Strategic Human Resources Development and Improved Performance - Literature review Example

Name Tutor Title: Strategic Human resources development Lead to Improved individual and organizational performance Institution Strategic Human resources development Lead to improved individual and organizational performance Introduction Strategic human resource development (SHRD) encompasses human resource learning activities that take into consideration the strategy of the organization with the primary aim of attaining competitive advantage. Several authors have explored the notion of strategic human resource development in the recent years (Bhatti, and Qureshi, 2007; Chew, 2004; Barlett, 2001; hadre, 2003; Mayo, 2000; Guest, 2001). There is an ongoing debate among researchers and practitioners as regard the purpose of human resource development (HRD). Many scholars are of the view that HRD must focus on improving organizational performance and more specifically the productivity of employees (Lee and Bruvold, 2003; Wright et al., 2003; Katou, and Budhwar, 2007; Rowden and Conine, 2003). Others claim that HRD should concentrate on broadly developing an individual without using the result as a test of the effectiveness of intervention (Stiles and Kulvisaechana, 2005; Lopez, et al., 2005). This paper will argue that strategic human resource development lead to improved individual and organization performance. Human resource development refers to all the human resource practices aimed at enhancing individual and organizational performance, such as training and development, career development and organizational development. Strategic human resource development can be defined as the study and activities of increasing the education ability of employees by developing and applying learning-based strategies so as to improve individual and organizational performance. Performance in this article will be understood as the overall achievement of an individual during a definite amount of time, considering the individual behavior and attitudes. Individual performance involves the particular behaviors an individual exhibit so as to attain particular tasks and results in the specific outcome that allow an organization to achieve its objectives (Shih, Chiang, and Hsu, 2006). The core mission of strategic human resource development is to develop the necessary skills for attaining competitive advantage. Human resources form the primary source of achieving competitive advantage. Human resources are the only factor of production that can combine all the other production elements to achieve the desired outcomes (Lee and Bruvold, 2003). Thus, employees need to be established through appropriately articulated SHRD strategies. Individual performance is critical as it has proved to have a great impact on the overall results of the organization (Shih, Chiang, and Hsu, 2006). The resource-based model tends to link HRD with performance and thus argue that increasing employee skills and motivation will automatically enhance organizational performance (Mayo, 2000). The focus on the human capital in the organization reveals that markets value relies more on intangible resources, especially employees and less on tangible resources. Recruiting and maintaining the best employees is just one component of the SHRD, which on its own cannot lead to enhanced employee and organization performance. It has to be complemented with leveraging the abilities and skills of employees through promoting individual learning and developing a supportive environment whereby knowledge can be generated, shared and put into good use to attain organization's goals (Wright et al., 2003). Increasing the abilities and skills of employees is expected to result in future returns through increased productivity and organizational performance (Stiles and Kulvisaechana, 2005). Strategic human resource development contributes to improved employees and organization performance. Human resource learning activities are planned to influence positively employees' skills, abilities and knowledge to increase productivity and performance. Strategic human resource development has proved a useful instrument in making sure that the human assets of an organization can lead to its competitive advantage. The survival of an organization depends on its intellectual capital, and this relates to the knowledge the organization has accumulated over time (Bhatti, and Qureshi, 2007). As a result, organizations have endeavored to allocate more money to human resource development activities with the primary aim of achieving a competitive advantage in the end. Studies have shown that organizations that largely invest in training and development of their employees tend to be more profitable, successful and valued on Wall Street (Katou, and Budhwar, 2007). It is projected that American organizations spend approximately $134 billion every year on human resource development activities (Wright, et al., 2003). Unfortunately, these huge investments in employee training and development activities do not always contribute to enhanced individual and organization performance (Guest, 2001). Many scholars argue that HRD should be developed in alignment with the strategies and goals of the company and organizations mainly rely on performance as the primary means to realize their objectives and strategies (Lopez, et al., 2005; Katou, and Budhwar, 2007). Then, it implies that HRD must primarily be concerned with enhancing performance at the individual and organizational levels. To maintain their global competitive advantage, organizations pursuing improvement in their processes and positions should maintain a high level of personnel training and development. Staff training has evolved an essential component of a wider business and employee management strategies. The significance of adequately trained and developed workforce is recognized by most people in business as critical to the application of continuous learning programs. The SHRD strategies are structured to convey the information to employees that the organization benefits when they stay for a long time in the organization, resulting in lower employee turnover and absenteeism (Chiu and Francesco, 2003). This information can be translated into positive employee's behaviors, such as remaining in an organization for longer as opposed to moving to other organizations or going to work rather than missing to go to work. Workers assign meaning to their performance by the indicators they get from the management via HRD information. Training employees are linked to a shared perception among employees as regard what performances are expected and compensated in the firm. A multilevel model has been used to link human resources activities to employee reaction (Ostroff and Bowen, 2000). It has been observed that employees' behaviors and attitudes reveal their expectations and preferences, countering the treatment they get from the firm. The job performance theory holds that employees' attitudes have a significant impact on their behaviors that in turn have an effect on organizational performance (Chew, 2004). Motivation, job satisfaction, and organizational commitment have been found to influence heavily employees' turnover. The argument that has been presented by most scholars to support this is that employees would not likely stay in organizations that are not satisfied with their performance. Most scholars argue that satisfaction normally precedes motivation and organizational commitment (Shih, Chiang, and Hsu, 2006; Rowden and Conine, 2003). However, it is critical to note that job satisfaction, organizational commitment, and motivation are strongly interrelated. Research had demonstrated that a significant part of the employees' sense of satisfaction may be attributed to training and development activities within the organization (Bartlett, 2001). Studies have demonstrated that individuals who have been trained exhibit greater commitment behaviors in the organization (Bhatti, and Qureshi, 2007; Mayo, 2000; Guest, 2001). Training and development of employees lead to the creation of positive attitudes and behaviors in employees. The positive attitudes associated with employee development include satisfaction, commitment, and motivation. Precisely, numbers of studies have considered motivation as a major determinant of individual performance (Katou and Budhwar, 2007; Hardre, 2003; Guest, 2001). Several research studies show a positive association between HRD and desired employees attitudes (Bartlett, 2001; Lee and Bruvold, 2003). Comprehensive learning activities are positively linked to decreased employee's intention to leave the organization, increased productivity and organizational effectiveness (Rowden and Conine, 2003). Human resource development (HRD) contributes to organizational citizenship behavior, which is a vital indicator of individual performance as organizations increasingly depend on the contribution of employee performance. Organizational citizenship behavior is the discretionary actions of workers that go beyond just meeting the role expectations (Lopez, et al., 2005). Continuous improvement practices are seen as vital elements of increased organizational competitiveness. Continuous improvement has been strongly associated with the development of an innovation culture within an organization. Innovation culture is crucial to the capacity of organizations to develop and assume new strategic direction and hence the suggestion that continuous improvement results in innovative culture are of great importance (Chew, 2004). Organizational abilities for viable and incremental innovation might only be created by various behavioral routines, including the capacity to develop sustained participation in continuous improvement, align continuous improvement practices with the organizational goals, effectively manage the continuous improvement processes, articulate and apply continuous improvement values and ensuring continuous improvement occurs across the organizational boundaries (Katou, and Budhwar, 2007). In this information era, efficient management, involvement, and development of personnel can help organizations obtain a competitive advantage that will ensure their long-term survival and business success even in times of financial crisis. In crisis times when companies tend to experience multilevel changes and turmoil, SHRD may provide a helpful framework for management in planning HRD strategies that will eventually lead to the right results of crisis planning (Guest, 2001). Implementing learning and performance-based HRD approaches and cooperating with the major stakeholders, human resource development managers can play a significant role in preparing the firm for crisis event (Wright, et al., 2003).SHRD focus on proactive change management and thus can help an organization excel in an increasingly global, competitive and unstable environment. The primary goal of SHRD is learning. HRD managers recognize that individual and organizational performance can only improve if there is effective learning. Thus, they ensure that implicit knowledge is efficiently passed on to employees during the training and development processes. Human resources theorists claim that organizations need to protect their core abilities by investing in learning and development (Lopez, et al., 2005). Human resource development is attributed to motivating employees, increasing their KSA and empowering employees to act, culminating in improved performance. SHRD practices promote an organizational culture of continuous learning. Continuous learning activities are aimed at enhancing the operations and systems of an organization. Most organizations are structuring their learning practices in ways which benefit individual employees and results in profit to the company. Continuous learning helps employees achieve performance outcomes that allow them to reach their personal objectives and goals (Rowden and Conine, 2003). Learning organizations promotes a culture continuous improvement in the workplace. Since the purpose of personnel training and development is to enhance performance, thus, it is the responsibility of HRD professionals to analyze in details a performance problem to find out the basis of that problem. This will help them in developing the right types of interventions that will adequately address the problem. Studies have shown that employee development contributes to the financial, organizational success through increased productivity (Bhatti, and Qureshi, 2007; Mayo, 2000; Guest, 2001). Apart from being attributed to increased productivity, the improved financial performance that an organization experience is also attributed to reduced overhead costs following decreased employee turnover (Stiles and Kulvisaechana, 2005). Many authors believe that improvements attained on individual performance will ultimately flow through to improve organizational performance (Chew, 2004; Lopez, et al., 2005; Katou, and Budhwar, 2007). Consequently, human resource managers are increasingly becoming responsible for implementing HRD policies and procedures. Chew, (2004) argues that the capacity of an organization to exploit its learning and knowledge capabilities must be directed to realization of competitive advantage. Barlett (2001) further outlines the importance of individual as well as organizational learning so as to develop organizational capabilities. Hardre (2003) presents training aspects similar to Mayo (2000), but he asserts that organizational capacities cultivate learning behaviors among employees across organizations. However, it is important to mention that HRD can fail to achieve individual and organizational performance if it is not based on a consistent set of corporate beliefs and values. Effective continuous learning relies on planning improvements, implementation enhancements, checks, and standardization of new practices. Among the main potential benefits of staff training and development are increased organizational effectiveness regarding decreased waste, set-up time, lead time, breakdowns, stock, and handling. The improved individual performance linked to education and development relates to empowerment, involvement and participation and quality employees' work life. Several scholars have made attempts to establish the relationship between HRD and employee and organizational performance. To ascertain the positive relationship between SHRD and performance, Barlett (2001) used the social exchange model to conduct a study that consisted of 337 participants. He found out that availability of training resources, social support for learning, motivation to learn as well as perceived benefits of learning are significantly correlated with organizational commitment. Scholars who hold the contention that the role of HRD is to improve performance argue that although improved employee performance does not equate to job security, poor organizational performance places jobs in serious jeopardy. The concept of strategic human resource development may appear to be very easy to design, execute and develop efficiently. On the contrary, SHRD is hard to design, establish and implement as successful SHRD requires learning to develop ever-more effectively and to address ever-more complex improvements challenges and problems across the organizational components of supply chains (Stiles and Kulvisaechana, 2005). Sustainable HRD requires strategic strategies in the organization that allow the manager to think globally regarding organizational needs but respond locally to those needs. The international issues for the firm reveal the primary competitive concern of the market. Today's increasingly dynamic business environment marked by unpredictability and uncertainty requires organizations to invest heavily in HRD activities (Chiu, and Francesco, 2003). Despite the significant efforts by scholars to link SHRD to improved performance, empirical evidence linking the two is still missing in the literature. Most researchers have concentrated more on learning transfer systems and training effectiveness (Lopez, et al., 2005; Katou, and Budhwar, 2007). Not all authors support the notion that SHRD enhances individual performance and organizational performance. Some argue that the existing literature doesn't efficiently link theory to show how employee development results in performance improvements. Guest (2001) believe that we are still not in a position to claim with confidence that effective HRD has a positive impact on organizational performance given the gap regarding models to link HRD to increased performance. There is a lack of a theoretical framework and evidence to support that improved individual and organizational performance is as a result of continuous learning (Lee and Bruvold, 2003). Some scholars argue that performance cannot be improved solely by HRD practices. Recruitment and selection form the basis of establishing an effective human resource management system that is directed towards achieving the organizational set goals and objectives. If an organization failed to recruit and hire the right employees, then its HRD practices may be doomed to fail to achieve the expected outcomes. According to them, the compensation system is another component that is critical in attaining organizational effectiveness. Attractive salaries, wages, incentive, bonuses, rewards, benefits and flexible work environment can serve to motivate employees, resulting in improved organizational performance (Shih, Chiang and Hsu, 2006). Conclusion The view that SHRD contribute to improved performance is grounded on the principle that when HRD is practiced in dynamic organizations, it should directly strive to reach the organizational goals and objectives. Organizational goals and objectives are usually performance-oriented, and thus, the organizations need to obtain effectiveness and efficient survival during crisis times to be able to achieve their goals. Therefore, it is the responsibility of human resource development professionals to emphasize on performance. They need to concentrate on processes and systems that will make sure employees in the firm have the attitudes, expertise, and knowledge to produce quality. Maintaining a competitive advantage raises the possibility of long-term organizational survival and financial success. The most strategic method to invest in employees is through training activities. Hence, organizations seeking to enhance their global competitive position need to maintain a high level of training that refines existing practices and abilities as well as develops new ones. Bibliography Bartlett, K. R. (2001). The relationship between training and organizational commitment: A study in the healthcare field. 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