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To examine whether human resource management works well in theory but not in practice, both theories and implementation cases in this field would have to be discussed to probe into this issue fairly.

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Introduction

To examine whether human resource management works well in theory but not in practice, both theories and implementation cases in this field would have to be discussed to probe into this issue fairly. Due to the complex nature and broad contents of the subject; however, the discussion will accordingly limit itself to only concentrate on the reward system in HRM, illustrating types of payment schemes commonly applied at present, such as time-based rates, payment by results (PBR), plant/ enterprise-based schemes, skill-based pay, and performance-related pay (PRP). By analyzing each one of them, adequate evidence should be drawn to reveal the pros and cons of each scheme and therefore lead us to a reasonable conclusion. In the following parts, types of payment schemes will be discussed respectively, yet among which performance-related pay (PRP) will be emphasized and focused upon more than the rest of the others, for it is the most popular system employed in the last decade and may still remain the most commonly adopted system in the succeeding years. As a result, the discussion will amply develop in this section to give a crystal inspection of this issue. To start with time rates, also known as day rate, day work, flat rate or hourly rate, seem to be the most common type of wage payment (Armstrong, 1977: 196). In real world time rates are usually applied in managerial and white-collar work. Though near three-quarters of British employees are paid on plain time-based rates due to its simplicity and easy-to-understand nature in theory (Marchington and Wilkinson, 2002), yet there is also evidence showing the defect of the scheme, such as the limitation in providing work incentives (ACAS, 1991). For example the clever employees, who feel inadequately paid, may divert themselves to new companies or competitive firms where the individual contributions to performance are measured and rewarded. In the method of payment by results, an excess payment has been given to pay schemes based on basic rate which relates earnings with output of the worker or of the group to which he belongs and attempts to motivate workers to achieve higher levels of productivity. ...read more.

Middle

As Frederick Herzberg indicated, too little pay can demotivate people, but it does not mean that more and more money is capable to generate their better performance. In his principle: the real motivation comes from the job, not things like money and the conditions under which they work. People works for satisfaction, for recognition, for pride and for more meaningful things in life, which is in particular applicable to those senior employees. When the salary is high enough, the excess money cannot make people do better. Secondly, PRP could contradict to team-work performance. It is not difficult to understand that when people are exposed in a competitive surrounding with their colleagues and evaluated individually, great emphasis is more likely to be attached to their own performance goals, and their attention are more easily to be focused on individual targets rather than the team's objective as a whole. Obviously, the possibility for employees to cooperate with and help each other is rather slim. As a result, less commitment and contribution will be involved in the teamwork as well as the organization. Thirdly, PRP can undermine intrinsic interest in a task. It has long been realized that excessive stress on extrinsic motivation in the form of pay can be detrimental to intrinsic motivation(Deci, 1975). Studies have shown that intrinsic interest which results in optimal performance typically decreases when external reasons are presented for doing it. In fact, a series of studies, published in 1992 by psychology professor Jonathan L. Freedman and his colleagues at the University of Toronto, confirmed that the more incentive we are offered, the more negatively we will view the activity for which the bonus was received (Kohn, 1993: 62). In short, PRP is inclined to reduce people's enthusiasm about their work, the outcome of which is undesirable performance. Besides, PRP can lead to short-termism. In order to achieve quick profit, it is easy for people to have strong intention on short-term benefits instead of pursuing the accomplishment of long-term strategic goals. ...read more.

Conclusion

There is no absolute evidence to support whether human resource management indeed only works well in theory but not in practice. Actually, in the light of our discussion, we found that the conclusions are balanced, which means for some theories they not only flourish in books but also effect well in real case studies. Time rates for instance, are generally applied in managerial and white-collar work, and PBR as well thrives in clothing industry and later on insurance business. Each scheme has its strengths in dealing with particular problems. Though weaknesses may be found while implementing the theory, the effectiveness in practice cannot be ignored. Besides, no theory is flawless, and even though there is, the implementation would generally not go as smoothly as the theory does. The critical reason behind this could be certain uncontrollable factor which varies hugely from place to place, time to time; that is-people. No matter how perfect a theory might be, when it comes to people, there could be some problems occurring. As what has been mentioned above, in most schemes, such as PBR and PRP, the standards of performance are often disputed and not easy to be decided. The obvious key point lies in personnel. The same as what happened to the performance appraisal evaluation system, a major argument about the justice of appraisal arose from the managers who made those assessments and might not have done them fairly and effectively. Because of this, many defects occurred while implementing the schemes. While more flaws may be uncovered, more improved human resource management theories would also be investigated and generated. Until now, there seem to be no theories in this field which can be proved to work perfectly well in practice, and such situation may still remain in the future. People changes; hence the study of human resource management must be varied and modified along with such fact. Does human resource management simply work well in theory but not in practice? The answer is uncertain and there are always more theories to come. ...read more.

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