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Discuss the role of HRM in enhancing employee performance. Use examples from recruitment/selection, reward and development initiatives to support your argument.

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Discuss the role of HRM in enhancing employee performance. Use examples from recruitment/selection, reward and development initiatives to support your argument. In an era of rapid globalisation and constant pressures of innovation, employers are turning to their workforce for maintaining and improving their competitiveness in the global economy. Organisations are therefore constantly looking for new strategies that will continuously facilitate higher levels of organisational performance. In recent years academics in Britain and the US have shown a considerable degree of interest in the practices of HRM and, in particular, the models of high commitment or 'best practice'. Pfeffer, one of the leading writers in this field, argues that a company can increase its profits if it simultaneously implements complementary 'bundles' of HR practices. The notion here is that the best bundle of HR practices could potentially improve employee attitudes and behaviours, reduce rates of absenteeism and labour turnover as well as improve levels of productivity, quality and customer service, (Marchington, 2002). This has been supported and, of course, criticised by fellow academics. Opponents of best practice express doubts about the particular mix that should form the high commitment bundle and the way in which employees perceive these practices and choose to adopt the 'best-fit' or contingency approach. The role that HRM plays in enhancing employee performance spans from the moment a post becomes available up until the termination of the employees contract. This encompasses all aspects of recruitment, selection, development and reward. The ability of an organisation to select the most suitable candidate for the job, provide the necessary skills and development and implement incentives on the basis of reward will all contribute to the level of employee performance within that organisation. This paper will evaluate the notion of best practice and argue that HR strategy will be determined by the specific environment within which it operates. It will contest the 'universalist' approach with the view that organisations must vary their HR practices between specific employee groups, organisations and industries in order to increase performance. ...read more.


The company can also benefit from the fact that the employee is already familiar with the organisational culture and practices thus saving money on induction processes. Recruiting externally, though costly, can bring new skills and knowledge into the company. According to Merrick, 1997, over �1 billion was spent on advertising in 1997 in the UK. Problems arise because employers do not know how to advertise effectively, Matthews and Redman, 1998, found that one in five advertisements gave no detail of salary level and job location, two of the most important factors in job selection. If done correctly the money spent on advertising will be far less costly than the amount required to retrain or discipline poorly selected candidates or indeed to advertise again. Different industries may benefit from different forms of recruitment, for example an investment bank may want to attract graduates from Oxford or Cambridge or a law firm may wish to recruit from personal contacts. The only limitations with these methods are that they will not necessarily provide the 'best' person for the job, as they are not exhaustive. Human resource management operates within an organisational context therefore firms need to choose whatever form of recruitment that fits their business strategy. There is a similar case when it comes to selection methods. Interviews are the most popular selection technique followed by application forms, C.Vs, covering letters and assessment centres respectively. The type of industry again can affect the method used, for example C.Vs are hardly ever used in the selection process for manual workers, however they are almost always used for professional recruitment. It is also evident that selection techniques vary between countries. Newell and Tansley (2001) found that interviews were most widely used in Britain and North America, graphology in France and assessment centres in Germany and the Netherlands, (Marchington, 2002). What is becoming clear is that it is most important to the most appropriate selection method for each individual situation. ...read more.


Lawler also pointed out that long-term objectives are most likely to improve motivation as they signify job security. It is also necessary here to briefly mention the role of non-financial rewards. According to Maslow's hierarchy of needs, what may be important to someone on low wages may not be so important to someone who earns more, (Marchinton, 2002). It is argued that employees value feedback and recognition for their work as well as involvement autonomy and responsibility. From the evidence and as already mentioned, it seems that if feedback through appraisal schemes is used in conjunction with financial incentives then the success rate will be far greater. Conclusion From this essay I can draw upon several conclusions. Academic evidence shows that there is a need to adapt HR practices to suit the needs of each individual organisation. Major criticisms of Pfeffer's notion of 'best practice' are that it adopts a universalist approach and ignores significant differences between industries and even countries. This paper has considered examples in which HR strategies are adapted to suit particular employee groups in order to maximise employee performance, showing that following the US model may be detrimental to some industries in other countries. This paper is not suggesting that HR practices should be driven completely by competitive strategy. This would also be detrimental because if employees perceive firms to be putting the interests of the firm before their own, then the result will be a decrease in morale, thus resulting in lowered standards of performance. HR strategy should give effect to the firm's current competitive goals, by recruiting and motivating people wit the sort of skills and motivations needed in the firm's sector, (Boxall, 2000). This is done through carefully planned recruitment and selection methods, followed by relevant training and performance based rewards as motivational drivers, as highlighted in the above examples. Finally, HRM plays a vital role in enhancing employee performance, however strategies should be adapted to best suit the individual organisations within the various industries. ...read more.

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