: Administrative Theory: formed by Henry Fayol, this states that there are few elements
which is considered in management process i.e. planning, organising, raining etc.
 Classical Organizational Theory: This was profound by Taylor, Weber and Fayol which
deal with companies to annalyse concpet to boost the effcicieny of management.
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According to Unger, Gemünden and Aubry (2012), These theories are different according
to varies consequences and situation as well as its impact depend on the structure of company.
McKinsey& Company can apply the administrative theory in their functional part to increase the
efficiency of their operations which they coordinate. It can help in aligning same purpose to the
entire company as well as maximise the revenues and result of the company.
TASK 2
P2 Different approaches and techniques used for HR to create a skilled and dedicated workforce
Human resource is the main assets of a company which is required for the management
of worker and entire employee group of a company. This is required for an organisation like
McKinsey& Company to manage skilled worker, motivate them within period of time in order to
retain them within the organisation. This can avail the organisation in development impacting the
enterprise more positively. For this, company organise various effective approaches, techniques
or approaches ton reach and commit the worker for the company in order to gain the productivity
and profitability. Here are few of those theories and approaches which McKinsey& Company
use with the purpose of better and effective execution of plan for dedicated human resource in
their workplace worldwide:
MOTIVATION AND MOTIVATION THEORY
Motivation mean 'to move' which refer to the forces which avail an individual or person
in arousing, stimulation and render inspiration to achieve the path of motivation. Thus, this
theory refer to the process how the behaviour of human activated?
The theory of motivation and motivation refer to the most written and frequent analysis
which is written in the scientific and considered one of the most significant method that reflect
construct complexity (Stredwick, 2013). There is no single theory under motivation and
motivation hut various types of theories in which the major one is mentioned here:
Major content theories Maslow's Hierarchy of Need: This theory is developed by Abraham Maslow that portray
the need of human as a hierarchy involving the security need, psychological ,esteem
need, self actualisation etc. The most important need of a person is psychological need
which is needed to manage for shelter, food, water etc. require for survival. Security
requirements is one of the physical requirements including freedom, stability etc.
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Belonging needs whereas the desire of love, family, friendship rendered by the respected
community. Esteem need is those requirements which is needed for individual himself. It
is essential to apply this theory in the workplace of McKinsey & Company as obvious,.
This create the sustainability in the mind of worker and make the more reliable on the
organisation increasing credibility of the company which is organised by the HR of a
company. Motivator Hygiene Theory: This was formed by Frederick Herzberg which is linked with
the Maslow's Hierarchy requirements but discussed the ways the individual get motivated
in the working environment. This argues that stimulation refer to the person's efforts and
achievement of higher-level need helps in motivation despite of fulfilment of lower level
requirements. The execution of manager for this theory is meeting lower need level
through development of wage, security and other elements can help in preventing
dissatisfaction of worker but does not affect their performance. A manager should focus
on the alternation of intrinsic nature as well as enriching level of job or render extra
services such as development of carer or skill,s gain recognition, additional duties etc.
Major process theories
 Theory of expectancy: This is one of the behavioural concept which is formed by Kurt
Lewin as well as Edward Tolman straightly to performance motivation. Vroom states that
the person only choose that work which they think is worth values. The individual are
willing to consider:
◦ Expectancy, refer to degree that can lead them toward effective performance.
◦ Instrumentality, that can lead one toward catering result or compensation
◦ Valence that is extent ton that predicated outcome can be unattractive and attractive
(Mir and Pinnington, 2014) .
All these help an individual in stimulation and motivation and help in increase their
competency level. Thus, the manager should attempt the belief of the worker for gaining
the better performance and rewarding values. Equity Theory: This theory suggests that a person compare their performance, rewarding
dan other efforts with the people who are relevant. If the organisation make the fair
decision while rewarding to thee employee it affect the worker as well. Equity can be
achieved if the person are getting the reward on the basis of performance which stimulate
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and motivate the other worker as well. But if the employee are given compensation on
biasses, inequity at workplace begin. According to this this, person get motivated to avoid
the perceived inequity, If the iniquity would in workplace it can lead to change in the
behaviour of one and efforts in regard of their work. On the other hand, equal
performance reward can lead the change of all employee in more positive and productive
manner.
HUMAN CAPITAL THEORY
Human capital refer to the individual or group disposition in the source form of skills and
knowledge which reflect the experience and education of people. This term was originated by
T.W. Schultz which have contributed in the development (McDonnell, 2011). This is the
investment of capital of human as well as income distribution of personal. The theory of human
capital thus it states that the worker performance and productivity is affected b y the training and
education through imparting skills, knowledge, hence increasing employee' income of future
through developing their earnings of lifetime. This states that organisation can retain and
mo0tivet their worker through the help of training and education which is a costly investment the
a company maintain for their worker.
Illustration 1: Elements of Human Capital theory, 2017
Thus, this is required for a company to manage those activities which can help them in
retaining, developing, attracting and maintain better and effective worker in their organisation. It
is require of McKinsey & Company to manage or execute a proper and effective strategy of
motivation and employee stimulation to develop the company's revenues and benefits. McKinsey
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& Company is adopting the Maslow's Hierarchy theory, hygiene theory and human capital
theory in their organisation to gain the dedication and commitment of worker in the company for
a long time.
According to , an organisation can use the effective approaches and models for making
the workplace of McKinsey & Company flexible, effective, positive and better place (Goetsch
and Davis, 2014). They can implement those model such as Maslow's Hierarchy model, Hygiene
theory, expectancy theory etc. for the better productivity of the performance which the worker
do.
The company can manage worker performance and develop their knowledge through the
help of knowledge management which is a systematic administration of the information and
strategic requirements. This consist of process, system strategies and processes of company
which can help in meeting the sharing and refinements for the worker. This is the most effective
medium to achieve the targets and goals through motivating worker.
TASK 3
P3 Use of contemporary knowledge to support evidence for emerging HR developments
As per the above report, various operational design, HRM approaches and techniques
were analysed in order to support and contribute in the activities of human resource
management. According to the required report, a proper evidence evaluation and research is
needed for supporting those evidence to adopt the development of HR.
A proper secondary data investigation over the issue were being conducted from various
scholars and authors to support the presented report. Here are those elements accumulated from
the these investigation mentioned under:
According to Inyang, Awa, and Enuoh (2011), various Emerging HR development
which is taking place within the company. There are various factors which help in increasing
value of human resource manager within an organisation. The trends of HR in the recent time
period are as under: Culture and ethics are required- The research is used for exploring contemporary
research which is totally based upon increasing HR development plans. The main motive
of human resource manager is to make effective plans and adopt those culture which help
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in maintaining culture power among employees. This will enhancing the value of HR in
the firm. They also managed and control all ethical and moral duties in proper manner.
 Performance reviews- This is another emerging research which conduct by manager for
the company development and growth in effective manner. It is the main responsibility of
HR is to examining the actual performance of employees which help them in achieving
desired goals and objectives.
 Team management- The team work should be managed and maintained by Human
resource manager for increasing coordination among team members so that they can
easily reach the target goals and aims. This activity will researching by manager for
analysing fixed purpose and aims of the company.
According to Florea, Cheung and Herndon (2013), the future for HR is as a process and
function which affects various functions and influence of organisation that can help the company
in improving and developing within the organisation. Here are some points which explains it in
better way:
 HR process became cloud based and automatic- Marketing and communication
technology will help in transferring proper information and data in different level of an
organisation. In future, HR technology has performed various functions such as hiring,
recruiting, training and development and on-boarding are executed in the cloud.
 Individual experience became best priority- In recent time period, Consumer technology
will mainly focus on “pleasure” the user and HR also expect them for smooth, soft and
impressive interaction in proper manner. The latest technology of human resource are
change as per the demand and need of expected customers at the given time period. This
factors will design to understand consumer wants and needs for achieving desired goals
and objectives.
 Recruiting will continue personalised and candidate central- This is one of the most
important process which have to be done by HR in effective manner. This can be
assumed as hiring and recruiting are the major factors by which manager will select
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skilled and experienced employees who are capable for handling all work of an
organisation. In future time, the value and importance of HR are increasing in the firm.
So that company will hire those employee who are best suitable for work.
According to Boxall (2013), there are numerous contemporary HR challenges which a
company has to face while managing HRM and administrating the worker to retain within the
organisation. A successful strategy of HRM can help the company in reaching the objectives and
goals of an organisation. This is required to manage the human resources of McKinsey as it is a
global consultancy organisation for retaining, developing and enhancing productivity of the
company activities and operation in order to gain increment in the revenues amount of enterprise.
After the new and modified technologies and various approaches of motivation, the HR manager
still have to face challenges in the competitive business sector in regard of their personnel to
manage them more properly and effectively. Here are some of those challenges that organisation
can face in the external and internal environment which may can affect the outcome of the
company. Some of them consist of: Competition: The competition is the industry affect the decision of HR in regard of
personnel of the company. They make the judgements on the basis of the competition
which the face in the competitive working environment. Compensation: People have become more centred and require monetary compensation
for the better productivity and as the compensatory. This is require for an organisation to
render the high quality work and render better and effective opportunities to worker for
developing to stimulate them. Legislation: the new laws and acts which is organised by the states of different nation
can restrain the evolution of HR. For example: Act of profitability and accountability,
Disability Act etc. It is needed to manage and comply these rules and this is a challenge
before HR to attempt all laws as well as benefit organisation and worker at the same time.
 Employee Relation: this is needed to manage the employee relation of the organisation
for the development of the company in constant evolution. This is challenge for HR to
organise those activities which can enable their skill in right direction to get the
maximum outcome.
According to Aubry and Hobbs, (2011), the new trends, and changes in the HR function
can help the organisation in developing more rapidly as well as will avail ion the implementation
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or adoption process of new change or technology within the company. It will help in creating
better an interactive communication among the workplace which will lead to more friendly
working environment. It will also avail in better and attracting more skilled worker which can
enhance the productivity of McKinsey & Company through the help of social media. They can
get the maximum revenues and easy working style along with effective outcome in the entire
consultancy sector.
TASK 4
P4 Organisational design to adapt change management
Organisational design includes about the designing of strategies and plans which helps
the management of company to accept the changes and achieve the organisational objectives
effectively. This includes about define decision rights, accountabilities, internal governance and
linkages etc. This helps to manage the complexity and ensure sustained performance. The cited
company uses many approaches to build organisational designing which helps to adapt change
management which are described below: Adopt rigorous approach in organisational design: This includes about strengths and
weaknesses of the organisation which helps the management to adopt proper strategies to
recover from their weaknesses and be flexible to adopt changes happen in internal
environment. Link organisation strategies and attain value: The management of cited company has
duty to link organisational strategies with their strategic priorities and critical operations.
This would contributes in international expansion, cost cutting, growth acquisitions etc. Focus on value creation: All the functions which are performed by company have main
aim to create value for their organisation. It means that all the operations helps the
company to achieve their organisational targets effectively. Such effective
implementation of strategies helps them in accept the changes which happen in business
environment.
 Deal with complexity: The main aim of organisational design is to be simple which helps
to remove the complex situation from company. This provides the opportunity to
employees to understand about the processes and strategies accept by company. This
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would make them flexible to accept the changes which have some impact on
organisational activities.
Organisation design is consider as process of aligning the structure of an association with
its objectives, goals and targets with an ultimate aim of improving practices and support in
gaining effectiveness and efficiency (Aswathappa, 2013). It is a formal process in which
management will going to integrate people, information and technology. The six major elements
of organisational design are stated as follow:
 Work specialisation
 Centralisation/ Decentralisation
 Span of control
 Chain of command
 Formalisation
 Departmentalisation
McKinsey& Company have followed the decentralisation process but now management
want to change their management of working in which they wants to follow the centralisation
process in which a suitable reporting relationship would be managed. Thus, this change restrict
business and its employees to adapt such consent properly and lead to affect their working
practices as well. Change is not appropriate for business and an association always resist to adapt
such modification which further impacted on production process as well.
Both these things are interrelated with each other in a situation when association
productivity get reduce. This impacted on business and its performance adversely due to change
in their working practices as they lead to adapt decentralisation process. Hence, it is a duty of
managers to adapt this change properly and facilitate their operations in an effective and
appropriate manner. Centralisation procedure will lead to contribute in increasing employees
productivity towards target achievement as a proper reporting relationship will get managed
between each other. This function harms business for starting some years but after some time it
will lead to provide benefit in an appropriate manner.
There are many types of changes which affect the organisation design of McKinsey and
co. So, the management of company has to critically evaluate all the changes that happen in
future which have impact on organisation activities and design (Arrowsmith and Parker, 2013).
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The main two type of changes which affects organisational design are transformational and
psychological change. Impact of both these changes on organisational design is described below: Transformational change: This includes about change in business culture because of the
change in past strategies and processes of company. The main cause of transformational
change is because of the combination of internal and external factors. The main reasons
of such transformational change is merger and acquisition, high revenue growth, rapid
sales hiring, major product launches and changes in top management of company. All
these changes have major impact on the organisational design. To accept these changes
the management of company has to make new strategies which are removing their
impacts.
 Psychological change: This includes about the change in thought process of top
management and employees of company which affects the organisational design. It is the
duty of management has to understand the psychology of employees to adapt the
changes and achieve the targets effectively (Armstrong and Taylor, 2014).
CONCLUSION
This can be concluded from the above report that human resource play a vital role in the
development and success of a company either consultancy of other commercial organisation. A
company require to fulfil the requirements, expectation and needs of the worker for gaining
proper and effective proactivity of their activities and best of their skills. The company use
various motivation theories, concepts and approaches for stimulate worker, retain and develop
them according to the needed of themselves and organisation as well. Also the company use the
best organisational design for the implementation in order to get the effective implementation of
the strategy and structure of firm to meet the goals and objectives.
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REFERENCES
Books and Journals
Armstrong, M. and Taylor, S., 2014. Armstrong's handbook of human resource management
practice. Kogan Page Publishers.
Arrowsmith, J. and Parker, J., 2013. The meaning of ‘employee engagement’ for the values and
roles of the HRM function. The International Journal of Human Resource Management.
24(14). pp.2692-2712.
Aswathappa, K., 2013. Human resource management: Text and cases. Tata McGraw-Hill
Education.
Aubry, M. and Hobbs, B., 2011. A fresh look at the contribution of project management to
organizational performance. Project Management Journal. 42(1). pp.3-16.
Boxall, P., 2013. Mutuality in the management of human resources: assessing the quality of
alignment in employment relationships. Human Resource Management Journal. 23(1).
pp.3-17.
Berman, E. M. and et. al., 2012. Human resource management in public service: Paradoxes,
processes, and problems. Sage.
Boxall, P. and Purcell, J., 2011. Strategy and human resource management. Palgrave Macmillan.
Florea, L., Cheung, Y. H. and Herndon, N. C., 2013. For all good reasons: Role of values in
organizational sustainability. Journal of Business Ethics. 114(3). pp.393-408.
Goetsch, D. L. and Davis, S. B., 2014. Quality management for organizational excellence. Upper
Saddle River, NJ: pearson.
Inyang, B. J., Awa, H. O. and Enuoh, R. O., 2011. CSR-HRM nexus: Defining the role
engagement of the human resources professionals. International Journal of Business
and Social Science. 2(5). pp.118-126.
McDonnell, A., 2011. Still fighting the “war for talent”? Bridging the science versus practice
gap. Journal of Business and Psychology. 26(2). pp.169-173.
Mir, F.A. and Pinnington, A. H., 2014. Exploring the value of project management: linking
project management performance and project success. International journal of project
management. 32(2). pp.202-217.
Stredwick, J., 2013. An introduction to human resource management. Routledge.
Unger, B. N., Gemünden, H. G. and Aubry, M., 2012. The three roles of a project portfolio
management office: Their impact on portfolio management execution and success.
International Journal of Project Management. 30(5). pp.608-620.
Wehrmeyer, W. ed., 2017. Greening people: Human resources and environmental management.
Routledge.
Online
The Importance of Organizational Design and Structure. 2011. [Online]. Available
through:<https://hbr.org/2011/02/the-importance-of-organization>.
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