Managing People and Organizations - Essay Example

Managing People and Organizations Name: Tutor: Course: Date: People management and impact on organizational performance People management The process of managing people has drawn a lot of attention in the human resource discourse as corporations strive to achieve sustainable competitive advantage. A growing body of knowledge supported by theories of management is providing evidence on the need to involve, engage, motivate, develop, and manage employees (Parry & Tyson, 2013). Consequently, human resource departments have been involved in practices such as health and safety, attractive compensation schemes, training and development and fairness concerns. Khandekar and Sharma (2014) argue that successful organizations are those in which their management teams create a work culture for employees to be motivated. Furthermore, employees with appropriate abilities and skills under motivating and proper organizational structures tend to achieve more for the organization (Robbins, 2012). For example, with the rise of Multinational Corporations (MNCs) in India, local firms have been forced to change their focus from human resource management to human resource development. This is because people are involved in strategy formulation and are constantly learning innovative and new ideas that transform the organizations. Therefore, it is inadequate to understand causes of organizational behaviors with little regard to people in the organization. According to Bubb and Earley (2007), organizations with less stewardship and accountability depict superiors who grossly mistreat their subordinates and often take credit where it is not due. Moreover, instead of motivating its employees some firms are more focused on their business systems and as a result struggle for survival in the competitive global marketplace. Human dignity and value of people in business is often ignored through actions such as undignified treatment of hardworking employees, downsizing and discrimination (Robbins, 2012). Fortunately, some modern organizations are coming to the understanding that aspirations, value and feelings of employees have a role in organizational and personal success. Saeed et al. (2013) in a study of human resource practice and organization performance based on a sample of 150 bankers in Pakistan used Pearson correlation and regression methods. The authors found that human resource practices such as training programs, incentive practices and staffing practices had significant and positive relationship with the performance of the organization. Moreover, Anantharaman (2003) used a causal model to analyze the impact of people management on organizational performance of Indian software companies. Although the results showed insignificant relationship between people management practices and organizational financial performance, it directly affected operational performance parameters such as operating costs, speed of delivery, product quality, and employee productivity and employee retention (Robbins, 2012). This indicates that people management practices such as incentives, compensation, job design and training influences organizational performance. Currently, a growing body of knowledge shows that firms with high quality people management have sustained competitive advantage that will be difficult to imitate by competitors. Patterson (2003) observes that company performance is not determined much by its physical capital but its people. Organizations with strategic initiatives of developing, attracting and motivating workers with critical and scarce abilities can generate effective task performance. Consequently, citizen behavior in the form of satisfaction, commitment and involvement are fostered through progressive people management practices that generate effective task performance (Hall, 2003). The key to top performance is not management strategy, technological edge or financial management but focus on employee development and commitment (Pfeffer, 1998). Furthermore, without highly motivated and committed employees, complex business objectives and organizational goals cannot be achieved (Saini & Khan, 2000). The human relations model emphasizes on values and norms associated with participation, trust and belonging. Motivational factors include group membership, cohesiveness and attachment. While concern for employee welfare is a cultural dimension, autonomy is necessary for employees to feel trusted and valued (Hall, 2003). Moreover, emphasizing on training allows employees to have a wide scope to enact work. Regular supervisory support helps in developing employee skills. Organizational performance Deployment and use of human resource leads to higher business performance (Patterson et al. 2013). There are a number of organizational performance variables that link employees and management. These include the ability to attract and retain employees, new product development, customer satisfaction and product quality. According to Yeung and Berman (1997) people management practices have significant roles such as improving shareholder and customer satisfaction, enhancing employee satisfaction and building organization capabilities. While Pfeffer (1998) found that mismanaging people created a downward spiral, organizations using employee-oriented approaches exhibited better profitability and performance. On the other hand, a study by Sharma and Aradhana (2002) found that organizations with strong corporate culture provided high levels of commitment and enthusiasm over employees and control on performance. In a climate of uncertainty, there is need to equip personnel practitioners with suitable competencies to develop mechanisms and strategies of integrating people management with business performance. Adopting people management strategies leads to stakeholder needs satisfaction and achievement of higher business performance. Richardson and Thompson (2013) conclude that there are seven people management policies in which organization can utilize to produce profits. These comprise providing employment security, adequate resources for recruitment of the right people, and decentralization and use of self-managed teams, high wage levels, high training expenditure, minimal status differentials and the willingness to share information across the organization. All organizations desire right set of workforce motivation, right mix of employee competencies and right number of employees (Hall, 2003). However, just as competence affect productivity and profits, motivations gives rise to quality consciousness and quality levels while correct manning levels results in employees working smart. Giacalone and Jurkiewicz (2014) agree that achievement of desired behavior in an organization will in turn affect the success of the organization in achieving its human resource objectives. In modern organizations, more attention is put not purely based on output per employee but on quality standards retention, creativity or innovation and sharing valuable information (Purcell et al., 2008). These aspects of employee behavior are influenced by employee motivation and competence which in turn affects organizational success. Conversely, behavioral objectives such as quit rates, working smart, quality consciousness and productivity influence production objectives such as quality levels and unit labor costs (Day, 2014). Despite firms being interested in reducing unit labor costs for competitive advantage, perceived and real product quality levels are associated with high sector wages and compensation. For example, the service sector has its employees directly determining customer satisfaction in which poor service delivery is linked to high levels of motivation including better wages. Given that high unit labor costs and quality levels affect profits, customer perception of ‘value for money’ is tied to employee contribution in the buy process (Armstrong, 2006). Managing people also requires internal fit where filling of vacancies by internal promotion is accompanied by complimentary training and development policies. Although this ‘fit’ encourages workforce motivation and competence levels, the joint impact of human resource policies should be emphasized (Michie & West, 2004). When there is ‘fit’ between organization strategy and structure, performance is optimized. This implies that firms observing a bundle of HR practices that fit ideal type systems or fits one another have higher levels of performance and competitive strategies. On the other hand, Saini and Khan (2001) observe that incentive pay can act as commitment and control mechanisms to reward different outcomes and behaviors. For example, an organization intending to pursue cost savings scheme may need to develop cost strategies while that of differentiation strategy may have to implement incentive pay models. People management need to take into consideration not only the amount of training for new and experienced employees but also the degree at which status barriers will be eliminated (Anantharaman, 2003). Besides, there must be an index at which individual’s pay is determined or influenced by the entire workforce’s output. The hiring criteria should emphasize on interpersonal skills and openness to learning. Role of managers in people management An incredible challenge to every organizational manager or leader is creating a motivating organization which leads to greater work performance. Although people management is an art, it requires faith in people, stewardship, experience, intuition and creativity (Robbins, 2012). A manager can create an environment where employees are passionate about their roles and know their expectations in the organization. High-performance organizations are truly people-based organizations where managers have mastered the art of managing people. Recognition of people as the components of transforming organizations from effectiveness to greatness is critical (Saeed et al., 2013). Hall (2003) opines that regardless of position or organizational hierarchy level, a manager works with people and requires knowledge on behavior and personalities of every individual for effective management. The downfall of any organization starts with dissatisfied or unhappy employees; hence the aspect of employee and customer dissatisfaction ensues (Warigon, 2011). Organizations with good organizational climate and satisfied employees experience improved performance or profitability as well as customer value. Nevertheless, motivation is intrinsic but important is creating and sustaining a vibrant workplace (Yeung & Berman, 1997). With growth of Enterprise Social Networks (ESN), employees are more engaged and encouraged to provide feedback. To unleash synergistic potential, most organizations are allowing their employees to think like entrepreneurs, take risks and perform to their best. Also, managers who motivate are relentless cheerleaders, coaches, trainers and facilitators who understand the role of preparing employees for constant organizational changes. According to Warigon (2011) routine and predictable work schedules can make employees to be de-motivated and complacent. Therefore, a more productive and enjoyable workplace will require employees and managers to have a good sense of humor. While business processes, information systems and strategies help employees in better job performance, managers still need to know the impact of such tool on people in the organization for better results (Hall, 2003). Effective solving and understanding of organizational problems enhances spontaneous, frequent and direct interactions among employees (Day, 2014). Therefore, a direct connection with all the employees in the organization ensures reality check in the organizational communication processes. Conducive employee work environment Employees unhappy about performance appraisals are likely to become bitter, divisive and indifferent. Apart from adversely affecting commitment and loyalty, vindictive and bitter employees will eventually collapse a successful organization (Warigon, 2011). Human relation skills are on high demand by real people-oriented managers. Career of a manager will potentially suffer when people are poorly managed. Moreover, legacies of leaders are defined by people they leave behind in the organization. Constant communication and giving people full credit for their contribution to the success of the organization. In the people management philosophy, inspiration should replace intimidation (Khandekar & Aradhana, 2014). One way of not to solve an organizational problem is to eliminate people perceived as ‘threat’ to the leaders without justification. By focusing on every reorganization effort, Patterson et al. (2013) notes that work processes can be enhanced. Furthermore, part of the organizational strategic visions should entail making effective people management. These can be in measurable and specific objectives reported regularly with transparent accountability. People management practices in the organization can be assessed by internal audits where managers become decisive and proactive in addressing known problems (Warigon, 2011). Human resource practices improve company performance through employee abilities and skills that promote positive attitudes and increase motivation levels. Employees can make full utility of abilities and skills when they are provided with expanded responsibilities. Developing the organization and its people Local-level people management and leadership skills become essential when the imperative for change and Organizational Development (OD) are ever stronger (Feilder, 2013). The way organizations are led and managed must reflect their genuineness to change. It is unlikely that OD programs succeed when solely focusing on the structures and systems without due regard to its people. This implies that line managers should build a high-performance culture, work actively with their employees at the local level and become real agents of change to achieve sustainable and successful OD. According to Patterson et al. (2013), the involvement, support and sanction of managers are vital for change initiatives to succeed. The role of line managers is central in the development and learning arena. Creation of Learning Cultures in the Workplace is dependent on the shift from training to learning. As part of their work roles individuals should engage in learning while local level leadership should set the tone for this culture (Feilder, 2013). Responsibility of line managers has received increasing recognition for a wide range of people management activities such as absence management, learning and talent management, performance management and employee engagement (Bubb & Earley, 2007). Policies and procedures can be formulated by HR professionals for people management activities, but it remains the responsibility of each individual employee to be appraised and engaged on daily basis. Reference list Anantharaman, P.A. (2003) Impact of people management practices on organizational performance: Analysis of a causal model. Journal of Human Resource Management. Vol. 14, No. 7: 1246-1266. Armstrong, M. (2006) A handbook of Human Resource Management Practice. Kogan Page Publishers. Bubb, S. & Earley, P. (2007) Leading and Managing continuous professional development: Developing people, developing schools. Sage Publications. Day, R.D. (2014) Leading and managing people in the dynamic organization. Psychology Press. Feilder, E.D., (2013) Importance of effective people management to the success of HR strategy. Talent Space. September 17, 2013. http://www.halogensoftware.com/blog/the-importance-of-effective-people-management-to-the-success-of-hr-strategy. Giacalone, R.A. & Jurkiewicz, C.L. (2014) Handbook of workplace spirituality and organizational performance. Routledge. Hall, A.H. (2003) Managing people. McGraw-Hill Education (UK). Patterson, M.G., West, M.A., Lawthom, R. & Nickell, S. (2013) Impact of people management practices on business performance. London School of Performance. London. Khandekar, A. & Aradhana, K. (2014) Strategic Human Resource Management: An Indian perspective. Lulu.com. Michie, S. and West, M. (2004) ‘Managing people and performance: An evidence based framework applied to health service organizations, IJMR, June, 5-6, 91-113. Parry, E. & Tyson, S. (2013) Managing people in a contemporary context. Routledge. Robbins, S.P. (2012) The truth about managing people. FT Press. Pfeffer, J. (1998) The Human equation: Building profits by putting people first, Boston: Harvard university press. Purcell, J., Kinnie, N., Swart, J. & Rayton, B. (2008) People management and performance. Routledge. Saeed, R., Lodhi, R.N., Igbal, A. Sandhu, M.A., Munir, M. & Yaseen, S. (2013) The effect of human resource management practices on organization’s performance. Middle-East Journal of Scientific Research. Vol. 16, No. 11, p. 1548-1556. Saini, D. and Khan, S. (2001) Human resource management perspectives for the new era. New Delhi, Response. Warigon, S.D. (2011) Managing people for organizational success. John Wiley and Sons: London. Yeung, A. and Berman, B. (1997) Adding Value through Human Resources: Reorienting Human Resources Measurement to Drive Business Performance, Human Resource Management, fall , 36(3): 321-335. Richardson, R. & Thompson, M. (2013) The impact of people management practices on business performance: A literature review. University of Oxford. Read More