Example Of Research Proposal On The Role Of HRM In Measuring Performance

The human resource management (HRM) has witnessed a rapid evolution over the decades. Though it initially began as a function that takes care of the administrative aspects of hiring and payroll, slowly it has evolved into a full-blown strategic activity that looks into employee satisfaction, employee retention, and legal compliance (Katou, 2008). Though recently a trend has been seen towards justifying the existence of the HR function with many popular business presses characterizing the HR division as redundant, several research studies show a connection between HR practices and the firm performance.
Strategic HRM has been defined by Wright and McMahan (1992) as “the pattern of planned human resource deployments and activities" the ultimate purpose of which is to contribute to organizational performance. The organizational performance of a firm and the HRM's contribution to it can be measured by four possible types of measurement parameters, including 1) HR outcomes, such as absenteeism, job satisfaction, turnover rate; 2) organizational outcomes, including quality, productivity, and service; 3) financial accounting outcomes, including profitability and Return on assets; and 4) capital market outcomes, such as returns, growth, and stock price (Katou, 2008). Research studies conducted by Russel, Terborg and Powers in 1985, Terpstra and Rozell in 1993, Borman in 1991 and Milkovich in 1992 have shown that HR practices including training, selection of candidates, appraisals, and compensation are well-connected to a firm's financial performance (Rogers and Wright, 1998).
There are two factors that affect the HRM activities and policies; internal and external. The internal factors affecting HRM functions include organizational objectives, organizational mission, size and structure of an organization, priorities of top management, issues of power and politics, priorities of line managers, traditions and history of the organization, the impact of training and education in HRM, and political and cultural characteristics of employees (Genc, 2014). Similarly, HRM function is influenced by the external factors, including technology changes, changes in national as well as international economy, the characteristics of an industry or a sector, national culture and traditions, government regulations, legislation, the actions of unions and competitors, and general policies and their enforcement (Bart and Baetz, 1998).
The development of HR policies and activities largely depend on these factors, which, in turn, affect the organizational performance. For instance, there are sectors like the mining and construction industry that need to put special focus on employee safety and security (Milkovich, 1992). These industries need to have the HR strategies formulated in accordance with the safety requirements so as to avoid penalties and compensation in the case of an accident. For example, Organizational Safety and Health Act (OSHA) makes it mandatory that the employer should provide a safe and healthy workplace for the employees (BLS, 2013). The failure of compliance with the required safety standards can bring upon an array of financial consequences for the company, and therefore, it is the purpose of the strategic HRM division to address these issues and formulate policies that not only safeguard the interests of the employers, but also provide a safe work environment for the employees. This boosts up the employee morale and leads to their job satisfaction. Similarly, the structure of an organization too influences the development of HR policies. For instance, in a multicultural organization with an employee base comprised of people of various ethnicities and religion, it is important to have HR policies in place that protect employees from discriminatory practices.

Work Cited

Katou, A. 2008. Measuring the impact of HRM on organizational performance. Journal of Industrial Engineering and Management, 1(2). p. 119-142
Genc, K. 2014. Environmental Factors Affecting Human Resources Management Activities of Turkish Large Firms. International Journal of Business and Management, 9(11).
Rogers, E. and Wright, P. 1998. Measuring organizational performance in strategic human resource management: Problems, prospects and performance information markets. Human Resource Management Review, 8(3), pp.311-331.
Milkovich, G. 1992. Strengthening the pay performance relationship: The research. Compensation and Benefits Review, 24(6), 53-62.
Wright, P. M., and McMahan, G. C. 1992. Theoretical perspectives for strategic human resource management. Journal of Management, 18(2), 295-320.
Bureau of Labor Statistics (BLS). 2013. Census of Fatal Occupational Injuries Summary, 2013. [Online] Available at <http://www.bls.gov/news.release/cfoi.nr0.htm> [Accessed 16 February 2015]
Bart, C. K., and Baetz, M. C. 1998. The Relationship Between Mission Statements and Firm Performance: an Expletory Study. Journal of Management Studies, 35(6), 823–853.