Impact of Human Resource Management on Organizational Performance

This report delves into the critical role of Human Resource Management (HRM) in contributing to organizational success. It explores various HRM functions, including job analysis and design, recruitment and selection, and employee relations, highlighting their significance in fostering business growth. The report further examines the impact of HRM practices such as training and reward management on staff performance. Through case studies of Google and Starbucks, the report illustrates how effective HRM strategies, including employee perks, benefits, and the role of line managers, drive organizational success and employee retention. The conclusion emphasizes the importance of aligning HRM activities with overall organizational goals to achieve optimal performance and competitiveness in the market. This report provides valuable insights into how HRM functions and strategies contribute to organizational success and offers practical examples of how these strategies are implemented in real-world business contexts.

Managing people and organizations

Managing people and organization
Table of Contents
Introduction......................................................................................................................................2
Human resource management functions..........................................................................................2
 Job analysis and design........................................................................................................2
 Recruitment and selection.....................................................................................................2
 Employee relations...............................................................................................................3
Effect and impact of HRM on staff and performance.....................................................................3
 Training................................................................................................................................3
 Reward management............................................................................................................3
Role of line managers with Examples.............................................................................................4
 Google Company..................................................................................................................4
 Starbucks...............................................................................................................................5
Conclusion.......................................................................................................................................6
References........................................................................................................................................7
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Managing people and organization
Introduction
It has been observed that human resource management plays an important role in contributing
towards organizational success. The major contributory area related with the success of the
organization is the management of the employees in the workplace. The company’s success in
the market economy focuses on the optimal utilization of the resources such as financial
resources, material resources and human resources. In this paper the emphasis will be given on
the different aspects related with Human resource management that assist the companies to attain
success I the highly competitive market.
Human resource management functions
According to Macdonald, Burke and Stewart (2017), HRM, contribute towards the success of the
organization by considering the different functions. There are different functions such as Job
analysis and design, recruitment and selection and also employee relations that have an important
role in boosting the growth of the business in the competitive market.
 Job analysis and design
It is important for the employees to perform the job according to the job requirements so that it
could be easy to give their best towards the assigned work. If the assigned task is not according
to their skills then it can lead to poor performance, absenteeism and affect the turnover rate. It
has been argued that there are employees who are demanding more satisfying and if it is not
given to them then it impact the success of the company in the competitive market. It can be also
be said that if their role in decision-making process is enhanced then it will help in boost the
organizational effectiveness in the workplace.
 Recruitment and selection
It is also one of the best approaches that help the companies in attaining success in the highly
competitive market. It is argued that without high quality employees, the company will not be
able to attain growth but on the other hand it can be said that recruitment of the right employee at
the right helps to maintain efficiency in the overall working pattern of the employees. Recruiting
and selecting efficient employees can assist in maintaining the growth of the company in the
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workplace. There are different activities which are accessed of the employees at the time of
recruiting the candidates in the workplace (Marchington, 2015). So, it is important to focus on
appointing the capable candidates so that positive outcome can be attained.
 Employee relations
It can be said by Brewster (2017), that employee relation is also one of the major functions in
human resource management. The labor union exerts the powerful force upon the workers and it
also influences the policies and programs for the union employees. It is necessary for the human
resource management to emphasize on boosting the relations of the employees and it can only be
done when there is proper understanding but on the other hand maintaining the relations of the
employees can be considered as the costly process (Wilton, 2016). So, it can be stated employee
relation can be considered as the important aspect that can help in boosting the success of the
organization.
Effect and impact of HRM on staff and performance
 Training
It can be said that it is the role of the Human resource management to offer training. Training is
one of the strategies that impact the performance of the employees. It can be argued that training
can be one of the additional costs for the company but on the other hand it is one of the
beneficial factors that can boost the performance of the employee. Through training the
employees can have proper understanding of the activities performed in the workplace and also it
helps to boost the skills of the employees towards the work (Tarhini et al., 2015). The HR best
practice focuses on the companies who invest in offering training to the employees within the
budget. After selecting the candidates for the job post it is important for the human resource team
to ensure that the skills required for performing the specified work is possessed within the
workers (Cohen, 2015). Therefore, it can be said that training strategy can boost the performance
of the employees and also it will add value to the overall success of the organization in the
competitive market.
 Reward management
This factor affects the business performance and can also add value to the companies. The
reward schemes are considered as an essential factor that helps to attract and retain the
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employees. It is argued that one of the major challenges faced by the HR is to determine the pay
and the way of rewarding the employees but on the other hand it is necessary for the HR
management to emphasize on offering rewards so that the positive impact can be seen on the
performance of the employees. Rewards offered to the employees encompass the different
factors such as financial and non financial rewards (Noe et al., 2017).
By offering the rewards the employees will feel motivated and happy towards the activities and
they will give their best towards the assigned work. So, it can be said that reward management is
managed by the human resource management and it affect the performance of the employees. If
the employees are not motivated then it will impact the performance of the employees in a
negative manner. Reward management can be considered as the strategy that can help in adding
value to the companies and also boost the success of the business in the competitive market
(Nankervis et al., 2016).
Role of line managers with Examples
 Google Company
The role of HRM strategies in the success of an organisation can be understood by examples of
successful corporations that have effectively aligned their HR strategies with corporate goals. A
good example is Google LLC which is an American multinational technology company that
operates in internet, software, and computer hardware technology. The company is known for its
effective HR strategies which enable the company to attract and retain talented engineers which
contribute to the success of the company (Steiber and Alange, 2013).
Google offers a wide range of perks and benefits to its employees by catering to their needs to
make them comfortable in the workplace and promote their creativity. For example, the company
offers free lunches, free coaching to learn new topics, higher education facilities, unlimited sick
leaves, long maternal leaves, transportation facilities, and others services to its employees
(D’Onfro and England, 2015). The line managers or supervisors in the company allow
employees to work on their personal projects during their office hours which promote creativity
and encourage employees to develop products and services which meet the requirements of a
large number of people. Through effective HR practices, the company has won the title of the
‘best place to work’ (Fortune, 2017). More importantly, the company has succeeded in the
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Managing people and organization
industry by continuously introducing disruptive services and devices in the market with the help
of its employees which leads to its success. It is important for Google to reduce employee
attrition rate since most of its employees are millennial who did not prefer to work for major
corporations (Finkle, 2012). In order to achieve this goal, effective HR practices enable the
company to understand the needs of its employees and implement policies to retain them in the
workplace for a longer period of time.
 Starbucks
Another good example to understand how HRM contributes to the success of a company is
Starbucks which is an American coffee house chain that is successful across the globe. The
company has established its operations in over 30,000 locations worldwide, and it has built a
loyal customer base that prefers its products and services above anything else (Market Insider,
2019). The success of the company comes from the dedication of its employees who build strong
relationships with customers while providing them their products and services. As per the HR
strategies of the company, the employees are called partners, and they receive various perks and
benefits from the organization (Kumar and Pansari, 2015).
The company has implemented HR policies which offer benefits to its employees such as life
insurance, retirement plan, higher education, and training facilities, discounts on hotels, paid
holidays and sick leaves and many other benefits (Lalonde, 2016). Through these policies, the
line managers or supervisors ensure that they build a strong relationship with its employees and
retain them in the organization for a longer period of time which is crucial for its success. The
line managers also improve the skill level of employees through the Barista Basics Training
Program in which they offer further skills and development facilities to its barista to improve
their abilities (Starbucks, 2019). Through these practices, the line managers enable that the
employees are ready and prepared to make high-quality coffee which customers expect from
Starbucks. It shows how effective HR policies contribute to the success of the company which
enables it to expand its operations on a global stage.
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Conclusion
It is concluded that human resource management has an essential role in boosting the
performance of the employee. The companies can attain success if they focus on the functions
such as Job analysis and design, recruitment and selection and employees relation. Also, there
are activities of the HRM that affect the performance of the employees such as training and
reward management. The role of the line manager is also essential as discussed in the examples
of Google and star bucks. So, it can be said that these activities should be managed effectively so
that organizational success can be attained.
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