Managing Employee Performance And Reward - Case Study Example

Managing Employee Performance And Reward Introduction Strategic human resource management is an organizational practice that involves dealing with people to ensure that their full potential is utilized. An organization engages in strategic human resources management to ensure that the employees’ needs are met and also to facilitate them to use their skills to accomplish organizational goals. The practice involves forecasting and determining the major drawbacks that may hinder effective performance of employees and finding a lasting solution. According to Edwards et al. (2007), the activities in strategic human resource management entail measures for improving the workplace environment, recruitment, performance and reward management among other activities that enhance the productivity of employees. On the other hand, organizations maintain competitiveness through inventiveness and uniqueness in their operations. These are accomplished through maintenance of a committed and competent work force, which is important in ensuring customer satisfaction. When an organization succeeds in maintaining competence and satisfaction among employees, it is able to maintain strong customer relationships as well as a strong brand image. High performance human resource practices involve supporting the employees to accomplish organizational goals; hence organizations that engage in employee training and support of innovative ideas are able to maintain competitiveness in the market. Strategic human resource management helps in accomplishing employee satisfaction. Moreover, it helps in maintaining skilled workers in the organization. This essay is a critique of the evidence that high performance human resource practices lead to high performance and successful results in organizations, with Gap Inc. and Abercrombie & Fitch UK Ltd as examples of organizations operating in the domestic market. It also presents a comparison of these organizations with Starbucks and British airways, which are organizations that operate in the international market. High Performance Human Resource Practices Recruitment & Selection Viswesvaran & Ones (2000) argue that recruitment and selection are the most significant practices that link people with organizations. They form the basis of strategic human resources management; hence the human resource managers have to ensure that they recruit the most competent employees in the organization to enhance the realization of organizational goals. This is accomplished through job analysis. Recruitment and selection processes need to be conducted in a cautious manner to ensure that the new recruits possess the core capabilities needed for accomplishment of organizational competitiveness. Hoevemeyer (2005) observes that human resource managers are important in helping the organization to determine whether the candidate satisfies the core competences needed. Recruitment and selection therefore are significant practices whereby organizations search talents from candidates, which may be useful for organizational success. Effective recruitment and selection helps in the engagement of qualified employees who are enthusiastic about the tasks they will be assigned in the organization. Without engaging competent employees in the organization through this process, the wrong applicants may be selected, which may lead to low morale in the workplace especially amongst the experienced workers. Edwards et al. (2007) observes that the unqualified employees usually leave the organization before accomplishing the assigned tasks, mainly due to stress associated with failures due to incompetence. On the other hand, the management may also be compelled to get rid of such employees later on after realizing that they are incapable of accomplishing tasks effectively. Hoevemeyer (2005) notes that employee recruitment and selection allows the human resource managers to conduct aptitude tests, which are important in recruitment and assessment to acquire information regarding the applicant’s intelligence and astuteness. Moreover, the candidates are taken through on-the-job tests to determine their competence in handling the tasks. Recruitment and selection also involves interviews that evaluate the applicant’s knowledge in regard to the desired competences identified for the position to be filled. Therefore, only the candidates who present the desired competences are selected, which saves the organization unnecessary costs associated with replacing incompetent employees. Training and Development It is important for organizations to encourage leaning in the work place. This is accomplished through training and development, especially when an organization operates in a dynamic environment where technological advancements are constantly occurring. Employees need to be kept informed regarding the new developments in technology for them to be capable of effectively utilizing the emergent technology. Therefore, the faster the organization grows, the more training it requires for employees to cope with the rapidly changing operating environment. Derek (2007) argues that training and development allows employees to acquire essential knowledge that is important in the accomplishment of tasks in the workplace, hence the human resource management’s role in an organization is to ensure that employees are exposed to training opportunities. The skills acquired from this kind of training allow the employees to understand the operating environment better and to be aware of the business goals as well as the practices that can lead to their successful accomplishment. Employees gain confidence in undertaking their tasks when they realize that their actions are likely to bring success to the organization. Human resource managers develop the training programs and also define what needs to be trained as well as who is to be trained. This is a significant role which takes in to consideration the fact that even though employee training is important, it can not be generalized to all the employees. Edwards et al. (2007) argues that there needs to be distinctions in the training offered to employees assigned to the various tasks. Moreover, managers are required to facilitate the training to ensure that it is undertaken at the right time. For example, it would be unnecessary to train employees regarding technology that is obsolete. Strategies have to be set for training after a critical evaluation of the usefulness of employee training, meaning that only the most appropriate employee training is undertaken. Whitfield & Poole (1997) argues that the training is usually significant for helping employees to acquire skills that they may not have acquired in educational institutions, such as interpersonal skills that are important in dealing with clients and team building skills that are necessary for accomplishment of tasks in the workplace among other skills that generate competitiveness in the work place. Employee training helps in maintaining focus in regard to the organizational activities as well as generating hope among them in regard to career development. Without the conviction that they will accomplish their personal and career development goals, the employees’ morale remains low. Training also helps the employees to learn how to take opportunities for knowledge acquisition. This is supported by Derek (2007) who believed that learning how to search and put new knowledge in to practice improves employee competence and the overall organizational productivity. Such employees engage in life-long learning and are significant assets for an organization. Performance Evaluation and Management Employee performance is significant to the organization’s success and hence when an organization is able to maintain high performance among its workers, it is capable of accomplishing organizational goals. Kauhanen and Piekkola (2006) argue that effective human resource management motivates the employees to accomplish tasks through setting performance standards. Performance management is therefore important in ensuring that the employees’ out put corresponds to the salary that they earn from the organization. In essence, employees work to get paid. What they accomplish in their work needs to be reflected in their salary and vise versa. This means that the employer and employee need to get satisfied. Najmi et al. (2005) believe that performance based pay programs used by organizations are significant in maintaining competence and high commitment among employees. They work hard to receive the benefits attached to a higher level of output. When an organization engages new employees, it uses the performance based pay motivates them to work hard to get the bonuses. This enables the management to identify the talented employees. Moreover, human resource managers are in charge of maintaining satisfaction among employees by offering unique benefits that other organizations do not offer. When potential employees in the job market identify such opportunities in the organization, they desire to offer their services to acquire the benefits. Therefore, it is always important to clearly state what the employees will gain from their engagement with the organization. This is supported by Shields (2007) who argues that it gives them an opportunity to compare with the other organizations to determine which offer they are going to accept. Such human resource management strategies help organizations to maintain competence. For example, increasing the hourly rate for working overtime is a motivating strategy that can encourage employees to work longer as well as attract new and competent employees from organizations that do not offer such benefits. Health benefits usually indicate the employer’s commitment to maintain good health among the workers. It is a show of concern regarding the employees, and it is a strong strategy to motivate them for improved performance. When organizations hire workers, they usually expect them to accomplish tasks according to the strategic plan. Kauhanen & Piekkola (2006) argues that performance evaluation is a human resource management practice that helps in ensuring that the employees are following the right track in their activities. For that reason, it is usually important to conduct the performance evaluation to ensure that weaknesses do not develop as the employees accomplish their objectives. Maintenance of Workplace Relations Harmonious relations in the workplace are important for the maintenance of employee competence. This involves team building to enhance productivity among employees by working as a group that is focused on the accomplishment of organizational goals. It helps in building confidence among them. Work place relations allow the unification of the various departments in the workplace so that each individual is able to own the organizational objectives. Luthans & Stajkovic (1999) observe that workers communicate better when they work as a team in the workplace. Moreover, the work teams are also capable of effectively communicating with the management and hence, strong teams are useful in knowledge sharing and innovativeness. Team building results in better quality work as people can solve problems through joint efforts. On the other hand, employees are motivated by feeling as part of a larger group that is aimed at accomplishing a common goal. They are therefore motivated to be supportive to the team since its failure or success is for all. Strong relations help in ice breaking amongst the employees to foster free and effective sharing of information. This involves ensuring that the employees understand each other and therefore can not reserve essential information that can be useful in enhancing the accomplishment of organizational goals. Schrader & Lawless (2004) argue that when the managers in an organization show interest in the employees’ activities through team building, they usually feel appreciated for their contribution to the organization’s accomplishments. In addition, it motivates them to maintain competitiveness. The managers promote interactions between the employees and the organizational management to understand the employees’ desires in the workplace. Competence is usually accomplished when the employees feel that they are treated in a fair manner. When they realize that the manager shares a common objective with them and that he/she shares their views, they feel as part of the organization and can work hard to achieve a shared vision. Exposing the employees to opportunities outside the workplace is an important tool that encourages them to be competent. This acts as an indicator to the employees that they are not prisoners in the work place. Whitfield & Poole (1997) argue that when the manager organizes trips outside the workplace, employees are exposed to learning opportunities that are important in opening up their minds to think in a different way. For that reason, when the employees get a learning opportunity that requires an academic leave, the human resource manager needs to offer support. This is a significant strategic human resource practice. On the contrary, authoritarian leadership leads to the emergence of fishy activities such as absenteeism from the workplace, low morale and such other behaviours as employees conceal their personal development activities. Luthans & Stajkovic (1999) support this fact with the argument that employees may be working part time while the managers assume they are full time employees. In other words, even if the human resource managers deny employees the opportunity for personal and career development activities, they are still likely to engage in them without the knowledge of the managers, which leads to low productivity. Employee Retention High employee turn over is detrimental to an organization’s productivity and reputation. It is usually costly to hire and train new employees to become competent in the workplace. The organization looses skilled employees to competitors, and more so, skills attained from the organization. Derek (2007) argues that it may be a great loss to the organization especially when an employee exposes company information to competitors. For that reason, the future projections may not be realized if the organization relied on training an employee to attain a particular goal in future. Customers may loose confidence in the organization due to disruption in service delivery especially when the departing employees were at strategic positions of service delivery. Other customers build their trust on particular employees especially for the services that require one-on-one relationships, and therefore they might not be willing to begin a new relationship with other employees in the organization. Human resource managers need to ensure that the employee turn over is not contagious. When workers leave organizations, it is likely that their workmates realize that they too may fall in to the same problem. Johnson (2001) argues that high employee turn over lowers the confidence and morale in the work place. When an organization is capable of retaining skilled employee through worker satisfaction, it attracts new skills to join the organization from the labour market as well as from other organizations, thereby improving its productivity. Strategic human resources is therefore important in maintaining employee competency through setting up employee satisfaction objectives such as work life balance, flexible work practices, allowing personal and career development among other practices that can help in retaining skilled employees in the organization. Internal Career Ladders Competence among employees is maintained through ensuring that they have hopes to advance in their careers. Edwards et al. (2007) observe that the morale of employees decreases when they work in the same position over a long period of time. As a result, they work harder to move up the ladder through promotions, hence the human resource managers need to ensure that promotions are awarded for good performance. Multinational companies use this strategy especially when identifying the employees who are competent to be given the privilege of heading departments in foreign subsidiaries. Johnson (2001) argues that the strategy is useful in determining the workers who are self driven and who can represent the organization with minimum supervision. On the other hand, additional responsibilities act as indicators of trust in employees, which is likely to improve their commitment. Job security Employees need to be guaranteed of their security in employment for maximum productivity. According to Whitfield, & Poole (1997), lack of security leads to low morale and engagement in search of opportunities by employees outside the organization. They can not dedicate their time fully to the organizational activities. Job security is significant in maintaining confidence among employees so that they are not easily lured out of the organization by competitors who are likely to guarantee job security. In other words, employees need to be convinced that they can not loose their job overnight. They too need to be heard especially regarding the workplace problems. Competency can not be accomplished if the working environment is not favorable. On the other hand, employees need to feel represented in the decision making process whereby their voice is put in to consideration. Examples of U.S and U.K Companies Gap Inc. is one of the companies in the United States that are renowned for maintaining competent human resource practices such as work place relations that have helped it to maintain competitiveness in the clothing industry. Broadfoot (2009) observes that employees are motivated through opportunities for personal and career development. The organization largely depends on customer relationship for maintenance of competitiveness and therefore ensures that employees are satisfied in the workplace. The organization uses performance based pay to motivate the employees to work harder to accomplish higher pay. It is also focused on helping employees to maintain a work-life balance. It provides benefits to its human resources, which include health and insurance cover, personal development loans, worker stock purchases, paid holidays and educational assistance among other benefits that have enabled it to maintain competence among employees; hence improved competitiveness. Abercrombie & Fitch UK Ltd engages employees in regular skills upgrading. Alice (1998) argues that this enables them to remain informed regarding the emerging technologies and new methods of production to ensure that they remain informed regarding emerging technologies. The human resource practices are aimed at enhancement of employee’s satisfaction in the workplace through flexible work practices. They are a major component of primary support for effective production and therefore the human resources manager ensures that they are facilitated to utilize their full potential. Satisfaction among employees is the basis of the survival of the organization. Similarities and Differences with Organizations Operating in the Global Market Starbucks which operates in the international coffee market recruits competent employees similar to the U.S and U.K companies whose innovativeness has made the organization to be a leader in the international market today. The organization recruits a diverse work force on the basis of the desired capabilities, which as Reilly (2008) notes, has enabled the company to combine talents from diverse cultures. In contrast to the companies operating only in the domestic markets, the organization is compelled to engage employees from diverse cultural backgrounds to represent the various cultures in the countries where it operates. This has been significant for the success of the organization in many countries globally. Employees share their unique qualities and capabilities that are attached to their cultural backgrounds. For example, Starbucks employs Americans who bring in a culture of hard working, Chinese who bring in team building due to their collectivism approach towards work, and the Japanese culture of competence in the workplace among other cultures. According to William (2004), a combination of these cultures leads to improved competence. For Gap Inc. and Abercrombie & Fitch UK Ltd that operate in the domestic markets, cultural diversity in the work place is minimal. British Airways is renowned for its performance management and evaluation strategies similar to those used by Gap Inc. and Abercrombie & Fitch UK Ltd. The performance targets have been set for the organization, which according to Ledwidge (2007) made employees work harder to accomplish organizational goals. The organization trains its employees, whereby each department is trained independently due to the wide range of employee activities in the different departments in a similar manner as in the organizations operating in the domestic market. All the new recruits are trained regarding the organization activities, while the existing employees are trained, which according to Colling (1995) ensures that employees are informed regarding improvements in the workplace as well as introduction of new technology. The major difference with the companies operating in the domestic market is as in Starbucks since the airline company is compelled to maintain diversity in its workforce, which is aimed at enhancing customer service and communication in the various countries that it operates. Without cultural diversity, it would be difficult for the organization to offer services globally due to language barriers. The U.S and U.K companies operating in the domestic markets may not be affected by the problem of language barriers. Conclusion High performance human resource practices lead to high performance and successful results in organizations. They are significant in recruitment and selection to ensure that only the competent employees are offered the job. Training and development helps in upgrading the skills of employees to ensure that they are able to accomplish tasks effectively. The use of performance evaluation and management motivates employees to accomplish tasks to acquire the attached benefits. Maintaining worker satisfaction through flexible work practices is also important in maintaining a competent workforce, and hence it helps in employee retention. Workplace relations are significant in building strong working teams. On the other hand, internal Career ladders generate enthusiasm among employees as they aim higher in the organizational hierarchy. 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