hrm perspectives 2012
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HRMTRANSCRIPT
Cover designed by Mr. Udeni Alawattage
Printed by Print Wave (Pvt) Ltd., No 244/4, Robert Gunawardana Mawatha, Battaramulla. Tel : 0777 751531
Editor : Dr. Ajantha Dharmasiri
Coordinators : Prof. Sudatta Ranasinghe
Dr. Pavithra Kailasapathy
Mr. Janaka Kumarasinghe
Mr. Udeni Alawattage
Mr. Aruna Dayanatha
Mr. Priyal Perera
Mr. Hasantha Sooriyaarachchi
Ms. Chathuri Galappaththy
Mr. Chandima Pinsiri
CONTENTS
1. The Challenge of Developing and Optimizing Human Resourcesin Sri Lanka: Current Issues and their ImplicationsSudatta Ranasinghe
2. Impact of Supervisor Support and Work Schedule Flexibility on JobStress and Turnover Intention of Software Developers in Sri LankaVathsala Wickramasinghe
3. Grandeur of the Grounded Theory: Unearthing the UniquenessAjantha S Dharmasiri
4. HR Technology and HR Technology for Competitive AdvantageAruna Dayanatha
5. Do Organisations Benefit from Employee Empowerment?Chandana Jayawardena and Yugan Pathirage
6. Talent Management Process and Growing OrganizationalComplexityChaturi Galappaththi
7. Employee Perception on the Existing Performance EvaluationSysytem: An Empirical Investigation at Star-Tel (Pvt) LtdAyoma Lakmali Aberathna
8. A Comparative Study of Traditional and Non TraditionalMotivational Methods in BanksR.S.P.N.Gunawardhana
9. Improving Performance of the Employees Through an EffectivePeformance EvaluationRamanusha Poopalaratnam
10. Impact of Human Resource Information Systems on StrategicHuman Resource ManagementShiwanthie Wijesuriya
11. Book Review: Dealing with Sexual Harassment in the WorkplacePavitha Kailasapathy
12. The Evolving Role of Modern HR Manager Chandrasiri Gannile
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Human resource, as we are aware, is the most precious resource in anyorganization. Research related to human resources occupies high prominencein the echelons of research. We, the Research and Publications Committee (RPC)of IPM, are indeed delighted to present the 2012 volume of the HRM Perspectivesmagazine in fulfilling our duty of showcasing HR related research.
Research on Human Resources falls into the broader category of Managementresearch, which in turn, is a part of the wider array of social research. Whilstpositive initiatives are being taken, the current situation with respect to researchin Sri Lanka is far from a satisfactory level. Dr Jayaratne Pinikahana has aptlyhighlighted this, in a newspaper article last year.
“Sri Lanka contributes only 0.17% from GDP whereas Singaporecontributes 2.3%, South Korea, 2.9% and China, 1.3% from theirGDP for research. A recent report published by the Ministry ofTechnology & Research in Sri Lanka revealed that Sri Lanka hasonly 287 researchers per million which is much less than theworld average of 894. The average number of researchers permillion in the developed world and the developing world is 3272and 374 respectively. It is clear from these statistics that SriLankan situation is worse than the average third world situation.The most alarming situation is that it is getting worse in recentyears. For example, in 1996 Sri Lanka had 6000 full timeresearchers including university researchers but by 2006 thisnumber declined to 4200.” (Island, 22/02/11)
In such a context, any move to strengthen the research rigor, particularly amongthe student community, is commendable. IPM also has taken a small but a
HRM Perspectives – Editorial
Highlighting Research on Human Resources
significant step in publishing the research of its students and members alike.Accordingly, offering insights into human behavior in organizations with social,cultural, economic, political and environmental aspects aptly blended, has beenthe key endavour in publishing this volume.
You will find a wide assortment of papers ranging from theoretical to practicalaspects. The authors with diverse backgrounds representing professionals fromboth public and private sectors have contributed to the informative and insightfulnature of the magazine. As such, papers from academics and practitioners alikehave been accommodated in order to maintain a healthy balance of depth andbreadth.
Our intention is not to project HRM Perspectives magazine as a scholarly journal,but more as a channel to recognize emerging contributors to HR related research,and include work of veterans as exemplary pieces of work. We were consciousof the fact that some of our selection may not appease scholarly academics, butthe intention was to accommodate upcoming researchers as a source ofencouragement for them.
We are of the view that research related to human resources has to gain arenewed enthusiasm in Sri Lanka. The presence of several annual researchconferences and the availability of several management journals are a welcomesign for a better future. Whilst appreciating their immense contribution, we seea void in accommodating research papers by practitioners. HRM Perspectivesmagazine attempts to fill this in providing a solid platform to showcase suchresearch.
We earnestly hope that HRM Perspectives would assist a deeper understandingof human resources, whilst enriching the body of knowledge, and in turncontributing to the development of Sri Lankan economy.
Ajantha [email protected]
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THE CHALLENGE OF DEVELOPING AND OPTIMIZINGHUMAN RESOURCES IN SRI LANKA:
CURRENT ISSUES AND THEIR IMPLICATIONS
Sudatta RanasingheProfessor, Faculty of Humanities and Social Science
Open University of Sri [email protected]
ABSTRACT
There is consensus of opinion that well developed human resources plays a critical
role in the process of value creation and thereby enhances the prospects of competitive
capability of a nation. Having reached over 92 percent adult literacy Sri Lanka
demonstrates a high potential to become a “knowledge hub in South Asia” as laid
down in the “Mahinda Chintana- towards a New Sri Lanka”, the policy framework
of the Government. Sri Lanka’s achievements in relation to social development
indicators such as adult literacy, life expectancy and infant mortality are well known.
However, it has not yet been possible for the country to reach the status of a knowledge
driven economy despite the fact that Sri Lanka has surpassed a per capita income of
US $2000 and reached a growth rate of 8 per cent in 2010. The annual investment
for education in Sri Lanka has been below 2 per cent of the GDP. Where higher
education is concerned the national investment has been dismally low; around 0.6
per cent of the GDP. In this context, transforming the nation’s human resource into a
high value adding dynamic resource is a serious challenge.
The data on performance of the economy shows that growth has occurred mainly in
the services sector which has contributed about 59 per cent of the GDP as per the
Annual Report of the Central Bank of Sri Lanka for 2010. Other key sectors such as
Agriculture, Forestry, Fisheries and Livestock, and Manufacturing Industries have
maintained a slow growth rate. These sectors have absorbed largely the less skilled
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rural labour whose productivity, as well as earnings, are comparatively low. Sri
Lanka is facing the challenge of absorbing into productive employment the youth
who join the workforce annually. These youth, in the age group of 15-24 years and
comprising of school leavers, apparently do not have marketable knowledge and
skills. Thus, the challenge of transferring marketable skills to these youths is expected
to be tackled through appropriate reforms in the system of education and training.
The paper posits that a paradigm shift in the current approach towards education,
higher education and vocational and technical education is needed if we are to
optimize the available workforce through transfer of marketable skills and inculcation
of right attitudes.
Key words: Marketable skills, productive employment, youth workforce, knowledge
and skills development
1. INTRODUCTION
The draft National Human Resources and Employment Policy developed by the
Government of Sri Lanka (GOSL) with the technical assistance of the International
Labour Organization (ILO) states thus;
“Human resources in Sri Lanka have considerable potential to steer the country’s
growth trajectory from its current low-skilled, low productive and low-income earning
workforce to one that is highly-skilled, dynamic, and globally competitive. With social
development achievements in access to education and health, further improvements in
the quality of education and training are critical to make Sri Lanka a knowledge hub in
Asia” (page 04 of the draft policy document).
Thus, as envisaged in the National Human Resources and Employment Policy, further
increase in the level of investment in human capital is necessary to raise the competencies
of our workforce in order to transform them qualitatively to become high-skilled and
high productive and globally competitive workers who can fit in for high-end jobs in
the global value chain. This would also entail wide reforms in the education system
covering the school and university education and technical and vocational education.
In this regard a lead role is expected to be played by the National Education Commission.
It might also be necessary to revisit the current fragmented institutional framework of
human resource development with the view to integrating institutional level strategies
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and action plans within the framework of the National Human Resources and
Employment Policy.
The objective of the present paper is to briefly survey the issues pertaining to human
resource development at the macro level and identify the scope and limitations in
transforming the current human resources in qualitative terms so that the available
potential can be optimized making the Sri Lankan workers globally competitive. The
paper is based primarily on secondary data gathered from published as well as
unpublished reports. The writer’s own observations as a member of the local expert
group involved with drafting the National Human Resources and Employment Policy
also helped in preparing the present paper.
2. ISSUES PERTAINING TO EMPLOYMENT, INCOME AND DECENTWORK
Though Sri Lanka has been able to maintain a consistent record in terms of social
development indicators for the past few decades, there has been less success in
eradicating the problem of unemployment particularly among the youth by creating
productive and decent employment opportunities. It is estimated that unemployment
rates among those in the 15-24 year age group are three times that of adult
unemployment in Sri Lanka: 24.6 per cent for young women and 18.6 per cent for
young men in the second quarter of 2010. Unemployment among the educated is also
high in Sri Lanka. The share of unemployed persons with GCE (A/L) and above
educational attainments had been 10.8 per cent, which is much above the average
unemployment rate for males (6.6 per cent) in 20091.
The annual addition to the labour force is estimated to be around 140,000. Of this
number only a few (about one third) enjoy prospects of securing employment in the
formal sector on account of educational qualifications and skills. It is estimated that
about 60 per cent of the employed are in the informal sector where opportunities for
decent work are limited. According to available data, over 85 per cent of employment
in the agriculture sector is informal and among those in informal employment majority
(65 per cent) comprise of males. One might also note that “working poor” is another
problem connected to low productive informal employment in the rural areas. Studies
on poverty have indicated that 13.7 per cent of the employed in Sri Lanka had come
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under the category of “working poor” in 2007 as they have earned about 1-2 dollars
per day from employment. Prevalence of high degree of underemployment among
these workers may also have contributed to low incomes.
According to the Department of Census & Statistics (Labour Force Survey- Annual
Report 2009), of the country’s labour force of 8 million (which accounted for a labour
force participation rate of 48.7%), 5.1 million comprised of males and 2.8 million of
females. Thus, the labour force participation rate for males was 66.6% and for females
it was 32.8%. A relatively low labour force participation rate among the females shows
that the contribution made by females towards economic activities goes largely un-
noticed and gets recorded under domestic work. A study undertaken by the Department
of Census & Statistics (2005) on female participation in informal economic activities
shows that 31% of the employed females were in informal employment and 34 and 30
per cent respectively of the female population came under “Unpaid family worker”
and “Own account worker” categories. In terms of educational achievements and
skills acquisition females appear to be more vulnerable to social and other constraints.
Hence their capacity to secure decent work in the formal sector has been limited.
Due to lack of marketable skills female workers have lesser prospects of securing
decent and safe employment in the foreign job market. According to the Labour Market
Information Bulletin (2009), among those who migrated for foreign employment in
2009, 54% were females and 46% were males. Of the total number of Sri Lankan
workers migrated abroad for employment, 48.5% came under the category of
Housemaids. Those classified under the Professional category was a mere 2,820
individuals and the Middle Level category comprised of 6,392 individuals. The Skilled
category made up 61,230 (26%) and the Unskilled category added a further 50,158
(21.4%). The profile of the Sri Lankan migrant workers shows that due to poor skills,
Sri Lankan workers, particularly females, are unable to secure better paid stable
employment. According to official sources, during 2011 Sri Lanka had lost the prospects
of securing a good number of well paid jobs in the Middle East due to shortage of the
skills demanded.
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3. LABOUR MARKET STRUCTURAL ISSUES
An effort has been made by the Tertiary & Vocational Education Commission (TVEC)
as well as the Department of Employment Promotion to assess the labour market
demand for a range of skills based on newspaper job advertisements. However, no
proper estimate or projection is available to determine the number of high, medium,
and lower level skills demanded in the labour market during a given period of time. If
such a human resource demand projection was available, it would have been possible
to develop the required skills more precisely to meet the market demand. During the
National Employment Policy formulation exercise, this issue was discussed and the
view of the employers and the trade unionists as well as other stakeholders was that
arriving at a reliable human resource demand projection was a difficult task given the
changes in the economy and the catastrophic conditions such as the fall of global
money markets due to recession.
One of the longstanding issues with regard to supply and demand for skills in the
labour market is the mismatch of available skills and the skills demanded. Several
studies have highlighted that the youth who join the labour market annually after
leaving formal education are not equipped with the type of skills demanded in the
labour market. It is clear that the number of youth who join the labour market after
completing school education up to GCE (O/L) or (A/L) is higher than the number that
join the labour market after completing vocational or technical education. It is also
important to pay attention to those who qualify to enter the universities on the basis of
performance at the GCE (A/L) but fail to gain admission due to intense competition
and the limited number of places available.
The GCE (A/L) is a highly competitive examination conducted annually in Sri Lanka
for the sole purpose of selecting suitable candidates to follow degree programmes
conducted by the state universities. Students who sit the GCE (A/L) examination
generally follow private tuition classes conducted by various individuals in addition to
following the syllabus in their respective schools. During the past few years the number
admitted annually to state universities on the basis of performance at the GCE (A/L)
had been in the region of 18-20 per cent of the number qualified. This situation has
left about 50- 60,000 youth who have passed the GCE (A/L) in the lurch. Majority of
these youth join the labour market with limited prospects of securing a job of their
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choice. Studies show that there is a mismatch of jobs expected by these youth (example:
clerical jobs, teaching, nursing etc) and the type of jobs available. On the other hand
one also finds a situation where private sector employers prefer to employ GCE (A/L)
qualified youth who have strong communication skills in English, and who demonstrate
a positive attitude.
During the past few years there has been a proliferation of foreign degree programmes
offered in the English medium by a multitude of private sector institutes. However,
majority of the youth who fail to gain admission to state universities are not able to
afford private university education. In this context the available options are the Higher
National Diploma programmes in Business Studies, Accounting, Engineering etc
conducted by the technical education institutes that come under the Department of
Technical Education & Training. Ironically, most youths who fail to gain admission to
a state university tend to select the option of registering for an external degree offered
by the state universities. It should be noted that the external degree programmes hardly
equip the participants with marketable skills and therefore the external degree holders
have limited prospects in securing employment in the private sector.
4. FITTING GENERAL EDUCATION AND VOCATIONAL ANDTECHNICAL EDUCATION
General education in Sri Lanka from Grades 1 to 13 is provided through the government
schools based on a curriculum prepared by the National Institute of Education, which
comes under the Ministry of Education. The ministry also manages a group of schools
known as “National Schools” which have greater access to resources compared with
provincial schools managed by the Provincial Councils elected in terms of the provisions
of the Thirteenth Constitutional Amendment.
A major issue that seems to affect the quality of the students who leave the school
education system in Sri Lanka is that their lacking of job-related skills because the
curriculum followed in schools has no link whatsoever with the vocational and technical
education system. And although the school education system imparts knowledge and
skills in reading and writing in one’s mother tongue and basic mathematics and English,
most of the rural schools do not have teachers and facilities to teach science, English
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and mathematics (Ranasinghe, 2008). Also, though a few rural schools have access to
computers, the shortage of IT trained teachers appears to be a serious constraint.
It is estimated that less than 25% of the students enrolled at the primary level proceed
to GCE (O/L) and about 40% drop out from schools before reaching Grade 6. One
might opine that these youths must possess certain vocational or technical skills if they
are to secure employment after joining the labour market. It would therefore be necessary
to take steps to introduce vocational subjects such as masonry, carpentry, plumbing
etc to the school curriculum and impart those skills through the school education
system. Similarly the school curriculum may incorporate subjects such as computer
hardware and software, culinary science, agri-business, fishing and marine science
including diving and sea sports, tourism and hotel management, vehicle repairing etc
that can help the youth in securing suitable employment.
The introduction of a National Vocational Qualification (NVQ) framework in the recent
past led to standardizing the training programmes conducted by the state sector TVET
institutions such as National Apprenticeship & Industrial Training Authority (NAITA)
and recognized training institutions outside the state sector. This positive step had
enabled NVQ certified youth to compete well in the labour market. The NVQ framework
had also recognized prior training which had provided an added advantage for the
youths to obtain certification to be able to compete in the job market locally and
abroad. However, a matter that deserves the attention of the policy makers is the
limited number of youth who enrol in vocational and technical courses and the increasing
number of students who give up their courses half way. Thus, one might make a case
for making vocational and technical education more attractive for school leavers through
a vigorous social marketing campaign.
5. GROWTH SECTORS IN THE ECONOMY AND AVAILABILITY OFSKILLS
The dawn of peace in Sri Lanka after defeating terrorism in May 2009 created an
environment which was conducive for investments and growth. Particularly,
infrastructure development projects in the war affected Northern and the Eastern
provinces and acceleration of tourism-related building projects had created employment
opportunities for skilled personnel mainly in the construction industry. However, due
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to shortage of skills in the construction industry, most of the projects in the North and
the East had to depend on migrant contract labour.
Studies have revealed that there is a serious gap between the demand and the supply
of skills in the growth sectors of the economy. The “Mahinda Chintana- Vision for the
Future” policy document had specified five economic hubs as leading sectors of the
economy comprising of navel and maritime, aviation, commercial, energy, and
knowledge hubs. It is recognized that there is a serious shortage of skills demanded in
the five growth hubs, particularly in the navel and maritime, aviation, energy, and
knowledge hubs. The commercial hub comprise of several sub-sectors such as banking,
finance and insurance, import and export trade, telecommunication, tourism etc. for
which the types of skills required may vary between high and intermediate level skills
as well as intermediate and low level skills.
For instance, in the insurance industry there is a serious dearth of underwriters, which
comes under the category of high level skills. In the tourism industry there is a growing
demand for low level skills such as room boys, cleaners, gardeners and waiters, which
cannot be fulfilled immediately. The tourism industry employs about 150,000 at present.
With the high growth potential in the tourism industry, it is envisaged that the industry
is likely to create about 500,000 new jobs in the course of next 3-4 years. However,
there is no comprehensive and integrated plan to develop the human resources required
for the tourism industry. The telecommunication industry has also recorded shortages
in skills at different levels. It was noted that there is a high degree of competition
among the service providers to attract skilled personnel. This has led to problems like
high level of employee turnover in the telecom industry.
IT and BPO industry in Sri Lanka has sustained a significant growth trend during the
past three years. The industry currently employs about 65,000 skilled workers and it
is estimated that about 10,000 trained IT personnel are required annually. The IT/
BPO industry in Sri Lanka is currently a US $450 million operation and the industry
has set a turnover target of US $ one billion to be reached by 2015. It is estimated that
the industry will require 120,000 skilled IT workers in order to reach the set target.
However, the capacity of the national universities to produce IT professionals is limited;
about 3000 per annum. The Sri Lanka Institute of Information Technology (SLIIT),
which is a degree awarding private institute, also produces about 700 IT graduates
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annually. While the limited investment in higher education has restricted the capacity
of state universities to produce a higher number of IT professionals, steps have been
taken by the SLIIT to expand its capacity. Another HR related issue that seems to
affect the IT/BPO industry is the problem of brain drain among young IT professionals.
The industry has already lost a good number of trained IT professionals due to brain
drain adding to cost of new recruitment and training.
Sri Lanka’s capacity to reach the status of a knowledge hub is restrained by the limited
capacity of the national universities to produce an adequate number of knowledge
workers. Thus, it would be important to make space for private universities with
foreign collaboration to start operations in Sri Lanka targeting specific skills. It is also
important to get the private sector involved more actively to work in collaboration
with the state sector institutions to produce competitive graduates within the National
Qualifications Framework that is already approved.
6. OPTIMIZING HUMAN RESOURCE UTILIZATION IN SRI LANKA
In Sri Lanka little or no attention has been given for optimizing the utilization of
human resources. This could be seen largely in the public sector and to a limited extent
in the private sector. The lack of an integrated plan for development and utilization of
human resources and the dominant mindsets which do not support change are among
the reasons for the prevailing situation. As discussed earlier several issues have
contributed towards sub-optimization of human resources in Sri Lanka. They include
such issues as structural imbalances in the labour market, lack of integration of knowledge
and skills and limited focus on the right attitudes, less opportunities of higher education
for the youth and the poor status of women workers. Some of these problems have
been in existence for several years. However, no consistent efforts have been made to
address the issues to pave the way for optimum utilization of human resources.
There has to be a sufficient growth of employment opportunities in growth sectors of
the economy to absorb those joining the labour market into productive jobs. This
depends on the level of investment in value creating activities. As noted earlier Sri
Lanka has remained more or less a low value adding and low tech economy. Among
Sri Lanka’s manufacturing operations only about 1.5 per cent comes under high tech
industries. It is observed that to raise this proportion to 15-20 per cent, Sri Lanka
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needs about 18,000 science and technology researchers. But the number of researchers
currently available is about 4000. Hence, there is a strong case to increase the level of
investment in science and technology research.
In order to transform the technological standard of manufactures that are exported, Sri
Lanka has to make a reasonable investment in Research & Development (R&D). At
present our annual investment in R&D is less than 0.18 per cent of the GDP. In India
investment in R&D is about 0.61 per cent of the GDP. In Malaysia it is about 0.93 per
cent and in China it is about 1.34 per cent and in Singapore R&D investment is about
2.36 per cent of the GDP. As a result of significant investment in R&D these countries
have been able to raise the standards of their products and be more competitive in the
global market. The level of skills of the work force has also been raised to match the
technology, which has resulted in increased labour productivity and incomes.
The private sector in Sri Lanka has a role to play in optimizing the human resource
potential. In addition to taking steps to develop the capacity of their employees through
training and development interventions, the private sector is expected to work jointly
with the government in promoting national level initiatives in the area of HRD. It is
important to learn from good practices adopted by countries such as India, China,
Singapore, Korea and Malaysia in this regard.
7. CONCLUSION
Sri Lanka is currently at the threshold of accelerated development after achieving
peace. In the emerging environment there is a tremendous potential to develop a
labour force with a right combination of knowledge, skills and attitudes. There has to
be fresh thinking at the macro level for adopting an integrated and holistic approach
towards development and application of human capacity. Thus, a paradigm shift in
policy prescriptions as well as action initiatives is necessary for us to make a major
breakthrough and position Sri Lanka among the countries that continuously add value
to their people, products and processes.
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REFERENCES
Central Bank of Sri Lanka, Annual Report 2010, Colombo: Sri Lanka
Department of Census and Statistics, Sri Lanka Labour Force Survey- Annual Report,
2009, Colombo: Sri Lanka
Dissanayake, Dharma (2005), Female Participation of Informal Economic Activities
in Sri Lanka, Department of Census and Statistics, Colombo: Sri Lanka
Draft National Human Resources and Employment Policy, 2011, Secretariat for Senior
Ministers, Colombo: Sri Lanka
Government of Sri Lanka, “Mahinda Chintana- Towards a New Sri Lanka” 2005,
Colombo: Sri Lanka
Ranasinghe, Sudatta. (2008), “Issues of Managerial and Organizational Capacity in a
Devolved System of Governance: The Case of General Education in Sri Lanka”,
VISTAS, Journal of Humanities and Social Sciences, The Open University of Sri
Lanka: Nugegoda: Sri Lanka
Tertiary and Vocational Education Commission, Labour Market Information Bulletin,
Vol. 02/09- December, 2009; Colombo: Sri Lanka
The World Bank, The Towers Of Learning- Performance, Peril and Promise of Higher
Education in Sri Lanka, July 2009, Colombo: Sri Lanka
(Footnotes)
1 ILO Technical Note on the Formulation of a National Human Resources and
Employment Policy for Sri Lanka, (2011), ILO Office: Colombo
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IMPACT OF SUPERVISOR SUPPORT AND WORK SCHEDULEFLEXIBILITY ON JOB STRESS AND TURNOVER INTENTION OF
SOFTWARE DEVELOPERS IN SRI LANKA
Vathsala WickramasingheProfessor, Department of Management of Technology,
Faculty of Engineering, University of Moratuwa, Sri [email protected]
ABSTRACT
This paper presents and discusses the results of an empirical study that investigated
the impact of supervisor support and work schedule flexibility on job stress and
turnover intention. In the study, supervisor support and work schedule flexibility are
considered as independent variables, job stress as the mediator and turnover intention
as the dependent variable. 350 self-administered survey questionnaires were distributed
among software developers full-time engaged in offshore outsourced software
development firms. 232 valid responses were returned, yielding a response rate of
66%. The three-step regression analysis procedure was used to test mediation
hypotheses using SPSS. It was found that job stress partially mediates the relationship
between supervisor support and turnover intention. Further, it was found that job
stress fully mediates the relationship between work schedule flexibility and turnover
intention. The results of the study imply that the increased levels of supervisor support
could lead to decrease in job stress, which subsequently could lead to decrease in
turnover intention. Similarly, the increased levels of work schedule flexibility could
lead to decrease in job stress, which subsequently could lead to decrease in turnover
intention.
Key words: Job stress, supervisor support, work schedule flexibility
1. INTRODUCTION
Job stress is identified as an important occupational health problem (Johnson et al.,
2005). Evidence suggests that high levels of unmanaged job stress not only undermine
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quality, productivity, creativity of employees but also influence employees’ health,
well-being and morale (Burton et al., 2008). Therefore, some of the most important
topics of research in human resource management today revolve around specific
policies, practices and programmes that appear to influence job stress (e.g. Dooris et
al., 2008). When it comes to addressing stress at workplace, it is necessary to evaluate
different strategies available at the organizational level to find out strategies that reduces
job stress (see Le Fevre et al., 2006). However, very little evidence is available on
which to base the organizational focused stress management strategies and very little
clear information is available on the relative effectiveness of various strategies in general
(see Le Fevre et al., 2006).
In the above context, this paper explores effects of two contrasting initiatives, i.e.,
instrumental support (i.e., work schedule flexibility) and social support (i.e., supervisory
support) on job stress. Therefore, this paper investigates the impact of supervisor
support and work schedule flexibility on job stress and turnover intention. In the
study, supervisor support and work schedule flexibility were considered as independent
variables, job stress as the mediator and turnover intention as the dependent variable.
Therefore, the study investigated the mediating effect of job stress on the relationship
between supervisor support/work schedule flexibility and turnover intention of software
developers attached to offshore outsourced software development firms in Sri Lanka.
The literature suggests that the high level of occupational identification among software
developers is suggestive of an aspirant profession and a key occupation to examine in
future studies of knowledge workers (Scholarios and Marks, 2004). They are identified
as one of the critical resources of a country in its quest to become a technologically
advanced nation. Further, they enjoy a considerable labour market power, which has
encouraged their mobility across organizations rather than promoting loyalty to a single
organization (Scholarios and Marks, 2004). During the last decade Sri Lanka witnessed
a growth of offshore outsourced software development firms in the country. The
literature provides evidence for both extensive opportunities created for software
developers as well as increased stress in the workplace (Aziz, 2004). However, the
literature suggests that attitudes of software developers towards the characteristics of
work organization in the offshore outsourced sector have, yet, not been systematically
examined (Aziz, 2004). Therefore, the specific objective of the study is to investigate
the impact of supervisor support and work schedule flexibility on job stress and turnover
intention.
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2. LITERATURE REVIEW AND HYPOTHESIS
2.1 Job Stress
Job stress is generally defined in literature as an employee’s feeling of job-related
hardness, tension, anxiety, frustration, worry, emotional exhaustion and distress
(Armstrong and Griffin, 2004). In other words, work related variables (job stressors),
when interpreted by the individual (cognitive interpretation), may lead to stress (Dua,
1994). Therefore, stressors denote the external force or situation acting on the individual
- objective events. Stress denotes the deformation or changes produced in the individual
as a result of those forces - subjective experience of the event (Le Fevre et al., 2003).
Further, job stress is a mental and physical condition and becomes problematic when
it remains unresolved because of lapses in an individual’s adaptive capacity (Erkutlu
and Chafra, 2006; Dua, 1994). When this happens, the individual becomes disorganized,
disoriented and therefore becomes less able to cope (Cooper and Marshall, 1976;
Erkutlu and Chafra, 2006; Le Fevre et al., 2006). The literature suggests that a high
level of stress is associated with decreased personal health and impaired individual
functioning in the workplace in terms of decreased capacity to perform, dampened
initiative and reduced interest in work, increased rigidity of thought, and a lack of
concern for the organization and colleagues (e.g. Cooper and Marshall, 1976; Dua,
1994; Erkutlu and Chafra, 2006).
2.2 Work Schedule Flexibility
Work schedule flexibility refers to a policy in which the traditional fixed times that full-
time employees start and finish the working day are replaced by a framework within
which employees are allowed some freedom to choose their starting and finishing
times (Golembiewski et al., 1975; Olorunsola and Ibegbulam, 2003). Work schedule
flexibility is in operation as a part of human resource benefit package offered to
employees (Scandura andLankau, 1997). The basic model of work schedule flexibility
usually consists of five interrelated components although there are a number of variations
in flexible time arrangements: (1) a band within which all hours must be worked (e.g.
6.00 am to 6.30 pm); (2) a core time during which all employees are required to be
working (e.g. 10.00 to 12.00 am and 2.00 to 4.00 pm); (3) a flexible band of hours
before, after, or in between core times that allows employees to exercise designated
- 15 -
options regarding their presence in, or absence from, the work place; (4) banking,
which allows a carry-over of surplus or deficient hours worked; and (5) variability of
schedule, i.e. the freedom of employees to vary working hours from one period to
another without prior approval from their supervisor.
The availability of flexible work scheduling gives employees greater control over work
and family matters, thereby helping employees to manage the often conflicting demands
of work and non-work domains (Anderson et al., 2002).The work schedule flexibility
is identified as the most frequently utilised and preferred arrangement by employees
of the offshore outsourced software development industry in Sri Lanka (Wickramasinghe
and Jayabandu, 2007). Wickramasinghe and Jayabandu (2007) also reports that software
developers experience reduction in stress with the implementation of flexible work
schedules. Therefore, in this study, work schedule flexibility is investigated as a form
of instrumental support received formally through organizational initiatives, which could
impact on job stress experienced by employees.
2.3 Supervisor Support
Supervisor support describes the extent to which a supervisor is sensitive to an
employee’s non-work responsibilities and is accommodating when conflicting work
and non-work demands arise (Carlson and Perrewé, 1999). Hence, scholars suggest
that supervisor support may make one’s work situation less stressful by providing
emotional support, instrumental aid or greater control over one’s situation (e.g. Anderson
et al., 2002; Carlson and Perrewé, 1999). Past researchers further suggested that
support from one’s supervisor is instrumental in reducing unfavourable effects of job
stress by providing emotional support to increase the stressed individual’s self-
confidence (e.g. Russell et al., 1987) and self-esteem (e.g. Wong and Cheuk, 2005).
Likewise, relevant and useful informational support from the supervisor helps the
stressed individuals to cope effectively with job-related problems, which in turn reduce
job stress one is experiencing (Thomas and Tymon, 1994).
2.4 Turnover Intention
Behavioural intentions constitute the most immediate determinant of actual behaviour,
in the context of this study, employee turnover intention (e.g. Bluedorn, 1982; Steel
and Ovalie, 1984). Steel and Ovalie (1984) showed an existence of a strong relationship
- 16 -
between turnover intention and turnover. Some scholars (such as Bluedorn, 1982)
recommended using intent to leave or intent to stay attitudes rather than actual staying
or leaving behaviour as collecting such information is relatively less expensive than
collecting actual turnover. The literature suggests that workplace practices (such as
work schedule flexibility and supervisor support) could reinforce employees’ beliefs
that the organization values their contribution and cares about their well-being, which
in turn reduce turnover intention (Eisenbeger et al., 1990). Based on the aforementioned
reasons, in this study turnover intention is used as the dependent variable.
A number of studies indicated that IT personnel exhibit little loyalty to their organizations
and may well be tempted to leave a firm for anticipated higher rewards elsewhere as
their skills are highly transferable across different firms and even different industries
(Adya and Kaiser, 2005). Hence, organizations today find difficulties in attracting and
retaining IT personnel. Studies that have examined the work in the outsourcing
environment identify two common features of these organizations (Pearce, 1993). On
the one hand, work in the outsourcing environment is highly monitored and controlled
by management. On the other hand, these organizations consist of empowered workers
who work in a positive work environment. These empowered workers customize
work to the needs of customers (Batt and Appelbaum, 1995). Therefore, the work
environment is highly controlled and performance is closely monitored and measured
against targets. However, employees are encouraged to take responsibility for both
their team’s and their own performance (Frenkel et al., 1999). In this work environment,
an important problem faced by the management is high labour turnover (Frenkel et al.,
1999). The Sri Lankan outsourcing sector also suffers from high labour turnover
(LIRNEasia, 2006).
2.5 Hypotheses
Drawing from the literature reviewed above, it is proposed for this study that the
direct relationship between work schedule flexibility and turnover intention will be
mediated by job stress and the direct relationship between supervisor support and
turnover intention will be mediated by job stress. Figure 2.1 illustrates the proposed
relationships.
Based on the conceptual framework developed for the study, following hypotheses
were proposed:
- 17 -
H1a: Work schedule flexibility will be negatively related to turnover intention.
H1b: Supervisor support will be negatively related to turnover intention.
H2a: Work schedule flexibility will be negatively related to job stress.
H2b: Supervisor support will be negatively related to job stress.
H3: Job stress will be positively related to turnover intention.
H4a: Job stress will mediate the relationship between work schedule flexibility
and turnover intention.
H4b: Job stress will mediate the relationship between supervisor support and
turnover intention.
Figure 2.1 Conceptual Framework
3. METHOD
3.1 Sample
A random sample of software developers attached full-time to offshore outsourced
software development firms was selected. The list of software development firms
registered and operate under Board of Investment of Sri Lanka (BOI) was used. By
the end of 2009 there were about 36 firms that are engaged purely in software
development. Of the 350 questionnaires distributed among randomly selected individuals
whose main job function is software development, 232 valid responses were returned.
The response rate was 66 per cent of the original sample.
- 18 -
With regard to demographics of the respondents, 66% were male and 44% were
female. 47% were single and 53% were married. The mean age was 30 years (SD=2.86;
min.= 27 years; max.=40 years). The average number of years of service in the
present firm was three years (SD=1.55; min=11 months; max=7 years); the average
number of years of service in the IT industry was seven years (SD=1.94; min.= 11
months; max.=11 years). 83% had Bachelor’s degrees or equivalent professional
qualifications; 17% had postgraduate degrees. 82% reported that they do not have
dependents.
3.2 Data Collection Instrument and Measures
A self-administered survey questionnaire was chosen as the mode for data collection.
In constructing the questionnaire, scale items from existing research were used.
Therefore, content validity of the questionnaire was protected by embodying sufficient
number of items related to each variable in the study. The questionnaire was piloted
prior to final distribution. The standardized estimates and reliability statistics for all the
variables are provided in Table 3.1.
Table 3.1 Standardized Estimates and Reliability Statistics
Job stress .758 2.04 67.95 .519 99.42***
Turnover intention .755 2.02 67.45 .641 76.86***
Supervisor support .696 1.53 76.67 .521 59.64***
Work schedule flexibility .717 1.93 64.49 .604 64.53***
Standar-
dised
Cronbach’s
alpha
Eigen
value
Explained
variation
KMO
sampling
adequacy
Bartlett’s
Chi-Square
Note: *** p<.001.
- 19 -
Item measures used in the questionnaire were as follows:
Supervisor support was measured by the six items from Anderson et al.
(2002). Respondents reported on a 5-point Likert scale from (5) very often
to (1) never.
Work schedule flexibility was measured by the three items that inquired into
the level of usage of periodical flexi time, daily flexi time, and time offs.
Respondents reported on a 5-point Likert scale from (5) very often to (1)
never.
Job stress was measured using the five items from Lambert et al., (2006).
Responses were reported on a 5-point Likert scale from (5) very often to (1)
never.
Turnover intention was measured by the four items from Bluedorn (1982).
Respondents reported on a 5-point Likert scale from (5) very often to (1)
never. The higher number indicates a higher level of quitting intention.
In the analysis three demographic characteristics (gender, marital status, tenure) and
one firm characteristic (firm size) were controlled. The demographic characteristics
were gender (female=0, male=1), marital status (single=0, married=1), age (continuous
scale), the highest level of education (degree or equivalent=0, postgraduate degree=1),
and the years of experience in the present workplace (continuous scale). In addition,
firm size is also added as a control variable. Firm size was assessed by the natural
logarithmic transformation of the number of full-time employees in the organization.
3.3 Data Analysis Procedure
The three-step regression analysis procedure recommended by Baron and Kenny (1986)
was used to test mediation hypotheses. According to Baron and Kenny (1986), the
following conditions must be met to support a mediating relationship. First, the
independent variable must be significantly associated with the dependent variable.
Second, the independent variable must be significantly associated with the mediator.
Finally, after the mediator is entered, the relationship between the independent and
dependent variables should either disappear (full mediation) or significantly diminish
(partial mediation).
- 20 -
4. RESULTS
Table 4.1 shows means, standard deviations and zero-order correlations between all
the variables. As can be seen in Table 4.1, work schedule flexibility and supervisor
support were negatively related to turnover intention. Job stress was positively related
to turnover intention.
In analysing the mediator effect of job stress, the hypotheses were tested by estimating
a series of multiple regression equations following the procedure presented in the
section on “data analysis procedure”. The results are shown in Table 4.2 and Table
4.3. The results relating to work schedule flexibility- job stress- turnover intention
relationship were shown in Table 4.2. As can be seen in Table 4.2, the conditions for
mediation were met. Work schedule flexibility significantly negatively associated with
turnover intention supporting H1a. Work schedule flexibility significantly negatively
associated with job stress supporting H2a. Job stress significantly positively related to
turnover intention supporting H3. After job stress is entered, the relationship between
work schedule flexibility and turnover intention disappears (β=-.272, p<.01 to β=-
.201, p>.10), suggesting full mediation. Critical ratios were also reported in Table 4.2.
Accordingly, the mediation hypothesis (H4a) that job stress mediates the relationship
between work schedule flexibility and turnover intention is supported by the data.
- 21 -
Table 4.1 Correlations
- 22 -
The results relating to supervisor support-job stress-turnover intention relationship
were shown in Table 4.3. As can be seen in Table 4.3, the conditions for mediation
were met. Supervisor support significantly negatively associated with turnover intention
supporting H1b. Supervisor support significantly negatively associated with job stress
supporting H2b. Job stress significantly positively related to turnover intention supporting
H3. After job stress is entered, the relationship between supervisor support and turnover
intention significantly diminishes (β=-.416, p<.001 to β=-.302, p<.01), suggesting
partial mediation. Critical ratios were also reported in Table 4.3. Accordingly, the
Table 4.2 Summarised Results: Job Stress as a Mediator in the Work ScheduleFlexibility and Turnover Intention Relationship
- 23 -
mediation hypothesis (H4b) that job stress mediates the relationship between work
schedule flexibility and turnover intention is supported by the data.
5. DISCUSSION AND RECOMMENDATION
Organizations identify the need of addressing job stress. Drawing on previous research,
this study investigated the effect of two major forms of support available in the
Table 4.3 Summarised Results: Job Stress as a Mediator in the SupervisorSupport and Turnover Intention Relationship
- 24 -
organizational environment, i.e., instrumental support and social support in reducing
job stress and in turn reducing turnover intention. In the study, supervisor support is
considered as an informal support and work schedule flexibility as a formal policy
initiative that could influence job stress and in turn turnover intention. The study
treated work schedule flexibility and supervisor support as independent variables, job
stress as a mediator and turnover intention as a dependent variable.
The study investigated whether supervisor support mediates the positive relationship
between job stress and turnover intention. It was found that job stress partially mediates
the relationship between supervisor support and turnover intention. Therefore, as
expected, supervisor support was identified as an important support that serves as a
mediator in the positive relationship between job stress and turnover intention. The
findings support previous research that reported support from immediate supervisor
helps individuals to reduce stress (e.g. Anderson et al., 2002). Hence, the findings of
the study imply the importance of supportive organizational context created by the
immediate supervisor in reducing job stress and in turn turnover intention.
Further, the study investigated whether work schedule flexibility mediates the positive
relationship between job stress and turnover intention. It was found that job stress
fully mediates the relationship between work schedule flexibility and turnover intention.
Therefore, work schedule flexibility was also identified as an important support that
serves as a mediator in the positive relationship between job stress and turnover
intention. The findings support previous research that reported the usage of flexible
work scheduling helps individuals to reduce stress (e.g. Wickramasinghe and Jayabandu,
2007). Hence, the findings of the study imply the importance of supportive
organizational policies (i.e., work schedule flexibility) in reducing job stress and in turn
turnover intention.
In the current global economic environment, organizations are continually trying to
discover value-added initiatives to strategically enhance the performance of their
organizations and employees. Therefore, some of the most important topics of research
in human resource management revolve around specific policies, practices and
programmes that appear to influence employee performance. Therefore, it is expected
that the findings of this study will provide useful information for both practitioners and
academicians to better understand the nature of strategies to be adopted in offshore
- 25 -
outsourced software development firms as the results of the study implied that increased
levels of supervisor support could lead to decrease in job stress, which subsequently
could lead to decrease turnover intention. Similarly, increased levels of work schedule
flexibility could lead to decrease job stress, which subsequently could lead to decrease
in turnover intention.
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GRANDEUR OF THE GROUNDED THEORY:UNEARTHING THE UNIQUENESS
Ajantha S. DharmasiriPostgraduate Institute of Management,
University of Sri Jayewardenepura, Borella, Colombo [email protected]
ABSTRACT
The purpose of this study was to explore the nature of grounded theory where the
researchers can move to the field with an open mind. “Let the data emerge the
theories” is the motto behind such a distinct approach. The researcher proposes the
argument that grounded theory offers a unique approach in unearthing the rich
patterns of behaviour that would otherwise have been hidden. A grounded theory is
one that is inductively derived from the study of the phenomenon it represents.
Developed by Glaser and Strauss (1967) and popular among many social scientists,
it is “grounded” because it is related to, emerges out of, is created through, and
grounded on empirical data. According to Sarantakos (1993), the centre of its interest
is not collecting volumes of data but organizing the variety of thoughts and experiences
that researcher gathers during the analysis of data. The researcher discusses the
way to judge the “groundness” of a theory and the steps involved in a typical grounded
theory approach. As the empirical component, the study on strategic orientation of
HR managers in South Asia by Dharmasiri (2007) is critically evaluated in explaining
how the grounded theory can be effectively used in management research. The
researcher concludes that the grounded theory rises above other qualitative research
approaches as a distinct way of exploring and interpreting reality.
Key words: Grounded theory, organizational commitment, qualitative research
- 29 -
1. INTRODUCTION
Qualitative research refers to any kind of research that produces findings not arrived
at by means of statistical procedures or other means of quantification. Grounded
theory approach falls into this category. A grounded theory is one that is inductively
derived from the study of the phenomenon it represents. That is, it is discovered,
developed, and provisionally verified through systematic data collection and analysis
of data pertaining to that phenomenon. As such, data collection, analysis and theory,
stand in reciprocal relationship with each other.
Grounded theory offers a fresh approach, where the researchers can move to the
field with an open mind. “Let the data emerge the theories” is the motto behind such
a distinct approach. As such, the writer proposes the argument that grounded theory
offers a unique approach in unearthing the rich patterns of behaviour that
would otherwise have been hidden.
2. GROUNDED THEORY EXPLORED
Grounded theory was developed by Glaser and Strauss (1967) and has become popular
among many social scientists. It is “grounded” because it is related to, emerges out of,
is created through, and grounded on empirical data. According to Sarantakos (1993),
the center of its interest is not collecting volumes of data but organizing the variety of
thoughts and experiences that the researcher gathers during the analysis of data.
The objective of the grounded theoretical approach, as interpreted by Wells (1995), is
an explanation of the variability in social interactions, the social structural conditions
that support the interactions, the consequences of the interactions and the conditions
that support changes in interactions over time.
Grounded theory grew out of the theoretical framework of symbolic interaction (Blumer,
1969; Bowers, 1988). This framework can be thought of as the lens or the glasses
through which one views the world. In the case of symbolic interaction, the framework
arises from sociology and proposes that individuals interpret their experience and create
meaning out of those experiences (Bogdan & Biklen, 2003).
Whilst there are a variety of applied interpretive assessments of what constitutes grounded
theory, it would seem that the one developed by Strauss and Corbin (1990) is referenced
- 30 -
most commonly by researchers as being essentially “the clearest theoretical exposition
of this important research tradition” (Miller & Fredericks, 1999). Strauss and Corbin
define a grounded theory as one that is;
“.......inductively derived from the study of the phenomenon it represents.
That is, it is discovered, developed and provisionally verified through
systematic data collection and analysis of data pertaining to that
phenomenon. Therefore, data collection, analysis and theory stand in
reciprocal relationship with each other.” (Strauss & Corbin 1990: 23)
It has been suggested by a number of authors that grounded theory has been and
continues to be the research methodology of choice in the qualitatively oriented research
fields of medicine, nursing, social work and education (Wells, 1995, Miller & Fredericks,
1999). The common socio-behavioural foundation that these human science research
fields share with the study of organizationally contexted human interaction suggests
that grounded theory may also be a useful methodology for application in the
investigation of phenomena in this later domain. It is the extent of grounded theory is
practical and theoretical suitability as a form of qualitative inquiry into organizationally
contexted phenomena that we are seeking to evaluate.
3. THE GENERATION OF GROUNDED THEORY
The foundation of the grounded theory process is the requirement for a constant
comparative analysis of the qualitative data which has been collected and, in turn, the
dynamic interrelationship that this has with hypothesis development and ultimately,
theory generation. In grounded theory, data collection and theory generation are
considered as “two parts of the same process” (Robrecht, 1995; Glaser, 1978; Glaser
& Strauss, 1967).
Bearing in mind that a fine balance between prescription and generality is required,
based on Glaser & Strauss’s lean structures, the following is an interpretation of the
steps to the generation of grounded theory:
a) Data collection - As grounded theory is a tool for qualitative investigation, the
commonly referenced forms of data collection are social interaction, field studies,
participant observation and semi-structured interviews. This is not to suggest
- 31 -
that other techniques for capturing qualitative data on human interaction may
not be as or more appropriate in a given situation.
b) Data analysis - Grounded theory focuses on the constant comparison of the
data leading to coding and then categorisation of the data.
Hypothesis formulation can (and is perhaps expected to) occur before, during,
and after, the initial process of data collection has occurred. Constant comparison
focuses on “the simultaneous conceptualisation and assessment of the similarities
and differences in social interactions” in search of a “core idea that could explain
variability in interactions” (Wells, 1995). This process of data collection, data
analysis and hypothesis is interrelated and cyclical in that each may influence
the other.
c) Theory delimitation - once the core idea has been identified, new data on
interaction is sought to “confirm and disconfirm the elaborated concepts and
the relationship among them” (Wells, 1995). This process is continued until no
new insights into these relationships in terms of the core idea or dimension are
revealed.
d) Theory definition - Definition of the theory is the final stage of the process. The
resulting grounded theory is intended to be a rich, “powerful and parsimonious
explanation”, of the investigated phenomenon (Wells, 1995). The better view
seems to be that, as it is a form of inductive reasoning, once a theory has been
arrived at, the process itself is complete and testing of the theory is not required
to confirm its status as validly grounded (Miller & Fredericks, 1999).
4. JUDGING THE “GROUNDEDNESS’’ OF A THEORY
Glaser & Strauss (1967) and Glaser (1978) propose four criteria for judging a theory
as grounded - fit, understanding, generality and control. The concept of “fit” suggests
a theory’s applicability to, or coverage of, the data that in turn delimits the boundaries.
Understanding is directed to and linked with practical application by researchers and
laymen. Generalisation suggests the necessity of balancing theory abstraction and
flexibility in application to ensure that the theory is “a general guide to multi-conditional,
ever changing daily situations” (Glaser & Strauss, 1967). Control refers to the capability
that the theory provides to the practitioner to assist in the development of hypotheses
- 32 -
regarding how the practitioner should act in particular situations that they may face
(Wells, 1995).
Collectively, the guidelines for theory judgment suggested by Glaser & Strauss (1967)
seem directed to ensuring that the resultant grounded theory is able to be readily
applied in practice by both laymen practitioners and academic researchers. Robrecht
(1995 citing Glaser, 1978) suggests “...that the goal of the discovery process is a
theoretical description of the basic social process that is most central or problematic to
participants involved in the investigation”. It appears that the “richness” of this “running
theoretical discussion”, as Glaser & Strauss (1967) refer to it, is one of the key
determinants as to whether one has a grounded theory which credibly explains and
gives meaning to the phenomena which has been the subject of the investigative process
(Miller & Fredericks, 1999).
5. CENTRAL CRITERIA OF GROUNDED THEORY
In discussing the uniqueness of the grounded theory, Hilderbrabd (1991) illuminates
us by identifying four important criteria that make it different from other qualitative
approaches. These are tabulated as given in table1.
As Sarantakos (1993) further elaborates, theories are initially developed and then
further refined and tested, in a continuous and unending process. This can be
summarised as:
induction (development of temporary / conditional hypotheses);
deduction (derive implications of hypotheses); and
verification (testing of the validity of these hypotheses).
This work pattern is the basis for the whole research process.
6. STEPS IN THE GROUNDED THEORY APPROACH
Strauss (1951) illuminates us by offering a logical sequence of steps that can be used
in grounded theory approach, as given in table 2. These steps portray a practical sense
with a methodological clarity, resulting in a distinct path towards unearthing hidden
patterns.
- 33 -
Source: Adopted from Hilderbrabd (1991) in Sarantakos (1993)
Table 1. Central Criteria of Grounded Theory
An
autonomous
unit
Interpretation
of reality
Everyday
thinking
Development
of concepts
The case under investigation is not an
amorphous piece of reality but an
autonomous unit with its own structure,
boundaries and history
Scientific interpretation of reality
resembles that of an artist. This element
suggests that social scientists that
employ grounded theory as their guide
approach and interpret reality the same
way as artists do when they work in
their context.
There is continuity from everyday
thinking to scientific thinking. Being
grounded to data means that grounded
theory is close to everyday behaviour
and action. Everyday knowledge is an
un-renounceable resource, which this
theory sets to make a central element
of its structure and approach.
Openness of social scientific formation
of concepts is the feature here. This
element suggests that the development
of concepts and categories is made in
a form that does not demand continuous
validity, that is, they change as soon as
knowledge of them and their
environment changes and as soon as
new ideas emerge and new explanations
dominate.
Involves the notion that
research is directed by
the interest of the
researcher.
Like the artists, social
scientists approach
reality in an
unprejudiced manner.
Primary experience is
very significant for the
development of
grounded theory.
The development of
concepts is a process
not a structure; it is
constantly changing.
Criteria Description
- 34 -
Table 2. Steps in the Grounded Theory Approach
Appropriateness of the indicators
Relative patterns
No preconceptions or models
Classification
Emergence of a concept
Refined and optimal relationships
with data
Similarity of the indicators vs. the
degree of saturation
Continuity in comparison
Authenticity
Consolidation of the emerged
patterns
DetailsImportance
1. Identifying indicators in the research topic
2. Studying indicators and comparing them
with each other
3. Coding indicators; looking for answers and
formulating hypotheses
4. Categorising similar indicators as a class.
5. Naming the class and perceiving it as a
coded category, which reflects the
indicators’ similarities, and the smallest
common denominator. This is the
conceptual code, the concept.
6. Comparing indicators with concepts and
with other indicators; this helps to refine
them and relate them optimally to the data.
7. Working through more attributes of the
categories, refining them, and getting
additional information until the codes are
tested and saturated, that is until no more
new information is gained.
8. Developing and saturating more categories
through the process of constant
comparisons.
9. Including in the theory, concepts and their
attributes developed that way.
10. Further testing, contrasting and comparing,
theories and perhaps refining and changing
them
Source : Adopted from Sarantakos (1993)
- 35 -
In comparison with the other qualitative approaches such as case study research,
anthropology and ethnography, action research as well as critical research, the steps
mentioned above cannot be clearly identified. As such, grounded theory approach
has its own “grandeur” in offering a unique path towards the exploration of reality. As
Nanayakkara (1983) illuminates us, “…the closer one gets to reality, the more deeply
one gets down to the uniqueness of each organizational event”.
7. MANAGERIAL APPLICATION:STRATEGIC ORIENTATION OFHR MANAGERS IN SOUTH ASIA
An application of grounded theory approach in organisational context can be seen in a
recent research by Dharmasiri (2007) on strategic orientation. In this particular research,
grounded theory procedure and techniques that were used extensively gave more
scope to discovery of the patterns related to the strategic orientation. The
conceptualisation involved is shown in the concept-indicator model as shown in
Figure 1.
According to the research abstract, the research problem was formulated as: “With the
increased emphasis on human capital as a global trend, what is the extent of strategic
orientation of Human Resource Managers in South Asia?” The objectives were to
identify the personal factors as well as organizational factors that contribute to the
strategic orientation of HR Managers and to identify the interactional effects of personal
and organizational factors. The scope of the research was limited to selected high-
performing organizations inclusive of banks, mobile communication companies and
Figure 1: Concept – Indicator Model
PersonalFactors
OrganizationalFactors
Strategic Orientation ofHR Manager
Source: Dharmasiri, (2007)
- 36 -
conglomerates from Bangladesh, India, Pakistan and Sri Lanka. In-depth interviews
were conducted with the Chief Executive Officer, Chief Finance Officer, and the Head
of HR of each company.
Based on the personal and organizational factors that emerged through data in relation
to the strategic orientation of HR Managers, the emergent model has been depicted
in figure 2
The intent here is not to discuss the emergent model in detail but to show
the complexity and comprehensiveness of it compared to the concept-
indicator model. It also demonstrates the richness of patterns that can be
captured through a grounded research approach. Study on functional
and structural elements of organizational commitment by Perera (2002)
is another such example.
Figure 2. The Emergent Model
Tacit Knowledge
Conceptual Skills
Business Awareness
OpportunityDeficit
OperationalInvolvement
StrategicInvolvement
CompetencyDeficit
Lev
el o
f P
rese
nce
ofP
erso
nal
Fac
tors
High
Low
StrategicOrientation ofHR Manager
Level of Presence ofOrganizational Factors HighLow
Lea
der’
s re
cogn
itio
nof
HR
Source: Dharmasiri (2007)
Con
duci
ve O
rgan
iza-
tion
al
Env
iron
men
t
Per
form
ance
Ori
enta
tion
- 37 -
8. SUMMARY AND CONCLUSIONS
Grounded theory has, since its inception, been accepted as an important research
methodology in the investigation of complex social interactions in the social science
fields. Given the obvious similarities in human interaction that occur in these social
areas and in organizations, grounded theory should conceivably be a potentially useful
methodology for the exploration and examination of organizationally contexted human
interaction. It is of greatest value when the researcher has little knowledge of the
subject field of qualitative inquiry that is likely to be the case in relation to the
investigation of many organizationally contexted phenomena.
Grounded theory’s greatest strengths are two-fold. First it permits the investigation of
higher level and lower level factors of causation which is critical when investigating
and seeking to explain variability in complex human interactions. Second, as an
extension of inductive reasoning, grounded theory is a unique form of theory
construction. As such, grounded theory rises above other qualitative research
approaches as a distinct way of exploring and interpreting reality.
Accordingly, it can be safely concluded that the grounded theory offers aunique
approach in unearthing the rich patterns of behaviour that would otherwise
have been hidden.
REFERENCES
Annells, M, (1996), “Grounded Theory Method: Philosophical Perspectives, Paradigm
of Inquiry and Postmodernism”, Qualitative Health Research, 6: 379.
Creswell, C. W. (1994), Research Design: Qualitative & Quantitative Approaches,
London: Sage Publications, pp. 173 – 190.
Dharmasiri, A. S. (2007), Strategic Orientation of HR Managers in South Asia,
Doctoral dissertation, Colombo: Postgraduate Institute of Management.
Glaser, B. & Strauss, A. (1967), The discovery of grounded theory: Strategies for
qualitative research, New York: Aldine.
Glaser, B. (1978), Theoretical sensitivity. Mill Valley: Sociology Press.
Kools, S. & McCarthy, M. (1996), “Dimensional Analysis: Broadening the Conception
of Grounded Theory”, Qualitative Health Research, 6: 312.
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Locke, K. (1996), “Rewriting the Discovery of Grounded Theory after 25 Years”,
Journal of ManagementInquiry, 5: 239.
Mill, J. S. (1970), A System of Logic, London: Longman.
Miller, S. I. & Fredericks, M. (1991), “Post Positivist Assumptions and Educational
Research: Another View”, Educational Researcher, 20 (4): 2-8.
Nanayakkara, G. (1983), “The Scientific Study of Management”, Vidyodaya Journal
of Management, 11 (1&2): 13 - 26.
Perera, C. T. (2002), “Employee Commitment: A Study of Selected High Performing
Companies of Sri Lanka”, Sri Lanka Journal of Management, 7(3 & 4): 188-208.
Robrecht, L. C. (1995), “Grounded Theory: Evolving Methods”, Qualitative Health
Research, 5: 169.
Sarantakos, S. (1993), Social Research, London: Macmillan Press, pp. 268-274.
Schatzman, L (1991), Dimensional Analysis: Notes on an Alternative Approach to
the Rounding of Theory in Qualitative Research. In D.R.Maines (Ed.), Social
organization and social process: Essays in honour of Anselm Strauss,New York: Aldine,
pp. 303-314.
Strauss, A.& Corbin, J. (1990), Basics of Qualitative Research: Grounded Theory
Procedures and Techniques, Newbury Park: Sage.
Wells, K. (1995), “The Strategy of Grounded Theory: Possibilities and Problems”,
Social Work Research, 19 (1): 33.
- 39 -
HR TECHNOLOGY AND
HR TECHNOLOGY FOR COMPETITIVE ADVANTAGE
Aruna DayanathaSenior Manager HR, Ceylinco Insurance PLC (Life)
Doctoral Candidate of PIM-University of Sri JayewardenepuraAspiring HR-Technologist/Chartered IT Professional
ABSTRACT
IT has emerged as a new competitive dynamic. IT helps any business function to
earn leverage. IT supported processes will be benefited by reduced cost, reduced
cycle time and improving output quality. However, HR sector has dramatically failed
to obtain the best benefit of IT, in todays’ context. Major allegation is that HR has
only used IT to “Automate” HR processes and to “informate” up to a certain level.
Yet there are higher levels of benefits that HR can obtain from IT. Literature suggests
that there are higher levels such as “Transformate” and “Endowmate” as well.
Author of this article explores the nature of intercept of HR and Technology (ICT),
and stresses the requirement of new space for HR Sector, that will provide solutions
in “HR Technology” domain.
Key words: HR, IT, HR technology, HRIS, HR-IT, competitive advantage, automate,
informatie, transformate, endowmate.
1. THE ISSUE
IT has become an essential tool for almost all the business functions within a modern
firm. All the functions utilize IT at some level, even though these functions may not
know the maximum potential of what IT can do to the best operation of the function.
HR being a function traditionally playing an administrative role, and today transiting to
a level of a business partner as well, uses the IT to enhance the activities within the
HR domain. Issue under consideration is, is the HR sector fully aware of the potential
of the IT capabilities towards making HR more efficient? This article will explore the
present level of utilization of IT in the HR function, within firms.
- 40 -
Borderic and Boudereau in their report “Human Resource Management, Information
Technology, and the Competitive Edge” argues that “No one yet proved the effects of
information technology on a firm’s competitiveness” (Broaderick R.F, 1991). Same
authors are arguing that “Information Technology has enormous potential to make HR
more competitive”. Further they state that “Unfortunately, most organizational
investments in HR information technology support only a narrow range of administrative
decisions, such as those associated with payroll and record keeping. In many cases the
competitive potential of even these narrowly focused investments have not been fully
exploited (Broaderick R.F, 1991). These statements pave the way to discussion of
what present HR Technology is focusing at. Allegations of the cited authors are that,
even though HR only utilizes IT for narrow administrative functionality, whereas the
HR function as whole needed to shift beyond the administrative role, HR sector has
not exploited the maximum potential of IT, even when it is being used for administrative
activities.
This scenario would be more relevant in the case of Sri Lanka using technology in the
HR sector. Sri Lankan HR sector may not be fully utilizing the power of Information
Technology or IT, in getting the support for HR functional processes. Towards the
21st century, the face of Information Technology took a drastic turn, where IT was
renamed as ICT, i.e. Information Communication Technology, by inserting the aspect
of “Communication” in to the scope. Further these changes were made enriched by
promoting the “Web” technology to “Web 2.0” as a technological advancement.
However, fact remains as Borderic and Boudereau points out, HR has not made the
best use of IT, i.e. Information Technology. It was argued that there is a greater
potential in ICT, i.e. Information and Communication Technology than IT. And with
the reshaped ICT, there is greater area to research and understand and intercept HR
and ICT, which we label as “HR Technology”.
2. ROLE OF IT IN ORGANIZATIONS
Information Technology or IT, Information and Communication Technology or ICT
in today’s context is simply referred as “Technology”. This technology drives the
organization in the new millennium. It’s treated as a source of competitive advantage
as well. The HBR article “IT that makes a Competitive Difference” by Andrew McAfee
- 41 -
and Erick Brynjolfsson, explore this phenomenon in all publicly treated US companies
from 1960 to 2005.
Towards the latter part of 20th century, development of ICT was accelerated. This has
resulted in a new competitive dynamic for companies (McAfee A, 2008). This was
prominently illustrated by the gap between the leaders and laggards of industries (McAfee
A, 2008). It was evident that organizations which has shown rapid increase in
performance were the companies which focused on the quality and quantity of IT, and
those organization whose operating system are revamped by employing IT and internet
technology (McAfee A, 2008). Thus a clear correlation was established between earning
a higher level of performance over the competition and investment in IT or Technology
(McAfee A, 2008).
During the same period, many products were getting the leverage from IT (McAfee A,
2008). Organizational processes as well are becoming more productive and efficient
with technology (McAfee A, 2008). Many, if not all of these changes are due to
employment of internet and enterprise IT systems (McAfee A, 2008). Important
characteristic of IT supported processes was, it could be easily replicated to support
the business (McAfee A, 2008). Replication is implementing the same enhanced
processes across different geographical locations where the business is operating.
Last decade of 20th century was identified as the era where the enterprise systems,
such as Enterprise Resource Management, Customer Relationship Management, and
Enterprise Content Management were the practical tools of adopting IT in to businesses
(McAfee A, 2008).
During the past decade usage of IT in industry and commerce has increased rapidly
(Elisabeth Wilson-Evered, 2009). Legare (2002) et al identifies the benefits obtained
by the industry after using ICT as, reduced cost, reduced cycle time, and improving
output quality (Elisabeth Wilson-Evered, 2009). Considering the importance of reduced
cost, cycle time, and quality, in the business context, IT can be placed as same as
strategic drivers of the businesses. Thus we can take that, ICT has given the industry
leverage. Out of many definitions, the author opts to accept the following leverage: as
a power is stated, as ‘power to influence people and get the results you want’ (Cambridge
Dictionaries Online).
- 42 -
Companies, who believe in the power of technology, have utilized the technology to
improve the processes within the organizations (McAfee A, 2008). Those organizations
where they don’t understand the power of technology may not use IT to improve the
business processes (McAfee A, 2008). It was established that “Firm with the best
processes will win in most or all markets” (McAfee A, 2008). In today’s business
environment, IT supported processes has the potential to earn the competitive
advantage. Andrew McAfee and Erick Brynjolfsson established that most successful
IT exploiters are the once that will pull out from the pack, losers will fall (McAfee A,
2008).
How organizations have stayed ahead of the pack was explained by the authors of “IT
that makes a Competitive Difference”- the article explains how companies competing
on the digital processes, in other words how companies earn a competitive advantage
by technology enabled processes.
“First deploy a consistent technology platform. Then separate yourself
from the pack by coming up with better way of working. Finally, use the
platform to propagate these business innovations widely and reliably. In
this regard, deploying IT servers to distinct roles – as a catalyst for
innovative ideas and as an engine for delivering them. Each of the three
steps in the mantra presents different and critical management challenges,
not least of which have to do with questions of centralization and
autonomy” (McAfee A, 2008)
This has given the management a new challenge. Organizations cannot support any
process with technology. Business managers should select the best process that should
be consistent, within the operating model of the organization. And use the technology
to replicate the process with high fidelity (McAfee A, 2008).
IT has brought about an opportunity for innovation in processes as well. Technology
should not be simply adapted to the processes as they were before adopting technology.
Collective Intelligence and Web 2.0, advancements of technology provide the framework
with making process innovations (McAfee A, 2008).
Web 2.0 applications, has brought about a big shift in the way the processes are
facilitated using Technology. (McAfee A, 2008). The capabilities of Web 2.0 have the
capabilities and features that would facilitate the business innovation (McAfee A, 2008).
- 43 -
More importantly it was pointed out that Web 2.0 has the capability of causing the
process changes to emerge from the lower level of the organization (McAfee A, 2008).
Web 2.0 and the ERP Systems have open up the avenues that all part of the organization
can come in to the innovation arena, without waiting till the innovation came from the
headquarters (McAfee A, 2008). Technology application in the businesses processes
has brought about a convenient standardization opportunity to business. Standardized
business processes can be easily replicated using technology (McAfee A, 2008).
Authors of the article “IT that makes a Competitive Difference” points out that IT
systems do facilitate the implementation and monitoring of processes, once the processes
are facilitated with technology (McAfee A, 2008). Thus facilitating the processes with
technology will create an opportunity for inventing better methods (McAfee A, 2008).
They further point out that HR policies as well should evolve to cater for such scenarios
(McAfee A, 2008).
How HR processes were enhanced with the help of technology is explained;
“An analysis of 400 U.S. companies that EriKBrynjolfsson published
with Wharton professor LorinHitt in 2005, found that organizations
successfully using IT were significantly more aggressive in vetting new
hires: They considered more applicants. They scrutinized each one more
intensively. They involved senior management (not just HR) early and
often in the interview process. After identifying top talent, these firms
invested substantially more time and money on both internal and external
training and education”
Result of employing IT in organizations was sharp differences, rather than reducing
the differences (McAfee A, 2008). Organizations always were having varied ability to
select, adopt, and exploit innovations; technology has accelerated and amplified these
differences (McAfee A, 2008). It was identified that the best value comes from process
innovations that can now be delivered on those platforms (McAfee A, 2008).
Successful process innovations with the help of technology were identified to have
important characteristics as follows:
They cover a wide span
They produce results immediately
- 44 -
They are precise
They are consistent
They make monitoring easy
They build in enforceability (McAfee A, 2008)
The argument that is established with the discussion is, it’s not the IT or ICT that
makes a competitive advantage in a company. It’s the IT enabled processes within an
organization that would contribute towards a competitive edge.
3. HR AND COMPETITIVE ADVANTAGE
Increasingly all the business functions are employing the power of ICT, to obtain a
strategic advantage or to increase the effectiveness or the efficiency. The Human
Resources sector has employed a low level of power of ICT to enhance its effectiveness,
efficiency, or to acquire a strategic advantage or in other terms to earn leverage from
ICT. HRIS systems are designed to improve performance (Elisabeth Wilson-Evered,
2009). HRIS has been used as a means for storage and retrieval of HR Data (Newell,
2007). HRIS can be designed in different ways, either to use as an electronic filing
system, automation of HR operational processes or it may be used to enable a strategic
approach.
It was pointed out that organization use new technologies, basically ICT, and information
systems to harness the knowledge, in other words, to manage the knowledge, and link
the organizational units or entities which are disparate (Lee, 1993). Yet, organizations
are turning to the human competencies and capacities to bring life to the organizations
which are transformed by the technology (Lee, 1993). Basically they are looking for
avenues to earn a competitive advantage through Human Resource. It was pointed out
that it would take considerable effort to identify the critical success factors of using
Human Resource as a competitive advantage (Lee, 1993).
Zuboff (1988) has pointed out two powers of ICT, automation capacity, and
transformational capacity (Newell, 2007). Automation is referred to as saving mental
or physical labor in the management data, mainly focusing on efficiency (Newell,
2007). Ball (2001) points out that many businesses have not moved beyond the strategy
of automation (Newell, 2007). Thus gives a little or no integration or strategic capacity
- 45 -
(Newell, 2007). Business organizations on an average have invested in ICT for HR to
improve the efficiency of personnel management functions and payroll management
yet has not taken initiatives to obtain an enhanced effectiveness for the HR function,
required by the 21st century.
Zuboff (1988) points out that another level beyond automation, is ‘infomate’ where
IT tools are used to generate new sort of information, where information is yielded as
a byproduct, thus generating new streams of information (Newell, 2007). Level beyond
automation potentially can make both managers and employees be more ‘empowered’
having greater control over their work and work lives (Newell, 2007).
Human resource is the resource that links other resources together to drive the business.
It’s the Human Resource that identifies business opportunities, develop product or
services, formulate strategies, make and deliver products and services to the market
(Lee, 1993). When Human Resource accomplish above activities, that organization
will have a higher probability of succeeding in the competitive market, than in the case
of an organization where such has not been happening (Lee, 1993). Success of Human
Resource performing the organizational tasks mentioned above depends on the policies
and programs used to attract, retain, develop, and motivate the numbers and types of
employees in an organization (Lee, 1993). These are the usual business of Human
Resource (Lee, 1993).
Strategic internal fit for Human Resources strategy is identified as the coherency or
synergy among the various Human Resources activities that make up the strategy,
external fit refers to the degree of consistency between Human Resource Strategy on
one hand and the business context on the other (Lee, 1993). Internal fit and external
fit is explained as follows;
“Human Resources strategies that demonstrate internal fit are more
effective than those that do not, in meeting Human Resources goals,
Human Resource Strategies that demonstrate internal and external fit are
more effective than those that do not, in contributing to organizational
effectiveness” (Lee, 1993)
It was pointed out that HR system with complementary HRM practices tends to
produce productivity and quality at a significantly higher level than any other HR
system considered operating alone (Lee, 1993).
- 46 -
There were no HR related areas that can be identified as having obtained leverage
from technology, similar to inventory management and “Just-in-Time” by linking supplier
systems through technology (Lee, 1993) or decentralization achieved by the service
industry with the support of Technology (Lee, 1993) Such are identified as
transformations of processes through technology (Lee, 1993). Intelligent management
of Human Resources which is identified as “leveraging intellect” (Lee, 1993) can be a
target for the HR Technology.
Work design was identified as a central strategy for HR (Lee, 1993). Main focus was
the employee contribution to the job, while the supervision, rewards training, and
employment stability are identified as important components of this strategy (Lee,
1993). Characteristics of getting high level of employee involvement into work design
were elaborated as follows:
“… employees rather than managers design the work – that is, the approach is more
bottom-up in orientation – using principles of job enrichment and, quite commonly,
employing semi-autonomous or even autonomous (i.e., self-managing) work teams.
Within broad guidelines, these terms decide on work goals, priorities, job assignments,
quality controls, and, in advanced cases, such personal matters as hiring, training, and
discipline, additionally, cross-functional, cross-level teams or committees (sometimes
including labor union leaders as, for example, at Saturn) are employed to provide input
in to or even to decide on broader organizational issues such as customer and supplier
relations, overall productivity and quality goals, comprehensive work pressure (e.g.
reengineering), human resource policies, and purchases of capital equipment.” (Lee,
1993).
4. COMBINING HR AND IT FOR COMPETITIVE ADVANTAGE
It was pointed out that even in a challenging economy firms continue to invest in IT
(Webster Buchman Research, 2010). Survey on 100 HR directors in UK conducted in
2010, established that 70% of the companies had planned to spend either same amount
or more in HRIT (Webster Buchman Research, 2010).
In the paper titled, “Human Resource as a Source of Competitive Advantage” by Lee
Dyer published by the Center for Advanced Human Resources Studies of Cornell
- 47 -
University stresses the fact that business contexts are in a continuous flux. Making the
new formulation of Human Resource Strategies and making them relevant and tested
to prevailing and emergent contexts that are vital for the business success as well a
challenging endeavor (Lee, 1993).
In the changing business contexts, running fast in order to get to a different place is a
competitive race (Broaderick R.F, 1991). Further it was alleged that during the best
time of businesses, they have only stayed at the same place (Broaderick R.F, 1991).
Managers search for combination of strategy, motivation, technology, and work methods
and design that earns the competitive advantage to a company (Broaderick R.F, 1991).
This competitive advantage or the competitive edge that they earn should assure that
the business performance of the firm will sustain the business performance at an
above average level (Broaderick R.F, 1991).
Business managers have searched in the areas of information technology and its
management applications as a source for competitive advantage (Broaderick R.F, 1991).
It was pointed out that many managers were especially interested in applications designed
for better management of Human Resources (Broaderick R.F, 1991). They expect the
investments in such applications to pay off by contributing towards the firm’s
competitiveness (Broaderick R.F, 1991) (Johnson R.D, 2004). It was identifies that
simple automation of HR processes will no longer assure the competitive advantage
for firms (Johnson R.D, 2004). Thus a new challenge for Business Managers in today’s
context is identified as identifying HR technology that would earn a competitive
advantage, in the journey of earning competitive advantage through people.
Decade of 80’s was identified as the era the business world started to use the Information
Technology (Broaderick R.F, 1991). Starting from this decade, computer technology
had led to creation of new products and services (Broaderick R.F, 1991).
While the capability of Information Technology can be used to develop competitive
products and services, it was identified that HR has only used the Information
Technology to improve HR decisions with better information (Broaderick R.F, 1991)
(Webster Buchman Research, 2010). Through research conducted in ten fortune 500
companies it was found that majority of these companies have invested on computer
applications to manage employee records, payroll, and compensation and benefit
administration (Broaderick R.F, 1991) (Webster Buchman Research, 2010). Outcome
- 48 -
of such investments falls in to an area of efficient management of information (Broaderick
R.F, 1991) using Information Technology, in other words to the paradigm of “informate”
through technology.
A different opinion was expressed referring to eHRM practices where adaptation of
eHRM practices were identified as in the rise (hmeier, 2009). Objectives of eHRM
were identified as follows “reducing costs, speeding up processes, improving quality,
and even gaining a more strategic role for HR within the organization” (hmeier, 2009).
It was pointed out that consequences of eHRM can become desired as well undesired
by the organization (hmeier, 2009).
Further advancement of using the power of technology was cited in the largest 500
companies (by revenue) in America. 79% of these companies were using the technology
for recruitment to some extent (Trkman, 2003). It was pointed out that the number of
companies that use internet for recruitment are on the rise (Trkman, 2003). Identified
benefits of internet based recruitment were as follows:
Lower cost of recruitment
Quicker process of recruitment
Possibility to attract better candidates (Trkman, 2003)
In 2010, as survey was conducted by the Webster Buchnan Research and published
article titled “From absence management to HRIT investment: assessing HR priorities
with association of computer in personnel, they have listed the investment priorities of
HR as follows:
Learning and Development
Recruitment
Performance Management
Reporting and Analysis
Absence Management
HR Self service
Maintenance and enhancement of their HR Management System (Webster
Buchman Research, 2010)
- 49 -
Yet the evidence of using “technology” in the HR was not available. With the
advancement of the Internet, it was evident that the power of Internet was used to
introduce eHRM in organizations (hmeier, 2009).
There were arguments to propose that employment of Information Technology was
used to eliminate layers of ‘paper and pencil’ entries in HR processes, and manual
calculations, and helped to cut the administration costs of HR processes (Broaderick
R.F, 1991). The best payoff was identified as the increased accuracy of execution of
processes to an estimated level of ninety nine percent (Broaderick R.F, 1991). This
type of applications could be identified as using “automation” of HR processes
(Broaderick R.F, 1991) or to the “automate” paradigm as we have discussed in this
article. Argument was presented to establish a greater automation in HR processes
through Information Technology as follows:
“To achieve these strategic objectives and realize competitive advantage
for the firm, HR must first apply to its own house – that is, within the HR
function itself. Restructuring in most firms has left HR with a smaller
workforce, yet equal or greater responsibilities and new demands. Time
has become a critical a resource as talent and money. HR must review its
work to define strategic priorities. What work must continue to be done?
of that work, which can be done better by searching out efficiencies and
economies of scale (cost leadership); which can be done better by
delegating and collaborating with line managers and employees or other
functional staffs (quality/customer satisfaction); and which would most
benefit from creative time, talent, and resource (Innovation)? In short,
how can HR best work harder, smarter, or with more vision?” (Broaderick
R.F, 1991)
Borderic and Boudereau discusses a higher level of application of Information
Technology, as providing early warning to the management (Broaderick R.F, 1991).
Example cited was “For example, one application might tally total monthly pay increase
allocated, compare them to targeted annual pay increase totals, and report the units
where actual increases are running well ahead of target” (Broaderick R.F, 1991). This
will alert the HR and line managers to act before variances are developed beyond the
level of control (Broaderick R.F, 1991). More advanced level of usage of Information
- 50 -
Technology may create application where the user department will be capable of
creating their own database to store local data and even to customize the reports
without involvement of IT departments (Broaderick R.F, 1991). Such will create
empowerment within the HR managers and Line managers. HR working harder with
fewer people in the HR department (Broaderick R.F, 1991) is increasing the effectiveness
and efficiency of HR department with the help of Information Technology.
Reviewing the Expert System Applications, it was identified, that Expert System
Applications contribute towards improved decisions for the businesses (Broaderick
R.F, 1991). Nature of applications are that decisions are derived through the expert
knowledge and experience built in to the systems (Broaderick R.F, 1991). These work
based on rules, which are complex in nature and they are derived inside the systems
based on careful analysis and expert decisions (Broaderick R.F, 1991). These
applications provide the user with the expert knowledge without hiring an expert to the
organization (Broaderick R.F, 1991). Such applications empower the people through
Information Technology giving examples for the paradigm of “empowering” or
“endowmate”, as the author proposes.
While discussing the Information Technology in the context of Expert Systems, it was
learned that expert systems use information from different systems, or may be
information from different geographic regions (Broaderick R.F, 1991). Expert System
Applications facilitate building scenarios that will not have one right answer to a case
(Broaderick R.F, 1991). There are two types of Expert Systems to identify. Expert
Systems with ‘black box’ approach, where the expert solutions are provided without
exposing how such was arrived at (Broaderick R.F, 1991) will facilitate automating the
tasks and processes. On other hand the ‘training’ systems use the learning capabilities
built in to the system, in order to make decisions. These systems use a dynamic
approach in arriving at the decisions, where the user has to provide the parameters of
setting the context (Broaderick R.F, 1991), in which case the user is empowered by
the usage of Expert System Application. A special characteristic in such case require
the users as well to be analytic enough to diagnose their own situation, by following
the guidelines provided by the expert system (Broaderick R.F, 1991).
It was pointed out through the Expert System Applications that management’s decision
making will to be delegated to lower levels (Broaderick R.F, 1991). At the same time
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these systems allow the HR to track the delegated decision making and further assess
the results generated by such decisions as well (Broaderick R.F, 1991). Such
characteristics are treated as specific to Expert Systems which are ‘training’ in nature
(Broaderick R.F, 1991). Using Expert Systems, HR could delegate many traditional
HR responsibilities to teams while increasing the likelihood that team decisions are
informed ones (Broaderick R.F, 1991). Benefits of such approaches assisted by
Information Systems is that HR and the Employees and other manages will better
understand how HR systems work, and thus will be in a better situation to suggest
improvements and to allow people work smarter (Broaderick R.F, 1991). These can
be treated as another level of empowering people through Information Technology.
Following reasons were identified as reasons why HR could no longer be away from
using technology. These reasons are from the point of view of businesses, not the HR
profession. They are:
Organizations expect to reduce the administrative burdens, by streamlining
HR Processes
Cost of HR administration and compliance is identified as an area where a
saving should be made
Organizations need to complete for global talent and firms should be more
effective in competing
Improve the access to services as well as to information for managers and
employees
In managing the workforce, decision makers would like to identify trends
using real-time matrixes
Transform the HR, to a level it can play a more strategic role (Johnson R.D,
2004)
New face of HR using the Technology, require the HR Professional to have
a fundamental change in approach, skills, and abilities rather than mastering
traditional HR skills (Johnson R.D, 2004)
With the rapid advancement of ICT in the last two decades, organizations were provided
with whole new possibilities of how the work would be performed and how the
organization would be structured (Trkman, 2003). Opinion was expressed that in the
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future people may not want to stick to one company, yet offer their services to
companies, and coined a term “Portfolio People” (Trkman, 2003). People will offer
their services to companies on project basis (Trkman, 2003). This will be a whole
paradigm of structuring the organizations and how people will work and how the work
is managed; these are subjects in the domain of HR professional, influenced by the
technology.
The concern was expressed to say that effectiveness of HRIS systems were not
measured, the HRIS success was not correlated to the dollar amount invested, yet
correlated to the total number of employees in the firm (DeSanctis, 1986).
HR professional and extent that IT influence the HR professional’s job was identified
as a major determinant for the success of IT implementation within the HR function.
(Gardner S.D, 2003). If IT makes the HR professional’s job easy, IT implementation
would be a success. If IT makes it difficult for the HR professional, IT implementation
would not be successful, basically the buy in of the HR Professional in a vital thing to
consider. Technology will change how things are done and will have an influence on
different functions and individuals in the organizations (Gardner S.D, 2003). Ulrich
has mentioned that IT will impact how HR is done within the organization (Gardner
S.D, 2003).
Information responsiveness is identified as a vital gain for the HR professional through
using technology (Gardner S.D, 2003). HR professional should be capable of being
relieved of routine administrative tasks and focus on providing meaningful information,
which is identified as information responsiveness (Gardner S.D, 2003). Increased
information responsiveness was recognized as an empowerment through technology
(Gardner S.D, 2003), which the author argues as a level in IT usage maturity. Such
empowerment or endowment of HR professional will enable them to provide increased
value towards the business (Gardner S.D, 2003). Ulrich has identified IT as one of the
tools that HR professional can utilize in order to provide more value to the organization
(Gardner S.D, 2003). Employment of technology provides the HR professional, and
for that matter, any professional with connecting with other professionals and share
knowledge and information (Gardner S.D, 2003). Using IT in HR function was identified
as giving HR professionals with opportunity to focus on more knowledge based activities
and internal consultancy activities (Gardner S.D, 2003)(T.V. Bondarouk, 2009).
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5. DEFINITIONS FOR THE COMBINATION OF HR AND IT(TECHNOLOGY)
Many authors have attempted to define the intersection of HR and Technology. Many
definitions may have been developed based on the contextual studies. HR-Technology
in practice at the time of definition will definitely influence the formation of the definition.
It is worthwhile to explore definitions for the HR-Technology.
An early definition for HRIS was presented as “specialized information system within
the traditional functional areas of the organization, designed to support the planning,
administration, decision-making, and control activities of human resource management”
(DeSanctis, 1986).
Another definition on HRIS was presented by Haines and Petit (1997) as follows
“system used to acquire, store, manipulate, analyze, retrieve, and distribute pertinent
information about an organization’s human resources” (T.V. Bondarouk, 2009).
Bringing the eHRM concepts to definitions, it was defined by Lednick-Hall and Moritz
(2003) as “conducting HR transactions using the Internet or intranet” (T.V. Bondarouk,
2009).
A different definition for eHRM was cited from Voermans and Van Veldhoven (2007),
as “e-HRM could be narrowly defined as the administrative support of the HR function
in organizations by using Internet technology” (T.V. Bondarouk, 2009).
Bringing the advancement of ICT, a definition was cited from Strohmeier (2007), as
“e-HRM as the ‘[planning, implementation and] application of information technology
for both networking and supporting at least two individuals or collective actors in their
shared performing of HR activities” (T.V. Bondarouk, 2009).
Bringing the eHRM to a level of virtual level, Lepak and Snell (1998) was cited as
defining eHRM as “‘virtual HR’ to describe a ‘network-based structure built on
partnerships and mediated by information technologies to help the organization acquire,
develop, and deploy intellectual capital” (T.V. Bondarouk, 2009).
Further definition of eHRM was cited from the works of Strohmeier (2007) “e-HRM
can be understood as the (planning, implementation, and) application of information
systems (IS) for both networking and supporting actors in their shared performing of
HR activities” (hmeier, 2009).
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After citing many definitions, Bondarouk (2009) defines eHRMin terms of concept,
concern for implementation, targets and eHRMconsequances, and further identifies
the focus of future researches in the same area as follows:
“Content of e-HRM: it concerns any type of HR practices that can be
supported with IT, either administrative or transformational; it also
concerns any type of IT that can offer support for HRM, either[,] Internet,
intranet, or complicated ERP systems. Researchers are expected to clarify
the match between a type of IT and the type of HR practices.
Implementation of e-HRM: it involves the process of adoption and
appropriation of e-HRM by organizational members. Researchers should
anticipate the ways they judge the success of e-HRM implementation.
Are we talking about e-HRM diffusion, acceptance, appropriation,
adoption, or user-satisfaction?
Targeted employees and managers: whereas until the mid-1980s HRIS
was primarily directed towards the HR department, by the turn of the
century, line management and employees were actively involved in using
e-HRM applications. Nowadays, at any given second, thousands of people
are zipping around the Internet in search of employment opportunities,
forcing organizations to direct e-HRM effort towards potential candidates
(HRFocus 2003). It means that modern e-HRM broadens its target and
goes beyond the organization’s borders to address the needs of all
stakeholders. At this point, researchers are supposed to focus on a specific
stakeholder group as the e-HRM target in their studies. .
e-HRM consequences: along with the discussion on value creation and
value capture (Lepak, Smith and Taylor 2007), we stress a multilevel
perspective viewing e- HRM value creation as ‘subjectively realized by a
target user who is the focus of value creation’ ( ibid. , p. 182). It means
that either an individual employee or an HR professional, the whole HR
department, organization, or a net of several organizations is willing to
exchange money for the value received from e-HRM. Lepak et al. (2007)
note further that the monetary amount exchanged must exceed the
producer’s costs (time, training, effort, money, meetings dedicated to e-
HRM projects); and it is approximated as a delta between new value
(like freedom from HR administration or less paper work) and the users’
alternative.” (T.V. Bondarouk, 2009).
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6. BUILDING THE CONTINUUM FOR IT MATURITY
It was identified that ICT can be used expecting several levels of results within business
organization. These levels are derived using identified capacities and capabilities of
ICT; they are Informational Capacity, Automating Capacity, Transformational Capacity,
and Capacity to Empower through ICT. Researcher coins the terms to be used in a
convenient manner as “Automate”, “Informate”, “Transformate”, and “Endowmate”.
Authors thought process for deriving these terms are as follows:
6.1. Informate
Informational capacity of ICT is where IT tools are used to generate new sort of
information, where information is yielded as a byproduct, thus generating new streams
of information (Newell, 2007).
6.2. Automate
Automate is referred to as saving mental or physical labor in the management data,
mainly focusing on efficiency (Newell, 2007).
6.3. Transformate
Transformational capacity of ICT is that ICT is capable of moving beyond simple
information management perspective to a deeper structural view, recognizing that ICTs
may be utilized to alter the structure (Pant Laxmi Prasad, 2011).
6.4. Endowmate
Researcher coined the term “Endowmate” from same being a synonym to Empower.
Empowerment capacity of ICT would potentially make both managers and employees
be more ‘empowered’ having greater control over their work and work lives (Newell,
2007).
6.5. Continuum
For the purpose of the research, researcher wishes to adopt the four levels of ICT
Maturity to be sequenced as 1. Informate, 2. Automate, 3. Transformate, and 4.
Endowmate. This sequencing was arrived at based on the complexities of technological
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usage to achieve each level of results through ICT. Informational role of ICT was the
initial role the IT was intended, based on the Input, Process, Output cycle, processing
data to obtain information was treated as the subject of Data Processing at the early
age of IT. Thus, the researcher believes that “Informate” should be placed at the
bottom most level. Automation or “Automate” as defined early in this chapter is to
save manual labor, basically eliminate the processing of paper and pencil work related
process steps in business processes, can be fairly placed at a higher level of complexity
than informational level. Transformation or “Transformate” definition demands a change
in the structure as well, this require more organizational effort as well as initiative.
Thus, the researcher places the Transformational task of ICT above the Informational
and Automation levels. Empowerment, “Endowmate” suggests changes to the work
life and work itself. This thus requires greater change than all the levels identified
earlier, where change in the manager as well as the subordinate is required, and further
the researcher trusts grater level of paradigm shift is required within the organization.
This requires a greater level of change in the mind set of both the parties as well.
Therefore, the researcher believes that Empowerment related ICT development efforts
are at the highest level. At the same time, latest technological developments related to
ICT, i.e. Web 2.0 are focusing on Empowerment related ICT usage, more participation,
and more freedom for both the employees and management.
7. LATEST DEVELOPMENTS IN ICT
There are many developments in the ICT world; amongst all development one major
improvement that shaped the entire world was web2.0. Web 2.0 is referred as wisdom
Web, people-centric Web, participative Web, and read/write Web (San, 2007). Specialty
in web 2.0 is the interactive nature of the technologies available (San, 2007). It promotes
social interaction; collective intelligence presents new opportunities for leveraging the
web and engaging IT users more effectively (San, 2007). Power of Web 2.0 can be
seen with the introduction of Social media Web facilities, namely Facebook, Youtube,
Linked in, MySpace, Flikeretc (San, 2007). Global Survey conducted by McKinsey
has identified that three fourths of the senior executives participated in the survey
accepted that Web 2.0 technologies are strategic and that they plan to increase their
investments in Web 2.0. (Bughin Jacques, 2011). In a survey conducted by Forrester
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Research, 89% of CIO’s expressed the opinion that “Efficiency Gains and Competitive
Pressures Drive Enterprise Web 2.0 Adaptation” (San, 2007). Web 2.0 has a paradigm
of technology and the paradigm of usage as well (San, 2007). Web 2.0 brings about
the following features to the technological world;
1. Facilitates flexible Web Design, creative reuse and updates
2. Provides rich, responsive user interface
3. Facilitates collaborative content creation and modification
4. Enables the creation of new applications by reusing and combining different
applications on the Web or combining data and information from different
sources
5. Establishes social networks of people with common interests and
6. Support Collaboration and helps gather collaborative intelligence (San, 2007)
The McKinseys research on “How Social Technologies are Extending the Organization”
-executives has stated that they are using these technologies to improve their agility
and to manage organizational complexity (Bughin Jacques, 2011). Many of these
executives believe that if organizations diminish the barriers to use social technologies
they could form the core of entirely new business processes that would create many
radically improved processes (Bughin Jacques, 2011).
Practitioner’s viewpoint of HR Technology
The article published by SHRM Foundation, and authored by Richard D Johnson and
Hal G. Gueutal, titled “Transforming HR through technology, the use of e-HR and
HRIS in organizations puts the practitioner’s perspective on the subject matter. This
study was conducted by two scholars on assignment by Society for Human Resource
Management.
Change of the face of HR, with the influence of ICT was explained as follows: “Today
the face of HR is often a portal, rather than a person. Almost all firms now provide
universal access to HR services through technology and web-based applications,
dramatically changing the practices of human resource management (Johnson R.D,
2004).
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The term e-HR was coined, when the power of internet technology was used for HR
Processes (Johnson R.D, 2004). HR Technology was used alternatively, when
facilitating the HR Process through web, thus coining the terms e-Recruiting, e-
Selection, e-Learning, e-Performance Management, e-Compensation, and e-Benefits
(Johnson R.D, 2004).
8. RECOMMENDATIONS
It is the right time for the HR sector to focus on the HR-Technology, employ for
greater value adding activities than record keeping in Personnel and Administration.
Past researches show that getting the IT in to HR is not in the top priorities of HR, to
begin with HR strategists should place getting the IT in to HR in priority list. There are
evidences to say even in the economic down turn, companies are investing in IT, and
this is an encouraging scenario for the HR sector to focus on IT.
For the success of any project, the buy in from the change target is vital, thus in order
to obtain the buy in from the HR professional, first step would be to facilitate the HR
professional. Technology should be used to make the HR professionals life easy. So
there would be more buy in from the HR professional. Starting point will be to relieve
the HR professional from routine administrative tasks with help of HR Technology.
Once the HR professional’s time was relieved, then business leaders can look at the
next level of technology usage in the HR arena, to earn a competitive advantage
through HR with the support of IT.
Focus in initial level should be a whole HR process. Agenda in using HR Technology
should be carefully prepared, it would not be the “Best Practice” paradigm, each
organization will have to assess its own process contribution and identify the processes
that would bring in best results by employing IT. Standing on the paradigm, “Firms
with best processes will win in most or all markets”, all HR-Technology investment
decisions should be aimed at making the processes better.
HR sector should recognize the power of Web 2.0. Web 2.0 has the potential of
getting the participation of all the employees at all levels, and even in all geographical
regions. HR Should look at the Social Media, positively and think out of the box for
how to use the same internally as well as externally for the betterment of the organization.
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HR Should open up to the “New way of working”, even though it’s out of the scope
for this article, latest developments and phenomena of IT like, Cloud Computing,
Virtual Classrooms, Software as a Service and Free and Open Source Software should
be assessed in different facets to identify how best the organizations could be benefited,
and how the organization could be altered to adopt such technologies.
HR Policies should evolve to cater for earning an advantage through IT, HR policies
should remove the barriers employing of technology within the firm. These will include
the social media usage powered by Web 2.0, and shifting in to entirely new business
processes that may radically change the processes.
9. CONCLUSION
Up to now, technology has been an alienated subject for many people. This may be
the reason why HR mostly depends on what IT gives HR. Depend on most of the
“Automate” and “Informate” paradigms. Time is right for the HR sector to shift towards
“Transformate” and “Endowmate” - the HR professional and HR processes with the
Technology.
To focus more on the matter, without keeping the HR and IT separate, we need a new
breed of professionals, who will most likely be labeled as “HR-Technologist”, to support
the business firms and HR sector.
REFERENCES
Broaderick R.F, B. J. (1991). Human Resource Management, Informtion Technology,and Competitive Edge. Cornell University.
Bughin Jacques, B. A. (2011, November). How Social Technologies are extendingthe organization. Retrieved November 26, 2011, fromwww.mckinseyquarterly.com: https://www.mckinseyquarterly.com/How_social_technologies_are_extending_the_organization_2888
Cambridge Dictionaries Online. (n.d.). Leverage_2. Retrieved 12 14, 2010, fromdictionary.cambridge.org: http://dictionary.cambridge.org/dictionary/british/leverage_2
DeSanctis, G. (1986, March). Human Resource Information Systems: A current
assessment. MIS Quarterly.
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Elisabeth Wilson-Evered, C. E. (2009). Measuring Attitude to HRIS implementation:
A Field study to inform implementation methodology. Asia Pacific Journal of Human
Resource, 374-384.
Gardner S.D, L. D. (2003). Virtual HR: the impact of Information Technology on the
human resource professional. Journal of vocational behaviour, 159-179.
Hmeier, S. S. (2009, March). Concepts of e-HRM consequ ences: a categor isation,
review. The International Journal of Human Resource Management, 20(3), pp. 528-
543.
Johnson R.D, G. H. (2004). Transforming HR through Technology, the use of e-HR
and HRIS in organizations. SHRM Foundation.
Lee, D. (1993). Human Resources as a Source of Competitive Advantage. Cornell
University ILR School.
McAfee A, B. E. (2008, July-August). IT That makes a Competitive Difference.
Harward Business Review, 99-107.
Newell, C. T. (2007). A Knowledge-Based view of Agenda-Formation in the
Development of Human Resource Information Systems. Management Learning, pp.
95-119.
Pant Laxmi Prasad, H. R. (2011). ICT-Enabled Development of Capacity for Climate
Change Adaptation. Manchester: University of Manchester.
San, M. (2007, July-August). Retrieved November 26, 2011, from wiki.uml.edu: http:/
/91-592-722.wiki.uml.edu/file/view/understanding_web_20.pdf
T.V. Bondarouk, H. R. (2009, March). Electronic Hum an Resource Management :
challenges in the digital era. The International Journal of Human Resource
Management,, 20(3), pp. 504-514.
Trkman, P. B. (2003, June). Influence of Internet and Information Technology .
Informing Science .
Webster Buchman Research. (2010). From absance management to HRIT investment:
assessing HR priorities. Computers in personal.
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DO ORGANISATIONS BENEFIT FROM
EMPLOYEE EMPOWERMENT?
Chandana Jayawardena1
andYugan Pathirage2
1Senior Lecturer, University of Peradeniya, Sri Lanka.2 Postgraduate Institute of Agriculture, University of Peradeniya, Sri Lanka.
ABSTRACT
The study was conducted, in an established apparel manufacturing plant in Sri
Lanka, to examine the impact of employees’ empowerment on team performance.
Specific objectives of the study were to identify the dimensions of team empowerment,
to assess the impact of team empowerment on performance, and to analyse their
interrelationship. A questionnaire (developed based on empirical models) was
employed over a sample of hundred and twenty (120) employees selected from the
organization. Respondents (employees) were selected through stratified random
sampling, and majority of them (102) were sewing machine operators. Key informant
discussions and focus group discussions were conducted for further insights. SPSS
computer package was used for descriptive and inferential (correlation and regression
tests etc.) statistical analysis. Empowerment measures included six dimensions/
variables. Their subscales were adopted based on empirical findings. Employees of
the apparel manufacturing plant perceived a high level of empowerment and teams
have recorded desirable levels of performance. Respondents perceived that team
empowerment had increased their team performance. There was also a specific
programme to empower sewing machine operators aimed at facilitating their
lifestyles. The correlation analysis indicated a highly significant relationship between
team empowerment and team performance. Sub variables of team empowerment had
a significant (and a varying) impact on team performance. The study concluded that
team empowerment results in better performance of teams, and organisations.
Key words: Empowerment, team performance, employees, effectiveness
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1. INTRODUCTION
The apparel industry has witnessed many challenges, changes and demands, such as
globalization, free trade treaties, rising expectations of internal and external customers,
and increased competition. Internal and external pressures and change forces have
made it a very challenging and a competitive industry. Production and operations
management has grown rapidly and its boundaries have been stretched in many
directions. Over the last two decades production and manufacturing management had
gathered several new production management concepts, such as manufacturing strategy,
focused factory, just-in-time manufacturing, concurrent engineering, total quality
management, supply chain management, flexible manufacturing systems, lean
production, and mass customization etc. Harrimand Alkshali (2008) identified ‘Human
Factor’ was a major factor in optimizing manufacturing systems. Employee
empowerment had gained increased attention in output optimization.
1. 1 Empowerment of Employees
Ettorre (1997) defined empowerment as, “employees having autonomous decision-
making capabilities and acting as partners in the business”. He elaborated that sharing
with junior employees’ comprise of four organizational ingredients; a.) Information
about organization’s performance, b) Knowledge that enables employees to contribute
to organizational performance, c) Rewards based on the organization’s performance,
and d) Power to make decisions that influence organizational direction and performance.
Bowen and Lawler (1992), and Cacioppe (1998) have suggested that empowerment
exists when companies implement practices that distribute power, information,
knowledge, and rewards throughout the organization. Cacioppe (1998) has emphasized
these four elements stating “If any of the four elements is zero, nothing happens to
redistribute that ingredient, and empowerment will be zero.” Athreya, and Chunkath
(1996) indicated that empowered employees provide quicker on-line response to
customer needs during service delivery. Employees will interact with customers with
more warmth and increased “trust” in the organization and less conflicts with managers.
Albert and Fetzer (2005) indicated that people who have information about current
performance levels set challenging goals and when they achieve those goals they reset
new goals at a higher level. An empowered organization would at least encourage the
employees to suggest improvements.
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The process of supervisory support is best described through mentoring or coaching
and it entails: determining the skill level of the employee, sharing information about
the goal to be achieved and confirming the importance of the goal to the organization
as a whole. Psoinos and Smithson (2002) suggest that appropriate supervisory support
has to be provided depending upon the employee skill level, e.g. ‘directing when the
employee has a low skill level and coaching when the employee has some skills, but
lacks experience or motivation’ etc. The “Toyota” manufacturing unit in Japan (Liker,
2003) has focused on value adding teams, in which the group leader is made responsible
for product quality, monitoring yield, quality systems management, and environmental
sustainment. Team Leader is responsible for team’s results (factory goals), and for the
results of team members.
1.2 Team Performance
Gemuneden, and Lechler (1997) have defined team performance as the extent to
which a team is capable of meeting established quality, cost and time objectives. They
have mentioned that, the perception of project’s success depends, in part, on perspective
of evaluator, and the operational concepts used to measure were: Effectiveness,
Efficiency, Learning, Work Satisfaction, Team Conflict, Effort, Balance of Member
Contribution, Mutual Support, Cohesion, Coordination, and Cooperation. Schwartz
(1994) has identified that collaboration with team members gives the opportunity for
learning social, project management, technical and creative skills’. Such acquisition of
new skills relates to team members’ desire for personal and professional growth and to
increase team members’ potential for future work.
Researchers suggest that effort of team members are measured in terms of norms.
They may exist in every type of apparent behaviour in teams. Hoegl, and Gemuenden
(2001) have identified the importance of balancing membership contribution to team
performance, as follows: “Every team member is able to contribute task-relevant
knowledge and experience to the team”. They defined mutual support as a central part
of teamwork, and have viewed that it protects the team from over-work. Fetterman,
Kaftarran, and Wandersman (1996) have suggested that team cohesion refers to the
degree to which team members desire to remain in the team. The degree of common
understanding of the inter-relatedness, and the current status of individual contributions
also determine the quality of team work performed. In apparel industry many activities
in task process are assigned to members performing parallel tasks.
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1.3 Problem statement
Importance and topicality of this study stems from several roots. Modern manufacturing
firms rely more on team based structures and designs. However, empirical findings of
team empowerment and its effect on team (and organizational) effectiveness in apparel
manufacturing industry are scarce, especially in the Sri Lankan context. As per the
2009 Annual Report of the Central Bank of Sri Lanka, textiles and apparel
manufacturing dominated the industry sector accounting for 46% of export earnings.
It had employed over 200,000 people directly, and about 400,000 indirectly in nearly
750 factories. Study has focused on the importance of team empowerment as a means
of enhancing team performance.
1.4 Objectives of the study
Overall objective of the study was to examine the different dimensions of team
empowerment, and to assess their contribution to team performance. Specific objectives
of the study were to identify the dimensions of team empowerment, to assess the
impact of team empowerment on performance, and to analyze the relationship between
team empowerment and team performance.
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2. METHODOLOGY
Study was carried out in October and November, 2010 in an apparel manufacturing
plant (hereinafter referred to as the ‘Organisation’) in the Central Province, Sri Lanka.
It belonged to a highly reputed and leading exporter of apparels in Sri Lanka. Target
group of the study was the operational level employees. Sewing Machine Operators
(SO), Supervisors (SL), Group Leaders (GL), Production Managers (PM), and the
Value Stream Manager (VSM) constituted the sample frame (Refer Fig.2). Sample
was selected through stratified random sampling. It consisted of 102 sewing machine
operators, 12 supervisors, 4 group leaders, and 2 production managers. Data were
collected through a questionnaire and an interview schedule. Questionnaire was
structured based on the major variables of the study. Questionnaires were handed
over with a briefing to respondents, and were allowed to respond on anonymity to
minimize biases. Key informant discussions and focus group discussions were conducted
to enrich the findings. Secondary data were collected from organizational performance
reports, publications, and research reports.
Figure 2: Sampling framework
Source: Authors’
- 67 -
2.1 Research Hypothesis
The main hypothesis constructed for the study was follows:
Ho-Team empowerment (six dimensions viz: Potency, Recognition, Motivation, Level
of Responsibility, Power & Autonomy and Group Culture) has no significant impact
on the overall Team Performance.
2.2 Variables and Analysis
Potency, Recognition, Motivation, Level of responsibility, Power and Autonomy, Group
Culture were identified as the sub variables of Team Empowerment. Team performance
was the dependant variable (Please refer Conceptual Framework in Figure 1). SPSS
computer software was used for analysis of data. Analysis involved frequency
distributions to describe demographic data of respondents, descriptive statistics of
Mean and Standard Deviation to calculate central tendency and dispersion (variance)
of responses to specific questions and correlation coefficient to ensure reliability of
questionnaire. ANOVA analysis and linear regression analysis were used to test the six
minor hypotheses on “the impact of team empowerment dimensions on team
performance”.
3. FINDINGS
3.1 Background Findings
The formal education level of respondents was measured by their number of years in
school. Majority of respondents (Sewing machine operators and Supervisors) had
completed senior secondary education GCE (Advanced) Level. Over 96% of
respondents had successfully passed at GCE (Ordinary) Level exam. The relatively
high education level (at all levels) of respondents (employees) facilitated the transfer
of knowledge and skills, and understanding of aspects related to work and work
environment. Increased levels of educated employees had made the locus of control
more internal, making empowerment a key issue in teams. About 72% of Supervisors
earned over Rs 14,000 per month, whilst 50% of them earned over Rs 17,000 per
month. About 60% of team members earned Rs 8,000- 10,000 per month, and 23%
of them earned over Rs 13,000 month. Their salaries were higher than what was
offered by similar organizations in the apparel industry.
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Table1 depicts the mean (M), and standard deviation (SD) of the two main variables
viz; Team Empowerment and Team Performance of respondents. Mean value of
Team empowerment was (4.64) and the SD was (0.81). This indicated that there was
a relatively high level of team empowerment (The maximum possible was 6). Of the
dimensions/ variables of team empowerment, group culture scored the highest mean
(4.91), (SD = 0.67), so that respondents had strong belief in their team. Production
flow was structured to the modular concept with 16 to 18team members. Each SO
was designated to do a specific job role. Everybody had to work cohesively, respectively,
qualitatively with personal accountability for team’s success. Management promoted
‘group culture’ through rewards based on team performance. Team performance was
measured through a combination of sub scales. A mean value of 4.19 for overall team
performance with a SD of 0.79 indicated a higher level of team performance. This
was evident from the fact that employees were highly focused on achieving the ‘team’s
target’. Supervisors seemed to have stretched that ‘extra mile’ to facilitate their team’s
performance.
Table 1: Factors related to team performance
Potency 4 0.83 3.78 0.68
Recognition 6 0.77 4.25 0.76
Motivation 5 0.86 4.67 0.81
Level of responsibility 6 0.83 3.98 0.79
Power and autonomy 5 0.87 4.68 0.87
Group culture 4 0.79 4.91 0.67
Sub Total 30 0.82 4.64 0.81
All Subscales together 40 0.86 4.19 0.79TeamPerformance
Variables
TeamEmpowerment
Items Alpha Mean StandardDeviation
Source: Authors’
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3.2 Relationship between team empowerment and team performance
Correlations and Regression analysis were employed to estimate the causal relationships
between team empowerment and team performance. Pearson’s Correlation Coefficient
analysis was used to assess the relationships of variables between team empowerment,
and team performance. Performance had a positive relationship with Empowerment.
Table 2 depicts the Pearson’s correlation with a correlation coefficient of 0.84 and p
value of 0.06. It was highly significant (at ά=1%) indicating that better empowered
teams perform better. And it also had a ‘positive infection’ on team’s performance.
Regression Analysis was used to assess the variables influencing team performance.
Table 2: Relationship between Team Empowerment and Team Performance
Table 3: Regression Analysis: ANOVA/ T – Coefficients
Variables Team Performance
Team Performance Pearson Correlation 1
Sig. (1-tailed)
Team Empowerment Pearson Correlation 0.84 (at ά = 1%)
Sig. (1-tailed) 0.06
Number of respondents 114
Using six point scale: 6 = Strongly Agree to 1 = Strongly Disagree.
Source: Authors’
Value Sig.
F 39.413 0.00
Beta Coefficients 0.696
T 13.933
R2 0.642
Adjusted R2 0.613
Team EmpowermentStatistical Indicators
Source: Authors’
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Table 3 depicts that coefficients of team empowerment were significant. A positive
relationship between empowerment and performance was indicated. Beta value (0.696)
of team empowerment signified a high contribution towards team performance. Values
of R2 (64.2%), and adjusted R2 of 61.3 indicated that team empowerment had brought
sufficient variation to team performance. This could be singularly focused on the six
sub variables of team Empowerment viz: Potency, Recognition, Motivation, Level of
Responsibility, Power and Autonomy, and Group Culture. It seemed to have a
synergistic impact as well. Larger values of R indicated a stronger relationship. F-
value showed that the overall model was statistically significant and team empowerment
had predicted the variation in team performance. It was significant at ά = 01%. Results
confirmed that team empowerment had resulted in better performance of teams.
Table 4: Regression Analysis- impact of Team Empowerment to Team performance
Table 4 depicts that sub variables of empowerment had a significant effect on team
performance (at p d” 0.05). However, the effect has varied from one sub variable to
another. The highest was explained by Group Culture (B = 0.83), then Recognition (B
= 0.71), and the least was Potency (B =0.19). The ‘performance culture’ within the
organization seemed to have made a high impact on group culture. The recognition
received by ‘teams’, and ‘individuals within teams’ seemed to act as a ‘trigger’ in team
performance. ‘Level of responsibility’ seemed to have stemmed from the ‘recognition’
Team Empowerment Dimensions B T Sig.
Potency 0.19 2.73 0.05
Recognition 0.71 8.63 0.00
Motivation 0.57 7.14 0.00
Level of responsibility 0.68 7.89 0.00
Power and autonomy 0.36 5.42 0.00
Group culture 0.83 9.78 0.00
R2 = 0.57 F = 51.02 Sig. = 0.00
Source: Authors’
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factor’. And the ‘level of responsibility’ seemingly contributed to the level of ‘motivation
of’ SO’s. Coefficient of determination (R2) for team empowerment was calculated at
0.57, meaning that 57% of the variation in team performance was explained by variation
in overall empowerment. F calculated value was 51.02 (at p d”0.05). The hypothesis
could not be accepted. It is concluded that employee empowerment had a significant
effect on team performance in the organisation.
3.3 Empowerment initiatives of the organisation
Majority (63.4%) of SOs had previous experience in apparel industry, and 62% of
SOs had some understanding of the concept of the empowerment and related activities.
The Organization had provided training to SOs and supervisors to enhance their decision
making skills. Training sessions included computer training, lean manufacturing, 6-S,
machine and technical training, defects identification, and problem solving techniques.
Knowledge and skills gained from training facilitated autonomous decision making
without overly depending on the supervisor. Availability of advisory services, counselling,
and library facilities enhanced the personal and group capacities of employees. The
Organization had a team based rewarding system, which aimed at facilitating team
empowerment through enhancement of team cooperation, delegations and cohesiveness.
The Organisation had a ‘suggestions culture’, wherein management support was
provided to implement the better suggestions and to reward employees. They had two
main meetings viz; the cross functional meeting to solve operational problems with the
attendance of supporting departments, and the management meeting for strategic
decisions. There was an initiative to enhance the personal lifestyles of non-executive
level female employees (especially the sewing machine operators). It was designed to
facilitate employees to ‘go beyond’ their traditional obstacles in life, and to help them
earn additional income through secondary sources. This was practiced as a CSR activity,
which helped to develop the image of employees bringing them a sense of achievement.
Designating of employees in the organization was note-worthy. Sewing Machine
Operators were designated as “Team Members”, which instilled in them a sense of
belongingness, and a pride of their role within the organization. Supervisors were
designated as “Team Leaders’ instilling a sense of achievement in them. They were
sharing the same canteen with the senior staff. Organisation also encouraged a ‘first
name culture’ among employees, which is not the norm in Sri Lankan/ Asian culture.
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However, there was a marked difference in the status-quo between SOs, supervisors,
and rest of the staff. Probably the nature of their routine-work pattern and the seemingly
inferiority image of sewing machine operators in the society would have also contributed
towards it.
4. CONCLUSIONS
Study has established that team performance has a positive relationship with team
empowerment. This paper concludes that highly empowered teams are found effective
at work. The research model was found highly significant. Among the six sub variables
of team empowerment, respondents had a strong belief in their teams and their culture
at work. They had ‘performance pride’ instilled in the work environment. However,
the turnover of sewing machine operators seemed to have slowed down the progress
of teams. The six sub variables of empowerment seemed to have triggered each other,
resulting in positive synergistic effects. Results of this study would be useful for
managers and academics to understand the importance of team empowerment for
team performance. It warrants extended studies considering other critical success factors
like learning, job satisfaction, balance of member contribution/ effort, mutual support/
cohesion, conflicts, coordination, and cooperation. These form elements of social
behaviour at work in terms of activities, interactions and sentiments. Though the
study was limited to one well established manufacturing plant, the findings will be
helpful to create empowerment for work teams, especially in the Asian context. Study
recommends executives to create an empowered environment for better team
performance, and for organisational effectiveness.
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Cacioppe, R. (1998).Structured empowerment: an award-winning program at theBurswood Resort Hotel. Leadership & Organization Development Journal, Vol. 19Iss: 5, pp.264 – 274
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Fetterman, M. Kaftarran, J. Wandersman, A. (1996). Empowerment evaluationknowledge and tools for self-assessment and accountability, California: SAGEpublications, Inc.USA, ISSN: 0013 - 9165
Gemuenden, H. G. andLechler, T. (1997) Success Factors of Project Management:The Critical Few: An Empirical Investigation, Portland International Conference onManagement of Engineering and Technology, pp. 375 –377.
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Schwartz, S.H. (1994).Beyond individualism/collectivism: New dimensions of values.In. Kim, U. Triandis, H.C. Kagitcibasi, C. Choi S.C. and Yoon, G., Individualism andcollectivism: Theory application and methods. Sage, Newbury Park, CA
Vosburgh, R.M. (2007).The Evolution of HR: Developing HR as an internal consultingorganization, Human resource planning, Vol. 30, Iss.03, pp.11-12.
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ABSTRACT
Firms resort to “Talent Management” in order to obtain a competitive advantage
from people. Talent management cannot be adopted as a blanket strategy for any
organization. Talent management needs to be customized to suit the context of the
organization. However, pillars of talent management define the success of talent
management process in an organization. At the same time, over time, organizations
tend to grow in complexity. Organizational complexity is created by 1. Structural
Mitosis, 2. Process Evolution, and 3. Product Proliferation, over time. Managing
the Organizational Complexity should be a focus of the management of the
organization, if the talent management process to be successful. This paper examines
the relationship between the Organizational Complexity and the level of tenants of
talent management.
Key words: Talent, tenets of talent management, complex organization, complexity,
structure, process, product.
WAR FOR TALENT
The varying demographics of the labour market, long-term skills shortages and employee
demands for work–life balance have created a so-called ‘war for talent’. Successful
organizations strive to improve their strategies, policies and practices for the attraction,
development, deployment and retention of talent, fundamental for their business
requirements. Hence organizations nowadays seek to understand the capabilities required
for their organization and determine the actual or probable talents required of employees
(CIPD, 2006).
TALENT MANAGEMENT PROCESS AND GROWINGORGANIZATIONAL COMPLEXITY
Chathuri GalappaththySenior Assistant Manager - Human Resources, Ceylinco Insurance PLC (Life)
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According to the literature available, there is no one approaches to talent management
that can be applied to all organizational settings. Each organization has different
resourcing needs for its current and future ‘talent pipeline’, as well as different concerns
on how best to meet these needs. These are the considerations that determine the
talent strategies organizations develop (CIPD, 2006).
The Researcher probe in to the issue of Effect of Organizational Complexity on the
Success of Talent Management within organizations.
TALENT MANAGEMENT DEFINED
To provide a meaning is difficult since it’s generally a complex undertaking that operates
within the limits of strategic human resourcing. Talent management demands HR
professionals and their clients to understand how they define talent, who is talented,
and what their distinctive backgrounds might be and whether to consider those recruits
as gifted. Talent can be considered as a complex combination of employees’ skills,
knowledge, cognitive ability and potential. Employees’ values and work preferences
should also be taken into consideration (CIPD, 2006).
Why companies are paying more attention to recruiting? It’s because recruiting is
more than just filling positions. It gets into talent management, and involves succession
planning. Retention is just as vital. Companies must go in to basics of welcoming
employees and help them assimalate in to the company. If asked on how employees
felt about their own companies’ on-boarding and integration process, the feedback will
show the level of the same, which will not be positive (Emerson, 2006).
Talent management is also known as human capital management. Talent management
comprise of recruitment and on-boarding as well an integrated set of goal-setting,
performance management, assessment, compensation management, learning, and career
and succession planning processes. These processes are intended not only to retain
employees, but to promote continuing development of the skills and competencies
needed to achieve the organization’s short term goals as well as long term strategic
objectives (Plateau systems Ltd, 2008).
Talent Management is a strategic and holistic approach to both Human Resources and
business planning which improves effectiveness of the organization. And it enhances
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performance in every level in the workforce thus allowing everyone to reach their
potential, no matter what it is (Ashton et al., 2005).
This interpretation of talent management provides a strategic balance between
performance and potential. Performance focuses on both the past and the present,
whereas potential focuses on the future. The idea is that potential exists and it can be
developed (Ashton et al., 2005).
Cultural attributes of current or historic nature may play a part in defining talent.
Many organizations accept that talent, when aligned with business strategy will change
in definition as strategic priorities change (Ashton et al., 2005).
“Talent management is the additional management processes and opportunities that
are made available to people in the organization who are considered to be” talent
(Blass, 2007).
The definition of ‘talent’ can also vary between organisations, or within the same
organization over time. Many organizations identify individuals across the organization
in terms of performance and potential, and they are marked high performers with high
potential who are most often the focus of talent management (Blass, 2007).
It seems that organizations define “talent” through some reference to potential. These
are people who are showing some potential to grow in the organization. Everyone
might be considered high potential in some organizations at different points in time,
while in other organizations an individual may need to come to a certain level in the
hierarchy in order to be considered high potential. Organizations will decide how and
who to label as high potential (Blass, 2007).
Others may define “talent” as crucial skills set, which has become difficult to obtain in
the labour market. Any organisation has a talent management system whether it
accepts it or not. Most talent management processes and systems fall within the domain
of human resource management and line management. The incorporation of these
management systems and their configuration with the business strategy is vital, but
generally they are developed separately (Blass, 2007).
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Organizational Complexity perspective
Organizations tend to add layers upon layers over time as a response to the
environmental pressure (Ashkenas, 2007). Following are characteristics of such complex
organizations;
1. Ungovernable
2. Under performing
3. Navigating the structure than concentrating on results
4. Unclear accountability
5. Data are sliced and diced away without clear idea of how to use them.
(Ashkenas, 2007)
Causes for organizational complexity as follows;
1. Structural Mitosis
2. Product Proliferation
3. Process Evolution (Ashkenas, 2007)
Mitosis is a biological concept of cell multiplication (Wikipedia foundation, 2010).
Starting from the complexity theory and organizational evolution, this biological concept
was related to the organizations and structure of organizations.
Complexity theory is used to understand how organizations or firms adopt to their
environments. This theory treats organizations as collections of structures and strategies.
When complex adaptive systems share the properties, they are more likely to adapt to
their environments (Figure 1) and thus survive (Wikipedia foundation, 2010). Complex
adaptive systems are complex where they are diverse and made-up of multiple
interconnected elements, adaptive where they have the capacity to change and learn
from experience (Wikipedia foundation, 2010). Complex Adaptive Systems defer
from Multi-Agent systems by features like self-similarity, complexity, emergence, and
self-organization. Multi-Agent System is identified as a system with multiple interacting
agents. Complex adaptive systems possess the properties of adaptation, communication,
cooperation, specialization, spatial and temporal organization and reproduction
(Wikipedia foundation, 2010).
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Figure 1 : Illustration of complex adaptive systems
Structural mitosis is the term that was used for the multiplication of functional elements
of the structure (Ashkenas, 2007). Such organizational multiplications may occur as
simple changing of reporting channels, job moves, accommodation of personal
preferences, multiplication of functional departments, and establishment of new
functional units for shared services will fall under the structural mitosis. Such changes
may be triggered as quick solutions to the environmental pressure, to satisfy CEO’s
ego issues, or any other reason (Ashkenas, 2007).
Companies improve their products. These improvements may come as package changes
or to new features and new products. Such moves are mandatory to counter the
forces of intense competition of existing competitors, new entrants, or counter the
competition of substitutes (Porter). With the addition of features for existing products
or with the introduction of new products, the organization structure needs to be expanded
as well. This may be achieved with the addition of brand management functions to the
existing structure or adding entirely new SKUs (Ashkenas, 2007). Large organizations
are good at expanding the structure than pruning the structure (Ashkenas, 2007).
Customers of such organizations also get affected with the organizational complexity
(Ashkenas, 2007). Proliferation of product portfolio is caused by addition of brands
without pruning them. Product proliferation do contributes to the structural mitosis as
well (Ashkenas, 2007).
Source :Wikipedia foundation (2010)
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Major efforts of Process Reengineering, ISO, Six Sigma, and Lean Manufacturing
place emphasis on the streamlining of the core operation of an organization. Such
processes are mostly streamlined due to high concentration on these processes. On the
other hand the supporting processes are not given due consideration on the same
ground. Processes of budgeting, customer services, Information Systems development,
and employee benefit management, tend to evolve over time without much of
streamlining or reengineering. Such free evolution makes room for management battles
inside the organization. Uncontrolled process evolution does cause process inefficiencies
(Ashkenas, 2007).
In addition to the Structure, Products, and Process there is a contribution from the
management as well for the increased complexity. Management habits also contribute
towards the organizational complexity. Senior Executives ad-hoc queries result in
complex data gathering tasks down the line. Even though the CEO’s request is relatively
simple, gathering required information from the organization and compiling the same
with proper processing may be a major exercise for the organization. Example from
Zurich financial services shows that their subsidiaries were maintaining non standard
key performance metrics that had evolved over time as a result of Senior Executives
requests. Standardizing these made a huge saving for the management (Ashkenas,
2007).
HR Transcending to Talent Management
Human Resources departments and personnel of today show a change in the way
businesses recognize HR’s function. They are changing from HR or personnel director
to vice president or director of talent management or talent acquisition.
The market for key talent is highly competitive and lots of counter offers are very
common. The imminentmass departure of the baby boomer will create openings that
will be ever more difficult to fill (Emerson, 2006).
For HR to become a value-added partner in business, it needs the resources, tools and
management recognition to get the administrative tasks under control and elevate to a
place of strategic adviser (Millar, November 2007).
With the introduction of the word “War for Talent”, HR function has to focus on
efforts on building a talent process and programmes for the organizations. However to
obtain a significant difference, a drastic effort on how talent is seen and managed is
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needed. In order for Talent Management to become a way of life, it should be practiced
in all levels of the organization (Warren et al., 2008).
Source : Bersin et al (2006)
Talent Management Priorities for Human Resources
Following will guide you in selecting a mix of approaches and practices that will make
a difference to the talent management efforts in the organization:
1. Rethinking and re-establishing the talent focus – talent classifications, values
and principles, business perspective, and talent market trends.
2. Positioning talent management – strategic decisions, actions and how talent
processes are designed and delivered.
3. Integrating talent and business – the TM system and position with the strategic
management process and annual or quarterly operating plans.
4. Leading the talent focus – the quality of leadership focus, route and classify
talent roles.
5. Examining culture and talent approach – common language, consistent
messages and cultural attributes and negative influences.
Figure 2 : Evolution of the HR Function
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6. Assessing capability and accountability – defining talent capabilities,
accountabilities for talent, quality and frequency of talent conversations and
talent measures and evaluation.
7. Process design and implementation – people and technology issues, success
rates from talent processes and process shortcomings or failures.
8. Assessing talent performance – improved talent growth, realizing potential,
talent exploitation and talent performance.
9. The talent agenda – to keep this agenda fresh and responsive through
continued support, regular analysis, regularity of discussions, etc.
10. Reviewing talent management – to set up how well you compare with other
organizations internally in talent focus, delivery and shortcomings.
(Ashton et al., 2005)
Talent Management Process
Organizations are made up of people who create value through established business
processes, innovation, customer service, sales, and many other activities. Consecutively
to meet the business goals, organization must make sure that it has a uninterrupted and
integrated process for recruiting, training, managing, supporting, and compensating
these people. The following chart shows the complete process (Bersin et al., 2006).
Figure 3: Talent Management Process
Source : Bersin et al (2006)
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Workforce planning should be incorporated with the business plan. This process
establishes workforce plans, hiring plans, compensation budgets, and hiring targets for
the year (Bersin et al., 2006).
Through an integrated process of recruiting, assessment, evaluation, and hiring brings
people into the organization (Bersin et al., 2006). On-boarding means an organization
must train and allow employees to become productive and incorporated into the
company more quickly (Bersin et al., 2006).
Performance Management is by using the business plan, the organization set up
processes to measure and manage employees (Bersin et al., 2006). Training and
Performance Support is a key function. It provides learning and development programs
to all levels of the organization (Bersin et al., 2006).
As the organization grows and changes, there is a need to move people into new
positions. Succession planning, a very important function, enables managers and
individuals to identify the right candidates for a position. Succession planning has to be
aligned with the business plan to understand and meet the need for key positions 3-5
years out. Although Succession planning is a process set aside for managers and
executives, it is applied across the organization (Bersin et al., 2006).
In compensation and benefits, organizations try to align the compensation plan directly
to performance management so that compensation, incentives, and benefits, support
business goals and business implementation (Bersin et al., 2006).
Critical Skills Gap Analysis is a process often done on a project basis, and is critical for
the business. Government, utilities, telecommunications, and energy are facing large
populations which are retiring. It’s important to identify the roles, individuals, and
competencies which are leaving. Organizations nowadays are working towards filling
these gaps (Bersin et al., 2006).
In the centre of this process (Figure 3) are important definitions and data: job roles,
job descriptions, competency models, and learning content (Bersin et al., 2006).
In “The Economist” article, “Building an integrated talent management strategy” by
Bill Millar, identifies the following areas of recruitment, talent mapping, work force
planning and development, performance planning and evaluation and retention as areas
of Talent Management (Millar, November 2007).
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Under recruitment the following is discussed: Isthe organization hunting the right people?
Is the organization successfully in attracting the right candidates? Data on such
information can be gathered and analyzed to generate benchmarks. Also organizations
must work on methods to track the effectiveness of competing recruiting techniques
(Millar, November 2007).
Talent Mapping provides the organization with business and strategic direction. It
determines the mix of talent and skills that will help the organization to execute its
tasks effectively. Methods have to be deployed to develop or acquire the correct mix if
it’s not available inside. Using Talent Mapping Human Resources executives can develop
recruiting strategies and design training programmes that focus on existing or future
needs (Millar, November 2007).
Workforce planning and development focuses on getting the organization’s human
capital from today to future state. In order to do this:
Form detailed workforce planning and skills gap assessments;
Identify high-potential employees and provide them with extra development
and retention strategies and
Adopt more supple development activities and use e-learning to reach much
wider audience (Millar, November 2007).
Performance Planning and Evaluation is very important. When managers communicate
what they expect from their employees, and how these targets tie into compensation,
it helps employees become more engaged and effective. Employees who know where
they add value do a better job in doing so. Many tools are available to help managers
to develop feedback about the performance expectations and actual performance. It’s
also important to evaluate the effectiveness of performance metrics (Millar, November
2007).
Retention is another area which enables you to identify clusters of key talent, set
retention benchmarks, apply retention strategies, and then evaluate and refine
approaches over time. For example, clear and broadly implemented retention processes
can help companies to:
Identify individuals with the characteristics of acritical performers, and manage
their development, compensation and engagement
Identify the early warning signs of employee defection, in time to act;
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Identify which combinations of incentives have an effect on behaviour and
retention, and set up the funds for rewards and
Set up a formal learning and development plan for all employees and track
growth by individuals or groups of “like” employees. (Millar, November 2007)
Although talent management processes can be aided by HR, technology strategy must
come first. Foremost you need to know what you want to accomplish for your business
and how better management of people can assist to achieve your expectations. Once a
company knows what it wants to accomplish in HR, that technology becomes a tool to
help you achieve your strategy (Millar, November 2007).
An intergrated talent management framework based on HR tecnnology solutions will
help an organisation to find answers for talent related questions much more easily and
faster. An integrated talent management framework can be defined as a secure, single
platform, workflow driven system that leverages a single data model and is inclusive
of the core HR system of record and all talent processes (Oracle Corperation, March
2008).
An intergrated talent management framework means a broad range of practical and
decision-making capabilities for strategically handling present and future business issues
within a reliable, end-to-end framework. Such a system empowers the organization
with insight, agility, efficiency and consistency in talent management (Oracle
Corperation, March 2008).
In “Managing talent for competitive advantage”,an article published by CRF, Chris
Ashton, and Lynne Morton identifies Talent Management as the integration of many
initiatives, bundled up in to a one activity. In it Talent Management is described in
following key words:
Ethos – Implant values and behaviour, to support the view that everyone is
worth developing.
Focus – knowing key positions and making sure the best person is holding it at
the right time
Positioning – Talent Management has to be practiced across the organization.
Structure – creating tools, processes and techniques with clear liability to ensure
that the work gets done.
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System – assist a long-term and holistic approach to generate change (Ashton
et al., 2005).
Talent management is an integrated system, with all the pieces fitting together within
the system. This will operate parallel with strategy, business planning and the
organization’s approach to people management (Ashton et al., 2005).
To obtain such integration the article provides a systematic view of talent which contains
five elements (Figure 4):
1. Need – the business needs resulting from the business model and competitors
2. Data collection – the basic data that is crucial for good talent decisions
3. Planning – people/talent planning guided by data analysis
4. Activities - the transfer of plans into integrated sets of activities
5. Results - criteria to evaluate the value and impacts (Ashton et al., 2005)
Figure 4 : The CFR talent management process
Source : Ashton et al., (2005)
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Using this system, Talent Management becomes a strategic activity rather than a
standard set of HR processes, if the right conditions, context, time scales and offerings
exist (Ashton et al., 2005).
The Four Tenets of Talent Management
In order for Talent Management to be truly embedded, there should be a drastic
change in management capability and organizational culture. With a constant focus on
each of the four tenets of talent management and their principles, talent management
can become a way of life for all organizations (Warren et al., 2008).
Talent Intelligence is building a common language, infrastructure, and a reliable set of
standards that enable talent to be effectively managed. Talent Capability bringsTalent
Management to life by allowing managers at all levels to attract develop and retain the
best. Talent Alignment requires talent management to be vital to the strategic goals of
the business and at the centre of the Human Resources program. Talent Culture is
going beyond talent processes, making Talent Management a way of life in the
organization (Warren et al., 2008).
By using the above tenets organistations should be able to:
Create a universal talent management classification that is generally shared and
understood at all levels across all regions of the organisation.
Build a manangement information system that can measure the present level of
Talent Management and forcast the future needs.
Senior managers of the organisation must be held liable for planting Talent
Management at all levels.
TM process should be simple, connected and spontanious throughout which
will make life easier for line managers.
Should be able to review the management roles and responsibilities.
TM should be aligned with proper reward structure.
Should manage the corporate Talent Management vision
Build a culture of accountability, trust and oppourtunity.
Coach line managers in the skills required for Talent Management (Warren
et al., 2008)
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Table 1: For Tenets of Talent Management
Talent Intelligence
Talent Capability
Talent Alignment
Talent Culture
Global Principle
Language, infrastructure and standards are globally
consistent.
User Acceptance Principle
Talent processes and interventions are designed for
high user-acceptance.
Talent Demand Principle
Analytical talent management information is readily
available.
Capability Principle
Recruit develop talent management capability at all
levels.
Accountability Principle
Strengthen the accountability that all leaders have for
managing talent through job design and reward
structures.
Agility Principle
The talent strategy is flexible to take face the changes
in market/labour conditions.
Line of Sight Principle
Talent management is consideration in business
decisions made at all levels.
Stewardship Principle
The talent strategy drives the HR agenda.
Engagement Principle
Develop an organizational culture that allows talented
people to perform at their best.
Sustainability Principle
Create the conditions and environment where talent
management becomes a way of life
PrinciplesTenets of TM
Source : Warren et al., (2008)
- 88 -
Creating and Evaluating Talent Management Success
In order to set and evaluate Talent Management priorities, start by deciding how the
organization hopes to describe its human performance capabilities and capacity in the
future. These will typically be focused on organizational strengths and areas of distinction
both present and future. The steps - planning, setting goals, investing, performing and
measuring, in creating and evaluation the talent management success is discussed
under this topic (Butterfield, 2008).
A Plan is the quantitative strategic strengths and competencies needed to achieve
organizational expectations.The goals should be set in order to close the gaps in
competency levels. Targets should be based on competencies that must be obtained.
Provide quantifiable business plan that show initiatives to support the performance
chain and obtain management support for the effort needed (Butterfield, 2008).
Setting goals is identifying specific, measurable goals that will envisage success. This
is established by identifying the needed organizational outcomes and Human Resources
initiatives (Butterfield, 2008).
After clarifying how Human Resources will realign generalist and specialist efforts to
provide these initiatives, realign Human Resources budget to serve talent management
initiatives. One should take responsibility for growth by replacement and seek initiative-
based funding (Butterfield, 2008).
Perform indicates integrating Human Resources initiatives and target to achieve
expected organizational Performance. Obtain initiatives as planned, on time and within
budget. And finally report progress in annual Human Resources reports and in the
human capital plan (Butterfield, 2008).
Finally measure the success by comparing outcomes with expectations. For instance
check whether core skill areas have obtained a higher retention rate than the rest of the
organization. Core skill areas should be compensated at or above the target market.
There should be an improved performance in core skill areas with high performers in
core skill areas report higher than average employee commitment. Internal promotion
rates in key performance areas are higher than average.If the above is obtained, the
Talent management programme that was implemented is a success (Butterfield, 2008).
- 89 -
CONCEPTUALIZATION & OPERATIONALIZATION
Conceptual Framework
Figure 5 : Conceptual Diagram
Hypothesis
Increasing level of organizational complexity will have a negative influence on the
average level of tenets of talent management
DATA PRESENTATION & ANALYSIS
Correlation of variables used in hypothesis
Behaviour of the average of tenets of Talent Management (Figure 6) is analyzed for
correlation using SPSS. Line of best fit was drawn using SPSS. Also Correlation
Coefficient (Table 2) for average of tenets of Talent Management was also obtained
through SPSS.
According to the scatter graph, it shows a negative relationship between level of tenets
of Talent Management and Organization Complexity. That means higher the
Organizational complexity; lower the level of tenets of Talent Management.
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Figure 6 : Behaviour of level of Tenets of Talent Management Vs Organizationalcomplexity
Statistical analysis shows that level of tenets of Talent Management is correlated to the
organizational complexity with a correlation coefficient of 0.841 (Table 2), which is
well over 0.65, and correlation is significant atthe 0.05 shows that there is a probability
of 95% for this relationship to be true, or only 5% chance of this relationship to be
wrong.
- 91 -
Pearson Correlation
Sig. (2-tailed)
Sum of Squares and
Cross-products
Covariance
N
Pearson Correlation
Sig. (2-tailed)
Sum of Squares and
Cross-products
Covariance
N
Organizational
Complexity
Quotient
Level of Tenets
of Talent
Management
Organizational
Complexity
Quotient
1
180.657
36.131
6
-.841*
.036
-16.959
-3.392
6
Level of Tenets
of Talent
Management
-.841*
036-
16.959
-3.392
6
1
2.249
.450
6
Table 2: Correlation Coefficient for level of tenet of Talent Management VsOrganizational complexity quotient
*. Correlation is significant at the 0.05 level (2-tailed).
Hypothesis testing
Researcher’s hypothesis is; Increasing level of organizational complexity will have a
negative influence on the average level of tenets of talent management
Figure 6 depict the correlation between the Organizational Complexity Quotient and
the level of tenets of Talent Management. Line of best fit drawn using SPSS shows
that when the Organizational Complexity increases, level of tenet of Talent Management
decreases.
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Table 2 depicts the correlation coefficient value between the Organizational Complexity
quotient and the Level of tenets of Talent Management. Value of the correlation
coefficient has taken a value of 0.841. A Correlation Coefficient over 0.65 establishes
that these two variables are highly correlated. The significance is stated at 0.05 levels,
establishing that in 95% of cases these two variables will be correlated. These facts
prove that there is a correlation between the level of tenets of Talent Management and
Organizational Complexity Quotient.
Hence the null hypothesis, increasing level of organizational complexity will have a
negative influence on the average level of tenets of talent management was accepted.
Researchers’ null hypothesis is established with the analysis of empirical data.
CONCLUSIONS AND RECOMMENDATIONS
67% of the organizations in the sample had reached a significant level of complexity.
Thus it would be an important initiative to use the tools gathered by the researcher in
assessing the Organization Structure to assure the fitness of the structure for the
organization and refining the structure for effectiveness.
Product portfolio could be audited using the Brand Portfolio Audit to assess if all the
products are having a healthy position. In cases where there are cash users, they need
to be pruned using the methodologies in liquidating and making the core brands strong.
Model T analysis can be used to access the level varieties that products should be
maintained at, while making the brand strong.
Processes of the organization as well, need to be audited using the framework identified
by the researcher. In this framework, entire organization will be assessed for process
enablers, and enterprise wise capabilities. If there are enablers which needed to be
developed, organizations could develop them using training and development. By
developing the enablers the organization could advance the process capabilities to
higher levels. Researcher’s contribution from this research is to present the
comprehensive set of tools from different sources into one place enabling organizations
to reduce the organizational complexity, through which organizations will be in a better
position to improve their tenets of Talent Management capabilities.
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Senior management could take initiatives for managing the complexity. Positive
perception of managers inside the organization will be positive contributor for the
success of the initiative. It’s recommended that senior managers embark on this change
with proper preparations, planning, and consultation with external express as well as
internal employees. Since it was established that the age of the organization has no
influence over the complexity, through efforts of management alone complexity can
be dealt with.
If failure in implementing and maintaining Talent Intelligence and Talent Alignment
programmes are sensed and observed, organization structure can be analyzed for
complexity. If failure in Talent Culture is observed processes in place can be analyzed
for complexity. Talent Capability can be developed without any impact from structure
or the process.
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Plateau systems Ltd. (2008). TM - Building a Successful Talent Management Strategy.
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ABSTRACT:
This study attempted to understand the employee perception on the existing
performance evaluation system of the Star-Tel (Pvt.) Ltd. At the time of this research
study the company has been using a performance evaluation system that is based on
the forced distribution method for categorizing employee performance and subsequent
rewards. Although there are many previous studies about forced distribution method
done on factors affecting employee performance, there are only a very few researches
conducted in the telecommunication industry.
In this study, three independent variables, or in other words factors, related to employee
perception on performance evaluation method that affect employee performance,
were tested for its applicability at Star-Tel (Pvt.) Ltd. The data was collected through
a questionnaire. According to the results obtained it was revealed that employee
performance has significant positive relationships with employee satisfaction on
Performance Management (PM) method, perceived fairness of PM method and
employee morale on PM method. Based on the findings of this study the above
positively related factors are recommended to the managements of the respective
organizations to improve their respective performance evaluation systems.
Accordingly, the researcher presented recommendations to the management. Further,
the limitations of this study were also identified and the researcher has given directions
for future research in this area.
Key words: Employee perception, performance evaluation, performance management,
employee satisfaction
EMPLOYEE PERCEPTION ON THE EXISTINGPERFORMANCE EVALUATION SYSYTEM:
AN EMPIRICAL INVESTIGATION AT STAR-TEL (PVT) LTD
Ayoma Lakmali [email protected]
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1. PROBLEM / ISSUE IN FOCUS
For organizations to survive in the present competitive environment it is necessary to
have a competitive advantage. The technology is evolving very fast in the
telecommunication industry. Thus it is important for organizations to retain their best
people by a suitable rewards systems, which is based on a transparent and a widely
accepted performance evaluation system. This research extensively focuses on the
employee perception of the organizational performance evaluation system in the Star-
Tel (Pvt.) Ltd and its impact on employee performance.
When grading employees at Star-Tel (Pvt.) Ltd, they are placed in to various
performance categories based on a pre-determined percentage. That is for a given
section (department) of the company, percentage of grades that can be handed out is
predetermined.
For example only 5% of the employees can have a “A+” grade (A+ for, Excellent
Performers) An “A” grade (A for good performers) is given to only 10% of the staff.
This is illustrated in the below
Table 1 : Performance Category and Allocation of Percentage
What kind of an impact does the above pre determined performance categorization
have on employee performance? Does it impact employee moral? Does it have a
dampening effect on employee morale, leading to de-motivation? Do employees feel
that no matter how they perform, they are not going to be rewarded due to the “quota
system” being enforced by the organization in performance grading? Is it perceived
as a fair system of evaluation, in an environment where “team work” is touted, but
employees are graded on individual achievements? Is it perceived as “fair” in the
Performance Category Allocation and Percentage
A+ 5%
A 10%
B 25%
C 40%
D 10%
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sense that lower grade/category employee have an equal probability of getting a higher
performance category as of their superiors, who at most times are exposed and credited
with divisional achievements, due to the way how “work” is structured in organizations?
Overall, are employees satisfied about the performance evaluation method? Do all
these factors in culmination, affect employee performance in any way, positively or
negatively? These are some of the questions that this research undertaking sought to
answer, in the context of Star-Tel (Pvt.) Ltd.
The objectives of this study were three-fold
1. To determine the level of satisfaction of employees with regards to the
performance evaluation method (rating method) adopted
2. To determine the impact of the selected evaluation method on employee
morale and thereby the achievement of organizational goals
3. To determine the tendency of performance evaluation method to favour
higher grade employees in organization hierarchy when compared with lower
grade employees
It was the objective of the researcher to determine the suitability of performance
grading method used at Star-Tel (Pvt.) Ltd in determining employee rewards which is
in the form of a performance related pay scheme. The impact that the performance
management system will have on the subsequent employee performance as a result
was studied from the perspective of employees.
Majority of the employees of the organization may not be satisfied with the current
performance evaluation system in use. If there are a higher percentage of unsatisfied
employees, it would mean that they consider themselves to be not properly rewarded
for the work they perform for the organization. This would lead to a de-motivated
staff and non achievement of organizational goals in future. If this is the case, as it is
to be found out from this research study, the company can look into revising its current
performance grading scheme.
For an organization to be high performing, its employees need to be highly motivated
with a high morale amongst them. Financial rewards that are based on employee
performance may not be the only motivator for employees. There can be other non
financial rewards in working for the company as well. It is an objective of this study
- 99 -
to determine the impact of the performance grading method on employee morale, by
considering the level of importance with which employees treat the company’s
employee rewarding scheme. Therefore it is an objective of this study to determine
the “fairness” of the current performance grading method used at Star-Tel (Pvt.)
Ltd, from the perspective of its employees. Based on this output, the company can
take appropriate measures.
2. LITERARY REVIEW
Virtually all companies have some formal or informal means of appraising employees’
performance. Performance appraisal is defined as any procedure that involves, setting
work standards, assessing the employee’s actual performance relative to those
standards, and providing feedback to the employees with the aim of motivating him or
her to eliminate performance deficiencies or to continue to perform above par.
Performance management is defined as a process that unites goal setting, performance
appraisal, and development, into a single, common system whose aim is to ensure that
the employee’s performance is supporting the company’s strategic aims (Gary Dessler-
11th edition). If one were to spend several days in Toyota’s Lexington, Kentucky,
Camry plant, the absence of “appraisal” would soon be apparent. Supervisors don’t
sit down with individual employees to fill out forms and appraise them. Instead, teams
of employees monitor their own result, continuously adjusting how they do things to
align those results with the work team’s standards and with the plant’s overall quality
and productivity needs. The fact that managers are emphasizing such a performance
management approach reflects several things; they are total quality, appraisal issues,
and company strategic focus.
Therefore today’s management writers define performance management in a broader
sense. Michael Armstrong in his book “Art of HRD” (1999) has defined performance
management as the process or set of processes for establishing shared understanding
of what is to be achieved, and of managing and developing people in a way which
increases the probability that it will be achieved in the short and longer term.
Armstrong (1999) defines performance management as the process of developing and
implementing strategies, policies and systems which helps the organization to achieve
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its objectives by obtaining and keeping the people it needs and by increasing their
motivation and commitment.
Rewards management process of a company is concerned with intrinsic as well as
extrinsic motivation of its employees with financial as well as non financial rewards.
Financial reward system will incorporate procedures for tracking market rates, valuing
jobs, designing and maintaining pay structures, paying for performance and skills and
providing employee benefits. The non financial rewards system will satisfy individual
needs for variety, challenge, responsibility, and influence in decision making,
achievement, recognition, skills development and career opportunities (Armstrong,
1999, P: 177). Performance related rewards management is only a component of
overall rewards management process of a company.
To reward employees, the company must first rank its employees from best to worst.
For this purpose, sometimes companies adopt a “forced distribution” method, which
was first popularized by General Electric (Dessler, 2008). Jack Welch, retired Chief
Executive Officer of General Electric (GE), is most often associated with forced
ranking. The forced distribution method is similar to grading on a curve, where you
place pre-determined percentage of rates into several performance categories. The
proportions in each category need not be symmetrical. GE used top 20%, middle
70%, and bottom 10% for managers. One practical, if low-tech, way to do this is to
write each employee’s name on a separate index card. Then, for each trait (quality of
work, creativity, and so on), place the employee’s card in the appropriate performance
category. However GE has recently been injecting more flexibility into its system.
For instance it now tells managers to use more common sense in assigning rankings,
and no longer strictly adheres to its famous 20/70/10 split (Dessler, 2008).
According to Gary Dessler (2008, P: 347), one survey found out that 77% of
responding employers using this approach were at least “somewhat satisfied” with
forced ranking, while the remaining 23% were dissatisfied. The complaints: 44% said
it damages morale. Forty-seven percent said it creates interdepartmental inequities.
High performing teams must cut 10% of their workers while low performing teams
are still allowed to retain 90% of theirs. Some writers refer unkindly to forced ranking
as “Rank and Yank”. About a fourth of fortune 500 companies including Microsoft,
Conoco, and Intel use versions of forced distribution.
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Sun Microsystems force-ranks all its 43,000 employees. Managers appraise employees
in groups of about 30, and those in the bottom 10% of each group get 90 days to
improve. If they’re still in the bottom 10% in 90 days, they can resign and take
severance pay. Some decide to stay, but if they are still in that group the firm fires
them without severance. This dismissal policy seems somewhat standard. It reflects
the fact that top employees often outperform average or poor ones by as much as
100%. Sometimes attempting to implement forced ranking fails; Jacques Nasser, a
former CEO, famously left in part due to resistance to his advocacy of such a plan.
This was followed by the review of the literature on factors affecting employee
satisfaction. Here the author presented the findings of few researches done in other
countries and industries.
Thereafter, from among the many variables that were found to influence organizational
commitment by many researchers, those which have relevance and indicated by the
respondents of the preliminary interview were selected for the study. Then supporting
literature was presented for those variables in order to develop the conceptual
framework.
3. CONCEPTUAL FRAMEWORK AND METHODOLOGY
Accordingly, this research will examine the effect of three factors on employee
performance. These three factors are taken as independent variables and employee
performance will be the dependent variable in this case. The independent variables
are, employee satisfaction of performance management method, perceived fairness
of performance management method, and impact of performance management method
on employee morale.
The following conceptual model can be developed as per the observations in the
literature survey and the information gathered at the preliminary survey.
- 102 -
Figure 1: Conceptual Framework of factors affecting Employee Performance
From the arguments developed under the conceptualization, the following six hypotheses
can be developed under the three categories of employee satisfaction.
Hypotheses related to Employee Satisfaction of performance Management Method,
the null hypotheses, and alternative hypotheses, can be formed as follows.
H0: Employee satisfaction of performance management method has no impact on
employee performance.
H1: Employee satisfaction of performance management method has an impact on
employee performance.
Hypotheses related to Perceived fairness of Performance Management Method, the
null hypotheses, and alternative hypotheses, can be formed as follows.
H0: Perceived fairness of performance management method has no impact on
employee performance.
H1: Perceived satisfaction of performance management method has an impact on
employee performance.
Hypotheses related to impact of performance management method on employee morale,
the null hypotheses, and alternative hypotheses, can be formed as follows.
H0: Impact of employee morale from performance management method has no
impact on employee performance.
H1: Impact of employee morale from performance management method has an
impact on employee performance.
1. Employee Satisfaction ofperformance management method
Employee Performance2. Perceived fairness of performance
management method
3. Impact of performance managementmethod on employee morale
- 103 -
This research was conducted among a convenient sample of all levels of employees,
that is stratified sampling method,at Star-Tel (Pvt) Ltd. The data was collected through
a questionnaire which was distributed by hand.The questionnaire was primarily based
on a Likert scale. The total questionnaire comprised of 44 questions. The first five
questions are to gather demographic information of the employee. Questions six to
thirty six consist of the Likert scale questionnaires. Questions thirty seven to forty are
polar questions (Yes-No questions). At the end, four open ended questions are there
to gather qualitative data.The 5 answers of the questionnaire were quantified as
Strongly Agree - 5 points, Agree – 4 points Neutral- 3 points, Disagree – 2 points,
Strongly Disagree – 1 point. Data was analyzed using statistical tools. Based on the
results of the correlations the hypotheses were tested. Regression analysis was used
to test the strength of the relationships.
4. DATA PRESENTATION AND ANALYSIS
In this chapter the collected data by the respondents of the all level of employees will
be presented and analyzed. Thereafter the findings will be presented. The statistical
data analysis was done using both the exploratory and descriptive methods. The mean,
standard deviation, and the coefficient of correlation are calculated in order to analyze
the data and to test the hypotheses formed. The relationships among the variables in
the conceptual framework are established through analysis of correlation coefficients.
The responses obtained for each question for measuring a variable was averaged for
each of the variables. This was done for each respondent separately. Then the resulting
processed data was input to analyze other variables.
A total of 50 responses were received. Since all the questions except the open ended
questions were made compulsory questions, all the received responses were complete.
A total of 28 respondents had answered the three optional open ended questions. All
the responses were take into consideration.
According to the analysis of composition of the sample gathered, it was observed that
a significant 44% of the respondents were from the age group of 20-30 and 28% of
the respondents were from the age group of 31-40. Another 28% were from the age
group 41-50; this means that most of the participants in this study were employees
- 104 -
who were in the initial stages of their career. It was also observed that 42% of the
respondents were female. The fact that in the telecommunication field the proportion
of females in the technical departments is very small compared to males can be given
as an explanation for this observation. The samples categorized according to the level
of education of the employees in the organization. From this it can be observed that a
majority of the respondents (48%) were professionly qualified employees. 30%
respondents were university degree holders. Next 16% respondents had completed
G.C.E A/L. And 6% of respondents were MBA/M.Sc qualified employees. According
to the job level of the employees in the organization, it was observed that a majority of
the respondents (52%) were non-executives,22% executives, 16% technical staff
and 10% supervisors. Considering the length of service in the company it was observed
that a majority of the respondents (50%) have one to five years of service, 30%
employees from 11 to 20 years of service, 12% have 5 to 10 years of service, and 8%
employees have been in service for more than 20.
Tabel 2: Means and Standard Deviations of the variables
N = 50
Var
iabl
e N
o
Variable
Mea
n
Stan
dard
Dev
iati
on
Sk
ewn
ess
Stat
emen
t No
1 Employee Satisfaction of PM method 3.88 0.361 -0.590
9 Employee satisfaction of OM method is importantfactor for motivation 4.40 0.606 -0.458
10 I am satisfied with the current PM technique(performance grading) which is in use in myorganization 2.44 1.146 0.323
11 I look forward to my performance appraisal meeting 3.72 0.640 0.321
12 I would be happy if the organization adopt a differentPM method 3.88 0.918 -1.239
21 Company has a problem in grading employees 4 0.782 -0.533
40 Perceived satisfaction of PM method has an impact onemployee performance 4.84 0.792 -4.841
02 Perceived Fairness of PM method 3.19 0.292 -0.059
13 Pre determined percentage ( Forced distributionmethod) for various performance categories is fair 2.70 0.863 0.436
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14 Current PM technique used in our organization is fair 2.42 0.785 0.408
15 Am I evaluated fairly 2.56 0.993 0.218
16 Higher performance grades are mostly given toemployees in higher job levels 3.94 1.132 -0.669
17 Rarely lower grade employees get higher grade 3.38 0.923 0.199
18 Limited percentage for higher grade is a result of interdepartment inequalities 3.80 0.728 -0.330
19 Limited percentage for higher grade is unfair 4.14 0.783 -0.255
20 There is tendency for performance evaluation methodto favour higher grade employees 3.60 0.833 -1.324
22 There is no favouritism in performance evaluation 2.60 0.990 0.763
23 Employee performance is graded taking intoconsideration the different tasks performed by eachemployee 3.52 1.015 -0.361
24 There are no favouritisms in allocating performancegrades 2.46 0.646 0.629
28 Performance grade in this organization largely dependon what kind of relationship one has with the topmanagement 3.44 0.884 0.097
37 Do you think pre determined percentage(Forced Distribution Method) for various performancecategories are fair? 1.24 0.960 3.821
39 Have you ever notice inter department inequalitieswithin same grade employees? 4.84 0.792 -4.841
03 Impact of PM method on employee morale 3.60 0.394 -0.286
26 There are career advancement opportunities with thisperformance evaluation method. 3.24 1.238 -0.479
29 Limited percentage for higher grade results indecrease in employee morale 3.88 0.718 -0.506
33 I feel I can improve on my performance grade ifI work hard 3.04 0.968 0.621
34 There are others in my division who will always getbetter grades as they carry out more important workfrom the organization’s perspective 2.84 0.912 0.835
N = 50
Var
iabl
e N
o
Variable
Mea
n
Stan
dard
Dev
iati
on
Sk
ewn
ess
Stat
emen
t No
- 106 -
35 I feel I have a little chance in getting a higher gradeas performance grade quota is limited 3.80 0.857 -1.013
36 My performance grade is an indication of how muchthe organization values my work 3.54 0.930 -0.834
38 Do you think limited percentage for higher graderesultsin decrease in employee morale? 4.84 0.792 -4.841
04 Employee Performance 3.48 0.40 -0.145
25 My performance grade is a fair reflection of mycontribution to the organization 3.20 1.050 -0.198
30 I can usually guess the performance grade I will begetting before the performance appraisal 3.48 0.863 -0.333
31 I have been getting the same performance grade forthe past three years 3.82 0.983 -0.830
32 I am satisfied with my last year’s performance grade 3.36 1.064 -0.358
36 My performance grade is an indication of how muchthe organization values my work 3.54 0.930 -0.834
The lowest mean value was observed for the question which asked as Yes/No question
was “Do you think pre determined percentage (Forced Distribution Method)
for various performance categories are fair?” This means that overall the
respondents’ perceived fairness of current performance evaluation method as not in
satisfied level. The highest mean value (04.84) was observed for the statement of
“perceived satisfaction of PM method has an impact on employee performance”,
which was questioned under the first independent variable that was employee
satisfaction on employee performance. This means that if employees are satisfied
with their performance management method naturally employee performance will
increase. The same figure was received for the Yes/No question which asked as
“Do you think limited percentage for higher grade resultsin decrease in employee
morale?
N = 50
Var
iabl
e N
o
Variable
Mea
n
Stan
dard
Dev
iati
on
Sk
ewn
ess
Stat
emen
t No
- 107 -
It can be observed that there are very low standard deviations in the independent
variables which mean that the dispersion of the responses is very low. When it is
observed standard deviation figures calculated for the statements under independent
variables, the highest standard deviation figure was 1.146 and it was for the statement
number 10:”I am satisfied with the current PM technique (performance grading)
which is in use my organization”. This means that the dispersion of the responses
for that question is very high.
The lowest standard deviation is 0.606; it was for the statement number 09. The
statement is “Employee satisfaction of OM method is important factor for
motivation”. It can be observed that there are very low standard deviations in this
statement which means that the dispersion of the responses is very low.
All variables show a moderate measure of means. The mean of employee performance
is 3.48 and the standard deviation is 0.40 which signifies that overall organizational
employee performance in the sample was at a minimum level. It can be observed that
skewness values of variables are negative. The left tail is longer; the mass of the
distribution is concentrated on the right of the figure.
4.1. Testing of Hypotheses
Hypothesis 1 is employee satisfaction of performance management method has an
impact on employee performance. The correlation index is positive 0.257 between
the employee satisfaction and employee performance. Therefore above data depicts
that employee satisfaction is positively related to employee performance at a 0.01
significance level. Hence, hypothesis 1 is not rejected at a 0.01 level of significance.
We accept the alternative hypothesis. Hence, higher the employee satisfaction, higher
the employee performance. As alternative hypotheses accepted the null hypotheses,
that is employee satisfaction of performance management method has no impact on
employee performance is rejected.
Hypothesis 2 is perceived fairness of performance management method has an impact
on employee performance. The correlation index is positive 0.407 between the
perceived fairness and employee performance. Therefore above data depicts that
employee satisfaction is positively related to employee performance at a 0.01 significance
level. Hence, hypothesis two is not rejected at s 0.01 level of significance. Therefore,
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we accept the hypothesis. Hence, higher the level of perceived fairness in performance
management method, higher the employee performance. As alternative hypotheses
accepted the null hypotheses that is,perceived fairness of performance management
method has no impact on employee performance is rejected.
Hypothesis 3 is Impact on employee morale through performance management method
has an impact on employee performance. The correlation index is positive 0.584
between the employee morale and employee performance. Therefore above data
depicts that employee satisfaction is positively related to employee performance at a
0.01 significance level. Hence, hypothesis three is not rejected at a 0.01 level of
significance. Therefore, we accept the hypothesis. Hence, higher the level of employee
morale on PM method, higher the employee performance. If employee morale increases
on performance management method employee performance will increase. As alternative
hypotheses accepted the null hypotheses that is,impact of employee morale from
performance management method has no impact on employee performance is rejected.
Multiple regression analysis was done by entering all the independent variables and the
dependent variable. The results of the regression of the three independent variables
against employee performance can be seen in the following table.
Table 3: Model Summary
This table lists the three independent variables that have been taken into account in
the regression model. R(0.632) is the combined correlation of the three independent
variables with the dependent variable. The R2 (0.400), which is the explained variance,
is actually the square of the correlation. What this means is that 40% of the variance
in employee performance has been significantly explained by the three independent
variables considered in this study. This means that there can be many other factors
that affect employee performance of Star-Tel (Pvt) Ltd.
Regression Statistics
Multiple R 0.632619
R Square 0.400207
Adjusted R Square 0.36109
Standard Error 0.318092
Observations 50
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5. DISCUSSION OF FINDINGS
The discussion of the findings will relate to the hypotheses formulated and the objectives
of this study. The findings will be discussed by attempting to relate them to the theories
and concepts that guided the researcher in formulating the conceptual framework.
The findings of this study did not support all the hypotheses developed between the
independent and dependent variables. The empirical results of this study highlight the
importance of the impact of affective factors on employee performance.
The alternative hypotheses on individual variables were accepted while the null
hypotheses were rejected. However, employee satisfaction on performance management
method, and perceived fairness of performance evaluation method showed weak
correlations with employee performance. But employee morale on performance
management method showed strong correlation with employee performance. Therefore,
it is important that organizations consider this aspect seriously. Perceived fairness of
performance evaluation method showed the second strongest correlation with employee
performance in this research. If the employees perceive the evaluation criteria to be
unfair, then such evaluation system would de-motivate the employees rather than
motivate them. From the questionnaire it was identified as a serious issue that employees
faced, and that higher performance grades are mostly given to employees in higher job
levels. This highly influences the perceived fairness of evaluation method. As a result
of this employees are not motivated to work. Also, less perceived fairness in performance
evaluation method results in inter department inequalities, thereby causing reduced
employee morale and teamwork in the departments. Employee satisfaction on
performance management method showed the third correlation with employee
performance. When evaluating the questionnairethe current need of performance
appraisal meeting for the organization was identified. 99% of employees agree with
the performance appraisal meeting. The research also found that employees are not
satisfied with current performance appraisal method, and that they would be happy if
the organization adopts a different performance appraisal method.
This finding suggests that in the Star-Tel (Pvt.) Ltd performance evaluation method
used, that is the forced distribution method, resultsin many problems and this should
be given due consideration by the human resource management. The variables for
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this study were chosen based on the responses the researcher collected in the preliminary
interview. Therefore some important variables may have been missed. Hence, future
research should study the effect of other variables such as recognition, incentives,
compensation, availability of procedural justice system, immediate supervision, etc.
on employee performance. Since the reliability of some of the scales was low, these
factors should be reconsidered for future research.
6. CONCLUSIONS
The results of this study showed that employee performance of the Star-Tel (Pvt.)
Ltd is not at a satisfied level. That means the current performance evaluation system
of forced distribution method has many problems. Given the extremely competitive
nature of the industry it is very important to maintain the competitive advantage of
each organization in order to survive in the market. Competitive advantage of the
organizations depends on the core competencies. Core competencies come from the
employees. Therefore, it is very important for organizations to indentify employees’
strengths and weaknesses and according to that evaluate the employees.
The study showed many areas where Star-Tel (Pvt.) Ltd should focus in order to
enhance the quality of performance evaluation method of the organization. The findings
showed that to promote organizational employee evaluation methods Star-Tel (Pvt.)
Ltd should concentrate more on affective factors. Out of these factors supportive
leadership to measure employee real performance, performance based culture,
opportunities of career advancement, fairness of performance management and
rewards system, and participation, are extremely important areas that the management
should pay significant attention to.Therefore, Star-Tel (Pvt.) Ltd should develop
measures in order to improve the above factors to improve the forced distribution
method.
As per the findings of this research, few other factors such as a pre determined
percentage for various performance grade categories should be equalized, or for this
pre determined percentage it also can replaced with identified percentages after
recognized the number of employees categorized under any performance grade.
Therefore, management should focus on these factors too.As per the findings the
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organizations should focus more on effective factors of employee performance. The
next section provides specific recommendations according to the findings of this study.
7. RECOMMENDATIONS
Recommendations are suggested based on the evidence gathered in the study of
factors affecting employee performance.
Perceived fairness of performance management system
Organizations should take steps to ensure that the employees perceive the performance
management and rewards system as a fair process. The performance evaluation
criteria should be clearly defined for each grade of employees and the rewards either
intrinsic or extrinsic should be defined in a similar manner.
Percentage for performance grades should be decided after employee
performance grades are given
Instead of this pre determined percentage method, management can decide the
performance grade percentage by considering the performance grades employees
should be given. If managers can use more common sense in assigning ranking, and
no longer strictly adhere to its pre determined percentage split employees will be
motivate to work, and many problems will be solved.
Performance appraisal meeting
Most employees expect performance appraisal meeting in employee point of view.
They need clear clarification with their performance grade. This will resultin employees
improving on their weaknesses by getting necessary training, and this also helps reduce
inter department inequalities with peers though they receive different performance
grades.
Instead of forced distribution method management by objective appraisal
method can be used
MOB requires the managers to set specific measurable goals with each employee and
then periodically discuss the latter’s progress toward these goals. Management can
engage in a modest and informal MOB program with subordinates by jointly setting
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goals and periodically providing feedback.Management can consider this approach to
develop the performance appraisal method of the Star-Tel (Pvt.) Ltd.
Opportunity for career advancement
Most of the company employees receivedthe same performance grade for the last
three years and as a result employees de-motivated because they did not get any
opportunity for career advancement. So the organization should realize this and should
formulate human resource policies to have career advancement mechanisms.
Participation
Management should involve and get the ideas of the employees as much as possible
from the relevant employees when making employee performance. At least
management should explain the decisions regarding performance grade they wish
you to obtain.
Supportive leadership
It needs to be ensured that organizations create an atmosphere where employees
perceive that the leadership is supportive of them.
REFERENCES
Ahmed, S. (1999). The Emerging Effectiveness for Human Resource Management:
An Exploratory Study with Performance Appraisal. The Journal ofManagement
Development. 18, 6, 543-556.
Barrier, M. (1998). Reviewing the Annual Review. Nation’s Business, 86, 9, 32.
Bartol, K. M., Durham, C. C. and Poon, J. M. (2001). Influence of Performance
Evaluation Rating Segmentation on Motivation and Fairness Perceptions. Journal Of
Applied Psychology, 86, 6, 1106-1119.
Boswell, W. R. and Boudreau, J. W. (2000). Employee Satisfaction with Performance
Appraisal And Appraisers: The Role Of Perceived Appraisal Use. Human Resource
Development Quarterly, 11, 3, 283-299
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Cleveland, J.N. and Murphy, K.R. (1992). Analyzing Performance Appraisal as a
Goal-Directed Behavior. Research in Personnel and Human Resources Management,
10, 121-185.
Davis, B. L and Mount, M. C. (1984). Design and Use of Performance Appraisal
Feedback Systems. Personnel Administration, 3, 91-107.
Eager, W.G. (1991). Relationship between Organizational Culture and the Performance
Appraisal Process. An unpublished dissertation. Pennsylvania State University/
Ford, J. K., Kraiger, K. and Schetman, S.L. (1986). Study of Rare Effects in Objective
Indices and Subjective Evaluation of Performance: A Meta-analysis of Performance
Criteria. Psychological Bulletin, 99, 330-337.
Gary Dessler (2008) Human Resource Management – Eleventh Edition ,” Performance
Management” PP-336-348
Gosselin, A., Werner, J.M., Halle, N. (1997). Ratee Preferences Concerning
Performance Management and Appraisal. HRD Quarterly, 8, 4, 315 – 333.
Karol, S.H., (1996). The Influence of Planning Activity on Employee Performance
Review. Unpublished Dissertation, Evanston, IL.
Latham, G. P., and Wexley, K. N. (1981). Increasing Productivity through Performance
Appraisal. Reading, MA: Addison-Wesley.
Michael Armstrong (2003) Performance Management- Key Strategies and practical
guidelines
Smither, J. W. and Reilly, R.R. (1987). True Intercorrelation among Job Components,
Time Delay in Rating and Rater Intelligence as Determinants of Accuracy in Performance
Ratings. Organizational Behavior and Human Decision Processes. 40:369-391.
Taylor, M.S. Tracy, K. B., Renard, M.K., Harrison, J.K., and Carrol, S(1995). Due
Process in Performance Appraisal: 40, 495 - 523.
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ABSTRACT:
Reward management is one of the integral parts of the whole management process in
organisations. Within reward management there are thousands of ways to reward
employees. One employer is not supposed to follow all types of reward methods.
Managers should therefore be knowledgeable enough to identify the most suitable
set of reward systems within their own business context. This is a challenge for most
human resource practitioners as innovative and creative formulation of strategies
help keep companies at the cutting edge of the market. That in turn makes the
organisation the employer of choice. The ways and means of rewarding employees
are thought to be decided in accordance with the economy of the organisation,
organisational culture, attitudes of the employees, type of the products or services,
the market dealt with, industry standards and many more factors. All these variables
have to be scrutinised in order to determine the best-suited set of rewards in a
particular organisation.
This research aims to investigate a small area out of this broad context. It is an
exploration of attitudes of human beings employed in banks towards traditional and
non-traditional rewards. The principle idea was to identify the type of reward,
traditional or non-traditional, that perpetuates employee motivation,especially in
the banking industry.
Findings from the research may be of interest for human resources strategy formulation
by practitioners in the banking sector. Primary research was carried out in two
banks in Kurunegala District. This research was primarily based on raw data directly
A COMPARATIVE STUDY OF TRADITIONAL AND NON-TRADITIONAL MOTIVATIONAL METHODS IN BANKS
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collected from relevant fields conducting a questionnaire survey. Secondary data
were utilised to frame major findings.
Survey results revealed three interesting findings. Every banker subjected to the
study was fully satisfied with their present job. Secondly, non-traditional motivational
methods are more effective than traditional rewards on retention of employees in
banks. Finally, non-traditional rewards have the most effect on retention of employees’
satisfaction than traditional rewards in the same sector.
Key words: Reward management,employee motivation
1. INTRODUCTION
The Central Bank of Sri Lanka, which started operations in 1950, stood at the apex of
the country’s financial framework in 1988. In many ways the Sri Lankan banking
industry has changed more in recent decades than ever before, due to the introduction
of new technology, rapid development of communication methods, introduction of
innovative products, globalization and so on. This scenario let banks compete with
each other. The maintaining of a co-competent staff is one of the measures taken by
managements in order to provide a high quality service.So this study will be carried
out to identify most effective motivation method traditional or non-traditional used by
the private and public bank in order to motivate their employees for better output
2. LITERATURE REVIEW
Motivation is one of the earliest concerns of the organisational behaviour. Links between
a motivated work force and increased performance (often assumed and with
surprisingly little empirical support) led managers to strive toward motivating their
workforces in an attempt to reduce alienation (Robert et al., 1999).
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Figure 1: The Basis of Motivational Theories
Figure 2:Maslow’s Hierarchy of Needs
Source: Robert et al (2003)
Needs Increases
Managers
Increase/DecreaseMotivating / De-motivating
Motives
Rewards
Jobsatisfaction
Individual
Generates
Recognition, Responsibilityand Importance
Challenge, Creativity, Opportunityand Achievement
Self-Actualization
Friendly Colleagues
Esteem
Safety at Work,Benefits and JobSecurity
PhysicalComfort, Payand BasicWorkingConditions
Social
Safety
Physiological
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McClelland’s Motivational Theory
McClelland’s acquired needs theory focused on the needs similar to the higher orderneeds identified by Maslow. Specifically, McClelland argued that an individual has
needs for,
1. Achievement (nAch)
2. Affiliation(nAff)
3. Power (nPow)
Herzberg’s Motivation-Hygiene Theory:
There are two types of motivators, one type which results in satisfaction with the job
(called motivators) and the other one which merely prevents dissatisfaction (called
hygiene factors). These two types of factors are quite separate and distinct from
each other.
The factors that lead to job satisfaction (motives) are:
• Achievement
• Recognition
The factors which prevent dissatisfaction (hygiene) are:
• Company policy and administration
• Supervision
(Thorpe and Homan, 2000)
Adam’s Equity Theory: Equity Theory on Job Motivation
As Adam (1963) stated, “We each seek a fair balance between what we put into our
job and what we get out of it. Adam calls these inputs and outputs. We form perceptions
of what constitutes a fair balance or trade-off of inputs and outputs by comparing our
own situation with other ‘referents’ (reference points or examples) in the market
place. We are also influenced by colleagues, friends and partners in establishing these
benchmarks and our own responses to them in relation to our own ratio of inputs to
outputs.
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3. RESULTS AND FINDINGS
Profile of the Respondents and Banks
This research was carried out in two branches in of Bank Of Ceylon and Sampath
Bank in Kurunegala district. Building societies were not considered as banks in this
study. The following table shows banks and their population figures
Table1: Populations of Two Banks
Figure 3:Population of Two Banks
No Bank Branch Population Sample
01 Sampath Bank Kuliyapitiya 30 5
Narammala 28 5
Giriulla 32 5
02 Bank Of Ceylon Kuliyapitiya 33 5
Narammala 26 5
Giriulla 29 5
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There was no much difference in populations in each branch. Therefore, the same
size of sample was considered in each. When differentiated into gender, it was found
that 42 percent of respondents were female and 58 percent were male. The expected
ratio was 50:50 but due to practical difficulties, the expected values could not be
attained.
Along with research objectives, data obtained from the sample were used for two
purposes: analytical and descriptive study. In order to achieve the basic specific
objectives, descriptive analysis was carried out describing rewards in the banking
industry. This data did not go through any analytical procedure and fresh data was
directly utilised as information for the description. Different rewards being used in
this industry are outlined below.
Different Ways of Rewarding in Banks
One of the aims of this research was to identify the various types of rewards available
or used by managements in the banking sector. According to primary and secondary
data sources, almost all the banks tend to use the same set of rewards while few
banks use innovative benefit packages for their employees. It was an obvious fact
that, managements of all banks seem prioritised towards financial rewards. But the
interesting fact was that, attention towards innovative non-traditional employee benefits
is becoming popular among employers in most modern large scale banks.
Different types of rewards employed by banks found through data survey are briefly
outlined under the following subtopics:
Financial Rewards
• Salary – Online recruitment web sites revealed that salary scales on all the
banks exist at a good standard compare to other industries. Salaries are highly
competitive, innovative and flexible.
• Pension Schemes – Some top level banks still offer pension schemes even
for new recruitments. Specialty goes to private banks like Sampath Bank. All
employees are entitled to the pension and the amount depends on the final
salary and the length of the service.
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• Share Ownership – Employees are allowed to buy company shares and end of
each financial year or every six months they are awarded with annual or biannual
dividends.
• Performance Bonus / Incentive Scheme – Individuals are rewarded for their
achievements against targets, which are set at personal, group or business level.
• Allowances- For many activities which are considered to be an extra additional
work or if need extra effort, additional cash allowances are payable.
• Preferential Rates and Discounts – These discounts are not only for the
own bank’s financial products but also with a broad selection of retailers and
leisure providers.
• Low Cost or Interest Free Loans – Employees are provided with low cost
or sometimes interest free loans, depending on the amount and the purpose of
the loan. E.g., Interest free loans are granted for holiday travels.
• Sponsorships – Sponsorships are available for employees who meet relevant
requirements for such events. E.g., Employees who are eligible to follow an
MBA degree can request a full sponsorship for the tuition fee.
• Life Assurance – Some banks offer a life assurance benefits which provide
highly lucrative lumpsum payments for beneficiaries whenever an emergency
occurs.
• Flex Benefits – Allows employees to adjust the balance of the benefits
according to needs. E.g.: buy childcare vouchers at a discounted rate.
• Reward Vouchers – Gift vouchersare common rewards system in many banks
in many occasions whenever employees achieve targets or perform well in
some assignment. E.g. Bottles of Champagne, Travel Tickets and so on.
• Commission Free Currency – Currency can be exchanged at commission
free basis.
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Non-Financial Rewards
• Recognition - A special favours for extra effort by individuals. Employees are
entitled to be rewarded for extra performance.
• Training and Development – There are various types of training sessions in
banks, with the aim of enhancing individual and organisational development.
Each bank tends to offer a wide range of learning and development opportunities,
where an employee can choose any subject area which best support their
career and future prospects.
• Scholarships – Even though scholarships can be categorised under financial
and training benefits, it should be specially mentioned as it is a kind of highly
popularised reward systems among employees
• Souvenirs / Yearend Gifts – In some banks, employees are rewarded with
souvenirs or gifts for their outstanding performance.
• Encourages Customer’s Feedback – Customers are encouraged to share
their feedback on the service they enjoy. Feedbacks are expected to be issued
via letters, phone calls or emails etc.
• Certificates – Some good performances are rewarded with certificates. This
ensures personal recognition and prestige. These certificates themselves will
be stepping stones for employees’ future progress in the same organisation or
for any other job opportunity.
• Family Health Cover – Employees are entitled to claim any cost incurred for
their health problems. This benefit is an entitlement for employees’ beneficiaries
too, regardless of number of members dependent on him/her.
• Prestige – Most of the employees prefer to work in a bank, as they enjoy the
prestige of being a banker in a well reputed bank in the country.
• Colleague products - Banks offer their own products with highly discounted
rates for their employees. E.g.: BOC provides its mortgages and savings to its
employees with extravagant discounts.
• Social Events -Most departments organise social events, ranging from informal
drinks to full-scale formal events
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After addressing basic specific objectives, the main focus of the research were
investigated through the analytical research. For this, data were analysed using
correlation analysis.
Table 2: Results of the Correlation Analysis
As shown in table 4.2 except for one independent variable other two variables have
significant association with the reward type. All variables have positive association
with the reward type. According to this civil status has minimum association or zero
association with the reward type. Other two variables have strong relationships with
the reward type. Out of that work experience has strongest relationship with the
reward type.
The following figure illustrates the same results graphically for a better understanding.
In this graph, the gap between reward types in the male population is far bigger than
that of female population. But preference for the non-financial benefits is higher in
both male and female populations.
Figure 4:Rewards V. Gender
Dependent Variable Independent Variable Correlation Value P Value
Motivation (Reward Type)
Gender 0.168 0.032
Civil Status 0.142 0.369
Experience 0.174 0.017
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Many bankers, those who prefer non-financial rewards, stated that their expectations
from the job, is far broader than financial desires. Some of the senior male employees,
for example, are motivated by rewards like recognition, a pleasant working
environment, and promotions such as intangible rewards rather than direct financial
rewards. Prestige is one of the other popular reward types among both male and
female populations as they revealed in the interview. Conversely, more and more
financial rewards are the only requirement for most of the other employees, those
who prefer financial rewards. They stated that, they would get whatever they want
through a good income.
Apart from gender, different ideas of married and unmarried employees were measured
against rewards type. These variables did not show significant differences as above.
The following graph represents results of the analysis, though it has not contributed
much to the shape of the study.
Figure 5:Relationship between Civil Status and Type of Rewards
The majority of the married population, fifty four percent, prefer non-financial rewards
while nearly a same amount prefers financial rewards. The gap between contradictory
ideas seems less. As far as the unmarried population is concern, the situation is same
but vice versa. However, a reasonable association between these two variables could
not be found in the analysis.
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Once respondents were differentiated in order of their age, results seemed better.
There was an association between age category and reward type. Most of the young
employees preferred financial to non-financial rewards. When moving on to more
mature employees, it turned out to be other way around. As young employees explained
in the interview, reasons for wanting financial benefits are that they need to reach
high living standard as early as possible. For an example, to be an owner of a car, to
buy a house, clothes, and so on. Most of them do not bother about prestige or
recognition. At the same time, other young employees explained it in a different way.
They appreciate training, certificates, experience, promotions rather than bonuses
and other direct financial rewards and stated that these rewards will be stepping
stones for their future careers.
As illustrated in the following graph, the majority of employees under thirty prefer
financial rewards. When it comes to middle age, the preference gap for non-financial
and financial rewards becomes lesser. Further, most of the employees who passed
their forties would be happier with non-financial rewards rather than financial rewards.
Figure 6: Association between Age and Reward Types
This graph shows a positive trend in terms of age v. non-financial rewards and negative
trend in terms of age v. financial rewards. This above analysis revealed an important
fact in which respondents, who possess more experience, provide information with
different directions compared to responses from less experienced employees. The
same analysis was expanded below to strengthen the validity of the relationship.
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The following figure shows the difference between various ideas of employees in
different categories of work experience. Employees, who have been working in the
bank for more than five years, are more likely to have non-financial rewards than
financial rewards while employees who are new to the bank prefer financial rewards.
It clearly shows how employees change their attitudes towards benefits with the
duration they spend in the bank.
Figure 7: Type of Rewards v. Years of Service
Respondents were later categorised into two categories based on the experience
gained in their present career. The main objective was to survey employees who
have been working in the bank for a long time, numerically more than five years (long
stay employees-LSE). It was an intention to compare effectiveness of reward types,
financial and non-financial, on retention of employees’ satisfaction by measuring
employees’ attitudes based on long-term and short term experience. Therefore, the
majority of the sample elements were selected among long stay employees while a
minority were taken from short stay employees (SSE) who had less than five yearsof
experience.
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Table 3: Relationship between Type of Rewards and Working Duration
Referring to the above table, 81% of LSE’s are satisfied with non-financial rewards
rather than financial rewards. The rest of the most senior employees argued the
other way around. At the same time, majority of employees, who have been working
for the organisation for short period of time, provided contradictory remarks. These
employees are fully satisfied with their present job but majority of them prefer financial
rewards to non-financial. 66% of SSE’s argued that they need more financial rewards
and they are less interested in non-financial rewards.
The majority, those who prefer non-financial rewards, expressed that more money
doesn’t play a big role in their goals. They want to climb up to a higher rank in the
hierarchy; hence they need appreciation, recognition and good reputation from their
bosses to whom they report. In addition, training, experience, good relationship with
the management, is their preference. Having further investigated the reasons for
these preferences, it was found that these employees like to handle leaderships in
their own organisations and some of them try to become a part of decision makers in
the management. Others valued social recognition as an achievement. The employees
who preferred financial rewards also preferred some of the above but they tend to
vote for more money because their priority is to have a high income. In spite of that,
every employee appreciated a pleasant working environment and good relationship
with fellow workers and their clients.
The following illustration will help enhance the understanding of above findings. Figure
4.6 clearly shows the difference between the preferences of the more experienced
and less experienced staff members. Forty eight percent of senior staff members
prefer non-financial rewards than junior staff members, as the gap indicates under
the non-financial column. At the same time forty seven percent of SSE’s prefer financial
rewards than LSE’s, as per the indicated figures under the financial column.
Type of Rewards
Working Duration Non FinancialRewards
Financial Rewards
Long Stay Emp(LSE) 81% 19%
Short Stay Emp(SSE) 33% 66%
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Figure 8: Types of Rewards v. Employee Experience
The graph below illustrates the way employees were rewarded during their career.
Figure 9: The Way Employees are Rewarded During the Job
Most of the LSE’s have been rewarded with non-financial rewards than financial
rewards while SSE’s have experienced things the other way around. Fifty eight percent
of long-stay employees were awarded with more non financial rewards than financial
rewards. Meanwhile, short-stay employees have mostly (60%) been awarded with
financial rewards. Senior staff members usually get more opportunities to enjoy
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company benefits than junior members as their working duration is longer. For instance,
a senior staff member would get two or three promotions while a newcomer would
enjoy only one promotion.
4. CONCLUSION
A general overview of types of employee rewards being implemented in the banking
sector and possible differentiation of identified rewards into non-financial and financial
rewards, were two basic and initial focuses of this study.
These findings were mostly backed by a secondary data survey rather primary survey.
Results evidenced that variability of non-financial benefits are higher than financial
benefits. It was an obvious fact that, larger and more powerful players in the industry
have brought up innovative and competitive rewards systems, helping to keep them at
the cutting edge of the employee market. Therefore, they usually possess the advantage
of recruiting and attracting co-competencies in the pool of employees. However,
financial benefits are the most widely used reward system in all banks. As far as
ideas of higher rankers are concern, it is an obvious fact that most employers are still
in the traditional framework when taking decisions on reward management. Employers
always try to motivate their employees mostly with financial benefits, and non-financial
benefits are always given secondary priority.
In general, all employees acknowledged that they are satisfied with their present
employee either due to non-financial or financial rewards. Recalling theories, Maslow’s
and Herzberg’s, employees are motivated when they are satisfied with their
physiological, safety, social and esteem needs. Studying the benefits given by various
banks, it was realized that these benefits managed to cover most of the employee
requirements in order to satisfy needs as theories indicated.
According to the figures in table 4.3, eighty one percent of LSE’s prefer non-financial
rewards to financial rewards. A minority (only nineteen percent) of same employees
prefer financial rewards and there is a significant difference between them. This gap
adds an important fact to the argument. Synchronizing these two findings, it can be
concluded that, there is a relationship between non-financial rewards and long term
stay in the same organisation.
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Interpretation of figure 4.9 provides additional evidence strengthening this argument.
It depicts that, throughout their career, LSE’s have been rewarded with non-financial
rewards rather than financial rewards. They were rewarded the way they wanted to
be rewarded. With all these facts, it is reasonable to come to a point where the
majority of long stay employees have been retained in the bank for long, as they were
rewarded mostly with non-financial rewards. Employees being satisfied with their
requirements may stay in the same organisation as long as they are satisfied with the
rewards granted. Employees who have not received their requirements may leave
the organisation and they may not be able to work long durations at the same place.
Employees who possess less experience are not able to differentiate between the
influences caused by the two types of rewards in the long run because of the time
factor. Employees who have ability to predict the future would sometimes provide
realistic feedback. But in general, it is hard to decide their desire without experiencing
it. New employees were rewarded both financial and non-financial rewards (refer
figure 4.9), but they are supposed to enjoy them in the long run in order to identify the
types of rewards that keep them motivated for long periods. Employees who have
long-term experience can, therefore, have a better understanding of the differences
of influence of reward types on employee satisfaction.
Considering above three arguments, 1) there is an association between work duration
and reward types 2) eighty one percent (81%) of LSE’s prefer non-financial rewards
and 3) majority of long stay employees who have remained in the bank were mostly
non-financially rewarded, it can be concluded that non-financial rewards contribute
more than financial rewards towards retention of employees in banks.
Expanding on the same discussion to address the last objective of the study, it was an
obvious fact that, all the respondents agreed that they are satisfied with their current
job regardless of working duration. Nobody seemed to be frustrated with their current
employer and everybody seemed to be happy with either non-financial or financial
rewards. Meanwhile most of the LSE’s (81%) have acknowledged that they are
satisfied mostly with non-financial rewards and they were treated mostly the same
throughout their career. These two findings lead to further conclusions. Senior staff
members have long been satisfied with their current employer, and they have been
working for the same organisation more than five years because most often they were
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rewarded non-financially rather than with financial benefits. Final conclusions can be
drawn on this ground. The final and main objective of the research was to compare
the effectiveness of two types of motivational methods in banking sector. Based on
above logic, it can be concluded that, non-financial rewards rather than financial rewards
have more of an influence on the retention of employees in the banking sector.
Based on long term experience and attitudes of the employees, it was found that the
effect of non-financial rewards is long lasting. Conversely, financial benefits, though
seemingly attractive at a first glance, do not help much to make employees motivated
for a long time. Therefore, it can also be concluded that, even though financial benefits
are common and popular among employers, their effectiveness is not long lasting.
Apart from its demand from the employee’s side, employers tend to design reward
packages prioritising financial benefits. The outcome of this research has proven that
this traditional system of reward management does not make sense for future
endeavours of human resources strategies in banks. Some radical solutions, those
that have been found during the survey, are mentioned under recommendations.
5. RECOMMENDATIONS
After reviewing of the whole research, a few recommendations have been made that
would improve the overall system of reward management in the banking sector. These
recommendations are based upon the findings of the research carried out, and can be
strategically implemented in the banking sector and in its working environment. Each
recommendation is considered in terms of what it is, how it would be implemented,
why it is necessary and any additional factors to be considered.
It has been suggested that, managers should pay more attention to non-financial rewards
in human resource strategy formulation than their existing strategies. Even though
there are plenty of non-financial rewards systems introduced by some market giants in
this industry, their implementations seem to be biased towards financial rewards. Human
resource management practitioners in the banking sector seem not to pay much attention
to radical rewards methods. Lack of communication among academics, literature and
practitioners keeps managers away from awareness of advantages of non-traditional
rewards.
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Before planning human resource strategies, it is one of the main responsibilities to
identify the culture of the organisation, attitudes of employees, their most wanted
requirements, desires and so on. The scale they used to design human resource
strategies must be unique to the organisation and they should deviate from traditional
and common frame work of designing employee rewards strategies. For instance,
yearend employee performance appraisal can be used to get employees’ most valuable
information and that information can then be used for strategy formulation.
Careful planning and non-traditional ways of implementing employee reward strategies
may result in significant changes in the organisation’s endeavours towards its success.
Employee retention is one of the crucial factors that need to be considered. When an
employee gains an experience and they get used to the own organisational culture,
he/she becomes an asset to the particular organisation. Therefore, such an employee’s
resignation may probably be a big loss to the organisation. Employee retention is an
important fact to be considered, along with human resource strategy formulation.
Customers always like to deal with knowledgeable, skilful, well experienced employees
because it helps save their time money and time. Especially in the banking sector,
customers expect high quality service due to highly competitive market in the industry.
It is, therefore, managements’ responsibility to maintain an excellent staff, if they
really want to survive in this modern and dynamic business environment.
It was found that most of the innovations introduced by academics have not trickled
down to practitioners or they are less aware about them. It was also an obvious fact
that coordination between academics and practitioners is less and this barrier hinders
the flow of theories or innovations to the real practical world. Therefore, awareness
about human resources theories, findings of new researches and state-of-the-art
strategic knowledge among personnel practitioners are controversial. Moreover,
exploring relevant literature for the research, it was found that the literature on employee
motivation, particularly in the banking sector, is insufficient. So it is important to conduct
further empirical studies in this discipline.
The following section points out some of non-traditional reward methods found through
literature surfing and primary data collection. These reward systems were introduced
by some of the outstanding performers in the market, and they seem extremely
uncommon.
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• Benefits choice programme is one of the attractive rewards systems. In this
system, an employee has a choice on their spending. An employee can pick and
choose benefits and other extras which suit him/her as an individual. This means
employee can choose to spend their salary on a wide range of options including
health care and insurance at low group rates, discounted childcare vouchers,
additional holidays, a personal computer, discounted wine and lots more. So
that when an employee’s life takes a different turn, rewards can be adopted too.
• Staff in an organisation is a sub society. Elements in this society are human
beings. They are not other objects of production process as considered in
Taylor’s era. Therefore, employee’s grievances should be considered as a one
of the most important responsibilities of human resource department. It has
been evidenced in some banks that they provide a sound counselling service
for their employees. They provide free and confidential advice service to all
their employees covering areas such as child care, relationship, legal matters,
eldercare, work and stress.
• It is also important to recognise that individual and group success requires
individuals to continue to develop themselves. In support of this, some groups
offer a wide range of learning and development opportunities. In this sense, if
an organisation owns its own learning and education network, acting as a one-
stop-shop to provide training for staff, Human Resource Department will be
able to deliver various courses online via intranet, and also provide access to
and co-ordinate online training, online assessments and supporting tools. This
network can be designed to support employees in technical, personal and
managerial aspects.
• Car parking is one of the integral problems that make most employees
frustrated.Prearranged parking facilities enable employees to park their vehicles
safely without delay. It subsequently ensures punctuality and better
concentration on their day to day work.
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Armstrong M. (2000) Employee Reward, London: CIPD House.
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Limited.
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HR Priorities Shift According to New Survey Analysis’, Employee Benefit Journal,
27:1, 3-3
Hume D. (1995) Reward Management, Massachusetts: Blackwell Publishes.
Hussey J. and Hussey R. (1997) Business Research, London: MacMillan Press Ltd.
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Measurement, London: Pinter.
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http://search.epnet.com/direct.asp? an=10613746&db=buh
http://www.tees.ac.uk/depts/lis/ejournals/display_new.cfm
http://www.businessballs.com/adamsequitytheory.htm
http://sbinformation.about.com/cs/benefits/a/8uncommon.htm
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http://www.joe.org/joe/1998june/rb3.html
- 134 -
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ABSTRACT
The research project is conducted to study the relationship between the effective
performance evaluation and employee performance. The objectives of the research
projects are (i) find out the relationship between Performance evaluation and employee
performance, (ii) to gain theoretical knowledge in performance evaluation, (iii) to
find out the factors that contribute towards ineffective performance evaluation,
and(iv)to investigate the problem and the solution though survey and recommend
steps.
Performance Evaluation is one of the key tools for any type of organization which
operate in the current dynamic environment of the world. It became one of the
crucial strategic means in order to survive and compete for the organization in all
sectors. This study was conducted in an organizations comes under the NGO
sector.NGOs are established to meet social and economic needs and to fill the gaps
in society by addressing the concerns of the disadvantaged and less privileged.
Therefore, this study intended to focuses on how an organization in the NGO sector
improves employee performance through elaborative and systematic performance
evaluation process in qualitative and quantitative means. In addition, this study
will provide guidance to carryout future research studies in similar related NGOs.
This is a single-case case study, where the entire organization constitutes the case
study. The sample size from within the case consisted of the entire current staff .The
sources for primary data collection was derived through questionnaires, group
interviews and telephone interviews. The sources for secondary data collection were
derived from annual reports of the organization, publications and media release of
the organization and website of the organization.
IMPROVING PERFORMANCE OF THE EMPLOYEES THROUGHAN EFFECTIVE PEFORMANCE EVALUVATION
Ramanusha [email protected]
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The research explored the satisfaction level of employees of the organization regarding
the current performance evaluation system of the organization. It also intended to
find out how performance evaluation is linked with other strategic means to achieve
organizational goals. The research intended to explore how the performance evaluation
systems of the organization affected the performance of the employees. The effectiveness
of the performance evaluation was also examined in this research. With the results
from the survey and the comments from the employees, it was concluded that effective
performance evaluation will improve employee performance.
Recommendations are suggested for this particular organization to conduct effective
performance evaluation in order to improve employee performance.
Key words: Employee performance, performance evaluation
1. INTRODUCTION
Organizations in the current global environment need to strategically use its resources,
including human resources, inorder to gain a competitive advantage. The success and
the sustainability of the organization are often depended on its employees’ performance.
Employees are the life blood of an organization, and their collective attitude can greatly
affect the direction and objective of any organizations. Employee performance
contributes to improve the outcomes of the organization and ultimately in achieving
organizational objectives.
Employee job performance is an important issue for all organizations (Mathis and
Jackson, 2000). The behaviours and the outcomes of the employees should be evaluated
systematically for purposes of managing and developing employees. Therefore,
implementing an effective performance evaluation system is one of the strategic
solutions to drive a high performance culture in the organization so that organizational
goals are reached. It helps to improve the productivity of the organization. Performance
appraisals on employees need to be conducted regularly in order to improve the work
of individuals and teams employees in qualitative and quantitative means. It has a
plethora of benefits and potentials to improve the performance of the employees of
the organization. They are employee satisfaction, commitment, involvement, motivation,
high performance culture, reduction of the level of employee conflicts, and quality of
work.Performance evaluation serves many purposes and ineffective performance
- 137 -
evaluation will result in employee frustrations, chaos, apathy, high turnover,and even
in lawsuits.
The organization of this research is one of the most important peace NGOs in Sri
Lanka. Also, one of the largest in the “peace” sector engaged in various different
work areas. The organization has experience of working with peace for more than
fifteen years and it has been active in several areas.
This study intends to focus on the potential use of effective performance systems and
to explore the ways to create the most appropriate performance evaluation systems
for an organization in the NGO sector.
The particular organization in this research is facing issues of employee turnover,
poor employee relations and donor pressures. The practice of performance evaluation
in this organization is not conducted regularly and not strategically connected to
organizational goals. Therefore, this study focuses on issues of ineffective performance
evaluation and how the performance evaluation system can be created to solve issues
and to improve the performance of the employees.
Presentation of findings
Identifying the problem
Statements Stronglyagree
Agree Neutral Disagree Stronglydisagree
Presence of regular PE process
Identification of T &D needs through PE
Satisfaction of rating method
Performance based rewards
Recognition for performance
PE and Bias
Constructive feedback
Clear goals for PE period
Ineffective PE and employee performance
1 3 3 7 4
0 2 3 10 3
0 2 7 7 2
0 3 4 8 3
0 4 4 6 4
0 3 5 8 2
0 4 4 8 2
0 6 2 9 1
3 11 2 2 0
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Statements Lack ofleadership
Lack ofKnowledgeand skills
ofmanagement
Poorcommunic-
ation
Absence ofregular PE
Poorrelationship
betweenmanagement
andemployees
The reasons for the gap instandard performance andactual performance
0 6 6 5 1
Statements EmployeeDissatisfa-
ction
Pooremployee
performance
Unfinishedprojects
Employeegrievances
Employeeturn over
Potential problems of poorperformance
6 2 3 3 4
Solution
Statements Stronglyagree
Agree Neutral Disagree Stronglydisagree
Motivation from managementfor high performance
PE as a practical solution forNGOs
6 10 2 0 0
7 8 3 0 0
Statements Mutuallyagreedgoals
T& Dopportunities
Performancebased
rewards
Constructivefeed back
Guidanceand support
Improvement of employeeperformance depends on
4 3 3 2 6
Statements Highperformance
culture
Employeesatisfaction
Achievementof goals
Increase inproductivity
Employeecommitment
Benefits of PE 1 5 8 2 2
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Statements Mutuallyagreedgoals
Constructivefeed back
Performancebased
rewards
Two waycommunic
ation
Other( T& D
identificationthrough
PE)
Recommendation for new PE 6 2 3 3 4
Statements EmployeeDissatisf-
action
Pooremployee
performance
Unfinishedprojects
Employeegrievances
Employeeturn over
Potential problems of poorperformance
6 2 3 3 4
Statements Rewardmanagement
Trainingand
development
Grievancemanagement
Employeerelations
Recruitment
The areas can be improved as aresult of effective PE
1 7 2 5 3
Statements Open andtranspar-
ency
Fairness Careerdevelopment
Fair rewardpractice
Recruitment
The changes expected frommanagement
7 4 1 2 4
2. LITRERATURE REVIEW
What is Performance Evaluation?
Performance evaluation is a systematic process of collecting evidence of employees toevaluate their job performance against the predetermined performance standards in acertain time period with the intention of using information for various managerial
decision making and development of employees.
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Performance Evaluation In Non-government Organization
Performance evaluation is not a popular practice in NGOs. Evaluating the performance
of the employees of non-government organizations is always a complex activity.
“Limitations of the instruments that NGOs use to monitor, evaluate and review are
one reason why NGOs have not been able to substantiate their achievements (Fowler,
1997) While, NGOs are struggling to measure their overall performance of the
organization, evaluating the performance of their staff is indeed a challenge for them.
It is believed that people of NGOs are motivated altruistically. The employees are
enthusiastic with their work and they are motivated by the work itself. But, still as
corporate sectors NGOs also should have employee performance evaluations systems
in policy and practice. Even though the success of the non-government organization
is not defined by the profits, still they are questioned by the donors, individuals,
communities and governments, on what are their outcomes and impact are by
interventions.
Therefore, there is a need for NGOs to implement effective performance evaluations
for their employees without contradicting with its values norms and culture. NGOs
sustainability is also based on its performance. Employees of the non-government
organizations should be directed towards the organizational goals. There is another
issue that arises is that the needs for training and development for staff cannot be
identified unless there is a better performance evaluations in the organization. Even
though NGOs are weak at staff performance evaluations there is necessity for the
NGOs to adopt performance evaluation techniques like other sectors in the
contemporary world.
Purposes of Performance Evaluation
Organizations practice performance evaluations for various purposes. The main
purpose of the performance evaluation process is to contribute to the improvement of
the performance of the employees to achieve organizational objectives.
Following are the multiple purposes of performance evaluation:
(a) Administrative purposes of performance evaluation
• To contribute to human power planning and selection
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• To use PE to link employee performance to financial rewards or other
types of benefits
• To use for management decisions on promotions, termination and
transfers.
• To provide challenging work such as job enrichment
• To use for disciplinary actions
• To maintain harmonious employee relations
• To provide an opportunity to communicate performance expectations to
employees
• To identify poor performers or under performers
• To update documentation for HR decisions
• To help to meet legal requirements
(b) Development purposes
• To identify the training needs
• To measure the success of trainings
• To assess and develop individual abilities
• To provide an objective basis to base decisions on
• To plan for career development
• To achieve career progression
• To link organizational success to employee
• To guide employee towards appropriate direction
(C) Communication purposes
• To communicate the organizational goals to employees and employees’
expectations from the organization.
• To recognize and acknowledge greatest performance
• To help employees to get prepared for future promotions
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• To help employees for role clarification of the job
• To provide constructive feedback to the individual regarding how their
performance is seen
Performance Evaluation Process
PE functions as a process in an organization to achieve its goals. Following steps are
to be taken systematically to conduct a successful operation of PE:
Establish objectives of PE
Formulate policies
Establish criteria and standards
Select methods of PE
Design evaluation form and procedure
Train evaluators
Appraise
Discuss PE results
Make decisions and store
Review and renewal
Establish objectives of PE
Objectives are favourable targets to be achieved in during a particular period. Objectives
are agreed by the employee and supervisor for the PE period. The objectives should
be specific, measurable, attainable, and clear and time bound.
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Formulate policies of PE
The organization should formulate its PE polices based on following issues:
1. On whom should PE be done?
2. When should PE be done?
3. Who should do PE?
4. How often should PE be done?
Establish criteria and standards of PE
Criteria refer to factors that are used to evaluate job performance of employees for
certain period of time. The inputs for the criteria can be derived from job analysis.
The dimensions of traits, behaviours and outcomes are keys to establishing criteria
and standards.
Standards should be determined after deciding PE criteria. Performance evaluation
standards indicate rating scales. These scales should be developed systematically
and fairly (Opatha, 2003).
The standards should be designed in a way to challenge employees,and at the same
time being realistic. Also the standards should be observable and measurable and
time frame should be specified.
Select methods of PE
PE methods are the techniques which are used to evaluate the performance of the
employees. There are various PE methods available today. An organization should
decide a suitable PE method to evaluate the performance of the employee by
considering several factors such as nature of job, purpose of evaluation available
resources, and number of employees (Opatha, 2002).
Following are some popular PE methods:
• Graphic rating scale
• Checklist method
• Critical incident method
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• Performance ranking method
• Paired comparison method
• Self evaluation and discussion method
• Point allocation method
• Field review method
• Management by objective
• Behaviourally anchored rating scale
• 360 0 –Degree feedback
Design evaluation form and procedure
After the selection of PE methods PE form and procedure should be designed. The
form comprises of evaluation methods, criteria and standards, to assess the quality of
the job performance of the employee.
Training of evaluators
Training of evaluators refers to a systematic attempt to improve related knowledge
and skills of the evaluators evaluating job performance of employee. Following methods
can be used in the evaluators training:
• Lectures
• Case study method
• Role play
• Programmed instruction
• Special course of PE
PE discussion
The results of the PE should be discussed with the employees after the evaluation of
performance.The performance appraisal is a tool for communicating with the
employee. PE discussion serves as a communication tool where results are discussed
with the employee.
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Performance Evaluation interview
The performance interview is an activity which involves supervisor and an employee
having an open discussion in a positive background. The objective of the feedback
interview is to get employees to do more talking and thinking about their job
performance in order to improve individual performance (Jone, 1998).
PE Review and renewal
Final element of PE is review and renewal
PE review is an activity of assessing effectiveness of the PE process to decide what
changes should be made to improve the PE process. PE renewal derives from PE
review and it generates information which is feedback in the all elements of the PE
program (Lopez, 1968).
Performance evaluation rating errors
The errors are caused by the subjectivity and bias of the evaluators. These errors
occur in observations, judgment and information processing and can seriously affect
PE results (Bernerdin and Russell, 1993).
Following rating errors should be avoided by the evaluator for an effective performance
appraisal:
• Halo effect
• Central tendency
• Harshness & Leniency
• Recency Bias
• Similar to me error
• Personal prejudice
3. CONCLUSION
There are several factors contributing towards the establishment of effective
performance evaluation process. They are regularity of PE, training needs identification,
- 146 -
pay for performance, recognition and appreciation, bias free evaluation, constructive
feedback, and clear goals in performance during PE period. According to the survey
conducted in thisresearch, majority of the respondents of employees were dissatisfied
and have negative responseswith regardsto these factors in their organization. Following
are the findings:
1. Regularity of PE - 61% disagreement
2. Training needs identification - 72 % dissatisfied
3. Pay for performance - 61 % dissatisfied
4. Recognition and appreciation - 56% negative response
5. Bias free evaluation - 55 % disagreement
6. Constructive feedback - 56% negative response
6. Clear goals for PE period - 56% disagreement
When considering the percentage of dissatisfaction for these factors we can come to a
conclusion that effective performance evaluation does not take place in this organization.
78 % of the respondents pointed that ineffective PE is a hindrance for high performance
of employees.
28% of respondents pointed that absence of PE directly caused the gap between
actual performance and optimum performance. 30% of respondents say that poor
communication caused less performance.
Following are the results of ineffective performance evaluation according to
respondents’ points of view:
1. Employee dissatisfaction - 33%
2. Employee grievances - 17%
3. Turnover - 22%
4. Poor performance - 11%
5. Unfinished projects - 17%
- 147 -
Even though only 11% of the respondents mentioned that ineffective performance
evaluation directly result in poor performance, other issues such as employee
dissatisfaction, grievances, unfinished projects and turnover ultimately affect the overall
employee performance.
Considering the above facts we can come to a conclusion that ineffective performance
evaluation decreases employee performance.
Majority of the respondents expect changes in their PE such as, mutually agreed
goals, two way communication, and pay for performance and fairness.
According to the analysis 28% of respondents noted that employee job satisfaction
can be increased by effective PE and 44 % of respondents pointed that achievement
of organizational goals are the benefits of the effective process. 11% of them also
pointed out that employee commitment increases by PE. These factors can improve
employee performance.
83% respondents agreed that effective PE is a practical solution in NGOs to improve
employee performance.
Considering above facts, we can come to final conclusion that effective performance
evaluation will improve employee performance.
4. RECOMMENDATIONS
To set effective and meaningful performance goals
The performance goals should be aligned with the overall organizational strategy. When
there is alignment with organizational goals and individual goals, employees will increase
their commitment towards achieving goals.
When setting goals, those goals should be specific, understandable and achievable.
Setting performance goals not only describes what to achieve but also how to achieve
them. The goals can be challenging, but should not be unrealistic. Therefore, it is
necessary for managers and supervisors to discuss with employees to get mutual
agreement towards the performance goals for the given period.
- 148 -
To train the evaluators
The knowledge, skills and attitudes of the evaluators should be trained to conduct
effective Performance Evaluations. Several skills such as communication skills,
listening skills and leadership skills should be improved to monitor and guide employees
to achieve determined goals.
As it is an NGO, evaluating the organization’s performance as well as the employees’
performance is a complicated entity. Particularly this organization is working for social
change towards peace and justice in the country. Outcomes of this organization are
not visible and difficult to measure. Because of that, relevant skills should be provided
to the managers and supervisors to translate those outcomes into measurable outcomes
of employee performance and to simplify the process and to produce accurate and
fair performance evaluation results.
To Link performance evaluation to reward decisions
The current system provides general annual salary increments for all employees.
When there is a general increment for the all employees, those who perform well,
moderately, and poorly,receive same increment. As a result people who perform well
can get frustrated and they can be demotivated by the current system of the
organization.
The employees who achieve high performance results should be rewarded. Financial
rewards and non-financial rewards more responsibilities and important roles in the
organization can be given to employees to motivate them to achieve higher performance
levels. When there is a link between the rewards and performance evaluation
employees will support the evaluation process and also take it seriously.
Ultimately employees can be motivated to perform well through effective alignment
between performance appraisal and reward system.
To identify the training and development needs
Performance evaluation serves the purpose of identifying training needs. The gap
between the determined standards and the actual performance should be filled with
training and development.
- 149 -
The results of the performance appraisal should be used for inputs for the key areas of
training and development of the organization in order to be an effective performance
appraisal process.
The performance evaluation should serve the purpose of developing and improving
the performance standards of the employees. Therefore, it is important to link
performance evaluation with training and development in order for it to be an effective
performance evaluation and result in improved employee performance.
To provide ongoing feedback
Giving ongoing feedback both positive and negative is another important element of
effective performance evaluation. Ongoing feedback is needed to encourage the
employees throughout the year and to track them when they are struggling. The
working environment may change during the year. The significance of some goals
may change, obstacles may occur, or employees may lose interest in work. In those
circumstances ongoing feedback will help employees to move forward.
To provide constructive feedback
When shortcomings are identified during the performance evaluation it should be
communicated to the employees in a way they do not feel bad. Constrictive feedback
is a technique to provide the negative feedback in an effective way. Sandwich model
can be used for this. That is to start discussion with positive comments and then
explain the changes needed in the behaviour and end with positive motivating
comments.
To create simple and understandable performance evaluation
The performance evaluation form and procedure should be simple at the same time
understandable by the employees. Otherwise, it will consume much time to proceed.
If the performance evaluation process is complex, then willingness of employee and
supervisor to proceedwith performance evaluation will be lost. Therefore it is
recommended that simple and understandable performance evaluation be created.
- 150 -
To conduct regular performance evaluation
The current performance appraisal is not conducted regularly. Therefore this
organization has to restart and regularize the formal effective performance evaluation
system in the organization. Annual performance appraisal can be suggested to this
organization with on-going feedback and regular documentation of performance of
the employees.
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Nigel Harrison: Improving Employee Performance (2002) 1st edition, Publisher-Kogan
page India Private limited. (Page 86-88)
Phil baguley: Teach Yourself Performance Management,1st edition Publisher-Hoder&
Stoughton (page 86-88)
The IPM Lecture Notes on Performance Management.
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ABSTRACT
Information technology is expected to drive Human Resource(HR)’s transition from
a focus on Human Resource Management (HRM) to Strategic Human Resource
Management (SHRM). This strategic role not only adds a valuable dimension to the
HR function, but also changes the competencies that define HR professional and
practitioner success. The study aims at investigating what role, if any, do Human
Resource Information Systems (HRIS) play in SHRM. It attempts to examine how HR
professionals and managers in different organizations see the effects of HRIS on
strategic HR tasks and job roles. It also tries to find out if there is any significant
difference in the usage of HRIS between Small/Medium (SME) size and Large size
companies. A survey questionnaire was sent to 130 companies and a response rate
of 20.77% was received. The target group of the questionnaire was HR Managers,
HR Directors, and HR Professionals in companies. The scope was widened to include
both large and small/medium sized organizations across all the business sectors.The
results of the survey reveal that HR professionals not only consider HRIS usage as a
support for strategic HR tasks but also perceive it as an enabling technology.
Key words: Strategic human resource management, human resource information
systems, human resource management, human resource
1. STUDY BACKGROUND
Invariably, human resource management (HRM) issues have been major concern for
managers at all levels, because they all meet their goals through the efforts of others,
IMPACT OF HUMAN RESOURCE INFORMATION SYSTEMSON STRATEGIC HUMAN RESOURCE MANAGEMENT
Shiwanthie [email protected]
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which require the effective and efficient management of people (Dessler et al., 1999).
The spacious array of HRM activities for example, planning, recruiting, selection,
and training just to mention a few, place enormous responsibilities on supervisors
and managers alike. These embrace analyzing jobs, planning labour needs, selecting
employees, orienting and training employees, managing compensation,
communicating (which includes counselling and disciplining), and maintaining
employee commitment.
Lately, the increasing pressure to support strategic objectives and the greater focus
on shareholder value has led to changes in both job content and expectations of HR
professionals. Similarly Schuler and Mayfield noted that one such major change
included contemporary use of Information Systems (IS) in support of the HRM
process. More so, a careful analysis indicated that increased human resource
information systems (HRIS) usage enabled improved professional performance and
thus facilitated involvement in internal consultancy activities. In addition, according
to Ulrich (1997), using HRIS provides value to the organization and improves HR
professionals’ own standing in the organization. In another development, Brockbank
(1999) suggested the need for HR to become a strategic partner.
HRIS provides management with strategic data not only in recruitment and retention
strategies, but also in merging HRIS data into largescale corporate strategy. The
data collected from HRIS provides management with decisionmaking tools. Through
proper HR management, firms are able to perform calculations that have effects on
the business as a whole. Such calculations include healthcare costs per employee,
pay benefits as a percentage of operating expense, cost per hire, return on training,
turnover rates and costs, time required to fill certain jobs, return on human capital
invested, and human value added. It must be noted though, that, none of these
calculations result in cost reduction in the HR function. The aforementioned areas
however, may realize significant savings using more complete and current data made
available to the appropriate decision makers. Consequently, HRIS are seen to facilitate
the provision of quality information to management for informed decision making.
Most notably, it supports the provision of executive reports and summaries for senior
management and is crucial for learning organizations that see their human resource
as providing a major competitive advantage. HRIS is therefore a medium that helps
HR professionals perform their job roles more effectively.
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1.1. Issue in Focus
This study explores the Impact of human resource information systems (HRIS) in
strategic human resource management (SHRM). The question to address in this study
therefore is “What role if any; do HRIS play in SHRM?”
2. REVIEW OF LITERATURE
2.1. Definition of HRM
There is no clear cut definition of HRM. However, the common ground settled by
different HR professionals and academicians is that they recognize that HRM is closely
fitted with business strategy than personnel management.
John Bratton and Jeffrey Gold (2003: 7) define HRM as the strategic approach to
managing employment relations which emphasizes that leveraging people’s capabilities
is critical to achieving sustainable competitive advantage. This is achieved through a
distinctive set of integrated employment policies, programs and practices. Moreover
HRM aims at recruiting capable, flexible and committed people, managing and rewarding
their performance and developing key competencies.
The authors defined HRM as the management of people in organizations. It consists
of the activities, policies, and practices involved in obtaining, developing, utilizing,
evaluating, maintaining, and retaining the appropriate number and skill mix of employees
to accomplish the organization’s objectives. The goal of HRM is to maximize employee’s
contributions in order to achieve optimal productivity and effectiveness, while
simultaneously attaining individual objectives and societal objectives (Dessler).
2.2. Processes of HRM
HR processes starts by planning labour requirements. This include, resource
specifications, long range planning, forecasting supply and demand of labour, staffing,
applicant qualification, training programs, costs analysis, salary, contract type, and
other related issues. Other key HR processes involve recruiting, selecting, performance
appraising, training and orientation, career development, occupational health and safety,
and compensation and benefits.
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2.3. Strategic HRM
SHRM has evolved and been transformed from personnel management into traditional
human resource management (THRM), and then to SHRM. SHRM, like HRM, do
not have any consistent definition but scholars generally concord to the central feature
of SHRM comprising designing and implementing a set of internally consistent policies
and practices to ensure human capital contributions to achieving business goals. In
spite of the increasing attention paid to SHRM, the term remains unclear. Some scholars
have described SHRM as an outcome (Patrick Wright), others have described it as a
process (Ulrich and Gerry Lake), and others have considered it a combination of
process and outcome (Catherine Truss and Lynda Gratton, 1994). Moreover, Alan
Bamberger and Professor Ilan Meshoulam (2000) argued that SHRM is a competency
based approach to personnel management that focuses on the development of durable,
imperfectly imitable, and other non-tradable resources. However, in the absence of a
consistent definition, scholars broadly agree that the central feature of SHRM involves
Organization Resourcing HumanResource
Development
RewardManagement
EmployeeRelations
DesignHuman
ResourcePlanning
OrganizationalLearning
Job Evaluationand Market
Surveys
IndustrialRelations
Development Recruitmentand Selection
IndividualLearning
Grade and payStructures
EmployeeVoice
CommunicationContingent
PayManagementDevelopment
TalentManagement
Job Design
HR ServicesHealth
&Safetyand welfare
Knowledge Management
PerformanceManagement
EmployeeBenefits
Human capitalmanagement
Human resourceManagement
Figure 1:
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designing and implementing a set of internally consistent policies and practices to
ensure that firm human capital contributes to achieving business objectives (Gratton
and Hope Hailey, 1999; Jackson and Schuler, 1995).
According to Michael Armstrong (Handbook of Human Resource Management Practice)
Strategic HRM is an approach to making decisions on the intentions and plans of the
organization concerning its recruitment, training, development, performance
management, reward and employee relations strategies, policies and practices and the
employment relationship generally.
The changes identified in the shift of HRM to SHRM included integration of the
human resource function into strategic decision making, a decentralization of much
activity to line managers, effective communications, human resource development,
workplace learning, career management and human capital accumulation. These were
in addition to managing organization’s trade unions relations, greater worker autonomy,
high commitment management, leadership, and business processes reengineering.
Figure 2:
2.4. The Meaning of Strategic HRM
Strategic HRM has four meanings: 1) the use of planning 2) A coherent approach to
the design and management of personnel systems based on an employment policy and
manpower strategy and often underpinned by a ‘philosophy’ 3) Matching HRM
activities and policies to some explicit business strategy 4) Seeing the people of the
organization as a ‘strategic resource’ for the achievement of ‘competitive advantage’.
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2.5. Aims of SHRM
There are several aims to strategic HRM such as 1) Generate strategic capability by
ensuring that the organization has the skilled, committed and well-motivated
employees it needs to achieve sustained, competitive advantage. 2) Provide a sense
of direction in an often turbulent environment so that the business needs of the
organization and the individual and collective needs of its employees can be met by
the development and implementation of coherent and practical HR policies and
programmes. 3) Provide ‘unifying frameworks which are at once broad, contingency
based and integrative’ (Dyer and Holder).Also there are several approaches to SHRM
such as resource-based strategic HRM, Strategic fit, best practise, best fit and bundling.
2.6. HRIS
The Human Resource Information Systems is introduced by presenting the various
definitions, development, costs and benefits, as well as their functions and relationship
with HRM. Furthermore, different software providers and their solutions are
presented.
HRIS shape an integration between human resource management (HRM) and
Information Technology. Even though these systems may rely on centralized hardware
resources operationally, a small group of IS specialists residing within the personnel
department increasingly manage, support, and maintain them. HRIS support planning,
administration, decision making, and control. The system supports applications such
as employee selection and placement, payroll, pension and benefits management,
intake and training projections, career-pathing, equity monitoring, and productivity
evaluation. These information systems increase administrative efficiency and produce
reports capable of improving decision making (Gerardine DeSanctis, 1986: 15).
HRIS is an effective and efficient catalyst for integrating human resource management
and Information Technology. This was common with all the various definitions of
HRIS. Tannenbaum (1990) defines HRIS as a technology based system used to
acquire, store, manipulate, analyze, retrieve, and distribute pertinent information
regarding an organization’s human resources. Kovach et al., (1999) defined HRIS as
a systematic procedure for collecting, storing, maintaining, retrieving, and validating
data needed by organizationsregarding its human resources, personnel activities, and
organization unit characteristics. HRIS as a system support HR functional applications
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such as employee selection and placement, payroll, pension and benefits management,
intake and training projections just to mention a few.
2.7. Components of HRIS
The composition of HRIS includes input, maintenance, and output. Input function
enters personnel information into the HRIS. The maintenance function updates and
adds new data to the database having entered data into the information system. The
output is considered the most visible function of an HRIS. HRIS process that output,
adjust it in such a way that it is understandable. Kovach et al., (1999) presented the
three major functional components in any HRIS by giving the model below:
Input Data Maintenance Output
2.8. Users of HRIS
The three major groups that make use of HRIS are HR professionals, managers in
functional areas, and employees. Whiles HR professionals rely on the HRIS in
fulfilling job functions, managers rely on the HRIS’s capabilities to provide superior
data collection and analysis, especially for performance appraisal and performance
management. Individual employees are the end users of many HRIS applications
and complexities of job related issues have augmented the awareness of HRIS
functionality among employees.
2.9. HRIS Functions
Functional HRIS must create an information system that enables an assimilation of
policies and procedures used to manage the firm’s human capital as well as the
procedure necessary to operate the computer hardware and software applications
(Hendrickson, 2003). While information technology affects Human Resource (HR)
practices (Lengick-Hall et al., 2003) HRIS and HRIS administration comprise a
distinct supporting function within HR. In addition to HRIS’s integration function,
HRIS enable effectiveness and efficiency, and ensure competitiveness among firms.
However, along with the benefits are the costs involved in implementing and
maintaining these systems. For example, hardware and software cost, time, and other
related costs. There are many software solution offers; the choice is however
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dependent on the decision of the user. Consequently, information validity, reliability
and utility constitute a comprehensive HRIS, and should always be the pivot for
every HRIS implementation.
2.10. Hypothesis
Various researchers have all agreed to HRIS capabilities in shaping the integration
between human resource management (HRM) and Information Technology by
supporting planning, administration, and strategic decision making, and control
(Gerardine DeSanctis, 1986: 15; Tannenbaum, 1990; Hendrickson 2003). Drawing
from the literature reviewed above, it is proposed for this study that there is a direct
relationship between HRIS towards SHRM.
Based on the conceptual framework developed for the study, following hypotheses
were proposed:
1. H 1: HRIS play a major role in strategic HR tasks.
2. H 2: HRIS are used by HR professionals in support of strategic HR tasks
3. H 3: HR professionals see HRIS as an enabling technology.
4. H 4: HRIS will be used differentially by Small and medium sized companies
in support of strategic HR tasks relative to large sized companies.
5. H 5: HRIS will be used more in support of strategic HR tasks in organizations
in the future.
3. METHOD
3.1. Sample
To retrieve a list of companies, the companies which are listed in Colombo Stock
Exchange and most reputed companies are selected as well as clients of HRIS
development companies. The assumption was that, most companies have HR
departments, especially the larger companies. The first query was to find large
companies in all business sectors. The inquiry returned 130 firms in alphabetical
order. In all 130 companies were selected for the survey. Regarding this study, samples
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of 130 companies were stratified. This sample size represented 42.5% of the original
sample from which the 130 companies were selected.
3.2. Data Collection Instrument and Measures
The study used a questionnaire survey to explore the HRIS’ role in SHRM. As stated
earlier in the questionnaire included demographic information needed to assess the
respondents’ level of experience in the field of HR and their various positions held.
Questions 1 and 5 were asked in that effect. Respondents were asked, “What is your
role or title?”, and “How long have you worked as an HR specialists?” It was expected
that the longer the years of experience as HR professional, the more likely it is to
obtain reliable information. More so, the position or title in the questionnaire was to
determine the authority of the respondents in the field under study. The study revealed
that while 25% of the respondents had below 5 years’ experience as an HR specialist,
37.5% of them had between 5 and 10 years of experience. Again, respondents with
over 15 years of experience as HR specialists also represented 37.5%. Altogether,
75% of the respondents had more than enough experience to give information which
is more credible in this area of study. The highest recorded experience was 30 years,
and the lowest was 6 months.
Similarly, regarding the roles or positions of the respondents in the various
organizations, 25% were HR managers, another 25% represented HR directors, and
33.3% were HR professionals. It was also noted that 16.7% of the respondents did
not provide their roles. This might be explained by the general roles, which most
managers assume, or a calculated attempt not to provide such piece of information.
Therefore, given that 83.3% of the respondents had specific roles in the field of HR
boosted the validity of the survey by adding more value to it.
4. RESULTS
This section presents the results from the empirical studies. The findings were reviewed
by considering the different formulated hypotheses one after the other.
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Hypothesis 1
Hypotheses 1 purported that HRIS plays a major role in strategic HR tasks. In order
to verify this assertion, respondents were asked, “To what extent do HRIS play a role
in strategic HR tasks?” A single sample T-test was conducted using a hypothesized
mean value of 3. This was because, respondents were asked to use a scale 1 to 5 in
responding to the question. The aim here was to compare the sample mean with the
hypothesized mean for probability estimation, that the sample mean is different by
chance or random occurrence. The t-test revealed that the question used for this
hypothesis had a mean value of 3.88 with a corresponding significant p-value of less
than 0.000 (See Table 1 below and Appendix B (iii)). It showed that there is a significant
difference between the two mean values, and therefore indicated that the probability
of this being a chance was 0 (t-test, p<0.05). Figure 5 is the graphical representations
of the results.
Table 1: The extent of HRIS role in strategic HR tasks (T-test)
The results revealed that there is a strong support for the statement that HRIS plays
a major role in strategic HR tasks. The findings are consistent with the organizations’
increased reliance on the use of HRIS in support of strategic HR tasks, and HR
professionals’ higher professional ratings after using HRIS. Hypothesis 1 is therefore
accepted.
Hypothesis 2
Hypothesis 2 purports that “HRIS are used by HR professionals in support of strategic
HR tasks”. A single sample t-test carried out produced a mean value of 3.13 with
corresponding p-value of 0.63 at 95% CI. The p-value of 0.63 is not statistically
significant. In other words, the mean value (3.13) is not significantly different from
the hypothesized value of 3.
Test Value = 3
95% confidenceInterval of the
difference
Meandifference
Sig.(2 ailed)
dfT
Lower Upper
The extent of HRIS role in 4.143 23 0.00 0.875 0.44 0.131strategic HR tasks
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Table 2: The extent of HRIS use in support of strategic HR tasks performancestrategic HR Task Performance - OneSample Test
There is evidence that HRIS are used in support of strategic HR tasks. The findings
are consistent with the organizations’ increased reliance on the use of HRIS in support
of strategic HR tasks. Hence, hypothesis 2 is accepted.
Hypothesis 3
Hypothesis 3 presumes that HR professionals see HRIS as an enabling technology.
This was investigated using a scale 1 to 5 as a measure of degree of HRIS support.
The assumptions for Questions are that, the greater the degree of HRIS supports for
the presumed strategic HR tasks, the stronger the HRIS’ technological enhancement.
Moreover, the higher the HR professional standing in the organization after using
HRIS in strategic HR tasks the stronger the HRIS technological enablement.
The single sample t-test conducted reported a mean value of 3.35 regarding HRIS
use in support of Communication as a strategic HR task with corresponding p-value
0.20 (t-test p>0.05). This shows that there is no statistically significant difference
between the mean value and the hypothesized mean, 3.
Likewise, HRIS use in support of Performance and Extend Skill Base as a strategic
HR has mean value (3.30) not significantly different from T-value of 3 with a p-
value of 0.15 (t-test, p>0.05). Additionally, the extent of HRIS use in support of
Career management as a strategic HR task recorded a mean value of 2.83 and a p-
value, 0.48 (t-test, p>0.05). There is no statistically significant difference between
the mean values. Similarly, there is no significant difference between the mean value
(2.67) and the hypothesized mean (3) given the p-value of 0.23 (t-test, p>0.05) in
respect of the extent of HRIS use in support of Commitment management.
Test Value = 3
95% confidenceInterval of the
difference
Meandifference
Sig.(2
tailed)
dfT
Lower Upper
The extent of HRIS support of 0.485 23 0.632 0.125 -0.41 0.66strategic HR Task - Performance
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Moreover, the single sample t-test performed on the extent of HRIS support for
Leadership management revealed that there is no significant difference between the
mean value (2.78) and the hypothesized mean (3), with a p-value of 0.40 (t-test,
p>0.05). Again, the test results on HRIS use in support of Business process reengineering
noted that there is no significant difference between the mean value (3.26) and the
hypothesized mean, 3. The p-value was 0.30 (t-test, p>0.05). However, HRIS use
in support of Managing relations with organizations trade unions as a strategic HR task
showed a significant difference in the mean values (2.18) and (3). The p-value of
0.01 (t-test, p<0.05) is statistically significant.
Finally, Decision making as a strategic HR task generated mean value (3.30) and a p-
value 0.25 (t-test, p>0.05). This indicates that there is no statistically significant
difference between the means. Furthermore, the t-test results for “How important
are HRIS in helping you to perform your job more professionally?” have a mean
value of 3.57 corresponding to the p-value of 0,001. The p-value is significant
indicating that there is a significant difference between the mean value and the
hypothesized mean value (3).
Furthermore, the t-test for HR professionals noted an increase in their professional
standing after using HRIS has a mean value of 3.57 corresponding to the p-value of
0,001. The p-value is significant indicating that there is a significant difference
between the mean value and the hypothesized mean value (3).
Table 3: Ratings of professional standing in organization after usingHRIS: One Sample Test
The findings indicated that HR professionals see HRIS as an enabling technology
because using HRIS in their organizations increase their professional standing.
However, the test to see if HRIS support HR strategic tasks noted that it is not all of
Test Value = 3
95% confidenceInterval of the
difference
Meandifference
Sig.(2
tailed)
dfT
Lower Upper
Ratings of Professional standing 3.725 22 0.001 0.565 0.25 0.88in organization after using HRIS
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the proposed strategic tasks that HRIS support. There is evidence of HRIS support
for communication, Performance and Extend Skill Base, business process reengineering,
and decision making as a strategic HR tasks. On the other hand, while there is a weak
evidence of HRIS support for career management, commitment management, and
leadership management as a strategic HR tasks; the evidence of HRIS’ support for
motivation is very weak. On the average, there is evidence that HR professionals see
HRIS as enabling technology. Hypothesis 3 is therefore accepted.
Hypothesis 4
Hypothesis 4 asserts, “HRIS will be used differentially by Small and medium sized
companies in support of strategic HR tasks relative to large sized companies”. The
independent sample t-test carried out revealed that the degree of HRIS usage in
respondents’ organization in the SME differed significantly from the large organizations.
Table 4: HRIS usage in respondents’ Organizations Independent Samples
Test Significant at 0.05 Level
There was a significant difference in the proportion of SME and large companies, who
use HRS in support of communication as a strategic HR task. However, the test
showed no significant difference in the proportion of users from SME and large
companies who use HRIS in support of Performance and Extend Skill Base. In addition,
there was a significant difference in the proportion of users between SME and large
companies, who use HRIS to support Career management as a strategic HR task.
Moreover, there was no significant difference in the proportion of users between SME
and large companies, who use HRIS to support Commitment management as a strategic
HR task. Nonetheless, there was a significant difference in the proportion of users
between SME and large companies using HRIS in support of Leadership management
as a strategic HR task. Again, there was a significant difference in the proportion of
Type ofOrganization
Sig(2-tailed)
HRIS usage in respondents Large 0.01
organizations SME 0.057
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users between SME and large companies, who use HRIS to support business process
reengineering as a strategic HR task.
Similarly, there was a significant difference in the proportion of users between SME
and large companies, using HRIS to support motivation as a strategic HR task. Finally,
there was also a significant difference in the proportion of users between SME and
large companies, using HRIS in support of decision making as a strategic HR task.
The independent sample t-test carried out revealed that the degree of HRIS usage in
respondents’ organization in the SME differed from the large organizations. In other
words, the degree of HRIS usage in respondents’ organization is dependent on the
type of organization. The large companies favoured HRIS usage than the SME.
In sum, there was overall evidence of difference in the proportion of users between
SME and large companies, using HRIS to support specific strategic HR task. SME
had limited use of HRIS in support of specific strategic HR tasks compared to large
companies. The conclusion is therefore that HRIS will be used differentially by Small
and medium sized companies in support of strategic HR tasks relative to large sized
companies. Hypothesis 4 is then accepted.
Hypothesis 5
Hypothesis 5 examines whether HRIS will be used more in support of strategic HR
tasks in organizations in the future.
The single sample t-test performed with regards to the development of HRIS in
communication showed that there is no significant difference between the mean (3.57)
and the hypothesized mean value, 3. The p-value, 0.24 (t-test, p>0.05) is statistically
not significant. Moreover, the test on Performance and Extend Skill Base recorded a
mean value of 4.13, and a p-value of 0.000 (t-test, p<0.05). This indicates that the
mean value is significantly different from the hypothesized mean of 3. In a similar
test performed in this study, the results revealed that the mean value in respect of
career management was significantly different from the hypothesized mean. The mean
and the p-values were 4.04 and 0.000 respectively (t-test, p<0.05).
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Again, there is no significant difference between the mean value (3.33) and the
hypothesized mean (3) given the p-value of 0.15 (t-test, p>0.05) in respect of HRIS
development in Commitment management. More so, the test performed on HRIS
development in Leadership management revealed that there is a significant difference
between the mean value (3.57) and the hypothesized mean (3), with a p-value of
0.02 (t-test, p<0.05). Consequently, the test results on HRIS development in Business
process reengineering noted a significant difference between the mean value (3.61)
and the hypothesized mean, 3. The p-value was 0.003 (t-test, p<0.05).
In addition, HRIS development in employee motivation showed a significant
difference in the mean values (2.21) and (3). The p-value of 0.006 (t-test, p<0.05)
is statistically significant. Lastly, HRIS development in decision making generated
a mean value (3.83) and a p-value less than 0.000 (t-test, p<0.05). This indicates
that there is a significant difference between the means.
There was evidence that HRIS would be used more in support of strategic HR tasks
in organizations in the future. This is consistent with the test to see if HR professionals
think that HRIS should be developed in organizations. The results showed that HR
professionals think that HRIS should be developed in most of the strategic HR tasks.
This is very much the case concerning HRIS development in Communication,
Performance and Extend Skill Base, Career Management, Commitment Management,
Leadership Management, Business Process Re-engineering, Motivation and Decision
Making, as strategic HR tasks. Again, there is strong evidence of HRIS development
in most of the strategic HR tasks, but weaker evidence with regard to motivation. In
all, Hypothesis 5 is also accepted.
5. FINDINGS & RECOMMENDATIONS
This study aimed at exploring HRIS role in SHRM. The study attempted to examine
how HR professionals or managers in different organizations see the effects of HRIS
on strategic HR tasks, and job roles. It also tried to find out if there is a significant
difference in HRIS usage between SME and large sized companies in respect of strategic
HR tasks performance.
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On one hand, various studies on HRM propose that HRIS can contribute to the creation
of a longterm competitive advantage through integration of HRM functions with HR
technology (Gerardine DeSanctis, 1986: 15; Tannenbaum, 1990; Hendrickson, 2003).
However, these studies did not address the role, if any, HRIS play in SHRM. On the
other hand, a number of strategic HRM tasks have been identified. These include
Communications, Performance and Extend Skill Base, Career Management and Human
Capital Accumulation (Sparrow and Hiltrop, 1994: 25 cited in Morley et al., 2006;
Beer et al., 1984; Keep 1989). Dixon (1992) and Kochan and Dyer (1995) consider
greater worker autonomy, high Commitment Management, Leadership, and Business
Process Re-engineering as strategic HRM tasks. Another one includes managing
employee Motivation (Michael Armstrong).
Linking both fields of research, it was argued that HRIS might play a vital role in
SHRM based on the following assumptions:
• HR professionals might also consider HRIS usage in support of strategic HR
tasks given the unrelenting HRIS support for the HR professionals’ job
(Buckley et al., 2004; Gardner et al., 2003; Ulrich, 1997; Brockbank; 1999).
• HRIS would continue to be used more in support of strategic HR tasks in
the organization in the future considering the augmenting pressure on HR
professionals to support strategic objectives through more innovative HRIS
applications (Storey et al., 2000; Ball, 2000).
The empirical results of the study revealed that HRIS play a key role in strategic HR
tasksand have a great impact on SHRM. This is an indication that HRIS capabilities
in shaping the integration between HRM and IT (Hendrickson, 2003) are also
applicable to SHRM. This means that HR professionals would be able to cope with
their new roles without panicking because their new role, SHRM, is still supported by
HRIS.
However, in the case of specific strategic HR tasks, the degree of the support depended
on the type of organization. Larger firms/companies experienced a great deal of
HRIS support in most of the strategic HR tasks namely,Communication, Performance
and Extend Skill Base, Career Management, Business Process Re-engineering, and
Decision Making. On the contrary, HRIS usage in support of Commitment Management,
and Employee Motivation did not reveal any significant difference in proportion of
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users in SME and large companies. It implies that users of HRIS need to identify their
strategic HR tasks and organization type before embarking on any HRIS implementation
in order to enjoy the full benefit of using HRIS both to HR professionals and to the
organization as a whole. .
HR professionals considered that HRIS are used in support of strategic HR tasks. This
might be explained by the fact that increased uses of HRIS allow professionals to
achieve improved performance and thus facilitate participation in internal consultancy
(PMP (UK) Ltd 1996; and 1997). The results confirmed Gardner et al., (2003)
revelation, that extensive use of IT enables HR professional to have more information
autonomy. This disclosure implies that firms will more or less need to rely on HRIS
technology for effective and efficient performance of their strategic human resource
management tasks. This calls for total commitment on the part of both management
and HR professionals towards a successful HRIS implementation. In a dynamic global
market where IT is the order of the day, firms without this technology might not only
find it difficult attracting HR professionals who are yet to acquire HRIS skills and
seeking for one on the job, but also lose those HR professionals who have these skills
and might want to develop and improve upon them.
Notably, the study suggested that HRIS are likely to be used even more for strategic
HR tasks in the future; this was a strongly held belief by both SME and large sized
companies. The response from the large companies were however, remarkably more
positive than those from the SMEs. Large companies have wellestablished facilities
such as intranets and extranets to access the required personnel information quickly
and efficiently (Ngai et al., 2004). SMEs generally lack the capital and technical
resources to implement HRIS (Ibid). While it is incumbent upon all organizational
types to stay abreast with HRIS dynamics by keeping system updates SMEs are the
most vulnerable due to the incidence of cost. A more feasible way to start may be to
use pre-packaged HRIS software. Implementing HRIS is very costly but a successful
implementation contributes to cost reductions, quality/customer satisfaction, and
innovation, which eventually lead to competitive advantage (Broderick and Boudreau,
1992). It therefore implies that SMEs especially will need to consider a vigorous
ositive change in policy regarding HRIS applications to strategic HR tasks regardless
of the cost involved because the cost of nonimplementation may be relatively higher.
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The study again showed that HR professionals agree that the HRIS usage for strategic
HR tasks lead to enhanced professional standing in the organization. This was in line
with Brockbank’s (1999) findings that HR professionals both provide value to the
organization and improve their own standing in the organization by using HRIS. The
implications of this disclosure are that HR professionals will need to develop their IT
skills and come abreast with HRIS’ technology in order to remain competitive in the
labour market. This means that firms will also need to develop and plan HRIS training
programs for both prospective and existing HR professionals in line with specific strategic
HR tasks since enhanced professional standing implies effective and efficient workforce
which leads to improved performance and increased output resulting in higher profit
margins and acceptable returns on investment (ROI).
Interestingly, the study showed a lack of HRIS support for managing trade union
relations with the organization. This was very much the case irrespective of the type
of organization. The failure to use HRIS in support of trade union relations with the
organization means that there will be little consideration of how HR policies regarding
labour issues might potentially change trade unions’ attitude towards
collective bargaining. The immediate objectives and activities of trade unions vary,
but may include provision of professional training, collective bargaining, industrial
action, legal advice and representation for members (Fraser and Hamish 1974: 34). In
an attempt to enforce the union’s objectives, union leaders normally find themselves
in confrontation with the employers, which most often leads to industrial actions.
Effective and efficient management of trade union relations reduces industrial actions,
conflicts, and wastes. However, the lack of HRIS’ support in managing trade union
relations implies no standard way of communicating justin time information between
the parties. This might make conflict resolution difficult. The inability to resolve conflict
leads to strike actions, the ultimate results of which are, output reduction, low returns,
slow growth and expansion, loss of skilled employees, high employee turnover, and
other resultant effects.
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6. CONCLUSION
Overall, the study suggested that HRIS play a key role in SHRM, but the degree of the
role was also very much dependent on the type of organization. This provides some
insights into the usage of HRIS in strategic HR tasks by some selected companies
which should help HR practitionersacquire a better understanding of HRIS role in
SHRM. However, caution should be exercised in generalizing the results of the study
due to the small sample size. Nevertheless, the results provide basis for future research.
Whilst this study has confirmed existing studies into HRIS, it provides a platform
for future work in this area, which should concentrate on a number of issues. First, a
detailed research would be needed to explore the role of HRIS in SHRM, especially,
with much bigger sample size and a higher response rate so that a deeper analysis
can be done for generalization.
Second, HRIS represent a large investment decision for companies of all sizes.
However, SMEs are increasingly failing to use HRIS in support of strategic HRM
tasks. It would therefore be very interesting if future research could be geared towards
finding answers to why SMEs are reluctant to commit time and resources for the
implementation of HRIS in strategic HR tasks. This will enable a careful analysis
and diligent consideration of HRIS application to strategic HR tasks since a successful
execution is rewarded with numerous benefits including improved accuracy, provision
of just-in-time information, and costs saving (Lederer, 1984; Wille and Hammond,
1981).
Third, an in-depth study on HRIS usage in support of trade unions’ relations with
organizations needs further examination. This will allow both the trade unions and
the employers to manage and resolve conflicts and other related labour issues
efficiently and effectively.
Finally, as HRIS becomes an increasingly vital component of SHRM tasks performance,
researchers must expand their efforts to understand the opportunities and threats that
it fosters. Human resource information systems may be a key enabler allowing HR
professionals to balance successfully the competing roles of administrative expert,
employee champion, change agent, and strategic partner (Ulrich, 1998). There is also
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a risk that large investments in HRIS will not improve HR professionals’ satisfaction
or render the SHRM tasks performance a more efficient cost centre. These may be
outgrowth of low technology acceptance among intended users, inappropriate technology
choices, or other factors. Until more is known, investments in these innovations should
be made with caution.
REFERENCES
Alan Bamberger, Peter & Professor Ilan Meshoulam (2000): Human Resource Strategy:Formulation, Implementation, And Impact (Advanced Topics In OrganizationalBehavior): Sage Publications, Inc
Armstrong, Michael (2007) : A Handbook of Human Resource Management,10thEdition.
Bratton John and Gold Jeffrey (2003) Human Resource Management: Theory andPractice 3rd Edition London: Palgrave Macmillan.
Dessler Gary, Cole Nina D., and Sutherland Virginia L. (1999) Essentials ofHumanResources Management in Canada7th Edition. PrenticeHall Canada Inc. Scarborough,Ontario.
Kotler J. (1996) Leading Change, Boston, MA: Harvard Business.
Kovach, K.A., Hughes, A.A., Fagan, P. and Maggitti, P.G. (2002), “Administrativeand strategic advantages of HRIS”, Employment Relations Today, Vol. 29 No. 2,4348.
Lawler E.E., Mohrman S.A. ‘HR as a Strategic Partner’: What Does It Take to MakeIt Happen? Human Resource Planning 26 (3), 2003, 15-29.
Ngai E. W. T. and Wat F. K. T (2004)” Human Resource Information Systems”AReview and Empirical Analysis.
Porter M.E. (1996) “What is a Strategy” Harvard BusinessReview, Nov.Dec. pp.6178.
Schuler R.S., Jackson S.E., Storey J.J., HRM and its Link with Strategic Management.
Shrivastava Samir and Shaw James B. (2003) Liberating HR through Technology.
Ulrich David, “Human Resource Champions” From e-business to eHR. HRIM Journal5(April, June 2001, 9097.
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In Sri Lanka we boast of our 2500 years of history and culture. Further, our
country has good life expectancy, literacy rates and low maternal and infant
mortality rates. Girls are in more numbers in secondary schools, and even in
universities females outnumber the males in some faculties. We also take pride
in saying Sri Lanka produced the world’s first woman Prime Minister and that
we also boast of a woman President who ruled for many years. But these statistics
and information on women deceive many things that take place in our country.
There are many gender issues in our country, society and in the workplaces.
These issues such as, incest, eve teasing, sexual harassment, rape, violence
against women, domestic violence, pay gap, discrimination etc., are usually not
addressed by the public. These problems are ignored, swept under the carpet,
denied, or joked about. Doing such acts as rape, sexual harassment, violence
against women or any human is not our culture and it should not be part of our
culture. However, these incidents continue to take place on a daily basis. This
is quite sad. Despite many decades of feminist movement in this country,
increased education levels and development, such issues still prevail. There is
still a lot to do in eradicating and preventing these matters.
Dr. Arosha S. Adikaram’s latest book is on dealing with sexual harassment in
the workplace. Dr. Adikaram who is a Senior Lecturer in the Department of
Human Resources Management, Faculty of Management & Finance, University
BOOK REVIEW
Dealing with sexual harassment in the workplace:Guide to employers and employees
by Arosha S. Adikaram. Pannipitiya:Stamford Lake Publication. 2011.
Reviewed byPavithra Kailasapathy
Head and Senior Lecturer,Department of Human Resources Management,
Faculty of Management & Finance,University of Colombo
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of Colombo, has been researching in the area of sexual harassment for quite
some time.
Sexual harassment can take place on the roads while we are walking, it takes
place in the public transportation (e.g., buses, trains), and at workplaces. Dr.
Adikaram addresses sexual harassment at workplaces. There are laws in this
country that deal with sexual harassment and organisations (though not all)
have policies on sexual harassment. However, when a victim reports such an
incident no action is taken. Not only that, the victim is further victimised by
organisations taking action against the victim. For example, you can read about
the case of Rangika in this book. Rangika was fired from her job after she
reported that she was sexually harassed by one of her superiors. This case is
similar to the case of senior Indian Air Force Officer Anjali Gupta. She had
accused three superior officers of sexually harassing her. In turn Indian Air
force charged her with corruption and court martialled her. In the end she
committed suicide. The book also refers to cases where organisations had taken
no action when incidents are reported, or where colleagues and society had
victimised the victim; like in the case of the teacher referred to in the book. In
all these cases the perpetrator is not punished in anyway, not even reprimanded.
Sometimes the perpetrator is even promoted (i.e., rewarded than punished!).
The book also discusses how organisations strictly adhere to policies and
procedures for any other matter such as, lateness, disciplinary matters,
performance, decision making, and how when it comes to sexual harassment
such adherence to policy, even where policies exist, is not seen.
With regard to the book, Dr. Adikaram has written it in very simple English and
in a way that makes you want to read more. She takes the reader step by step
from explaining what sexual harassment is, what companies should do,
investigation procedures and so on. She has even included a policy model for
organisations. Therefore, this book is indeed a guide to employers and
employees.
I hope by publications such as this and other awareness efforts, sexual
harassments are handled in the correct way without further victimising the victim.
Sri Lankan organisations have a lot to do in this area.
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THE EVOLVING ROLE OF MODERN HR MANAGER
Chandrasiri GannileHonarary Secretary, IPM - Sri Lanka
The whole gamut of role of HR has evolved to that of an essential and integral part of
the anatomy of any professional who wishes to gird oneself with people management
skills .
The intense competition that drive today’s corporate world demands a lot from its
employees and this is where the competent and qualified Human Resource Management
Professional play a vital role. Investing time and effort into hiring employees that
complement an organization’s style and finding the correct balance between shared
values and diversity of viewpoints can be challenging. It requires a clear understanding
of the organization’s values. And it requires agreement on those values. And it also
requires that those values are exemplified and used as a benchmark at every stage of
the employment process- from recruitment and hiring, to training, to promotion and
termination decisions. It’s not an easy task, but all the same, it is a very crucial role.
It is heartening to note that HR management has become a much sought after academic
path for study fellows and it is our hope that the awareness and knowledge gained
would stand them in good stead in their professional future.
The expression ‘People Drive Business’ has now become the buzz phrase in the
corporate world. Yet ponder awhile and let this phrase sink in to each one of us. Isn’t
it then simply true? Those who are less concerned over their people, and untrained
and unskilled workers with attitudes not in sync with the required business environment,
would continue to under- perform. And the resulting low morale and productivity will
lead to employees who are not motivated in achieving better results than their counter
parts in the industry.
It is a true fact that people oriented management is taking vast strides in the world of
business. Innovative ideas from people to guide their businesses, and which are being
carried out by energized people, again would give a whole new concept and indeed a
new meaning to the phrase, ‘People Drive Business’!
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Today’s business leaders who are much concerned about their financial resources
rather than human capital would in fact end up losing many business
opportunities, whilst those who preserve and develop their Human Resources
even through many setbacks in other areas will have a greater chance in regaining
lost opportunities faster and successfully.
HR is often perceived as procedure, compliance, and protocol driven, or sometimes
even as organizational bottlenecks, being reactive to every new situation which may
arise in day today’s business environment. The new HR roles are work force planning,
employer branding, and employee retention. These roles will be responsible for
developing a system that identify and mange how the organization is perceived by
both internal and external key talent constituencies to ensure that the organization
develops and maintains a dominant position in relevant labor markets as the employer
of choice (Note that the emphasis on this new role is not an employment advert but an
understanding and managing perception among key constituents). Specific
responsibilities for these roles include:
Developing and implementing an employment branding strategy that ensures
key constituents continue to perceive the organization as an employer of
choice, thereby simplifying talent retention and motivation.
Marshaling internal management practices and people programs to ensure
that the employment experience delivered is capable of sustaining projected
talent needs.
Overseeing the creation and integration of employment branding messages
in all public relations, media relations, marketing communication, community
relations, special events, and recruitment advertising campaigns.
Identifying and developing storylines around company management practices
that can be repeated internally and externally through employee referral
campaigns, public speeches by executives/managers, news stories, and select
award program applications.
Periodically assessing employment brand internally and externally to ensure
alignment between current strategy and labor market conditions.
Establishing and maintaining the business case for organizational change
needed to develop the required employment brand
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These new roles can be associated with three main perspectives: functional specialism,
level of competence, and key behavior. The professional areas where HR has to work
are : 1. Strategy, insight and solutions 2. Leading and managing the function
3. Organization design 4. Resourcing and talent planning 5. Organization
Development 6. Learning and talent development 7. Performance and reward
8. Employee relations 9. Employee engagement 10. Information and service
delivery.
The competence would highlight what you need to know (the knowledge factor) and
what you need to do (activities) then how you need to do it (behaviors).
The last dimension sets out the qualities that HR practitioners need in order to be
effective, these qualities are : 1. Curiosity 2. Decisive thinking 3. Goal driven 4.
skilled influencer 5. Team Player 6. Credibility 7. Ability to take on a challenge
and 8. Role model.
However the above roles and the volume of work are to be dealt with in line with the
strategic priorities of the organization.
The professional institutes like IPM Sri Lanka has a pivotal role to play in creating an
environment for developing HR professionals from junior category to a most senior
HR professional who serves as a board member of an organization.
REFERENCES :
Chartered Institute of Personnel Development (2009) HR Business Partnering, CIPD,
London
Schuler, R.S. and Jackson, S.E (2009) Strategic Human Resource Management,
Blackwell, Oxford
People Management (2009), CIPD, UK.