Review of Literature 41 CHAPTER II REVIEW OF LITERATURE Planning is the first and most crucial function of management; “Well plan is half done”, it means looking ahead and designing future courses of action to be followed which tells where we should begin and how things will be in an organization. Therefore planning makes possible effective co-ordination & perfect adjustment between present and future developmental needs of the organization. It is easy for human beings to learn from the past experiences and make the plan for the future. In this context, a review is made of the existing relevant literature available on the topic of research. 2.1 RECENT STUDIES IN HR PRACTICES IN GLOBAL CONTEXT Plessis & Huntley (2009) there has been a move from personnel management PM to human resource management HRM; more recently to international human resource management IHRM. Challenges in IHRM involve the same activities as domestic HRM; the main difference is that domestic HRM is involved with employees within only one national boundary. IHRM assists organizations to best utilize their HR in the international context. Since multinational activities are involved in HRM, it is believed that IHRM is more complex than domestic HRM. In the South African context, employees come from different backgrounds and experiences; it is more difficult to manage them in a multinational corporation MNC than if they were all in the same country. Internationalization impose a movement in the direction of standardization of pay, working conditions and management systems in MNCs, including HRM, the influence of local culture, institutional arrangements and labour market practices. A model was developed by the authors and is recommended for use by South African HR practitioners. Bowra, Sharif (2012)The main endeavor of this study is to examine the relationship and nature of relationship between the employee perceived performance and human resource (HR) practices (compensation, performance evaluation, and promotion practices) in the banking sector of Pakistan. Survey of 235 banking personnel was conducted through personally administrated questionnaire to investigate the impact of HR practices on employees’ perceived performance. The relationship and nature of relationship is
54
Embed
Review of Literature - INFLIBNETshodhganga.inflibnet.ac.in/bitstream/10603/16095/4/chapter 2 (41-94... · management IHRM. Challenges in IHRM involve the same activities as domestic
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
Review of Literature
41
CHAPTER II
REVIEW OF LITERATURE
Planning is the first and most crucial function of management; “Well plan is half done”, it
means looking ahead and designing future courses of action to be followed which tells
where we should begin and how things will be in an organization. Therefore planning
makes possible effective co-ordination & perfect adjustment between present and future
developmental needs of the organization. It is easy for human beings to learn from the
past experiences and make the plan for the future. In this context, a review is made of the
existing relevant literature available on the topic of research.
2.1 RECENT STUDIES IN HR PRACTICES IN GLOBAL CONTEXT
Plessis & Huntley (2009) there has been a move from personnel management PM to
human resource management HRM; more recently to international human resource
management IHRM. Challenges in IHRM involve the same activities as domestic HRM;
the main difference is that domestic HRM is involved with employees within only one
national boundary. IHRM assists organizations to best utilize their HR in the international
context. Since multinational activities are involved in HRM, it is believed that IHRM is
more complex than domestic HRM. In the South African context, employees come from
different backgrounds and experiences; it is more difficult to manage them in a
multinational corporation MNC than if they were all in the same country.
Internationalization impose a movement in the direction of standardization of pay,
working conditions and management systems in MNCs, including HRM, the influence of
local culture, institutional arrangements and labour market practices. A model was
developed by the authors and is recommended for use by South African HR practitioners.
Bowra, Sharif (2012)The main endeavor of this study is to examine the relationship and
nature of relationship between the employee perceived performance and human resource
(HR) practices (compensation, performance evaluation, and promotion practices) in the
banking sector of Pakistan. Survey of 235 banking personnel was conducted through
personally administrated questionnaire to investigate the impact of HR practices on
employees’ perceived performance. The relationship and nature of relationship is
Review of Literature
42
calculated by applying the Spearman’s correlation matrix and multiple regression
analysis. The Spearman’s correlation results demonstrate that, the employee perceived
performance and HR practices has the positive and significant relationship. The
regression results indicate that the two HR practices: performance evaluation and
promotion practices are significant but the compensation practices are not significant.
Moreover, this study provides help for top-management of banking sector to design or
revise their HR policies and make practices to attain high employee performance.
Roche & Teague (2011) The research conducted in this study reveals the advent of HR
functions that have commonly avoided radical reconfiguration or depletion of resources
and that have gained new influence as ‘business partners’, mainly on foot of a ‘hard’ HR
agenda dictated by primarily short-term responses to acute commercial challenges. The
basis of HR’s new-found centrality to business is manifestly the increased dependency of
firms on HR expertise and knowledge in successfully introducing controls or reductions
in areas like pay and headcount and related changes in working-time regimes and work
practices.
This new centrality however, does not appear to have commonly translated into
leadership with respect to HR strategy over the medium to long-term, nor into strong
advocacy regarding the pivotal role of many ‘soft’ HR practices in harnessing
commitment and engagement for sustainable business success.
Few instances were reported in the focus groups or case studies (Ericsson was an
exception) where HR managers were active in positioning HR practices, systems or
processes to support business revival over the medium or long-term. Where such an
instance was identifiable, for example in the Ericsson case study, the strategic focus of
the HR function preceded the recession. Where HR managers have become influential as
a result of the recession, it cannot be inferred with any confidence that they will remain
influential when more normal business conditions return.
Boedker et. al.(2011) This research report aims to open up the ‘black box’ of
management and provides insights into the leadership, culture and management practices
that higher performing workplaces deploy and benefit from. It also illustrates the
productivity and profitability benefits that accrue to higher performing workplaces. It is
Review of Literature
43
part of a 2.5 year project funded by the Department of Education, Employment and
Workplace Relations to the Society for Knowledge Economics in December, 2009. It
shows that HPWs consistently outperform the rest both in regards to managing their
intangible assets and their productivity and profitability.
Thite & Wilkinson (2011) The rapid rise of multinational Corporations (MNCs) from
emerging economies has led to greater interest and urgency in developing a better
understanding of the deployment and diffusion of managerial strategies from their
perspective and without assuming the prevailing Western ethnocentric orthodoxy. This
paper develops a conceptual framework of global HR strategies and practices in MNCs
from emerging economies across their subsidiaries in both developed and developing
markets. Using data from a pilot study of an Indian MNC, it provides insights and
guidance into the motives, strategic opportunities and constraints in cross national
transfer of HR policies and practices in a multi-polar world.
The year 2008 has been a year of transition, with the global economic recession affecting
businesses across the globe.” The pharmaceutical industry, although comparatively less
affected, has metamorphosed in terms of bifurcating business units, rationalizing
operations, restructuring certain jobs, etc. Earlier, the role of HR personnel mainly
involved recruiting talent, but today, it is more about retaining it,” says, Saloni Vora.
Hanif Khaki (2006) is of the view that, today human resources management is opening
up new avenues around the world. Thus the demand for experienced human resource has
increased. Today businessmen have understood the value of hiring professionals with
experience working in HR. The companies have learned the importance of good relations
with their workforce. The fact is that Human Resource Management exists just for this
purpose –to bridge the gap between employee and employer. The company which does
not realizes the importance of its human resource cannot progress. The employee also
likes an organization which cares for them and rewards their services accordingly.
Examples of this begin at the most basic level of appreciation. Certificates of recognition
awarded on a monthly, bi-yearly, or even yearly basis, for instance, are all that many
employees wish. Likewise, health benefits are probably the second most important factor,
Review of Literature
44
besides financial benefits which is always welcomed by the employee. The HR
department is generally very open for such aspects in the workspace.
Rosenberg, Marc J. (2006) discusses that training organizations, will have to focus far
more on the workplace rather than just the theoretical knowledge, and learning should be
such to help people on the job. Training organizations will have to become more
diversified in their approach. They will need to find new technologies and approaches for
training organizations formal and informally. It is essential to focus on how the processes
and tools of work can be made easier, from the start. He says, “Only these things will
help in sustaining good performance of the employees. While traditional e-learning and
associated technologies are important, practitioners have often been too quick to embrace
them, especially to solve current problems—a "cure all" mentality—without considering
what future challenges and consequences might be. We should think of e-learning and
learning technology as enablers, not as a strategy. It’s the highway, not the destination;
the means rather than the ends.”
Sheth Hiral (2005) did a global IBM study on human capital that provided a deep insight
into the issues related to HR practices. A surprising trend that emerged demonstrated a
disparity in HR practices between upcoming and developing markets. He observed that
the human resource team is more active and takes care of employee needs in an emerging
or upcoming market than in a maturing or developing market. In a maturing market, the
HR function became more institutionalized i.e. more tilted towards the organizational
needs and less focused on the individual employee. According to the study, the build
strategy is a better option in the long term, than buy talent strategy. However a balance
between the two is the best approach. It was found in the study that companies that
invested in building talent, has higher profits per employee as compared to organizations
who buy talent. Moreover, the study also pointed out that organizations, which buy talent
tend to face many problems. Thus it may be concluded that the build talent strategy is
better for the long term.
John Simmons (2003) laid emphasis on the need for balancing performance,
accountability and equity in stakeholder relationships by pursuing socially responsible
HR practice. The paper uses stakeholder analysis to examine issues of performance,
Review of Literature
45
accountability and equity in organizations; and to analyze the relationship with more
socially responsible HR practice. Its theme is that effective governance can be reconciled
with social responsibility, and that incorporating stakeholder views in HR systems
enhances organization performance and commitment.
Bowen et al (2002) conducted a study of various countries on the role and importance
assigned to human resource management in an organization. The study was conducted on
different dimensions such as firstly how the status of HRM departments varies (e.g.,
perceptions of its importance and involvement). Second, on whether there is cross-
country strategic HRM (SHRM) in terms of the conventional contingency approach
(linking HRM practices to strategy), as well as a resource-based view of the firm (e.g.,
developing organizational capability as competitive advantage). The results of the study
showed significant differences in HRM status across countries, significant correlations
between status and organizational capability, and in Asian countries, a slight tendency for
HRM practices to be linked more to a differentiation strategy, whereas, in Anglo
countries, a strong linkage between HRM practices and organizational capability.
Hiltrop (2002) evaluated the HRM practices of Multinational organizations i.e. those
organizations which operates in more than one country. This article differentiates
between multinational and domestic companies and also compared and contrasted the
HRM practices of multinational companies. The conclusions drawn from the study help
to understand what strategies multinational companies adopt to attract talent, its retention
and how to motivate people and how this varies between industries and nationalities of
the corporate parent.
Sheppeck and Militello (2000) were of the view that over a period of time organizations
from stable operating configurations (patterns) which has a bearing on their
organizational effectiveness. These configurations are affected by factors like operating
environment, business strategy, HRM practices, and senior manager’s values and
behaviour regarding employees. However, once established, the configurations or
patterns guide employee behavior, there resistant to change, and are associated with
different levels of organization effectiveness.
Review of Literature
46
Gravett Linda (2004), in her view, “strategic planning is not a one-time event, but rather
it’s an ongoing process that must be fluid to address the changing environment in which
the organization exists.” Strategic planning is future oriented, with a vision for a period of
about three or five years so that there is enough time to set goals, carry them out and
analysis the results. The purpose, then, for establishing a strategic plan is to: decide
where the department will continue over the specified timeframe, prepare an action plan-
specifying where the organization wants to go, help the staff focus on the truly important
activities, access the requirements of required resources needed to accomplish the
objectives followed by a plan to acquire unavailable resource for ensure that the
objectives defined achieved.
Lou Adler (2005) diagnosed that ‘root because analysis’ method should be used to hire
efficient employees. Root cause analysis is a method of going deep into the real cause of
the problem rather than relying on superficial information. Generally Companies want to
employ efficient and more proactive candidates. For this, these companies offer good
compensation packages and other benefits to attract and retain these employees. But
when root cause analysis was used it was found that problem is not compensation, in
order to employ good candidates, the scope of job should be increased, in other words his
job should be enriched i.e. it should provide more challenges and opportunities.
Therefore, root cause analysis tries to understand the problem in depth & then find
solution accordingly.
Scott Weston (2003) studied use six sigma in Recruiting. A sigma is a mathematical
symbol for what is known as standard deviation. In this case it is used as a statistical term
that measures how much a process varies from perfection based on the number of defects
per million units. It provides a clear design or framework to help an organization a
process of improvement fully right from start till the end. He opined that some areas of
recruiting are more art than science; therefore, it can definitely be applied to the sourcing
and selection processes in recruiting. If these areas can be measured, so can improvement
to them. It is based on training of its participants and these are referred as green belt,
black belt, and master belt to indicate a level of training, capability and their respective
roles in implementing the six sigma methodology. It is almost similar to TQM
improvement method. The resources include both financial and manpower commitments
Review of Literature
47
and will often entail an additional budget investment to reap the rewards in the future.
Therefore six sigma involves a lot of time and manpower cost but does gives very good
results.
Pearse Robert F (2003) analyzed that knowing and understanding organizational culture
is very important for succeeding in a career. For reaching the top position in the
organization this knowledge of culture is very important. But this is easier said than done.
For the success of the career it is important to have information about the organization
culture. Especially those managers who wants frequent promotions knows what kind of
behavior is most appreciated in each culture. After understanding the important role of
organizational culture helps personals to maximize their potential. He suggested that we
should know our culture and manage it accordingly. The tough guy organizational
culture, the work hard/play hard organizational culture model, the bet-the –company
model, organizational culture and the bureaucratic organizational culture model were
recommended by him in his study.
Jacobson Ralph (2006) in his research paper he has emphasized that the most widely
used and an effective tool for performance appraisal as perceived by human resource
professional is 360-degree competency assessment process. The issues involved with the
360-degree assessment include the determination of competencies, interpretation of
results and subsequent efforts to use the data to create development plans. These are
simpler, most cost effective and more powerful methods for providing feedback that are
more likely to improve individual and organizational performance. The 360-degree
involves giving a list of competencies and a set of behavioral anchors to co-workers and
managers to use in evaluating performance. They are then asked to check their level of
agreement. Two clear issues emerge with this method of assessment since 5-8 people are
involved, one or two answers have a significant impact on the averaged score for that
item. Secondly, it is difficult to specify the context in which they expect particular
competencies to be exhibited. He stated that the purpose of competency assessment
should be to pinpoint and develop those few critical competencies that yield
extraordinary and disproportionate performance. He mentioned about some feedback
alternatives: providing direct feedback and using leadership tools. According to him the
direct feedback approach actively involves the employee and all critical stakeholders in
Review of Literature
48
the improvement process. The leader’s toolbox approach skips the diagnostic assessment
completely and instead provides a common language for leadership at all levels, as well
as many management and leadership tools to more directly achieve bottom line
improvement.
Masthan et al (2005) in their research on performance management concluded that any
economy requires more performance-based organizations for its development. Better
performance means, achieving higher productivity with limited resources- a fewer
people, lesser costs and time. In a dynamic environment, the organizations, for their
survival and growth, need to focus attention in scaling up in performance. For which,
they need to understand the key factors that influence performance. These factors are
quality innovation, productivity with quality, low cost and quality, better people
practices, collaborative leadership and learning culture.
Beatty et al. (2005) in their book that is based on research from 1850 individuals
organized in 265 teams from industry and academic in both public and private sectors,
recommend building smart teams for high performance. According to their book, there
are three critical processes and skill sets that a team needs. Teams must devote sufficient
time and energy to developing effective team management practices, problem solving
abilities and conflict- handling processes to work effectively together. Team management
practices refer to task processes, social processes and commitment of members to
complete the task on schedule in their study. According to them, good team practices
should include explanation of purpose and goals followed by roles and responsibilities
and then norms and protocols. Teams with strong problem solving skills should have
effective inter personal skills. Team members should work hard and understand each
other for effective communication and better decision-making. In conflict handling, team
members should not avoid thorny issues but have a strategy in place to deal with the
problems. They should work to identify and understand the underlying issues and to deal
with them effectively. The team effectiveness gap analyzer in their study would provide
an overall assessment to both what is in good shape and where the gaps need to be
bridged so that high performance can be practices in organizations.
Review of Literature
49
Ashton Chris (2004) studied transforming strategic performance through the balanced
scorecard and observed that it provides senior management with a high level depiction of
what needs to be done, if the organization is to deliver to its strategy. CEO conviction to
champion scorecard deployment and senior management team buy-in-to derive the
process. Using the scorecard as a strategy map to link vision, strategic themes, strategic
objectives and operational measures through cause-effect relationships. The vision is the
roof, strategic themes are the pillars and the foundation comprises the people and
technology dimensions.
Brown Chris (2003) studied the systems that aim to improve workforce performance. He
opines that an appraisal system should have the full support of senior management.
Without this, the system will eventually collapse. The appraisal system should first have
been piloted and then reviewed and the intentions of the appraisal system should be
clearly communicated to all staff. All staff should have training in appraisal techniques.
Interviewing skills, giving feedback and objective setting are all elements that require
training to be carried out effectively. The system should enable all staff to have clearly
established aims and objectives that are linked with the business strategy. The appraisal
system should follow a cycle of defining the performance that is required, measuring and
evaluating it, giving feedback and sharing information with other parts of the
organization. The system should have simple and easily understood documentation
supporting it. It should not be a part of the standard disciplinary procedures of the
company, be adaptable and encompass all levels of staff in the organization, must be
subject to ongoing monitoring, review, evaluation and updating.
Hal Richman & Wiggenhorn William (2006) are of the view that emerging markets,
which have a strong economic growth trajectory and market opportunity, are of great
interest to large multinational corporations and other organizations with an international
presence. But there is a lot of leadership talent waiting to be developed in these markets,
and a lot of risk if this development doesn’t occur.
Abraham Samuel (2002) observed in his study that new employment philosophy calls
for career resilience, with a view to merge individual interest and company needs. While
presenting a new paradigm for career management in his study he examined that one of
Review of Literature
50
the most difficult jobs HR managers have in any industry is the idea of how to provide a
blueprint for career progression for the employees. He found out that organizations that
will thrive in the new reality are those that are filled with employees who have the option
to leave, but choose to stay; those that fail will be populated by employees who are only
there because they are afraid to go elsewhere.
Hyde and Pethe (2005) opine that, in management, the current era is the era of Human
Resource Development and Employee Involvement. The modern approach to
management ensures employee involvement and empowerment. Employees and
management admit that many obstacles to achieve organizational goals can be overcome
by employees themselves if they are provided the necessary tools and authority to do so.
There is a direct relationship between the concept of employee involvement and
employee empowerment and organizational growth and development. The present study
seems to be an attempt to explore the impact and relationship between the HRD climate,
empowerment and organizational citizenship behavior in private and government
organizations.
Daniels Aubrey (2003) in his study on how do you appease your employees after you
fire their favorite co-worker explains that it is always difficult to terminate employees
under any condition, but it is especially difficult when the person has good peer relations
with the remaining employees. For that reason, such terminations are usually done
poorly. That is to say that employers take way too long to make the decision or they wait
until the problem is so severe that everyone is in agreement that the person must go. Not
only is this devastating to the employee who is terminated, but it also usually results in
less confidence in leadership with the remaining employees. The most common
complaint of unfair treatment in the workplace comes from management's failure to deal
with poor work behavior and poor performance. Good performers, in particular, don't like
when management tolerates this type of behavior. Good performers are often called on to
take on tasks that poor performers don't get done or do poorly. Be vigilant for
opportunities to positively reinforce good work habits and good performance, but don't
hesitate to apply negative sanctions when the behavior warrants it.
Review of Literature
51
2.2 RECENT STUDIES IN HR PRACTICES IN INDIAN CONTEXT
Saleena Khan, Bhawna Chahar (2010) in the contemporary context, the Indian
management mindscape continues to be influenced by the residual traces of ancient
wisdom as it faces the complexities of global realities. One stream of holistic wisdom,
identified as the Vedantic philosophy, pervades managerial behavior at all levels of work
organizations. This philosophical tradition has its roots in sacred texts from 2000 B.C.
and it holds that human nature has a capacity for self transformation and attaining
spiritual high ground while facing realities of day to day challenges (Lannoy
1971).Human Resource Management has evolved considerably over the past century, and
experienced a major transformation in form and function primarily within the past two
decades. Driven by a number of significant internal and external environmental forces,
HRM has progressed from a largely maintenance unction, to what many scholars and
practitioners today regard as the source of sustained competitive advantage for
organizations operating in a global economy. Some of the factors that contribute to the
evolvement of human resources management are technology, globalization, diversity,
immigration and an aging workforce. In this article, we would be discussing the various
Issues that HR is facing in today’s corporate scenario. A few challenges they have been
able to overcome successfully but a lot of issues still need to be dealt with. We would be
discussing issues HR is facing in the present and some strategies which, if adopted, can
help the HRM to sustain better in the challenging and dynamic scenario.
Ayanda, Sani (2011) This study examines empirically, the influence of ownership-type
and age on the adoption of Strategic Human Resource Management (SHRM) practices
that have been shown to contribute to organizational effectiveness. The study also
hypothesized that there is no significant difference between the level of strategic HRM
practices adopted by government-owned universities and private universities in Nigeria.
A multi-respondent survey of 29 government-owned universities and 15 private
universities in Nigeria was undertaken and data collected was subjected to regression
analysis and one way analysis of variance as well as descriptive statistics in pursuance of
the stated objectives of determining whether ownership-type and age influence the
adoption of strategic HRM practices in Nigerian universities and if any significant
difference exist between the level of strategic HRM practices adopted by government-
Review of Literature
52
owned universities and private universities. Results indicate an impressive moderate
adoption of strategic HRM practices in the Nigerian university system and that the extent
of this adoption is mostly a function of whether the university is government-owned or
run by private investors. Results also show that there is indeed a significant difference
between the level of strategic HRM alignment, training and development, career planning
system and employee participation of government-owned universities and private
universities in Nigeria. The study, therefore, recommends amongst others that
universities should improve its integration of HRM practices into their overall operations
and strategies and that private universities should be encouraged to adequately plan for
the career development of its employees as well as giving them adequate opportunities to
participate in taking strategic as well as tactical decisions affecting their work
environment.
Baral1, Bhargava (2011) Work-life balance has become a subject of concern for both
research scholars and business leaders in view of the contemporary demographic,
technological, market, and organizational changes associated with it. However, there has
been little academic attempt to provide a holistic picture of work-life balance benefits and
programmes (WLBPs) offered by various organizations in India. With the basis of extant
literature, primary and secondary data, the present paper has made an effort to understand
the current status of WLBPs in Indian organizations and to identify its future prospects.
The paper has discussed the challenges for effective implementation of such policies,
which can help HR managers to be cautious before introducing WLBPs in their
respective organizations. Analysis of literature and available data suggests that family-
friendliness of employers in India have been reflected in various welfare provisions
which has been a matter of concern for employers since industrialization. With time, the
scope and coverage of such initiatives have broadened and have become more individual
growth and family well-being oriented. However, these policies and practices are more
prominent in new economy organizations such as software and services organizations.
Moreover, the range of WLBPs varies across organizations and there is still a long way to
go when WLBPs will become strategic HR initiatives in most organizations. The paper
suggests that organizations need to incorporate WLBPs and encourage a culture that
support utilizing them to ensure employee commitment and productivity. While
Review of Literature
53
introducing WLBPs, congruence between employee needs and organizational values also
should be considered.
Khans (2012) in recent years, emerging market economies (EMEs) are increasingly
becoming a source of foreign investment for rest of the world. It is not only a sign of their
increasing participation in the global economy but also of their increasing competence.
More importantly, a growing impetus for change today is coming from developing
countries and economies in transition, where a number of private as well as state-owned
enterprises are increasingly undertaking outward expansion through foreign direct
investments (FDI). Companies are expanding their business operations by investing
overseas with a view to acquiring a regional and global reach.
SHARMA (2010) This study has tested empirically the differences of significant
importance of e-recruitment practices associates responses for organization type,
organizational size and respondent category; impact of e-recruitment on quality, wider
choice, time and cost in hospitality and healthcare sector, large and small size, and HR
Managers and employees; and differences of significant importance of quality, wider
choice, time and cost between HR Managers and employees. The results as presented for
the differences of significant importance of e-recruitment practices associate’s responses
for organization type, organizational size and respondent category imply that e-
recruitment practices have significant differences across organizational size and
respondent’s category. In contrast, Organization type pays equal importance to e-
recruitment.
Suman Shikha (2006) studied the knowledge athletes in organizations. She observed that
technical specialists become the backbone of new technology in the enterprise.
Successful companies create competitive advantage in the marketplace through
innovation and creativity. They effectively manage their human resources to create and
market new products and services. Human resource management strategies have the
potential to fuel innovation and creativity in the organization. The four dimensions in
which the HRM strategies that can push innovation and creativity are: human resource
planning – it involves multidisciplinary approach to new product development that help
in finding right people and overshadowing the cost incurred in the lengthy recruitment
Review of Literature
54
process. Performance appraisal- it includes not just rewarding the good employees and
punishing the bad ones but also helping the marginal performers. Self-policing and peer
control mechanisms are encouraged in favor of superior subordinate evaluations. Reward
system – the companies provide their employees with freedom to conduct R&D, freedom
to fail, and to run their own new ventures. The motive is to maximize productivity and
minimize turnover. The challenge lies in balancing team rewards with individual rewards.
Managing employee’s careers – employees are continually educated and trained in
different skills to provide them a well-rounded professional experience. When the
companies review these four principles there is little that’s new or earth shaking but that
is the nature of HRM. Finally work is the primary motivator. It recognizes how important
HRP is and performance management for R&D personnel, it recognizes that the
professional and institutional recognition should go hand in hand and that the laboratory
head’s role is much more than simply to inspect the work of his or her researchers.
Innovation has as much to do with the environment that is created as the creative types
that are employed.
Ramesh T (2005) studied the changes occurring in the field of human resource
management in today’s era. He observed that today’s competitive business climate
presents the HRM function with a number of important challenges and opportunities –
dramatic advances in technology, in recruiting, selection, training, appraisals, rewards
and other human resource practices. In his study, he observed that HR functions are
concerned with a variety of activities that significantly influence almost all areas of an
organization and aim at the organization fulfilling its employment, carrying out job
analysis, planning to meet their requirement, providing training facilities and
implementing organizational development programmes. The success of HRD in an
organization depends to a large extent on the existence of a favorable HRD climate a
combination of various factors such as openness, team spirit, trust, autonomy,
cooperation, integrity, recognition, participation, fair compensation, counseling, problem
solving, valuing the assets, and respect for the individual. There are two main ways of
human capital management practice that might enhance performance. Firstly, through
raising the skill base of employees– appropriate recruitment and retention,
comprehensive training and broad– based departmental activity. Secondly, through
enhancing employee motivation and ability to use their skills through measures such as
Review of Literature
55
design of reward systems, participative problem solving and team work. Having capital,
an asset of any organization, is a function of people management and is all about having
an objective view on the deliverables that professionals can create. And in no case can we
replace it with figures and logarithms. It is the human intellect, human energy and human
inventiveness, which accomplish excellence for the firm. If a company wishes to make
purposeful trade– off, it must create radical decentralization and give autonomy to the
employees. A good HR leader can always turn the worst to the best because he/she can
really get the employees to work and motivate them to perform better. Getting the
employees to work and to give their best requires an EI quotient assessment. This would
result in better conflict resolution skills, better understanding of others and more pro–
social strategies in inter– personal solving.
Padhi Nayantara (2005) reviewed strategic human resource management and studied
that it bridges the gap between business strategy and HRM. It focuses on the integration
of HR with business and its environment. According to her, SHRM has become topical in
recent years but the definitions, reason of integrating business strategy and HRM, and the
process of integration widely vary. Organizations are changing and adopting new ways
along with new intensities. Parallel to these changes, and inspiring or legitimating them is
a body of ideas of a various and complex nature known as SHRM. Managers need to
realize its importance and try to link HRM with organizational strategy and performance.
The key functions associated with this concept are- integration of HRM with business
policies and plans, HR deployments, exploring people’s capabilities and matching them
with business strategies, capacity building, organizational learning and commitment.
Reddy Sumati (2005) opines that businesses are faced with intense competitive
pressures. Hence, this requires them to continually develop their competencies to respond
to the ever-changing market forces. One solution is to develop collaborative work system
built around teams. Teams are an innovative way of resolving business-related
challenges. Organizations can choose to formulate a team, which best suits, its
requirement. Teamwork brings astounding results. The business imperative to deploy
teams in response to the need to retain competitiveness has led organizations to evaluate
team productivity vis-à-vis individual productivity. Teamwork brings several advantages
to organizations. It can “ensure survival, amidst business uncertainties and intense
Review of Literature
56
competition”. Teamwork is also ideal for “product innovation” in an environment, which
can render a product obsolete in shorter time frame with respect to product innovation,
however the process itself is time- consuming and expensive in terms of resource
involved. Teams can, nevertheless, be effectively employed to achieve “efficient and
cost-effective product design processes”. Wars have been won through effectively
coordinated teamwork and singular focus on team goals. Teams work in animal kingdom
as well. Not only do human beings practice teamwork, but also so do different species of
animals, which rely on teamwork to ensure their survival. Hence, teams have been tested
and found to be successful in several businesses. Organizations which invest the time and
effort to built team– based systems as a parallel structure to the existing structure are the
ones who will benefit in the long– run.
Pal Som (2005) studied HRD in larger context that how we can develop the emerging
workforce. His study focuses on how corporate, educational institutions, research bodies,
training and development organization and the government, can co-ordinate and co-
operate to train and develop a graduate in this phase for taking on work roles effectively
in the corporate world. It discusses what the corporate world looks for in fresh graduates,
and the type and quality of training needed for fitting well into the corporate world. It
provides a framework of developing a talented pool of human capital and looks at how
constructivist psychology can help in the development and implementation of the
framework.
Shantaram M.R. (2005) examined a case on human resources issues in information
technology (IT). His case describes the problems of the IT industry in general. It covers
issues of redundancy and retraining due to changing technologies, issues of different sets
of employees gaining and loosing relative importance. It highlights challenges created
when a set of people are in short supply due to many companies chasing them. Issues
arising out of rapid fire hiring by different departments, like parity dissatisfaction, HR
costs are also highlighted. Further the case touches upon how a negative culture is created
by certain functions especially for training and development. Finally the case raises
questions about the approaches to monitoring.
Review of Literature
57
Sharma Devinder, (2003), Human Resource Development, have explained the
successful implementation of a suitable HRD programme is crucial to the success of
many organizations and to the self development of its managers and employees. The
book highlight; the role of managers in HRD; the variety of approach to HRD; ways of
building learning into the management process; how to deal with the team conflict and
the notion of virtual team situations; how to manage change.
Nivedita Kothiyal (2005) developed a model investigating human resource management
(HRM) practices as antecedents of perceived organizational support (POS) and tested
with the help of responses received from a sample of 277 executives from an Indian
Pharmaceutical Organization. The results of the study suggest that fairness of
performance appraisal and career development are highly significant predictors of POS.
Realistic job preview, and satisfaction with benefits are also significant predictors of
POS. The findings are not surprising as these practices are more a part of the
discretionary action taken by the supervisors as agents of the organization. Training has
no significant explanatory influence on POS. A reason for this finding could be that
training conducted in the organization, particularly in the manufacturing unit was more a
part of good manufacturing practices (GMP) as required by external accreditation
agencies. Therefore, employees may not have perceived it as a discretionary action taken
up the organization. The perceptions on realistic job preview, fairness of performance
appraisal, career development, training, and satisfaction with benefits were measured.
Results suggest that perceptions of these practices have significant correlations in the
positive direction with POS. Also, except for perceptions on training, all the other
variables contributed significantly to the development of POS. Tenure with the
organization was the only demographic variable that contributed significantly to the
development of POS. The statistical method used was regression.
Srivastava V N and Ghosh K (2005) hold the opinion that even after more than a
decade of the changed economic environment, a large number of high performing
enterprises have become low performing; many of them have been struggling to survive
and some have faced closure also. The arrival of many world class organizations with
higher order experience levels has severely threatened many of the so-called high
performing Indian organizations with lower order experience levels and has put their total
Review of Literature
58
survival at stake. The state of affairs in state government departments also has not been
very sound. Widespread frustrations and demoralizations have been found among the
state employees. Today, the organizations are looking towards HR to make them more
competitive and come out of the red by successfully meeting the challenge. State
government departments also undertook HRD planning and implementations at the
instance of the World Bank in the World Bank funded projects in the health, forestry and
other social development sectors. The paper discusses the HR needs in the present
context, the HR perspective, some experiences of developing HRD plan in the forest
departments in two states in India, the critical business areas and a few HR challenges
that can really help achieving transformations.
Palekar Padmaja (2006) in his study emphasized that outsourcing of recruitment and
selection has picked up pace, essentially in IT industry. But outsourcing all the activities
involved in the recruitment process does not provide a competitive advantage because of
inherent problems associated with it i.e. inefficiencies because contractors lack firm
specific knowledge and engage in opportunistic behavior. But there are advantages too,
such as, reduction of cost by provision of economies of scale and increase in incentives
and accountability. Hence, he observed that effective recruitment processes ensure that
the right people are matched with right roles in the organization. He also observed in his
study that the two most commonly outsourced activities in organizations were
transactional and administrative HR functions.
Rajan Susy (2005) opines that mentoring is a one to one non-judgmental relationship in
which an individual voluntarily gives time, support and courage to one another.
Mentoring represents a powerful form of management. It is a process to increase
visibility of skill and talent in ones organization. It is a process of learning from the
senior persons within the company who are actual “ropes of organizational life”.
Objectives of mentoring include improvement in study skills such as instructing specific
skills and knowledge that are very critically linked with job performance, building self-
confidence, time management, communication skills and providing important insights
into the corporate affairs. There is a wholesome benefit to almost all the parties involved
in the process. For the mentee, mentoring can improve self-confidence, self-esteem,
increase motivation, broaden horizons and experience, and raise achievements along with
Review of Literature
59
aspiration levels. For mentors, there is the opportunity to develop skills & understanding
as part of their personal development, to feel valued and to contribute something back to
the community. For mentoring to be effective, each organization has to draw up a
mentoring camp or programme that fits its company’s culture and answers the needs of
its employees. A well planned and managed mentoring programme will definitely
provide the opportunity needed for any person to learn, develop and work to his or her
potential. At the individual level, it allows them to discuss confusing, perplexing or
ambiguous situations and their innermost feelings and emotions with someone they can
trust and respect. The mentor needs to be competent. He should have good
communication, genuine interest in the mentee, commitment, clarity of goals and good
sense of humor.
Muralidharan T (2005) examined corporate ethics that could be extended to the process
of recruitment. There must be some set of rules to be followed and more importantly the
recruiting company should abide by these rules to ensure that there is no malpractice at
any side. The author says that behind every attrition, there is recruitment. i.e. whenever
an employee leaves an organization in hurry, he is sure to join any other organization.
Corporate sector has clear guidelines on corruption, sexual harassment and even
competition spying. But when it comes to framing policies for recruitment they turn a
blind eye to patently unfair and unethical trade practices. The author suggests that to
avoid such instances, the top 10 IT and BPO corporate should get together and follow the
following set of rules while hiring: No recruitments without retrieving letter or providing
proof of serving the notice period, corporates should not hire anyone who has spent less
than one year in his current organization. The logic is formed as the basis of recovering
recruitment costs and obviously the doubtful loyalty to the hiring organization, no
headhunting should be encouraged, corporates should not bail out the prospective
employee commitments such as employment bonds etc.
Sreekanth (2004), His study explains about the employees’ engagement and retention in
an organization. According to him, the employees can be retained for a longer time by
sensitizing them with relative value of the employment offer. It depends upon the ability
of manager to understand, predict and control the attrition in the organization, as
compensation and other social intervention are not enough to retain talented employees.
Review of Literature
60
In order to make effective retention plan three factors are really necessary i.e. challenging
work environment, learning opportunities, career growth. He examined that different
folks require different strokes and same folks require different stocks at different point of
time. The challenge for HR organization is the ability to understand these factors and
design dynamic programs/intervention, which have maximum return on investment. His
study gave some interesting recommendations for high attrition rate. If permanent
attrition is to be avoided then the organization should undergo proper planning, it should
focus on lead time reduction, multi- skill/ cross skill development and move from people
dependency to process focus.
Kalyani (2004) studied the benefits of online recruitment. He says that clerical work has
significantly reduced, information is obtained in a pre- determined and uniform manner,
data can be categorized on various basis, instant feedback such as registration and
acknowledgement can be done, data created can be used for voluminous reports, quicker
communication due to email, progressive impression of company in front of candidates
who apply for jobs and online advertisements have a wider reach and are available all the
time.
Singh P N (2002) examined that good training leads to better organizational results.
Organizations should put their best managers in the training department and should
consider the following points while selecting trainers. Does the candidate understand the
business well? If yes, the trainer is more successful. Does the candidate practice what he
preaches? The effective trainer must be good role model. They should design training
process powerful enough to produce result, target training at key result area, adopt a
training process approach, training must use a process approach to build and maintain
performance improvement, get trainees to complete end of course action plans, use
“Multiphase” training, follow up after training. There are six things that trainer can do to
increase his or her effectiveness: Recognize the type of learning difficulties, identify the
student with learning difficulties, show empathy for student with learning difficulties,
create a learning environment, make accommodation for student with learning difficulties
and provide support for student with learning difficulties.
Review of Literature
61
Sudhaker. V. S. (2005) refers to training and coaching as emerging HR interventions and
lists the benefits of it as follows: higher return on investment, less stress in the workplace,
removal of fear and lack of confidence, improved personal performance and personal
contribution, increased knowledge and highly developed skills, improved team working,
working relationships with peers, increased job satisfaction and staff retention.
Kumar Ramesh (2005) in his study on the need of training employees in the present-
day scenario focuses on planned development of these programmes. He says that training
is needed when the factors such as potential triggers, negative indicators and external
indicators are in routine. Therefore, training is required- as top-level managers, senior
managers of various functional areas and supervisors of other grades would otherwise be
seriously affected. Hence there is a need to explore new ways and methods to determine
the exact training needs to provide the right training to the right person. Planned
development programmes will return values to the organization in shape of increased
productivity, heightened morale, reduced cost, greater organizational stability and
flexibility to adapt to changing external requirements.
Chaudhuri Manodip Ray (2004) his study focuses on employee training and its
importance in the future. The essentials in training are to match employee specification
with the job requirement and organizational need. It is also for coping with technological
advances and to improve human relations. He examined some priority areas in today’s
training agenda; leadership management training, technical training, custom- designed
training for specific needs, teamwork and problem solving training, workplace security/
safety training, sexual harassment prevention training, conflict resolution training and
quality control/ quality management training. No matter where, when, why, how and
from whom the training program is conducted, an effective training exercise must be a
teaching method that advocates principles and practices of learning as its core focus.
Srikanth K. (2004), in his research emphasized on the fact that the productivity of an
organization is dependent on occupational health and employee well being. In turn, the
well being of an employee is a function of various factors like organizational psychology,
job security, work hours, control at work, and managerial style. His study analyzes the
various factors that affect the employee’s state of being. It has looked at the
Review of Literature
62
consequences of workplace changes, particularly their impact at both the individual
employee level and the organizational level. The focus was on four major areas in
organizational psychology. Job security: Organizations are increasingly utilizing
contingent workers as an alternative to conventional full-time employees. His research
clearly suggests that perceived job insecurity is bad for employee well being. This, in
turn, can impact organizations through increased sickness absence. Given the reported
increase in perceived job insecurity, organizations need to consider the financial costs
associated with those employees who are reluctant to be working in jobs, which they
perceive to be insecure. Work hours: There has been an increase in the use of workdays
or work shifts longer than 8 hours. Some schedules compress the workweek so that 36-48
hours is completed in 3-4 days instead of five. In terms of actual weekly work hours,
some countries have reduced work time whilst in others it has been extended. The
increase in work hours in some countries is in part due to the trend for restructuring and
downsizing in many organizations. There exists a relationship between prolonged work
hours and employees mental and physical ill health. Changes in work time schedules
shows that prolonged work hours and work shifts have detrimental effects on employee
well being. Where extended work shift schedules are to be implemented, these must be
carefully evaluated and appropriate precautions made to reduce work overload and
environmental exposure to chemicals and other hazards. Control at work: many
employees have perceived a gradual loss of control over their work lives and careers over
these years. The concept of perceived autonomy or control has been extensively
investigated in his research. Managerial style: increased managerial pressure can also
impact employee well being. In an investigation of organizational management style,
there are greater levels of perceived stressors (underutilization of skills and job overload)
for employees in a traditional organization compared to those working under a more
democratic management style. A negative management style can exacerbate stress levels
for managers if their behavior results in deterioration in an employee’s work performance
or attitude towards them. Organizations should raise awareness amongst their managers
of the importance of providing support for their employees.
Sumalata B (2004) examined outsourcing of training and development in various
organizations. She observed that as the outsourcing market matures, it is expected that
firms will gain considerable competitive advantage. Training BPO has proven a powerful
Review of Literature
63
strategy that can help companies create this competitive advantage. Advantages of out
sourcing training are that it allows a company to focus on its core business or core
competencies, it benefits the company in accessing the world class solutions, a good BPO
has many cost effective characteristics the basis of which are efficiency and cost
management and the ability to vary service level with customer demand. She studied the
following two approaches to outsource the HR functions: One is for external resources
known as replacement strategy and the second is for internal resources.
Kodwani Amitabh (2004) in his study on training and return on investment thereof
focuses that constant up- gradation of new skill; knowledge and technology are essential
weapons in the competitive struggle. New technology cannot be acquired and
implemented successfully without training. The value-added by giving proper training
and the losses incurred due to inadequate training are too high, which cannot be ignored.
The net value of training increases with wider dissemination throughout the organization.
Evaluation of T & D has mainly two basic objectives i.e. assessing training effectiveness
and using it as a training aid. He studied that the primary objective of evaluation is to
improve training processes in order to achieve stated objectives (to sort out the good
training from the bad). Since ‘evaluation’ affects ‘learning’, it could also be used as a
training aid. He emphasized that one of the basic reasons for evaluating training activities
is because top management people who are funding the training programs are asking for
such evaluation data. Such data not only include indicators of management support, such
as total training investment and the number of man hours spent in training, but also
tangible evidence of the effectiveness of training like successful learning, improved on-
the-job performance, changes in key business measures, and ROI in terms of profitability.
Seth Meera (2003), in her research on training the top brass examined that leadership is
not just about vision and strategy formulated by top management, but something that
needs to be woven into the very fabric of the organization through realism and rigors in
execution. An attitude of continuous learning and open-mindedness needs to be infused at
all levels. Today, a number of so-called sophisticated analytical decision tools have
become available which mirror real-life that is full of uncertainty and risk. Probabilistic
models with the capacity for numerous simulations of ‘what if’ and ‘what can go wrong’
must take their place alongside time-tested analytical techniques – he emphasized that we
Review of Literature
64
should not forget that they, too, were considered too sophisticated when they were
introduced, but were gradually accepted through practice.
Sanghi Seema (2003), studied some aspects of training needs and skill requirements of
Indian workforce in the next fifteen years. She observed that workforce has to be multi
skilled. The environmental pressures would increase and people should be prepared both
mentally and with multi skills for a quick shift. She recommended, while educating our
workforce for the global challenges it needs to be trained for: (i) behavioral skills to
change mindset, (ii) Vocational skills related to agriculture and on farm activities, and
off farm activities, (iii) Tourism, films, information and communication, medical
services, construction, fine arts, cottage & small scale, (iv) IT and IT enabled services
and (v) Various languages.
Rao T S R Krishna (2003) examined the learning perspective in training.
According to him, to survive for a long time organizations, big or small have to undergo
learning. The need of the hour is that the learning organizations continually expand the
capacity to be creative and innovative. Learning is the key in being able to both identify
opportunities that others might not see and to exploit these opportunities regularly and
fully. People are more receptive if they are involved in a learning experience, which is
interactive and fun. The players in the learning game soon become stimulated and start
developing ideas. This results in new skills and concepts getting absorbed quite fast. A
trainer must excite and direct the learner’s self motivation. People learn best through self-
discovery, so they should be put in situations where they are actively involved in the
training sessions. Experience is the best teacher but unfortunately, a private tutor. He
studied that we have to develop a tested tool to solve the conundrum of collective
learning. The training system can play a pivotal role here by being a conduit for sharing
experiences. The method encompasses the belief that learning is most effective when it
involves active participation. This method goes beyond the conceptual framework and
departs from imbibing skills and values. On the other hand, it offers the trainees or the
users an opportunity to absorb and embrace ideas and ideals because they have
themselves experienced them.
Review of Literature
65
Rao P.L. (2003) suggested training to youngsters while playing games in his study. He
conducted a workshop to bring out professionalism, creativity, group behavior and
adjustment in adults. Games such as the alchemy, group buildup, bomb the city, throwing
the ball and different roles were used for training and development and it was found out
that some adults are only good as heads but their contribution is minimal, some are
selfish and try to corner resources as much as possible, there are some who spoil the
environment like mud and there are quite a few who add value to the group.
Majumdar Shyamal (2005) observed that every year, employees and their immediate
bosses enter into an elaborate gaming exercise called the performance appraisal. Most of
it is just empty form– filling. But every company still goes through the ritual. A good
performance appraisal scheme is the manager’s ability or willingness to give people not
just good news but the news about their weakness that they don’t know. While managers
are focusing on how much money this is going to mean in their pocket. Also, managers
are often forced to be dishonest on appraisals in order to ensure that the employee get
something. They would like to avoid the inevitable confrontation associated with telling
an employee that he merited no increase. He has discussed the ‘Bell curve’ in his study.
His Bell curve theory explains that most employees are in the middle as far as
performance is concerned. There is bunching of excellent performers at the top and the
worst cases at the other end. Managers have to keep this broad picture in mind when they
rate their team members. These kind of artificial structural rigidities often lead to a huge
number of de- motivated people in an organization. Apart from deciding increments,
nothing gets done with the data that HR gets out of it. Companies are unable to take a call
on how many of its people can be posted for new business assignments, what are the
common sets of weaknesses on which employees have to be trained, how to improve the
performance of under performers and so on. Everyone wants to be in the top-performing
bracket, which just cannot happen. Most employees in these companies want a
performance driven culture but are not willing to accept lower performance. If the
management does not have the skill to manage such expectations, the company can only
except to see an ever-growing number of long faces and a rising attrition graph. One
problem is that companies assess people in a certain way at the time of hiring but
differently at appraisal time. This makes process very uncertain.
Review of Literature
66
Adivarahan (2005) studied that employees performance was measured on certain
parameters by the employee’s supervisor in earlier days. Based on this appraisal system,
employee’s growth was determined and most of the time, employee was not even aware
of his appraisal. In current situation, many organizations have introduced new methods
that are transparent and effective. First is the Balanced Scorecard, where the employee
fixes his own targets and appraises himself. His supervisor approves his high
performance. After this the organizational objectives are set. He also suggested some
methods in current practices. The employees should be educated about job responsibility
and accountability and then the targets levels should be fixed as month by month to
achieve organizational objectives. Another method is 360-degree appraisal where an
employee is appraised by his friends, official people and family. Official environment
includes immediate supervisors, co- workers, customers, suppliers etc. Friends’
environment includes school/ college friends, friends in same department, other friends.
Family environment includes family members, relatives etc. All these environments are
in contact with each other to get the true picture of employee’s performance by these
groups. Friends’ environment reveals the fair picture of employee’s nature and true
performance, as they know him better. Feedback from family also improves the
productivity, as they are able to point out weaknesses better than others. All these are the
methods being adopted by organizations nowadays to measure and evaluate the
performance of employees. This gives motivation and encouragement to them but if not
practiced in smooth way can lead to problems also. Performance appraisal is the indicator
that may be communicated to the employee and based on this employee growth for a
particular period is determined. Growth includes increment, promotions, feedback etc.
The parameters related to 360 degree vary from organization to organization, individual
to individual, department to department and position to position. Similar is the case with
BSC. It is more important that HR people constantly look for any good procedure or
process for the improvement of the organization or individual.
Kumar and Sinha (2005) According to their research business performance may be used
for a variety of purposes including decision-making, financial control and executive
remuneration. Companies have been measuring costs, quality, quantity, cycle time,
efficiency, productivity, etc of products, services and processes. They studied that
performance measurement systems play a key role in developing strategy, evaluating the
Review of Literature
67
achievement of organizational objectives and compensating managers. Their research
emphasizes on the emerging trends in corporate performance management and highlights
some of the best practices. Companies are focusing on stakeholders to ensure they pay
attention to all the important facets of performance, more recently; the concept of the
multiple stakeholders has come to the force. Companies can no longer be satisfied with
only considering shareholders and customers. Employees are also seen as important
stakeholders; as are suppliers, government and the community at large and these
stakeholders need to be incorporated into the performance measurement system.
Srinivasan Vasanthi (2005) reviewed William’s book titled “Performance Management”
that gives account of three PM model:
� A system for managing organizational performance
� A system for managing employee performance
� A system for integrating management, organization and employee performance.
She observed that the critical drivers of performance culture are the performance
philosophy of the organization and a robust method to drive the planning and goal setting
process in alignment with the organizational performance indicators. There is a great
need for setting goals, process improvements goals and strategic goals. While setting the
goals at the beginning of the year, there is an exception that individual will require
periodic feedback on their performance. The last part of Performance management is
Appraisal. Appraisal provides an opportunity to consolidate the evaluation pertaining to
an individual performance.
Sivaram Y.G. (2004) studied the HR competency model developed by Confederation of
Indian Industry (CII), which mentions about nine behavioral competencies. They are