HR Management & Business Performance

Human Resource Management

There seems to be no clear-cut theory or common understanding of exactly what HRM comprises of (Boselie et al., 2005), and the HR practices that are included in the studies examining the link between HRM and performance varies in both in number and type. Some choose to include only a few practices; others include more than ten practices. Thus, there are also great discrepancies between the types of HR practices that are included for each study, although we see many of them recurring quite often. The typical HR practices that have been investigated are recruitment and selection, training and development, performance appraisals,
performance related incentives, internal career paths, job security, benefits, grievance systems, empowerment.

Organisational Performance

We have seen that there are a number of different HR practices that are frequently repeated throughout the HRM-performance research. However, what types of performance that these HR practices, or systems of them, are measured against varies. In the following section, I will briefly outline the types of performance that are commonly used within the research field. The various types of performance have been divided into three main categories:
 1) Financial and Market performance,
 2) Operational Performance
 3) Employee attitude and behaviour.

   Financial performance  

Financial and market performance data is of an objective nature, and can in many instances be easily obtained even when the number of organisations under investigation is big. This type of performance is also the most frequent type of performance found in the HRM-performance literature. However, there is also a more subjective side to the financial and market performance data in the research field of HRM and performance – that is perceived organisational performance, which is often utilized in those instances when objective data is difficult obtain. Specific examples of financial and market performance are return on assets, return on equity, revenue, market share, and market value.

 Operational performance 

Typical measures of operational performance can be productivity, production quality, service quality, sales and innovation. These measures can be obtained both though subjective estimates and objective measures. However, more often than not, the operational measures are of an objective nature. Many of these types of performance are easy to break down in numbers, e.g. the quantity of products produced, number of customer complaints, or number of new products developed.

 Employee attitudes and behaviour 

Employees’ attitudes, behaviors and perceptions have largely been neglected in previous HRM-performance research. What has been the most common measure on and individual level is turnover On a positive note, more recent studies have started to include one or more employee measures into their investigations. Examples of attitudes and behavior that are typically measured within the research field is motivation, job satisfaction, organisational citizenship behavior, commitment, trust in management, absenteeism and turnover. Measuring and quantifying the employees’ attitudes and behaviors can be considered more of a challenge compared to operational and financial performance. Of course, turnover and absenteeism are of a quantitative nature, however, the other types of attitudes and behavior have been translated into quantifiable data, commonly though Like-type ratings, in order to be analysed in the quantitative empirical work that characterizes the research field.

Reference

(Boselie et al., 2005; Paauwe & Richardson,)
https://www.duo.uio.no/bitstream/handle/10852/49030/Cathrine-Byremo-2015---HRM-and-Organisational-Performance--Does-HRM-lead-to-improved-organisational-performance-.pdf?sequence=1[Accessed On 2018]


Performance Image
https://www.google.lk/search?biw=1536&bih=732&tbm=isch&sa=1&ei=DGgwW53BKI_59QOtzYS4AQ&q=HRM+%26+organisational+performance+financial+performance+%2F+operational+performance&oq=HRM+%26+organisational+performance+financial+performance+%2F+operational+performance&gs_l=img.3...187737.196790.0.196859.28.24.1.0.0.0.2160.4143.0j7j3j9-1.11.0....0...1c.1.64.img..16.0.0....0.JAlZkX8ERrk#imgrc=J5qW7QiIjRQ16M:[Accessed on 2018]