Introduction
The concept of globalization can increase market competition among businesses. The current financial crisis affecting most world economies today can complicate market globalization for organizations.
Organizations may shift their focus to productivity maximization by developing means of improving their quality of products and services. Productivity maximization can be achieved through human resource management (HRM) practices.
HRM is based on the idea that the success or failure of an organization depends on how the employees are managed. Human resource practices are vital elements in organizations and their impact on the performance of organizations is crucial.
Most HR practices like compensation determine the level of performance of an organization. HR practices like recruitment, training and compensation influence organizational performance (Githrie, 2001).
High performance work systems (HPWS) can be developed in the process of creation of efficient HR practices that may improve the performance of organizations. HPWS suggests that certain HR practices can be more effective if implemented in “bundles” rather than separately.
High performance work practices are HR practices that improve the performance of employees and those of the organizations. A number of Fortune 1000 companies that implement HPWPs register improvements in their organizational performances (kling, 2005).
Many organizations implement HPWPs in order to enhance their performance. However, not all organizations can implement HPWPs. I disagree with the idea that HPWPs can be implemented in any organization.
This paper puts into perspective the theory or model of HPWPs which is referred to as the AMO model. The model explains how HPWPs work when implemented in “bundles”. Afterwards, the paper will discuss the reasons why HPWPs cannot be implemented in any organization.
This aspect forms the basis of my thesis. The implementation of HPWPs is not common in small organizations. This fact is because of the cost and the size of the organizations. The implementation can be expensive and not many small organizations may be willing to incur the costs.
Certain organizations like the Japanese Construction Company for which I work employs workers on a contractual basis for a short term and may not be willing to commit its limited resources on the workers.
My organization can be used as a case study to justify why HPWPs cannot be implemented in every organization. Small organizations use simple structures that may not necessitate complex management systems like the large organizations.
The nature of the organization also determines whether HPWPs may be needed. Studies indicate that organizations in the manufacturing sector are more likely to implement HPWPs than those that deal with service provision.
The manufacturing sector is more likely to be in control of the production process than the service one. In my analysis, the implementation of HPWPs enhances performance which is evident in an organization’s financial results (Combs et al, 2006).
HPWS’ constituents include employee involvement, job rotations, team work and open communication in organizations.
The AMO model
Organizations may face stiff competition from local and international competitors as a result of globalization. The competition may put pressure on them to develop new HR practices that may enhance a competitive advantage over their business rivals.
These practices may aim at improving the quality of products and services and increase the rate of production. The implementation of high performance work practices (HPWPs) may be the solution that HRM may depend on to achieve its objectives.
HPWPs aim at improving and developing the skills of employees, motivating them and achieving flexibility in their work. Employees can be the foundation of an organization and an important element in achieving and maintaining competitiveness in the organization.
HPWPs provide the management with different approaches of leadership like the reduction of management levels and completion of tasks by the managers. HR practices cannot be effective on their own.
They have to be supported by other systems including performance measures, communication and total quality management (TQM) systems. TQM involves maintaining high standards of quality in the entire organization.
HPWPs engage HR management practices that include recruitment, selection, training, development, compensation plans and employees’ involvement (Appelbaum et al, 2000).
The HR practices that constitute the HPWS are delivered in three bundles namely, abilities (A), motivation (M) and Opportunities (O) (Appelbaum et al, 2000). Trainings offered by organizations enhance and develop the skills of employees and can either be internal or external.
Compensation plans like increased salaries and awards motivate the employees. Opportunities for promotions and sharing of information also increase the employees’ desire to work harder. Teamwork and involvement of employees in decision making are important in an organization.
High performance work practices may be the solution to improving performance and raising the standards of quality in organizations. Organizations that implement high performance work systems are referred to as high performance work organizations (HPWOs).
HPWPs’ practices have existed for a long time. The delivery of these practices in bundles ensures that performance is improved “gradually”. To ensure effectiveness, HPWPs have to be aligned to the goals of the business.
Abilities
Human resource management should encourage the organization to invest in human capital. HPWPs include HR practices that focus on employees’ training and skills’ development. An organization can cater for the costs of the training or subsidize them.
The trainings can be offered internally by the organization or externally through outsourcing. The organization needs to view its resources in a long term perspective instead of a short term one that may be focused on cost cutting.
The training programs should educate the employees and improve their existing skills or develop new ones.
Motivation
Involving employees in the making of important decisions of the organization creates trust in them and enhances their communication with the management. Organizations should restructure their work designs to make them interesting and to promote their effectiveness.
HR practices give power of control to the employees. This power motivates the employees as they tend to feel appreciated and involved in decision making by the organizations.
Employees should develop the desire to work for their organizations in order to achieve and maintain high performance. Employees who are poorly motivated may not deliver good results for their organization. These employees can give their business competitors undue advantage.
The organization should also put into place reward and compensation schemes. Rewarding employees for their work enhances their commitment to the organization.
The rewards can be financial like increased salaries, bonuses, benefits and profit sharing or they can be in form of promotions. Performance-based rewards may be the most important aspects of motivation and high performance.
Organizations have to exercise caution when remitting these rewards as inadequate payments can cause de-motivation in employees. Other rewards like flexible work, career plans and “friendly” policies can be used to motivate and instill a sense of commitment in the employees.
Maintaining open communication is an important aspect of motivation. An organization should share information about the company and its performance with the employees to make them feel trusted.
The employees should have access to the company’s information including its operations and financial reports. This fact oversees that employees at every level are familiarized with the objectives and future plans of the organization.
The management of the Federal Express Company creates a video interaction program which the employees can use to keep themselves informed about the company. The information is updated regularly to ensure that the employees are updated information of the company.
The knowledge of the future plans of the company creates a sense of employment security in the employees. It is not common for many organizations to maintain open communication with their employees.
The organizations may fear that their lower cadre of employees may be empowered like those at the top management. Many employers prefer maintaining hierarchical differences among their employees.
The differences may lower an organization’s performance.
The management needs to understand that for employees to perform to their level best, the latter need to be aware of the organization’s objectives, its operations and current financial position so that they can align their output to the organization’s goals.
Organizations like the Fortune 1000 companies work towards involving their employees in decision-making especially in matters that affect them like salaries and retrenchments.
This move enables the companies to register an increase in performance as a result of the employees feeling motivated and trusted.
Lack of sharing of information creates mistrust between the employees and their employers. It tends to make them believe that the management may be hiding something from them which can threaten their job security in future.
The lack of trust results in reluctance in the employees’ performance and they may not be motivated to take organizational initiatives. The Japanese Construction Company employees are not motivated because the management is not willing to commit its resources on them.
As a result of the lack of motivation, the company not only experiences low employees’ motivation and company’s performance, but also high employee turnover rates.
Opportunities
In the past, organizations focused on the technical aspects of organizations like administration and equipments than the human performance aspects. Today, research shows that an organization’s high or low performance is determined by the employees’ attitudes towards their work.
Involving employees in planning their own work offers them the opportunity to utilize their abilities and skills.
The employees may get an opportunity to contribute to the success of the organization either by providing creative solutions to problems or developing new ideas on products and services creation.
The Federal Express Company realizes this fact and formulates a feedback segment in its interactive video program which enables the employees to give their views on the company’s management. It also allows them to offer possible solutions to the problems facing the company.
Human potential can be explored through opportunities at work. The employers need to create “environments” that encourage employees to contribute their ideas to the running of the organizations.
The management should involve employees in work meetings where the work policies that affect them can be formulated, problems discussed and their solutions sought. Teamwork is an important aspect of high performance work practices and should also involve the management.
During teamwork, employees need to interact with people that they may otherwise not interact with. The employees need to share and exchange ideas and information on emerging trends in organizational behavior.
The involvement of teamwork by the management gives the employees an opportunity to present their ideas. Working in teams improves the employees’ social skills and gives them the courage to explore their creativity.
It also gives them a chance to solve any existing conflicts between them and the management or fellow employees. Employees may use the opportunities to express their grievances and concerns about each other and the management.
The opportunities reduce the gap between the “top” management and the employees in the “front line” of the organization. This aspect in turn creates a sense of connection between the two. In 1988, Colgate-Palm Olive established a new branch in Cambridge.
It decided to implement HPWPs through the use of teamwork. As opposed to its usual practice of assigning its production processes to different departments, the management of Colgate-Palm Olive decided to use one team to handle all the processes.
The team was in charge of bottle making, filling and packaging of the company’s products. Today, people may be conditioned to individual thinking which may be the reason why it is hard to employ team-based work systems.
Rewards can be usually administered based on an individual’s ability to make independent decisions and achievements. Organizations should learn to appreciate diversity of the ideas of their employees and their contributions.
The management should inform the employees on what is expected of the team-based work to ensure that teamwork is effective. The employers should also reward teamwork and not just individual accomplishments.
HR practices cannot be separated from employees’ performance because the two complement each other. HPWPs not only improve performance but also quality in any organization. HPWPs increase flexibility and employees’ job satisfaction.
They also improve employees’ skills through the trainings and job rotations. Employees can be able to make crucial company decisions, plan their own work and manage their work teams and in the process, improve their skills.
The skills’ improvement may be derived from the employees’ assumption of new and challenging tasks. In my evaluation, this flexibility facilitates acceptance of the changes that take place overtime.
Attracting and retaining an efficient workforce are the core objectives of human resource management (Frauenheim, 2009). To achieve the mentioned objectives, the employers should implement HPWPs in order to engage their employees.
Employees’ engagement is defined as the level of organizational commitment of employees to their organizations and their initiatives. The key factor of employees’ engagement depends on both horizontal and vertical communication.
This form of open communication shifts the leadership paradigm from a dictatorial to a democratic one. In my assessment, employees require information, training and skills development in order to get a clear perspective of their organizations’ position and understand their roles (Liao et al, 2009).
Organizations must for that reason continuously invest in human capital and maintain open communication channels. Incentives should be created to motivate employees to perform to their maximum levels and to enhance their commitment to the organization.
HPWPs’ implementation
Globalization and the changes in the business environment bring about the need to implement HPWPs to control competition among businesses. Many organizations develop high performance work systems to facilitate the achievement and sustenance of high performance.
High performance work practices include inclusive recruitment and selection of employees, training, reward schemes and performance management. In my investigation, HPWPs facilitate the “acquisition” and “retention” of an efficient workforce (Githrie, 2001).
High performance work organizations may be able to achieve increased productivity as a result of the high performance work practices. The turnover of employees also reduces with the implementation of HPWPs.However, not all organizations can implement HPWPs.
Small organizations cannot implement HPWPs mainly because of their restricted resources in comparison to large organizations (Welsh and White, 2006). The implementation of HPWPs can be costly in terms of meeting the costs of employees’ trainings whether it is the full cost or part of it.
Most of the times, the small organizations opt to use their limited resources to meet the costs of production rather than invest it in human capital. The Japanese Construction Company employs workers on a contractual basis.
The contracts expire in the year 2015 hence the management is not willing to commit a lot of resources on the employees in their training and skills’ development.
As opposed to the complex structures of large organizations, the “simple” structures of small organizations facilitate fast and informal management styles.
Large organizations may use complicated structures that require the use of effective means of “aligning” the output of employees to the strategic objectives of the organization.
This fact may eliminate the need for extra expenditures on the implementation of formal management systems that are brought about by HPWPs.
Most small organizations may not be ready to spend on human resources’ specialists. In my hypothesis, this fact gives the proprietors the responsibility of decision making (Matlay, 2003) meaning that the decision to employ HPWPs may be based on the management’s perception of HPWPs.
Most of these proprietors may end up viewing the implementation as an unnecessary cost. The limited finances do not also support reward schemes like wage increment, profit-sharing and bonuses. The Japanese Construction Company tries to limit its expenditure.
It may not consider improving the salaries of its workers. I suggest that the emergence of globalization and technological advancements continues to change the labor model from a long-term to a short term one (Dau-Schmidt, 2001).
The Japanese Construction Company may only hire the needed skills for a given time. It may be unwilling to invest in human capital like training because the employees may not be in employment long enough for the employer to recover the investment.
The contracted employees at the construction company may not undergo on-the-job training. This fact is because the management may consider that after the workers’ contract comes to an end in 2015, the employees may no longer work for the company.
In this regard, the company may not have enough time to recover the resources that it has invested in the employees. The workers of the construction company may use the gained skills in other jobs.
The work environment in the Japanese Construction Company may not encourage the implementation of HPWPs. The stiff competition among business that is evident today may lead to the increase of “poaching” of employees of the Japanese Construction Company by its competitors.
A number of organizations especially the large ones “poach” trained employees from small organizations. The organizations can be able to do so because their financial position allows them to offer large incentives like high salaries and bonuses.
This risk renders small organizations unwilling to undertake HR practices like investing in human capital. The small organizations opt for the selection and recruitment of already trained and skilled employees.
The Japanese Construction Company prefers to employ skilled workers so that it does not spend its limited resources on training them. The nature of an organization and its operations also determine whether HPWPs can be implemented or not.
Most organizations that implement high performance work practices are those that deal with the manufacturing of goods. In my assessment, the manufacturing sector involves the use of intricate and hazardous equipments or machinery (Combs et al, 2006).
The management of the organizations needs to develop policies and procedures that ensure that the employees are trained on their use and safety. The organizations also have to keep on training the employees due to the fact that technology and business environment changes may take place.
This fact means that the employees should be trained on the new equipment and products. These changes and the need to remain flexible for the purposes of adaptability make the implementation of HPWPs appealing to the organizations.
HPWPs may not be popular with organizations that deal with service provision. In my evaluation, the assumption is that employees in service-based organizations may not be affected by changes in technology like in the manufacturing companies (Combs et al, 2006).
Unlike the manufacturing companies,the service-based ones may not depend on the management for the “supply” of skills. Organizations in the service provision sector may be in a position to develop the needed skills without formal training.
The effectiveness of HPWPs is hence greater in the manufacturing organizations than in the service-based ones, thus reducing the need for HPWPs.
In my investigation, organizations in the service –based sectors cannot exercise a lot of control on the “final” results as is the case of the manufacturing ones (Combs et al, 2006).
Due to the lack of “control”, HPWPs cannot be implemented in these organizations as they may not have clear impacts on the performance of the organizations. The effectiveness of teamwork is also more visible in manufacturing organizations.
This fact is because employees from different departments may be bound by the “interdependency” of the stages of the manufacturing process. The production processes in service-based organizations are not heavily interdependent on each other.
A number of state policies affect the implementation of high performance work practices. The policies do this by influencing the implementation of the HR practices in HPWS.
The influences deter the implementation of HPWPs. All the policies that are formulated to protect employment may not be relevant to the HPWPs that deal with recruitment and selection or training and development.
Organizations that are governed by the policies may be unable to implement HPWPs. Organizations should ensure that they familiarize themselves with different state policies and their implications on the national business “environment” in which they intend to operate.
Organizations with complex management hierarchies cannot adopt HPWPs. The implementation of HPWPs encourages the sharing of all information and the involvement of employees in decision making.
The management of organizations that have complex hierarchies may not be willing to hand over the responsibility of decision-making to employees in the lower chain of command. This fact is viewed as giving employees control of the organization’s management.
The management may not also be ready to listen to the contribution of the employees because the interests of the latter may be secondary to the organization’s welfare.
The organization’s approach may compel the employees to believe that the top management is the only one with the authority to make decisions. The employees may perceive themselves as not having a “meaningful voice” in the making of important decisions or control of their work plans.
The senior leadership can be more comfortable with the “command” and “control” kind of leadership style. The kind of communication systems employed in the organizations can be inaccessible and formal.
Most of these organizations recruit and select employees for promotion from their current workers and do not engage in sourcing for feedback.
In my hypothesis, the responsibility of the maintenance of the employees’ welfare is usually at the discretion of the organization for which they work (Szasz, 2007).
Many organizations that employ workers on a contractual basis may be unable to effectively cater for their employees’ welfare due to the absence of the benefits that are linked to short-term contracts. The organizations may also have restricted use of available resources.
I postulate the idea that due to the high employee turnover rates experienced by various organizations, their management may formulate policies and procedures that favor cost-cutting (Bohlander &Snell, 2010).
The implementation of HPWPs not only ensures that an organization experiences high performance but also that the social welfare of its employees is addressed in the process.
Every organization should improve its performance in order to attain the best results in the competitive business environment. However, not all organizations view the welfare of their employees as a factor that determines the desired economic success.
Certain organizations aspire to address their employees’ welfare but their financial position may not allow them to do so. Organizations should consider undertaking the process of departmentalization. The organizations should be partitioned into sections that handle related tasks (Kritek, 2002).
They should also develop work designs that are flexible so that the employees can have a favorable environment in which to operate. The employees may be able to maximize their output in the attainment of the organizations’ goals.
Every worker at all levels should have access to the organization’s information. This information can be availed to workers during orientation, trainings or workshops, in their database or during team-building retreats.
An organization cannot achieve the motivation of its employees if the working conditions are oppressive because motivated employees are a key element in gaining a competitive edge in the market for organizations.
In the Japanese Construction Company, the restricted resources do not allow the management to commit its resources to the employees. It does not offer training to the employees nor does it extend other incentives to its workers like bonuses and increased wages.
This fact means that the employees’ level of motivation is low. This aspect affects the overall performance of the company. Competition among organizations is a vital element in improving their performance.
An organization should maintain high standards of quality of its products and services to ensure that it remains at par with its competitors. This fact can only be attained when the organization achieves high performance in the market.
The need for improving performance necessitates the implementation of high performance work practices (Jeong & Nor, 2007). High performance is a prerequisite for success of any organization regardless of its implementation of HPWPs or not.
However, to gain a competitive advantage in the market, organizations need to integrate HPWS into their human resource management systems.
I suggest that prior to setting up an organization and operating in a new environment, organizations should understand the state’s policies regarding HPWPs and make the necessary changes to incorporate them (John, 2010).
Conclusion
An organization can be made up of several connected “parts” that work together to achieve its objectives. Human resource management can be at the center of the connections as employees determine the success or failure of an organization.
Human resource management practices directly determine the attitude and performance of the employees who in turn affect the output of the organization. Organizations implement HPWPs to improve and maintain their performance.
The practices are delivered in bundles since their “collective” effect is greater than when they are implemented individually (MacDuffie, 2005).
However, the HPWPs may not be applicable to every organization because they highly depend on the availability of resources and the nature of the organization. HPWPs can be costly. The management may need to consider its options carefully before embarking on the use of HPWPs.
The Japanese Construction Company does not allocate most of its resources to its employees because of the contractual nature of its work. The size and structure of an organization also determine whether HPWPs may be implemented in a given organization.
The arguments in this paper hence affirm my hypothesis that states that HPWPs cannot be implemented in any organizations.
The managements of various organizations should link HPWPs with the organization’s strategic goals especially because of the changing nature of the business environment to ensure that HPWPs remain effective.
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