What Best Practice mean??
A best practice is a technique or methodology that, through experience and research, has proven to reliably lead to a desired result. A commitment to using the best practices in any field is a commitment to using all the knowledge and technology at one’s disposal to ensure success. The term is used frequently in the fields of health care, government administration, the education system, project management, hardware and software product development, and elsewhere.
In software development, a best practice is a well-defined method that contributes to a successful step in product development. Throughout the software industry, several best practices are widely followed. Some of the more commonly used are: an iterative development process, requirement management, quality control, and change control.
An iterative (meaning repetitive) development process, which progresses in incremental stages, helps to maintain a focus on manageable tasks and ensures that earlier stages are successful before the later stages are attempted. Requirement management addresses the problem of creeping requirements, which is a situation in which the client requests additional changes to the product that are beyond the scope of what was originally planned.
To guard against this common phenomenon, requirement management employs strategies such as documentation of requirements, sign-offs, and methodologies such as the use case. Quality control is a strategy that defines objective measures for assessing quality throughout the development process in terms of the product’s functionality, reliability, and performance. Change control is a strategy that seeks to closely monitor changes throughout the iterative process to ensure that records are intact for changes that have been made and that unacceptable changes are not undertaken.
A best practice tends to spread throughout a field or industry after a success has been demonstrated. However, it is often noted that demonstrated best practices can be slow to spread, even within an organization. According to the American Productivity & Quality Center, the three main barriers to adoption of a best practice are a lack of knowledge about current best practices, a lack of motivation to make changes involved in their adoption, and a lack of knowledge and skills required to do so.
Best Practices (BPs) are innovative, dynamic management tools available to practitioners to ensure Minnesota’s parks and outdoor recreation areas are managed as efficiently and effectively as possible.
Think of BPs as practical guidelines – not rigid standards. They are the current state of what is working well for an organization and worth sharing within the outdoor recreation community. Practitioners are challenged to improve upon existing BPs; and document and share their improvements with colleagues.
A practice which is most appropriate under the circumstances, esp. as considered acceptable or regulated in business; a technique or methodology that, through experience and research, has reliably led to a desired or optimum result.
Best Principles Before Best Practices
There is a game being played somewhere right now within almost every government organization. The game is called ‘In Search of Best Practices’ and it is played something like this: “We’re about to launch a major change (like putting in a leadership development program). Before we do, let’s benchmark the best organizations around to find out what they do, and especially, let’s see what other government organizations are doing. After all, we don’t want to reinvent the wheel now, do we?”
So the change team dutifully goes out, does their research, makes some site visits, documents their findings, and then prepares a menu of best practices from which a program is built. The game proceeds by briefings up the line which are bolstered by citations from the Who’s Who of Best Practices—prominent companies in the news, selections from the 100 Best Companies to Work For, other Federal agencies, etc. The game is won when the program, designed around the Best Practices, is given the go ahead. So what’s the problem? It may possibly be declaring a premature end to the game by failing to realize that ‘best’ is simply a local term, not a universal one, and that there may be better and prior wisdom that is being ignored in the bargain. It’s something worth discussing.
What Best Fit mean?
Best-fit type refers to the type pattern that fits you best. No one description or pattern will be a perfect match to all of who you are. Your personality is rich and complex, and a “type” or type pattern cannot adequately express all of that richness. Each of the sixteen types comes in a variety of “flavors,” and best-fit type means that the themes and preferred processes of that type seem to fit you the best
Characteristics of Best Practice Model
Work teams- flexibility
2-way information –Care with recruitment – selection
Traits / Behaviors – not skills
Fair appraisal – reward
Involved in decision making
Emphasis at training – learning
Individual development
Best Practice Model
- Argument: all firms will see performance improvement if best practice.
- Method: identify best practice, give HR a high profile, get top level commitment, sell it, do it, measure it, reward champions.
- Advantage: much agreement / tradition on basic best practice. Also recognition of.bad. practice. Established rules of thumb for selection training; appraisal methods. No need to re-invent. It.s out there.
- Disadvantage: difficulty arises when we go beyond these straightforward practices.
Best Fit Model : appropriateness
- Argument: HR strategy becomes more efficient when it is linked / tailored to its surrounding context or environment of the business. 2 elements:
- External Fit: the fit is linked to the operations strategy / marketing strategy.
- Disadvantage: can overlook employee interests. Some firms are good all-rounder so HR practices unlikely to be based on one strategy. While practices may meet existing strategies, things change quickly so HR strategy cannot be too parochial. Must support organizational flexibility. Too much can be left out.
- Internal Fit: HR policies & practices must be coherent. Avoid policies which work in opposite directions ie. encouraging teamwork then rewarding individual performance. Make sure that practices are in proportion to the organization ie. stage of development / resources.
Resting Practices
The victory lap cannot realistically be taken until the program design actually produces the results that people intended because somewhere in people’s minds is the sneaking suspicion that if we do it like the big boys and girls we will be like the big boys and girls. But that syllogism can turn out to be false, and some have fallen into that trap—including me.
Dave Ulrich, perhaps the wisest human resources expert around, uses the term “interesting practices” to describe such approaches to a range of human resources initiatives. They may work in the long run–or they may not. The key is to understand the culture of the organization, the capabilities the organization possesses, and the needs it is trying to address. Keeping up with the GEs or the Microsoft of the world or even the IRSs does not mean your approach to leadership development will mirror the outcomes of theirs.
Five Best Principles
It may make more sense to start with a solid understanding of what can be called ‘best principles’ in succession and leader development and then see which practices will work for your organization’s culture and its specific needs for future leadership. If you begin with the best principles, you can then safely test out your proposed practices to see which ones best fit your situation. Here are five principles that have bred success, specifically in excellent Federal Government organizations:
- They base their practices on the four proven principles of how leaders learn to lead—challenging and varied work experiences; significant relationships with senior leaders; self awareness based upon feedback, reflection and lessons from the hardship crucibles of life; and self development and selected training.
- They make a business case for developing future leaders with decision makers that helps drive the mission and avoids the trap of simply being something ‘good’ to do.
- They recognize that initiating leadership development, at least in the Federal Government, is most often a cultural change as well where leaders shape the culture and it is not simply a case of human resources development (HRD) standing up another new training program.
- They understand that the key cultural change is this: it takes leaders to grow leaders—not trainers, not HRD experts, not consultants: leaders grow leaders—and that it will take a serious time commitment on their part.
Best Fit vs. Best Practice is best practice dead ?
Empirical evidence suggests that HR policies are inevitably driven by context ~ including societal /organizational / size of organization / stage of development etc. However, there are many generic processes(ie selection / appraisal) that make it sensible to follow best practice. Things get out of hand when this approach is taken further and applied as a.one size fits all.
Small firms are indifferent to the nuances of HR practices in larger companies; HR employed in high tech industries are of little concern to mass producers.
Best Practice and Best Fit
One of the critical unresolved debates is whether or not there is a single set of HR policies and practices that represents a universally superior approach to managing people; are there such things as “best practices” in human resource management? Several recent studies seem to suggest there are.
For instance, Huselid (1995) reported from a sample of 968 firms that those using comprehensive employee recruitment and selection procedures, extensive employee involvement and training, and formal performance appraisal linked to incentive compensation were likely to have lower employee turnover, higher productivity, and enhanced corporate financial performance. Huselid referred to these HR practices as “high performance work practices” (p. 635). Other studies seem to support this perspective (Delaney & Huselid, 1996; Delery & Doty, 1996; Huselid & Becker, 1997; Kalleberg & Moody, 1994; MacDuffie, 1995).
On the other hand, one of the most compelling and widely accepted notions in the field of management and organization theory has been the notion of “fit” or contingency theories. These theories suggest that there is likely to be a variety of practices that work depending on the context (Lawler & Jenkins, 1992; Meyer, Tsui, & Hinings, 1993; Venkatraman, 1989). There is also evidence for this approach, particularly when the strategy of an organization is considered to be a primary contextual factor (Gomez-Mejia & Balkin, 1992; Pilkington, 1998).
For example, Cappelli and Crocker-Hefter (1996) examined successful pairs of organizations operating in the same industry and found different strategic approaches supported by quite different HR policies and practices. Arthur (1994) found that in the U.S. steel minimill industry, firms pursuing cost leadership were more likely to develop human resource systems characterized by well-defined jobs, rigid rules, and highly structured pay for performance systems. Firms purs uing a differentiation strategy were more likely to develop commitment HR systems characterized by high levels of training and socialization. Arthur also showed that firms with commitment systems tended to outperform firms with control systems.
“Best practices” and “fit” notions need not necessarily be in conflict. Becker and Gerhart (1996) argued that the two approaches may be complementary if one understands that “best practices” exist at different levels. They propose that such practices may be viewed at the level of systems architecture (guiding principles), policy, or practice. As such, best practices may exist at the upper level (e.g., employees are treated as valued members of the organization) while still allowing for differential policies and practices that support the overarching principle. This position allows that fundamental incremental advantages can be achieved by adapting HR practices to the organization’s context, particularly to its business strategy (Becker, Huselid, Pickus, & Spratt 1997; Delery & Doty, 1996).
Beyond the debate about fit versus best practice, there is also the problem of definition of best practices. No two studies have defined them to be the same. For example, incentive pay is a best practice in some studies (e.g., Delaney & Huselid, 1996; Pfeffer, 1998) while its absence is a best practice in others (e.g., Arthur, 1994). Perhaps it is not surprising that there is disagreement about the efficacy of different approaches to compensation within “best practice” studies. This mirrors the variability of findings in the compensation literature itself. Different studies on incentive pay often reach contradictory conclusions (Gerhart & Milkovich, 1992).
In addition, some studies have shown that the relationship between pay systems and organizational performance changes as the measure of performance changes. For example, Welbourne and Andrews (1996) found that the existence of an organization-based compensation program (e.g., profit sharing, gain sharing, stock options) was negatively associated with stock prices in an initial public offering (IPO), but positively associated with company survival over a five-year period after the IPO.
HRM and Performance
Best practice and the best-fit approaches. Some say there are universalistic best practices in HRM (Pfeffer, 1994), others argue that there are only best-fit practices (Wood, 1999), stating that the effect of HR practices depends on the specific (internal and external) context. It seems logical to believe in a best-fit approach in contrast to a somewhat simplistic best practice approach, but the empirical evidence still supports the best practice approach (Delery and Doty, 1996).
Gerhart (2004) demonstrates a critical analysis of those who claim that some form of internal fit – the alignment of practices with each other – outperforms the lack of this type of fit. Gerhart’s (2004) evaluation is very convincing in showing that the systems approaches that build on the notion of internal fit do not outperform the other approaches in which individual HR practices are not aligned.
Boxall and Purcell (2003) argue that both streams – best practice and best-fit– might beright each in their own way. Some basic principles like employee development, employee involvement and high rewards are universally successful, but the actual design of the HRpractice depends to some degree on unique organizational contexts.
The internal context – for example, the nature of the production system (e.g., assembly line) – might create restrictions with respect to the successful design of some HR practices (e.g., teamwork, performance related pay), but also the external context – for example, the legislation and trade union influence – might have a direct impact on the optimal HRM design. So the whole debate about universalistic best practices versus best-fit practices actually represents two sides of the same coin and both are relevant in exploring the linkage between HRM and Performance.
Attract and Retain Employees
The ability of reward systems to attract and retain employees is of primary concern to most organizations. This is obviously an issue during periods of economic expansion when labour markets are ‘tight’ and organizations struggle to fill positions and hold on to qualified employees. However, even during recessions, organisations are concerned with finding and securing the efforts of qualified individuals.
Best fit advocates suggest that the composition of the reward package will attract different types of applicants. Lawler states that “for example, organizations that offer a straight base salary with no chance for incentive earnings, typically ends up attracting and retaining very different individuals than one that offers large amounts of incentive pay.” Organizations who reward their employees with different performance-related pay incentives are much more likely to attract the more entrepreneurial and problem solving employees than those that just offer a base salary.
It is a basic assumption of the best fit proponents that “good performers tend to seek organizations where performance is recognized and rewarded.” (Schuster and Zingheim) Lawler suggests that a reward system should differentiate between good and poor performers. Not all employee turnover is harmful to organizational performance. A reward system should promote the retention of good performers and facilitate the decision of poor performers to leave.
Best fit advocates emphasize the importance of external competitiveness for attracting and retaining employees. To be effective, a reward system must distribute rewards in a way that will lead the organization’s most valuable employees to feel satisfied when they compare their rewards with those received by individuals performing similar jobs in similar organizations. However, Lawler adds a caveat when he states that for some organizations, it is more cost effective to keep wages low and accept high turnover, especially if replacement costs are low as with unskilled labour.
According to Pfeffer “Although labor markets are far from perfectly efficient, it is nonetheless the case that some relationship exists between what a firm pays and the quality of the workforce it attracts.” Best practice advocates place great emphasis on the need to attract and retain the type of employees that will help an organization to gain and sustain competitive advantage. This is in part achieved through externally competitive pay levels.
However, it is the combination of a number of interrelated policies that ensures that highly qualified people apply and stay with an organization. Huselid states that ‘Recruiting procedures that provide a large pool of qualified applicants, paired with a reliable and valid selection regimen, will have a substantial influence over the quality and type of skills new employees possess.’ Pfeffer discusses the ‘symbolic’ aspect of the rigorous selection process. The successful candidate feels that s/he is joining an elite organization with high expectations of performance – a firm where people matter.
‘Best practice’ advocates positively value low turnover, without Lawler’s caveats. Again, this is because other related policies and procedures ensure that the right employees are chosen in the first instance. Unlike Lawler who claims that employment security does not reflect the realities of today’s competitive global business, employment security is often mentioned by best practice commentators as being of fundamental importance in attracting and retaining employees (Delery & Doty, 1996; Morgan) In part, this is because employees are unlikely to make suggestions to increase productivity if they fear it will result in the losing their job.
Pfeffer claims that although people do work for money, work also adds meaning to their lives. Therefore, organizations with low turnover rates, offer intellectually engaging work, a family friendly environment and the opportunity to work with fun, interesting people in addition to a competitive reward package.
To summarize, advocates of both approaches agree that externally competitive reward packages are important to attracting and retaining qualified employees. However, they differ about which employees are a source of competitive advantage. Best fit focuses on specific high achievers or categories of employees with high replacement costs. These employees need to be satisfied that their reward package equals or exceeds what they will earn in the external market. Best practice, however, believes that there are a number of interrelated policies that attract and tie the individual to the organization. All employees are carefully chosen and are a source of competitive advantage. They stay with an organization because of the challenging environment, meaningful work and competitive pay package.
Motivate Performance
Wagner claims that a primary concern in the design of reward systems is how well the plan will work in motivating employees. However, there are several theories of motivation and no agreement on a ‘general theory’. Different theories underpin very different types of reward systems. As we will see, even the same theory can be interpreted in different ways and used to support alternative pay system designs.
Wagner claims that “two of the process theories of motivation are of particular importance in the development of performance pay programs: the Equity and Expectancy theories of motivation.” In Adams model of distributive justice, there are two variables: inputs and outcomes. ‘Inputs’ refer to factors contributed by individuals to the social exchange. ‘Outcomes’ are the rewards provided by the organization in exchange for individual inputs.
In order to determine whether equity exists in the exchange relationship, Adams theorized that an individual compared the ratio of his/her outcome to input to the same ratio for significant others. Equity or fairness requires that the ratios are equal. Motivation is particularly affected if the comparison results in ‘negative inequity’ or the belief that an employee’s greater effort is not being recognized by higher rewards. Negative inequity can be internal if the comparator is within the organization or external if s/he is working in another organization.
Schwinger suggests that social norms also intercede into an employee’s perception of individual justice. Based on the work of other writers in this field, he identifies three justice principles: “(a) the “contribution principle”—allocation proportion to individual’s contributions toward the group goals, (b) the “equality principle”—equal allocation to all individuals, and (c) the “need principle”—allocation according to individual need.” (Schwinger)
The belief that payment systems should reflect individual employee contribution is common to all best fit advocates. Lawler discusses the dissatisfaction that results from negative inequity and the consequences for the organizations.
Employees may reduce efforts or seek employment in higher paying jobs in other organizations. As a general rule, Lawler observes that “highly diversified companies are pulled more strongly toward an external market orientation, while organizations that are based on a single industry or single technology typically find themselves more comfortable with an internal-equity basis.” He states that although both types of inequity present serious implications for the firm, ‘…the consequences of external equity (e.g., turnover and absenteeism) are the most severe for the organization and deserve primary consideration.
References
Article for Ray Blunt
Minnesota Recreation and Park Association
- Article for Linda V. Berens and Dario Nardi
- Essay for Jaap Paauwe and Paul Boselie.
- Boxall, P. and Purcell, J. 2003. Strategy and human resource management, London
- Mick Marchington and Adrian Wilkinson, Human Resource Management at work.
- Article for TQM And Human Practices Company.