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The Impact of Hrm on Organisational Performance

In: Business and Management

Submitted By maggielmz
Words 3635
Pages 15
Essay Title: ‘Assess the state of the evidence in favour of HRM’s impact on organisational performance. Do the supporters of HRM’s strategic contribution have enough of a case?’ Word Count: 3,105

Abstract

The evidence in favor of HRM’s impact on organizational performance is growing, however some doubt has cast on these studies. Thus, this essay suggests that the evidence of HRM-performance linkage is weak because theoretical and methodological issues remain among most of these studies. So, this essay will mainly analyze theories concerning on HRM and firm performance relationships and methodological problems in empirical studies. As there are flaws in both theories and the process of studying the relationships, this essay concludes that the evidence in favor of HRM’s impact on organisatioanl performance is weak. It seems that it is better to pay more attention to the HRM’s theories and methodologies in order to further the understanding the correlation between HRM and firm performance.

TABLE OF CONTENTS

1. Introduction 4 2. Evidence of previous studies 5 3. Theoretical evidence 8 3.1 Categorizing theories 9 3.1.1 Strategic theories 9 3.1.2 Descriptive theories 11 3.1.3 Normative theories 11 3.2 Conceptual theories 13 4. Methodological issue 15 4.1 Measurement of HRM 16 4.2 Measurement of performance 17 5. Conclusion 18

1. Introduction

Human resource managers have been worrying about the inability to prove their contribution to the organisations for a long time (Drucker, 1954, and Stewart, 1996, cited in Wright, Gardner, Moynihan and Allen, 2005). As responses to the uncertainty of whether human resource management (HRM) has an impact on organisational performance, there have been a lot of studies emerging and attempting to prove HRM does add values to firms. Until now, a developing body of research has...

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