HRM & Organizational Performance

The following assignment is a compact yet detailed overview of Human

Resource Management & Organizational performance.

Human resource management comprises two very important motif, first

one is human resource and second is management.

Before going further first we have to look at the basic definition

of both discipline. The term human resource means,’ Scarcest and most
crucial productive resource that creates the largest and longest
lasting advantage for an organization. It resides in the knowledge,
skills, and motivation of people, is the least mobile of the four
factors of production, and (under right conditions) learns and grows
better with age and experience which no other resource can.’ This
definition of human resource is precise and clear that what is the
actual meaning of human resource. Human resource means the productive
resource who create largest and lasting reinforcement for an company/
organization. The main USP of human resource that it is less mobile
than others factors of production and it gets better and more useful
with age and experience. Other resources of production are
licentiousness without the interference of human resource.

Second discipline is management. Management is very broad in

itself and its not limited to certain areas or fields. Today
everywhere management rules and methods are in use. Basic definition
of management is,’The act, manner, or practice of managing; handling,
supervision, or control: management of a crisis; management of
workers/employees .’ Definition covers all aspect of management. It
covers each and every phase of organization. Management starts from
root age and continues tills the tasks accomplished.

Both discipline have their own identity and utility. Human

resource management contains all advantages of the management and
human resource. Basic definition of human resource management is,’
Human Resource Management (HRM) is the function within an
organization that focuses on recruitment of, management of, and
providing direction for the people who work in the organization.’
Definition clearly states that Human resource management is all about
the management of recruitment, training and organization development.
Human Resource Management is the organizational function that deals
with issues related to people such as compensation, hiring,
performance management, organization development, safety, wellness,
benefits, employee motivation, communication, administration, and
training.
 HRM & Organizational Performance

Various functions which are comes under the Human resource

management is compensation, hiring, performance management,
organization development, safety, wellness, benefits, employee
motivation, communication, administration, and training.

Several methods used for Human resource management implementation

1. Theory X and Y

2. Theory Z

3. Theory of needs

4. Theory of Planned Behaviour

5. Two Factor Theory

These are the some useful methods used by organizations for

implementing Human resource management in the system. Overall, Human
resource management is very important disciple which can not ignore
by organizations today and it is necessary for every management to
focus clearly each and every part of HRM.
 HRM & Organizational Performance

ORGANIZATIONAL PERFORMANCE:
Organizational performance comprises the actual output or results
of an organization as measured against its intended outputs.

The term Organizational effectiveness is broader.

Specialists in many fields are concerned with organizational

performance including strategic planners, operations, finance, legal,
and organizational development.

In recent years, many organizations have attempted to manage

organizational performance using the balanced scorecard methodology
where performance is tracked and measured in multiple dimensions such
as:

• financial performance (e.g. shareholder return)

• customer service
• social responsibility (e.g. corporate citizenship, community
outreach)
• employee stewardship

ORGANISATIONAL PERFORMANCE INDEX ( OPI ):

The Organization Performance Index (OPI) is an integrated score that

determines an organizations competitiveness. The scores are initially
generated from weighted scoring of various areas of management which
include Leadership and Management, Human resource focus, customer
Orientation and Marketing, Financial Management, Innovation,
Information and Knowledge Management and lastly Productivity and
Quality. Metrics are used to come up with the weightings required in
order to generate the required results.

OPI is as a result of Innovation from the Kenya institute of

Management (KIM). It was recently used by the Small and Medium
Enterprises (SMEs) Participating in the KIM Annual Business Awards
(KABA).