HRM and Business Effectiveness

Based on Chapter 3 of Human Resource Management in a Business Context (2nd Edition, 2004) by Alan Price - published by Thomson Learning

Contents

Objectives

The purpose of this chapter is to:

• Introduce the concept of high commitment/performance work systems
• Provide an overview of human resource systems
• Evaluate the contribution of HRM and HR technology to business effectiveness
• Provide a checklist of HRM principles

High Performance Organizations

Knowledge management

Knowledge management: a Big Idea

Tacit and implicit knowledge

Knowledge management practice

HRM and business effectiveness

HR systems

HR professionals and the HR system

Measuring the impact of HRM

Where does the HR profession go from here?

A 10-C checklist for effective HRM

Summary

In this chapter we discussed recent and ongoing ways in which the human resource management function is changing - perhaps more radically than ever before. The HR function and its activities are being examined in microscopic detail in many large organizations. Human resource processes, especially those involving the collection and dissemination of information, are being computerized and automated, potentially eliminating routine clerical activities. HR information and knowledge is being linked and integrated with other information systems, breaking down departmental barriers.

As HR processes become more easily measurable, the need for justification and the means to do so become more obvious. Concepts such as the high performance organization and knowledge management offer HR specialists the chance to push HRM to the fore. HR processes and their outcomes are central to these concepts and the introduction of technology allows more exact methods of determining whether or not human resource initiatives do affect the 'bottom line' and shareholder value.

Yet there is some cynical scepticism coming from HR practitioners and academics, some of it associated with dogged technophobia, together with justifiable questioning of the methodology, rationale and, not least, the capabilities of the systems and concepts we have discussed.

Further reading

Karen Legge provides a carefully reasoned critique of the high commitment/performance concept and its links to HRM in a chapter of John Storey (ed) (2001) Human Resource Management: A Critical Text. In the same book, John Storey and Paul Quintas provide a thorough overview of knowledge management and its implications on HR in their chapter on the topic. How to Measure Human Resource Management (2001) (3rd edition) by Jac Fitz-Enz and Barbara Davison, published by McGraw-Hill, contains practical information on measuring elements of HR. If Only We Knew What We Know: The Transfer of Internal Knowledge and Best Practice (1998) by Carla S. O'Dell and Nilly Essaides (published by the Free Press) provides a good explanation of how applying the ideas of Knowledge Management can help employers identify their own internal best practices and share this intellectual capital throughout their organizations.

Review questions

Case study for discussion and analysis - High-Quality Workplaces in the Health Services

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