Best fit and best practice in HRM
In the today world Human resource management is so important to manage human than early time .It plays vital role for organization how they recruit highly motivated and competent employee. To sustain competitive advantage over the organization as we know managing human is difficult task so that to fulfill this need we need professional HR manager .Managing human resources depends upon both external and organizational environment. . The genesis of Human resource management was originated from people management to personnel management in late eighties. Late eighties was time of industrial revolution in UK. With the rise of industrial revolution, the emergence of trade union started .emergence of trade union was main reason for development for people management . The scientific management was prioritized by the industry instead of haphazard picking of labor .Now organization started providing skills and training to their workers.
In nineties this people management was transformed in HRM. The HRM was very vital force for all Japanese manufactures to capture western market. The theoretical approach of human resource management now taking consideration in context of taking competitive advantage of organization this led to how an organization use their technical and best human resources to compete the current market scenario. Faculty and alumni of Harvard business school first proposed the model of HRM which was known as the Harvard Model of HRM. This was first time then intellectual think to consider HRM for management students In contrast to theoretical assumption, the practical studies also reflect that there was significant change in the practice of managing people in modern organization. These countries focus more empowerment, teamwork and commitment. Substantial data reflect the evidence of new practices implemented in organization to achieve performance. Best practices in human resource management are in universalistic in nature .They are independent on context and internal factors .These practices are applied to better organizational performance. Researcher identifies different HR practice which leads to better organizational performance and competitive advantage through people. These practice are classified into employment security, selective recruitment, self managed team, high pay contingent on company performance, extensive training, reduction of status differential and sharing of information. These all practices are called high performance work practices.
These practices were applied by US organization to enhance productivities and financial performance. HRM is now become argument among various critics. In some case and context HRM practices are not relevant for growth of organization .On the other hand, radical critics have pointed out that the specific HR practices are in varied in nature in some context. Then there was argument about the best fit model which can also have individualistic approach for performance. There is big debate upon the model for HR practices .
Universalistic approach of HR is based on ideal pattern of leadership which is fit for all the situation and it is universal in nature and it applied all over the world to enhance the performance of organization .In contingency approach is more powerful for defining the concrete action of task, this means that it is best fit approach to enhance the organizational performance. Human resource management has been supported by the best practices and HIM (high involvement management that guarantee the high performance of organization. But some of the theories show that best fit also feasible to achieve best organizational performance .there is great rivalry between best fit and best practices. In resent discussion more focused upon the best practices that focus upon the high commitment and involvement. These practices involve job flexibility, low differential status, team working contrary to past traditional methods. Read also under what circumstances should a company’s management team give serious consideration
These all factors are more responsible for achievement of high performance of organization .IN contrast to universalistic approach the contingency theory implies that internally fitted practices match the strategy of the firm may perform the best. Understand universal and contingency approach. There are different hypothesis are considered to put light on the subject. First hypothesis say that high involvement and performance HR have positive effect on organizational growth and second hypothesis say that strategic factors can moderate the relationship between high involvement HR and organizational performance contrary to universalistic approach. The link between HRM and Firm performance mostly focused upon the two approaches, best fit and best practices.
Best practices are more focus on performance regard less of context and best fit are more focus on contextual and adaptation of situation. In most of context it is proposed that the HR practices depend upon the geographical context rather that business system theory. Large set of research demonstrate how demographic region and social cultural affects the performance of organization. Study gives reflection, how different bundle of HRM tested and how they impact upon the geographic regions. The bundles of HRM grouped in the European Union. Most of HRM practices designed in USA .The study Highlight the effect of HR practices in cross cultural and cross border. HR practices have different performance in different geographical region.
Study suggests that the number of difference in the HR practices among the different countries. It also highlights cultural, institutional and structural factor moderates the effects of HR practices on both the national and organizational level. In research, the researcher cluster different countries on the behalf of proxy for social cultural and political difference regarding work related practices. Regardless of country cluster formed on the basic HRM strategy would impact on institutional and regional practices how particular organization and environment respond to different culture and social class. Some of HR practices are effective in one context and may fail in different context. In context of UK and Ireland, they are categorize in business model and in context of North Germanic countries are collaborative nature. In these countries union of organization is weak. Avoidance of employee voice is high.
Latin and south European countries have high power distance reflective about paternalism and institutionalism in all level. All these put emphasis on business model theory.. The explanation of best practices in HRM regarding to worker outcomes in Malaysia and England Governmental organization show different details. The research consider psychological climate and trust on employee perception on the basis of five work related area, job satisfaction, motivation, organization citizenship behavior, stress and quit. Study explains Malaysia more focus on HR practices than their counterpart. Concept of best practices is different in cultures and nations. It is claimed that performance matched with HR practices. It needs to investigate which HR practices affect on the performance of organization. The Black Box testing is used to investigate the relation between performance and HR practices.
Later the question was arisen whether HR practices are useful for increasing the performance of organization but answer is still unclear. There is more empirical evidence is required for understand the internal functioning of HR practices .The conclusion is drawn that psychological climate also effect the outcomes. The comparison across national context has conversing effect. The study shows there is much influence of HR practices adoption as manager in different culture. This means that much challenge for HR managers in different culture and regions. In context of Malaysia and England there is much difference in the their culture and society .The Malaysia reflects high level of collectivism due to power distance and Eng shows individualism because of low power distance.
The effect of organizational strategy on universalistic and contingency HR practices Indian firm show different results. The fifteen HR practices are tested to know the organizational performance in Indian manufacturing industries context. These industries are classified into Oil, Gas, Infrastructure, Power, Chemical, Metal and Mining. The number of authors establish link between HR practices and Firm level strategy. The main motive of study is that whether Indian firms adopt HR practices for long term strategy. The widely perceive assumption that people provide organization to sustainable growth. The bundle of HR practices are benchmarking for Human resource management to achieving competitive advantage of organization. The best practice are generic in nature .They are considered as universal in nature for all industry. The best practices are universally adopted and linked with best organizational financial performance. In contingency view there are some HR practices which are adopted on the firm strategy.
Indian firm follow “one size fit all” universal approach than contingency approach. The data show that Oil and Gas industries perform low as compared to other industries in context of best practices .Data interpretation also shows that Indian manufacturing firm are not so mature to implement the Human resource management in practices. Universalistic approach does not work in all kind of industries .Some of industries performed well and some of industries could not achieve standard. So this means that universalistic theory does not match performance of industries which it claims. This data clearly show that there is need to follow strategic approach to implement HRM rather than best practices. Some of HR practices could not work in all situation .There is need to change strategy upon contingency. This study shows the conceptual framework for implementing human resource best practices to maximize the productivity and reduce volunteer turn over in Mexico. Give emphasis upon how HRM improved efficiency of the company . Read also under what circumstances should a company’s management team give serious consideration
There is widespread assumption that HR practice increase the efficiency and effectiveness of the company and it also help in reducing the volunteering turnover .This study reflect how adopt the HR practices according to their national cultures. Volunteer turn over mean that employee has to quit their job from organization and in -volunteer means that employee forced to terminates his employees. Wages and additional benefits are more important to reduce volunteer turnover. Reduce turnover also affects the productivity of organization in some circumstances. Cost affects productivity. Company achieved 100% turnover than USA. This is because of low environmental laws and less effective labor unions .The effect of HR practices seen in the Mexican company they will able to reduce their volunteer turnover maintained High productivity and move toward the more value added products by implementing TOM .By using best strategy Company become more productive and reduced volunteer turnover.HR practice help company to become more job enrichment.
The study also reveals that HR practices have impact on the organization but it also affects the internal consistency. In case of Mexican companies, improve the productivity and reduced turnover but also affects financial condition of organization to some extent. Some authors believe that HR practice should be contingent upon the strategy of organization to maximize the overall performance. The Best practices in HRM work only for intrinsically motivated employee is critical assumption, how the perception of best practice in HR affects the outcome of employee. It is assumed that best practices, like high performance, high commitment, high involvement affects overall performance of employee. High performance best practices increase ability, skill and knowledge of employee. Best practices also stimulate the employee to act and motivate them to do best for organization .This all leads to overall performance of organization. Intrinsic motivation is perception to perform their task individually to experience satisfaction and pleasure. This is assumption that people motivate to work hard because they want to build their abilities and competence. There is another perception that employee outcomes are dependent upon factors like KSA (knowledge, skill, ability) and motivation. The performance of employee is moderated by two factors like intrinsic motivation. This theory tells employee who are intrinsically motivated do well to their abilities and learn knowledge to perform well for organization.
Some employee are less motivated cannot perform their work skillfully. Some studies also reveal that firm performance more depends upon individual perception of HR practices in organization. This study based upon hypothesis that shows employee with low in intrinsic motivation perceived as low work performance and have high volunteer turnover. Intrinsic motivation assess that my job is interesting that is motivation for itself. Study shows that different HRM practices are suitable for different behavioral nature of employee. So relation between performance and HR practice is critical in case of intrinsically motivated people. Intrinsic motivation is moderating effects on perception of using HR practices. IT hard to make conclusion that intrinsic low and high motivated people do well and bad in context of performance and outcomes . Conclusion
Human resource model become critical because people become vital competence of business. Criticism of best fit practices become abstract and it leads to number problems. Best fit model also affects the cultural and social value of people .Further criticism is that best fit model tends to ignore employee interest in pursuit of achieving advance economical performance. The main and unique qualities provide main source for competitive advantage but also neglect the internal environment of organization. Best fit model provide competitive advantage in sustained business environment but in the dynamic changing environment it may affect negatively rather than positive effects .Best Fit model may be risky in changing environment. Further it leads to deteriorate the performance of company. So it is very hard to change strategy in dynamic environment to implement new strategy. It is very hard to change strategy as their rivals do. The main objective of implementing HR best practice is that it works on enhancing moral values, skills, knowledge, abilities of employee. Best fit model hide aspects of all personal development. Best fit approach to strategic HRM use outside perception. To explain how strategy of human resource management can deliver competitive advantage. The best practice model and high commitment model early identified as US model of HRM later this model widely used to improve work performance and achieving competitive advantage of company. Best practices model also used as improving employee attitude means intrinsic motivation and low in absenteeism means it able to reduce volunteer turnover and increase productivities.
This means it leads to enhance quality and efficiency of organization. Universalism and high commitment bundles used to enhance the performance of organization using people interest first rather than company individual interest. This means that universalism show some degree of morality rather than best fit. Best fit approach is rigid in nature it does not consider supportive for vales of employee. The number of studies has done in regard to establishing link between HR practices and organizational performance. In context of USA and Britain, High commitment bundles stimulate performance of the business. The HR bundles of best practices are regarded as having potential to improve employee attitude and behavior. Ultimate objective of HR practices to increase profitability of organization. HR bundles used to improve performance and these are consider as good for workers. HR practices like training, employment security, high pay etc are suitable for worker satisfaction. If workers are satisfied with their work then ultimate objective can be achieved. HR practices also help organization to benchmark strategy against their competitors.
This working strategy assumed as competitive advantage of business. In the end I conclude by saying that implementing HR best practices in an organization can be a very difficult and challenging job for HR managers all over the world. Comparative and integrative approached of HR practices can help in this but they have their pro and cons. Every culture has distinguish shared values and spiritual beliefs which need to be studied all the aspect of any culture and region before applying HR practices one could integrate them into HR best practices. Sometimes there is different perception regarding business ethics and personnel opinion so this may lead to conflicts and affects performance. In context of Indian sub continent, HR best practices not implemented perfectly then it might affect bad inter-personal relationships and poor performance and increase stress at work. Issues like low job satisfaction, employees, high volunteer turnover mean and absenteeism etc might be increased over the time. Western m management theories like HRM best practices need to give serious consideration where globe have different culture and values so that all organization will able to achieve ultimate objective of HRM practices. Recommendation
Today we are living in dynamic world where business environment changing rapidly. So we are inhabitant of world where different diversity, culture, and shared values. Organizations of World applying best HR practice to attain better organizational performance and enhancing employee competence. There is no doubt about performance of HR best practice in western world where society has low status differential .HRM practices done remarkable job from its inception to till date. HR practices become very useful for growing personnel and inter personnel skill of employee. The bundles of HR seemed very important to attain competitive advantage of organization. All over the world manager of HRM gives more importance to HR best practices. In western culture best practices achieve high degree of reputation for enhancing attitude and giving more security to employee. HR practice become vital force for achieving competitive advantage of organization.HR best practices also works in favor of welfare of employee so this enable to achieve high job satisfaction but according to geographical region and diversity of the globe HRM researcher should think of culture and shared value of particular region before applying and theory.
By analyzing different culture and shared values there is need to transform different strategy according to organizational objectives .In the dynamic nature if world manager of HRM should rethink to adopt contingency approach regardless of limitation against employee morality so that ultimate objective of HRM practice to achieve organizational objective .I am agree to adopt best practice model to large extent but there is also need to change according to changing business environment. According to my opinion we need to make multicultural model which should fit in all context of region and business environment .Some of HR model should be then made according to need like diversity and different culture rather the Global prospective. If it successful then we could able to solve conflicts and limitation of HRM practices and we can achieve higher performance and employee consideration in context of organization. HR practices should be monitored time to time to bear change in environment so that HRM can achieve its strategic objective of organization.
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