Increase Organization Performance by Human Resource Management

Performance-oriented human resource or HR practices increase organization performance by increasing managerial affective dedication. There are eight HR performance practices were categorized as either maintenance oriented or performance oriented: employment security, selective hiring, reduction of status distinctions, participation in decision making through teams, comparatively high pay contingent on performance, performance appraisal, career planning and extensive training. Performance  oriented Human Resource practices are aimed at motivating, developing, and effectively utilizing human resources, and six of the eight HR practices were divided as such and are as follows: selective hiring, involvement in decision making through teams, performance appraisal, and comparatively high pay dependent on performance, career planning and extensive training. The remaining two HR practices  employment reduction of status and security were categorized as maintenance-oriented, and this kind of HR practice is aimed at establishing employee equality and security.

After this classification, the authors next investigated the effect of performance-oriented and maintenance-oriented HR practices on organization performance. In this study, indicators of firm performance were the firm vice presidents’ and president rankings on the following dimensions: profit, net sales growth, market share, net asset growth, after-tax return on net assets, after-tax return on net sales, and labor productivity. Result indicates that performance-oriented HR practices absolutely affected organization performance whereas maintenance-oriented HR practices not.