Exploring Hrm Performance Linkages

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5. Recruitment

Recruitment is defined as the identification and creation of a talent pool which can cater to the staffing needs of the organization. Selection is the process of identifying the most appropriate candidate from amongst the talent pool. It puts the right person at the right job.

The process of Selection:

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Fig 1. The process of selection

The candidates are hired after a carefully implemented job analysis. It is the process through which the duties, skill and competency requirements of a job and the kind of person to be hired is determined. In the absence of such an analysis the process of selecting the employees will not be of much use. When Morgan Stanley aimed at creating a one-firm firm, it required an employee force that was willing to work in groups. However, in the absence of the specific requirements, if the firm would have hired very able but lone riders, it would have gone against the new vision of the company. In that case a mismatch would arise because of poor job analysis and the entire purpose of selection would have been defeated. If the employees fit the job well, their output is high which translates into high productivity of the organization.

Apple and Google are ranked among the most preferred brands for both employees and customers. There exists a strong interconnection among the two in some companies. A bad recruitment strategy may adversely affect the employer brand of the company which may lead to spoiling the brand image of the company. The productivity will be low from hiring misfit candidates. Also, the company will have to incur additional costs in order to re-hire. All this will directly or indirectly hit the sales and profits of the company. Therefore, the importance of a well framed staffing policy for good organizational performance cannot be emphasized enough.

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Fig 2. Advantages of well framed staffing policies

A good recruitment policy results in the hiring of high performing recruits, which leads to high employee output and as a result high organizational output. High quality output is expected to improve the brand image of the product as well as the overall organizational image. This in turn helps in attracting high performing recruits.

Having a good recruitment and selection policy can provide the organization with a competitive advantage whereas an ineffective selection policy can adversely affect their performance.

Kim et. al. conducted a study on a change in staffing at Seoul National University Hospital which showed that a staffing policy can directly lead to improved performance for the hospital. They changed from hiring radiography technicians to registered nurses for administering MRI contrast media in patients. The study compared the number of cases with adverse reactions before and after the staffing policy change. There was a reduction of 55.81% in the number of adverse reactions. This showed that there was an improvement in the performance of the department as a result of the staffing policy change.

6. Employee Benefits

In today’s economic scenario, with increasing size and share of service industry, people have become a more valuable asset to the organizations. Organizations have started realizing this growing importance. They are becoming more aware of the fact that it is the people in the organization that can provide them a sustainable competitive advantage over their competitors because processes and technologies can be replicated or borrowed but human resource is not something that can be easily replicated. Moreover, in the talent war facing the organizations today, it has become extremely necessary for them to focus on the people as a resource, in fact, the most valued one. It has become very costly to replace people and thus employee retention has become a focus area as well as an effectiveness measure of the performance of the organization.

Employee benefits is the non-monetary compensation given in addition to salary. This may include insurance, sick leaves, paid vacation, flexible working hours, etc. The amount and type of benefits can vary from organization to organization depending on feasibility and usefulness. They may also vary from location to location or with hierarchy in the organization. These benefits play a crucial role in making employees realize that they are valued and are taken care of by the organization. This gives a sense of belongingness rather than their job being simply a contract with the employer where they are paid in cash for their services. A highly motivated and enthusiastic workforce has become a necessity in today’s dynamic work environment. Employee benefits can motivate employees to perform their best. In some cases, it can even motivate them to outperform organization’s expectations.

In addition to this, it can also affect the employee’s job satisfaction and his views on long term engagement with the organization. This satisfaction from the job may result in a reduced attrition rate which will show impact in the form of timely delivery of outputs and enhanced client satisfaction. It will also reduce the time effort and the resulting costs of rehiring to fill the vacant positions. Reduction in attrition also helps in lowering the requirement for training the new employees. This helps in saving the training costs.

Apart from employee satisfaction and retention, benefits can also play a key role in attracting fresh talent. If two similar jobs exist with similar compensation levels, the person might choose the one which provide him more rewarding benefits. This can provide a competitive advantage to the firm over its competitors.

Impact of Employee benefits on the organization’s performance has been studied by Zhaohong and co-workers (Zhaohong, Xing and Zhe 2014). In this research they used the survey methodology to understand and determine the impact of various benefits like security needs, work support, rewards, etc. The survey questions the respondents on the extent of benefit implementation in their organizations. A coefficient of 0.47 for overall benefit system in the study of a relationship between benefits and firm performance shows that a clear relationship between the overall benefit system and the overall firm performance exists.

7. Appraisal: Linkages to the Organizational Performance

The Performance appraisal is an important aspect of human resource management practices as it provides an insight