Organizational Performance Employee Relation

Student Name
INSTITUTIONAL AFFILIATION(S)
EMPLOYEE RELATION
AND ITS EFFECT ON
ORGANIZATIONAL
PERFORMANCE

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Employee relation and its effect on organizational performance
Introduction
Organizations of the 21st century use the term employee relations to demonstrate the
relationship that exists between both, employers and the employees. Employers seek to
manage their employee relations effectively with every individual working for the
organization and thus adopts several means to motivate them. It can be said that employee
relations are all about managing effective organizational communication that can develop
employee confidence, loyalty and trust, enable management to identify sills and potential of
employees and acknowledge their participation in management ( Rahman & Taniya,
2017). At an organizational level, the outcomes of such strategies or managing employee
relation processes can be assumed as an important mechanism which helps firms achieve core
objectives, decrease conflicts and increase organizational performance (Nikoloski,
Dimitrova, Koleva, & Kacarski, 2014). In this light, this essay proposes to identify
benefits behind employee relations, ways organizations develop employee relations and its
effect on organizational performance.
Discussions
Every organization need high performing staff so that attainable goals can be met,
products or services are delivered appropriately and to achieve competitive advantage. Low
performing staff not only hinder goal achievement capabilities but also lead organizations
towards failure. It can be said that “Employee performance has been shown to have a
significant positive effect on organizational performance” ( Rahman & Taniya, 2017, p.
92). Employee relations directs and gives oversight to the human resources considering staff
and non-staff employment issues such as individual performance, leave of absence and other

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disciplinary matters. While evaluating individual performance management metrics,
employee relations help management in determining formal and informal complaints,
workplace misconduct allegations, harassment or workplace discrimination issues and to
settle unemployment compensations or complete termination claims ( Duah & Danso,
2017). For example, at BMW Group, the firm provides equal opportunities and diversity
holistically to handle workforce management. Every employee uniqueness and individual
needs are regarded as important factors (BMW Group, n.d.). This helps the firm’s
management and employees along with supervisors to interpret, interact and implement
policies required for employee welfare and increased organizational productivity.
The use of advanced technology, best human resource practices, skilled labour and
training have made many organizations successful. Nonetheless, disengaged employees who
show low productivity hampers organizational performance. It can be said that longevity of a
firm is highly affected by employee engagement practices which in turn becomes an
important factor contributing to the financial performance. Research made by Osborne &
Hammoud (2017) shows that effective employee productivity has positive effects on firm’
financial performance. Autonomy, competence and psychological needs motivate employee’s
behaviour that is essential for healthy workplace atmosphere and if employees are satisfied,
they tend to perform optimally. Hence, the basic needs of employee satisfaction can be
directly associated with employee dedication and firm's growth. Trust is regarded as one of
the most influential factors which impact organizational performance, efficiency and
productivity (Al-Khozondar, 2015). This is the reason most of the researchers claim that
trust establishes reliability and integrity between employer and employee. In employee
relationship, the level of trust between employer and employee determines confidence upon
each other and if it does not work, communication between them impacts workplace
performance negatively.