The paper “ Human Resources Management Influence on Financial and Social Performance of Business” is a convincing example of the literature review on human resources. Human resource management involves general practices and policies that govern the various parties in the workplace. Human resource management has been a subject of debate all over the world on its ability to influence the financial and social performance of a business organization. The issue of the adoption of effective human resource management should be the main objective of many organizations given the fact that there has been considerable evidence to suggest a positive relationship between human resource management and organizational performance.
Despite the high evidence on this link, it is worthwhile noting that there are some studies, which contradict this view. Human resource management comprises policies and practices like concerning staffing, out sizing, outsourcing, designing the employment system, leadership, organization, learning and staff development, performance management, rewarding employees i. e. using the performance-based pay system among other roles of the HRM department. Human resource generally coordinates the total personnel activities of the business. In carrying out this they adopt management and leadership styles.
Human resources practices are argued to influence the financial and social performance of the business. According to Cullinane and Dundon, 2006,) the social performance of the organization generally deals with the job satisfaction of the employees of the organization in carrying out their duties. On the other hand according to McDuffie, 1995; Youndt, Snell, Dean, & Lepak, 1996) the financial performance of the business involves mainly the current and the long-term net worth of the business. Human resource management directly influences the performance of the business.
With effective and efficient Human Resource Management in place, the performance of the business is likely to increase more than when there is a poor one in place. Various studies carried out by different scholars clearly show the existing link between HRM the performance of the business.
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