HRM and Job Performance

HRM and Job Performance

HRM and Job Performance

Submitted To
Dr. Muhammad Anwar

Submitted By
Anam Hassan F10MB021 Aisha Chohan F10MB022 Anam Javed F10MB02 Sana Javed Hayat F10MB027

Page 2

HRM and Job Performance

Introduction
Human resource management (HRM) has contributed continuously in employees job performance which is the key element for the success of an organization. The competency of the workers employed will determine just how successful the organization will be. Its imperative that companies hire competent staff to perform all job duties and responsibilities. However, there are times when the best workers will need to improve their job performance. Human Resource management is skilled to assist in the implementation of performance management in the organization. Therefore, department managers will need to collaborate with HR staff to ensure a competent staff is in place and how to effectively improve workplace performance As human resource management plays a very important role in the performance of the employee in the workplace so we choose two variables; human resource management and job performance. Job performance is an individual level variable. That is, performance is something a single person does. So performance is an individual output in terms of quantity, quality and timeliness (attendance) expected from each employee of an organization in a particular job. Human resource management refers to the coherent and strategic approach to understand the needs of the people working in a firm. Undoubtedly, the growth of a firm is totally based on the individual and the collective efforts of its workers. Human resource management evolved as a serious discipline in the business world when it was understood that employees are not mere business units, like machines and automobiles. Instead, they are a valuable human manpower and have personal, emotional and financial needs. Hence, human resource management was formed to cultivate a positive work culture in the organization, motivate employees through promotions, streamline the recruitment process and provide employee training. The dynamics of business have become more and more challenging in today's global economy. Employee retention is a crucial factor where the need of a human resource manager is vital.

Page 3

HRM and Job Performance

Dimensions of HRM related to Job Performance

Recruitment and job performance Recruitment refers to the process of attracting, screening, and selecting qualified people for a job. The process of recruitment begins with specifying the tasks and duties for a job, to document the actual or intended requirement of the job to be performed. This information is captured in a job description and provides the clear set of actions to the employees and hence the performance of the employees can be improved as the employee and the organization will know what is expected from the employee to perform. Vague task definitions on the basis of which recruitment is done can decrease the job performance as what the organization is expecting from the employees is not produced. Training and job performance Training refers to the teaching of skills and competencies to the employees to perform high in the given department of the organizations. Employee training affects the performance of the employee as it gives some new knowledge to the employee which prior on attending the training session the employee did not have. Promotions and Job Performance A promotion is the advancement of an employee's rank or position in an organizational hierarchy system. Promotion may be an employee's reward for good performance i.e. positive appraisal. A promotion can involve advancement in terms of designation, salary and benefits, and in some organizations the type of job activities may change a great deal. Promotion of the employee may have an effect on the performance of the employee, as it might increase the morale of the employee. Promotion very rarely can also have a negative effect on the employees performance because the employee might not be able to handle responsibilities and can also take it for granted which may lead to demotion of the employee. Hence before a company promotes an employee to a particular position it ensures that the person is able to handle the added responsibilities by

Page 4

HRM and Job Performance

screening the employee with interviews and tests and giving them training or on-the-job experience. Retention and Job Performance

Employee retention refers to the efforts by which employers attempt to retain employees in their workforce. In a business setting, the goal of employers is to decrease employee turnover, training costs, and loss of talent. Employees today are different. They are not the ones who dont have good opportunities in hand. As soon as they feel dissatisfied with the current employer or the job, they switch over to the next job. It is the responsibility of the employer to retain their best employees. If they dont, they would be left with no good employees. Employee retention can effect the performance of the employee as remaining with the same employer might help in achieving best as the employee well understands the job requirements.

Objective
The main objective of this study is to find out how HR practices have a direct impact on employee skills, motivation, job design and work structures. The HRM has a great importance in assisting employees in achieving their goals, and enhance the individual's jobs performance in the organization. Therefore this study would be very beneficial for the organizations to find out how different dimensions of HRM effecting the employee job performance.

Significance
This research will be useful as it throw light on different dimensions of Human Resource Management (HRM) and how different dimensions of HRM leads toward high or low job performance. This study would be beneficial for the individuals as well as organizations. The HRM has a great significance in contributing towards the employees job performance i.e it assist employees in achieving their goals, at least insofar as these goals enhance the individual's

Page 5

HRM and Job Performance

contribution to the organization. Personal objectives of employees must be met if workers are to be maintained, retained and motivated. Otherwise, employee performance and

satisfaction may decline, and employees may leave the organization. Human resource management (HRM), or human resource development, entails planning, implementing, and managing recruitment, as well as selection, training, career, and organizational development initiatives within an organization. The goal of HRM is to maximize the productivity of an organization by optimizing the effectiveness of its employees while simultaneously improving the work life of employees and treating employees as valuable resources. Consequently, HRM encompasses efforts to promote personal development, employee overall performance. HRM department provides a good working environment which is essential for the employees to produce the desired results. A pleasant atmosphere gives an employee job gratification as well. In fact, general performance of the employees largely depends by the work culture or work atmosphere. On the other hand if employee problems are not catered properly by the HRM department of the organization then it become the cause of demoralization and descend in the performance standards of the employees and it also results in wastage of human talent and resources.

Literature Review
A literature review is a body of text that aims to review the critical points of current knowledge including substantive findings as well as theoretical and methodological contributions to a particular topic. A well-structured literature review is characterized by a logical flow of ideas; current and relevant references with consistent, appropriate referencing style; proper use of terminology; and an unbiased and comprehensive view of the previous research on the topic. A literature review has been done to know about the various dimensions of HRM affect job performance. Delery and Doty conducted a study in 1996 examined the relationship between HR practices and job performance in a sample of banks. In the study, they found that, in general, HR practices were positively related to job performance.

Page 6

HRM and Job Performance

Guthrie in 2001 examined the impact of HR practices on job performance and employee turnover. He noted that HR practices had an impact on job performance, and that the relationship between retention and productivity was positive when implemented high-involvement HR practices, but negative when they did not. The major study at the plant level has been conducted examining the relationship between HR practices and firm performance. MacDuffie in 2001 found that the HR practices were related to quality and productivity on auto assembly lines. HR practices were related to operational performance among a sample of manufacturing plants. Dyer and Reeves in 2004 reviewed much of the existing research on the relationship between HR practices and job performance and proposed that measures of job performance could be broken down into three categories. First, employee outcomes deal with the consequences of the practices on employees such as their attitudes and behavior, particularly behavior such as absenteeism and turnover. Organizational outcomes focus on more operational measures of performance such as productivity, quality and shrinkage, many or all of which would be precursors to profitability. Financial/ accounting outcomes refer to the actual financial performance measures and include expenses, revenues and profitability. He concluded that in order to successfully achieve all these three job performance parameters strong HRM practices are very necessary and HRM has a positive impact on employees job performance.

Theoretical Framework
A theoretical framework is conceptual model of how one theorizes or makes logical sense of the relationships among several factors that have been identified as important to the problem under study. The theoretical framework discusses the interrelationships among the variables that are considered to be integral to the dynamics of the situation being investigated. Theoretical framework is none other than identifying the network of relationships among the variables considered important to the study of any given problem situation. There are two variables in our study HRM and job performance in which HRM is an independent variable and job performance is the dependent variable because HRM influence the job performance.

Page 7

HRM and Job Performance

Components of the Theoretical Framework

There are 6 components of theoretical framework which is described on the basis of our research question. Research Question: Why HR practices have an impact on employee job performance? 1. Inventory of relevant variables The variables which are relevant to our research question as follows:  Job Performance is dependent variable.  HRM is independent variable. 2. Direction of relationship The HR practices have a positive relationship with employee job performance.

HR Practices

Employees Job Performance

i.e Higher the HR practices in the organization, higher the employee job performance. 3. Logic for the proposed relationship Human resource management (HRM) has contributed continuously in employees job performance. It assists employees in achieving their goals, at least in so far as these goals enhance the individual's contribution to the organization. Human Resource management (HRM),

Page 8

HRM and Job Performance

or human resource development, entails planning, implementing, and managing recruitment, as well as selection, training, career, and organizational development initiatives within an organization. Thats why human resource management has a positive impact on employees job performance. Continuous supervision is done by the HR department so the performance of the employees never decline and it helps in improving the performance. The previous studies also proved that HR practices have a great and positive influence in improving the organizational work environment resulting in the better employee job performance.

4. Inventory of propositions From the preceding discussion, the following propositions are put forth: Higher the HRM practices (recruitment, job training, promotion and employee retention) in the organization more the skilled and professional employees. Higher the positive work culture higher the employee motivation. Higher the professional employees in the organization higher the positive work culture. Higher the employee motivation higher the employee job performance. 5. Arrange the propositions sequentially Proposition 1: Higher the HRM practices (recruitment, job training, promotion and employee retention) in the organization more the skilled and professional employees in the company. Proposition 2: Higher the professional employees in the organization higher the positive work culture. Proposition 3: Higher the positive work culture higher the employee motivation. Proposition 4: Higher the employee motivation higher the employees job performance.

Page 9

HRM and Job Performance

6. Schematic diagram

HR Practices
Recruitment Training Promotion Retention
Dependent Variable Independent Variable

Job
Positive

Performance

Hypothesis
H0: There is no relationship between HR practices and job performance. H1: HR practices have positive impact on job performance. HR practices have a positive impact on employee skills, motivation, job design and work structures. These variables elicit certain levels of creativity, productivity and discretionary effort, which subsequently translate into improved job performance. There are a number of ways an organizations HR practices can foster a collective level of commitment in its workforce which can increase their job performance and so the firm's overall performance. First the initial impact of HR practices on employees commitment to the organization begins with selection and staffing. When firms invest in selecting the most highly skilled people, and providing them with increased skills through continuous training and development opportunities, employees find a workplace filled with well qualified co-workers. This makes for a positive work environment by enabling them to focus on serving their own customers successfully, doing their own job well and not having to constantly clean up the mess of other co-workers.

Page 10

HRM and Job Performance

Additionally, by using valid performance management systems and monetary incentives to elicit high performance, employees can see a more direct line of sight between their behavior and their personal outcomes. This creates a positive work environment where individuals feel fairly and equitably rewarded for their efforts. Finally, having open communications and participatory systems enables employees to both understand the organizations competitive position and be able to participate in processes to help improve it. This creates a positive work environment where people feel they are listened to and respected, thus enhancing their performance which eventually benefits the organization.

Theoratical Definition of HRM:

Human Resource Management is also a strategic and comprehensive approach to managing people and the workplace culture and environment. It focuses on recruitment of, training of, promotion of and retention of the people who work in the organization. Effective HRM enables employees to contribute effectively and productively to the overall company direction and the accomplishment of the organization's goals and objectives.

Operationalization of variables
Operationalization is the process of linking the conceptual definition to a specific set of measurement techniques or procedures. We operationalize the two variables present in our study which is HRM and job performance.

Operationalization of HRM
To operationalize HRM first of all it must be defined conceptually. Human resource management (HRM) refers to the coherent and strategic approach to understand the needs of the people working in a firm. Human resource management was formed to cultivate
Page 11

HRM and Job Performance

a positive work culture in the organization, motivate employees through promotions, streamline the recruitment process and provide employee training.

Dimensions of HRM
For the dimensions of HRM it is appropriate to look at this concept from different angles the different dimensions of HRM are  Recruitment  Training  Promotions  Retention

Elements of HRM
In this each dimension is further divided into actual patterns of behavior that would be exhibited in an organization. The logical rationale for each particular element is developed. Elements of Recruitment  Screening and selecting qualified people  Specifying the duties of a job  Provide clear job description Elements of training  Teaching of skills and competencies  Give new knowledge to employees  Polishing the existing employee skills Elements of promotion  Advancement in rank or position  Mobility policy  Promote employees equitably

Page 12

HRM and Job Performance

Elements of retention  Decrease employee turnover  Decrease training cost  Save the loss of talent

Conceptual definition of Job Performance Operational definition of Job Performance

Job performance is an individual level variable. That is, performance is something a single person does. So performance is an individual output in terms of quantity(in terms of no. of work hours), quality(no. of projects accepted/rejected) and timeliness (attendance) expected from each employee of an organization in a particular job. To operationalize job performance firstly it must be defined conceptually.

Dimensions of job performance

For measuring job performance it is appropriate to look at this concept from different angles relating with work. While employed in an organization the workers might be looking for many things. Each of these things may be considered as a dimension. Those things that have usually been considered important at the place of work can be  Quantity.  Quality.  Timeliness.

Page 13

HRM and Job Performance

Elements of job performance

Elements of quantity  No. of working hours  Overtime spent Elements of quality  Projects accepted/rejected.  Input v/s output  Calculated Risks. Elements of Timeliness  Attendance.  Meeting deadlines.

Then on each element questions and statements are made and look into the scalability of questions. We are using a five point scale (Likert scale).

Page 14

HRM and Job Performance

Statements

No.

Statements

Strongly Agree

Agree

Neutral

Disagree

Strongly Disagree

1.

To what extent HR practices have a positive impact on employee job performance?

2.

Do you think that HRM plays a major role in employee job performance?

3.

Do you think that above phenomenon applies in your organization?

4.

Do you think that HR practices increases the overall productivity of an organization?

5.

Does recruitment on the basis of vague task definitions decrease the job performance?

6.

What contribution does the training makes to job performance?

7.

What effects does the fair promotion construct to job performance?

8.

Does the Promotion built a negative effect on the employees performance due to added responsibilities?

9.

Does appropriate retention measures reduce employee turnover?

10.

What effect does the positive work environment filled with qualified coworkers creates on the job performance of employees?

Page 15

HRM and Job Performance

Research Design A research design is a master plan specifying the methods and procedures for collecting and analyzing the data. A research design involves a series of rational decision-making choices depending upon the various options available to the researchers. Broadly it is composed of different elements: the purpose of the study, the unit of analysis, time dimension, and mode of observation, sampling design, observation tools, data processing, and data analysis.

Research design elements

1. Purpose of study The purpose of the study is likely to determine how rigorous the research design is likely to be, therefore, the on the purpose of study the whole study is based. The purpose of this study is to find out how HR practices have an impact on employee skills, motivation, job design and work structures and overall employee job performance. 2. Unit of Analysis The unit of analysis refers to the level of aggregation of the data collected during the subsequent data analysis stage. Our study is the organizational level study in which we collect data from individuals. We collect data from individual employees and asked from them that what are the impacts of HR practices on their job performance. So, our unit of analysis is individual employees and our unit of observation is also each employee working in organization. 3. Time dimension While planning the strategy for data collection the time dimension may be an important component.

Page 16

HRM and Job Performance

We are collecting data from survey method which is the cross sectional study. Cross-Sectional Studies are carried out once and represent a snapshot of one point in time. Data are collected just once in order to answer the research question. 4. Researcher control of variables In cross section study there is no control over variables thats why is non-contrived variables. Cross sectional studies are invariably conducted in non contrived settings. Cross sectional studies done in organizations are called field studies and the researcher does not interfere with the natural occurrence of events in as much as independent variable is manipulated. 5. Mode of observation We are using a survey method of questionnaire for the collection of data. In the survey research a we collect data by the use of questionnaires to gather data about employee thoughts and their behavior regarding HR practices on their job performance. 6. Sampling Design In this study our target sample is employees working in organization. Target Population element is the subject on which measurement is being taken in this regard, our target sample is the employees itself because employees are the people who experience these situations on regular basis so they are the most relevant people who would told us that what are the impact of HR practices on their job performance. 7. Observation tool We are using a questionnaire toll for collecting data. In the questionnaire different questions are put relevant to the study consisting of a series of questions and other prompts for the purpose of gathering information from respondents.

Page 17

HRM and Job Performance

Page 18