Examining the Modernization of Human Resource Management

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As our wants and needs grow, so do the ways of satisfying them. Consider the growth of the home computer industry, for example, and how firms within it are racing to deliver software games, puzzles and the educational exercises to meet customer demands for such products. None of our wants and needs is satisfied randomly or haphazardly. When you go to a store that sells computers, for example, the store will be open, and you will be able to buy the product of your choice even though the salesperson who helped you last time has the day off. In the process of satisfying needs and wants, continually and predictability are essential in the delivery of goods and services. In a modern society, community and predictability are made possible by organizations. Some of the organizations that accommodate our wants and needs are fast food restaurants, movie theaters, sporting goods store, hospitals, universities, accounting firms and the antique stores, to name just a few. Each of these organizations exists because consumers demand its product or services. So a number of people are brought together, and each is assigned a part of the total task. It is most efficient to divide a large task (such as building a house) into its component part so that specially qualified individuals can perform the sub-functions. Specialization by sub function and coordination among all the tasks to be accomplished make the largest scale possible. Although there are great differences among the organizations in our society but they also have much in common. Every organization is made up of people who perform specialized tasks that are coordinated to enhance the value or utility of some goods or services that is wanted by and provided to a set of customers or clients (Bohlander & Snell, 2007).

The modern corporation is a thing of a past. The twentieth century enterprise was defined by Alfered P. Sloan, the legendary chairman of General Motors Corporation and the most influential professional manager of the time. His classic work set forth a management philosophy that has dominated U.S corporations for decades. Company success, he argued, was based on efficiency and economies of scales he however mentioned the words of "creativity" or "flexibility". Large, efficient organizations, he theorized must have decentralize manufacturing while centralizing corporate policy and financial controls in the hierarchical structures. This new paradigm values teamwork over individualism seeks global markets over domestic ones and focuses on the customers rather than on short-term profits. It views time, than a single minded focus on costs, as the key competitive advantage. It recognizes the value of multicultural workforce in an increasingly diverse labor pool and customer base. The new form of organization is based on a network of alliances and partnerships, not on the self-sufficient hierarchy. It is governed by an independent board with a broad view of the company's constituent's not just shareholders, but also employees, suppliers, customers and the local community.

Organizations are managed and controlled by people. Without the people, organizations cannot exist. The challenge, the opportunity, and also the obstruction of creating and managing organizations habitually stanch from the people (HR) related problems that arise within them. People related problems, in turn, frequently stem from the false belief that the people are all the same, that they can be treated in the same manner. Nothing could be further from the truth. Like snow-flakes, no two people are exactly alike, and everyone differs physically and psychologically from everyone else (Cascio, 5th Edition). Sitting in a sports arena, for example, will be tall people, small people, fat people, thin people, people of color, white people, senior people, fresh people and so on. Even inside any single physical category there could be enormous variability in psychological characteristics. Some will be outgoing, others reversed; some will be intellectual, others not so intellectual: some will prefer the indoor activities, others outdoor activities. The point is that these variances demand the attention so that every person can capitalize on his or her latent, so that the organizations can maximize their value, and so that the entire society can make the cleverest use of its human resources.

Human Resources (human capital) are an essential fragment of the organization and they may be defined as the total creative abilities, services, knowledge, talents and capacities of an organization's human capital, as well as the morals, attitudes, methods and views of the individuals involved in the matters of the organization. It is the total or the collective of intrinsic capacities, attained knowledge and capacities represented by the skills and abilities of the persons engaged in the organization. The human resources are multi-dimensional in its kind. From the nationwide point of view, human resources may be called as the knowledge, abilities, creative-skills, aptitudes and gifts acquired in the population; however from the individual enterprise point of view, human resources represent the combination of the inherent skills, acquired knowledge and talents.

Human Resource Management has come to known as an essential part for the management, which is related with the HR (human capital) of an organization. Its aim is the maintenance of better human relations in the business by the growth, use and evaluation of policies and procedures and platforms relating to the human resources to heighten their contribution towards the recognition of organizational objectives (Ankur, 2009). In other words, HRM is related with the attainment of the best results with the association of people. It is an important but unique portion of the management, which is related with the labor at work and their affiliations within the organization. HRM helps in attaining maximum individual growth and development, anticipated working relationship between the employees and managers, personnel and personnel, and effective exhibiting of human resources as compared with physical resources. It is the training, recruitment, selection, development, leadership, utilization, compensation, performance appraisal and motivation of human resources (human capital) by the organization. When it comes to dealing with people, all managers must and are concerned to some amount with the following five practices which are: recruitment and staffing, retention, development and growth, adjustment and managing to the change. Useless to say, these activities can be passed out at the individual, work-team or larger organizational unit (e.g. department) level. Sometimes they are started by the organization (e.g. recruitment efforts or management development programs), and sometimes they are started by the individual or work team (e.g. voluntary retirement, safety improvements). Whatever the case is the main task for carrying out these activities are extremely unified. Together these activities establish the HRM system.

History of HRM:

Key ideologies and practices related with the Human Resource Management go back to the beginning of mankind. Different mechanisms and procedures were established for the selection of the tribal leaders, and knowledge was documented and passed on to youth about the safety, health, hunting, and gathering. More advanced Human Resource Management functions were established as first as the 1000 to 2000 B.C. Employee selection tests have been drawn back to 1115 B.C. in China. And the initial form of industrial education, the apprentice (intern) system, was started in the ancient Greek and Babylonian civilizations before attaining reputation during the medieval times (Mote).

Since the beginning of modem management theory, the language used to elaborate the role and the functions of a worker has developed from the "personnel" to the "industrial relations" to the "employee relations" to the "human resources" and now to the "human capital". While all of these terms remain in practice, "human resources" most correctly represents the view of workers by modern management theory: as the valued resources managed in the same way as the other valued resource.

The need for a planned form of HRM developed throughout the industrial revolution, as the manufacturing process developed from a cottage structure to the factory production. As the United States moved from an agricultural country to an industrial country i.e. economy, organizations were enforced to grow and implement effective ways of selection and keeping the skilled workers. In addition to that, industrialization facilitated division immigration, as the country opened its boundaries to fill the industrial positions. Filling these jobs with migrants, however, formed an even greater need for suitable management of the employees.

In the middle of the 1880s and the 1940s, immigrants rose significantly and continued tough until World War II. Advertisements spread throughout the world portraying the United States of America as the land of the prospects where good pay industrial jobs were ample. As a result, the country had a solid stream of low-skill, low-cost migrant workers who engaged in manufacturing, construction, and machine operation positions. Even though these employees executed largely routine tasks, managers faced serious complications when trying to manage them as they all speak different languages.

Early HRM methods included social welfare approaches aimed towards helping migrants regulate to their life and their jobs in USA. These packages assisted immigrants in learning English and getting housing and medical care. In addition to that, these procedures promoted administrative training in order to increase efficiency and productivity.

While some companies paid responsiveness to the "human" side of service, however, others did not. Thus, other issues such as dangerous (hazardous) working environments and pressure from labor unions also played part in increasing the importance of the effective management of human resources. Alongside with the manufacturing effectiveness brought about by mechanization came several shortfalls relating to the working conditions. These difficulties included: unsafe tasks, long hours, and corrupt work environments. The direct cause of employers looking for improved HRM packages was not poor working settings, but somewhat the disputes and burdens generated by labors and systematized labor unions. Certainly, labor unions, which had been present as early as before 1790 in the United States, developed much more central in the later parts of 1800s and early parts of 1900s.

Also there were two other main important contributing aspects to the initiation of modem HRM throughout that time. The first one was the industrial welfare drive, which symbolized a shift in the way that supervisors regarded employees from non-human assets to human beings. That drive resulted in the formation of medical maintenance and the educational accommodations/facilities. Frederick W. Taylor's (1856-1915) Scientific Management was an instant factor, a breakthrough book that defined management methods for achieving superior productivity from the low-level production workers.

The B.F. Goodrich Company in 1900 made the leading business employment department designed to address employee issues. In 1902 National Cash Register modeled a similar department to manage worker grievances, wage supervision, record keeping, and many other roles that would later be referred to HRM divisions at most large.

U.S. corporations HRM as a specialized discipline was exclusively encouraged by the opening of the Wagner Act in 1935 (National Labor Relations Act), which continued the basis of the U.S. labor law through the 1990's. It amplified the power of labor unions and improved the role and the significance of human resource managers.

During the 1930's and 1940's the common emphasis of HRM changed from a focus on the workers productivity and skills to employee satisfaction. That swing became especially obvious after World War II, when a deficiency of skilled labor enforced companies to compensate more devotion to the workers' needs. Employers, inclined by the noticeable Hawthorne productivity studies and similar research, inaugurated to emphasize private development and enhanced working conditions as a means of encouraging workers.

In the 1960's and 1970's the national government expanded the HRM movement with a series of regulations formed to enforce fair conduct of labors, such as the Equal Pay Act of 1963, the Civil Rights Act of 1964, the Employee Retirement Income Security Act of 1974 and the Occupational Safety and Health Act of 1970. Since these acts, organizations began placing larger emphasis on the HRM in order to evade lawsuits for violating this rule. These regulations formed a totally new legal role for HRM specialists. Moreover, during the 1970s, HRM expanded status as a recognized occupation with the beginning of human resource programs in schools.

By the end of the 1970s, practically all of the medium-sized and the large corporations and societies had some style of HRM packages in place to handle recruitment and selection, training and development, regulatory compliance, dismissal, and other related matters. HRM significance continued to mature throughout the 1980's for several motives. Changing human resources values, for example, essential the skills of HRM professionals to adjust the organizational structures to an innovative generation of employees with changed attitudes about power and conformity. Shifting demographics enforced changes in the way workers were selected, fired, and managed. Other aspects contributing to the significance of Human Resource Management during the 1980's and 1990's were developing education levels, development of service and the white-collar jobs, corporate streamlining (including cutbacks in middle management), more women in the staff, slower domestic market progress, larger global competition, and new federal and state protocols.

Importance of HRM:

In today's businesses, the right approach and management of the company's employees can greatly affect the company's overall performance. A strategic approach in Human Resource Management is vital especially in growing companies. Starting from right staffing to maintaining performing employees, HR management is the key in developing not only the employees, but the whole organization itself.

Human Resources encompass a broad scope in management. An expanding company dependent on its current success can maintain and further develop its business starting with the right staffing. As demands for the product or services increase, additional manpower is needed to comply with them. The current manpower should be checked but not simply if they can comply with the demands, but it has to ensure that it can still keep its quality and standards. Mass production or bulk orders should not be an excuse in decreasing quality, hence, increased customer dissatisfaction and decreased sales. For a company that is already recognized in the industry and is eyeing on expansion, their status and reliability should be maintained. The leaders of the company can now focus on the products itself and expansion, and let the HR department handle the development of the organization. Minor employee and performance problems should be seen immediately to avoid any future inconvenience and potential problems to the customers and thus become a liability to the company. HRM professionals can also identify the processes and the proper staffing for each of these activities, and in effect, the systems and approach in terms of the company's front line operations can be improved to decrease manpower hours, improve quality, streamline processes, and elevate standards (Facsimile).

The success and growth of a small company can be attributed to its culture. Due to its size, communication between all employees is not complicated. And alongside this communication, the trust and organizational goals are easily shared and understood by everyone. And in its growth, it is important that this culture is maintained and adjust to changes accordingly. HR professionals can work both with management and employees in doing this. With increase in employees and more demands in operations, communication may take a backseat for both parties. However, Human Resources Management can amend this and become a bridge in establishing what the management wants from employees and vice-versa.

In its continuous development, it is but imperative that the management or its owner be prepared for more arduous tasks in operations and leading the rest of the team towards continued success. Management should be equipped with the right skills in planning, leading, organizing and establishing standards. As they are the ones who will eventually be focused in developing the company instead of the operations and technical aspects, a higher understanding of this responsibility is essential, and this also plays a significant part once competition is put into the picture. Companies fail because of a number of reasons, and mismanagement can be one of them. Operations may spin out of control if personal agendas and politics are placed, and in growing companies, this should be monitored and prevented (Jackson, Schuler, & Werner, 2009).

Developing not only management but also its employees is significant. To keep up with competition, employees should be given with a number of reasons to stay with the company, and do their jobs exemplary well. Their continuous growth, the right compensation and benefits, and work-life balance are just some of the things that motivate employees to perform better, producing better results for the customers and ultimately, the company.

Modernization in HR Concept:

Modern study stresses that human beings are not just "commodities" or any "resources", but they are creative and social beings in a dynamic organization. The 2000 review of ISO 9001 in contrast involves the identifying the processes, their classification and interaction, and to explain and transfer responsibilities and authorities. In common, heavily unionized countries such as France and Germany have agreed and encouraged such job descriptions exclusively within trade unions. One view of this movement is that a strong social agreement on political economy and a decent social welfare system assists labor flexibility and tends to make the whole economy more efficient, as labor can move from one organization to another with little complications or difficulty in adapting (Rivera, 2009).

An important debate regarding labor mobility explains the broader rational issue with the practice of the phrase "human resources": governments from the developing countries often regard developed countries that boost migration or "guest workers" as assuming human capital that is technically part of the developing country and required to additional-zed its growth as a civilization. They reason that this appropriation is alike to commodity of colonial nature fiat wherein a colonizing European authority would express a price for arbitration for natural resources, extracting which contracted national natural capital.

The argument about "human resources" versus human capital thus in several ways rebounds the debate about natural capital versus natural resources. Over the time the United Nations have come to more commonly support the point of view of developing nations, and have demanded significant equalizing "foreign aid" contributions so that an emerging nation losing human capital does not drop the capacity to remain to provide training to new people in trades, professions, and the arts.

A vast version of this view is that historical imbalances such as African servitude must be compensated by existing developed nations, which benefited from filched "human resources" as they were increasing. This is an extremely debated view, but it resonances the general theme of transforming human capital to "human resources" and thus critically diminishing its worth to the host society, for example "Africa", as it's put to contracted imitative use as "labor" in the using society.

In a chain of reports by the UN Secretary General to the General Assembly over the last few years, an extensive inter sectorial method to developing human resourcefulness through HR training has been sketched as a significance for socio-economic development and mainly to the anti-poverty approaches. This calls for tactical and unified public policies, e.g. in the sectors of education, health, and employment which encourage occupational skills, knowledge and performance improvement.

In the very thin corporate "human resources" context, there is a distinct pull to reflect and necessitate workplace diversity that echoes the variety of a worldwide customer base. Foreign language and culture skills, creativity, humor, and careful listening, are examples of individualities that such packages typically require. It would seem that these evidence a common shift to the point of view of human capital and acknowledge that human beings indeed contribute much more to a creative organization than "work": human beings bring their character, ethics, creativity; their social connections, in some circumstances even their families with them and change the workplace character. The term corporate, culture is used to brand such processes.

The customary but extremely contracted context of hiring & firing and job description is reflected in the 20th century anachronism. Most commercial organizations that compete in the modern global economy have accepted a view of human capital that reflects the above modern consensus. Some of these as a result criticize the term "human resources" as useless.

As a whole though human resources have been a part of organizations and businesses since the early days of agriculture, the present concept of human resources began in return to the Taylorism's efficiency focus in the early parts of 1900s. By the year 1920, psychologists as well as the HR experts in USA initiated the human relations movement, which regarded workers in terms of their psychology and appropriate with companies, rather than as exchangeable parts. Throughout the middle of the 20th century this drive saw growth, placing importance on how leadership, structure, and loyalty played important roles in organizational achievement. Although more increasingly challenged this vision quantitatively, harsh and less "soft" management techniques of the 1960s and beyond, HR had increased a permanent role within an organization.

Strategic HRM:

Strategic human resource management is a multifaceted process which is regularly evolving and being studied and debated by the academics and analysts. The area of Strategic Human Resource Management (SHRM) is which that lingers to suggest an immense debate as to what it holds actually. Definitions of SHRM range from "human resource system that is personalized to the business strategy demands". "The design of planned human resource activities intended to facilitate an organization towards achievement of its goals". Although the variance between these two seems delicate but the effects of the difference are considerable. Whereas, in the first definition, the human resource management is rather a 'reactive' management area in which human resource management becomes a device to implement strategy, in the second definition it has a proactive meaning in which human resource activities actually build and shape the business (Kumar, 2006).

Strategic human resource management (SHRM) is an idea that adds traditional human resource management activities inside a firm's overall strategic planning and application. SHRM adds human resource attentions with other physical, financial, and technological means in the setting of goals and solving difficult organizational problems. SHRM also highlights the implementation of a set of strategies and practices that will size employee pool of skills, knowledge, and capacities that are relevant to organizational goals. Thus a larger range and more complete set of keys for solving organizational problems are delivered and the likelihood that business objectives of the organization that will be attained is strengthened.

Strategic HRM can be observed as a general line to the strategic HRM in an accord with the intentions of the company on the forthcoming direction it wants to take. It is related with longer term human issues and macro concerns about assembly, quality, culture, values, and commitment and equivalent resources to the future need. It has been well-defined as: All those actions affecting the performance of individuals in their efforts to devise and apply the strategic requirements of business. The shape of planned human resource deployments and actions intended to enable the forms to attain its goals. There are two attitudes of the SHRM which are as follows:

Efforts to link Human Resource actions with competency based performance measures

Efforts to link Human Resource actions with business surpluses or income

These two methods suggest two factors in an organizational set. The first one is of the human factor, the performance and their capabilities and the latter is the business profits. An approach of people concern is established on the faith that human resources are exclusively important in sustained business success. An enterprise gains competitive advantage by consuming its people effectively, sketching on their expertise and ingenuity to meet evidently defined objectives. Integration of the business profits to the competency and performance of human required adequate policies. Here the roles of strategy move toward into picture. The manner, in which people are motivated, managed and deployed for work, and the obtainability of skills and knowledge drive all form business strategy. The strategic direction of the business then demands the efficient orientation of human resource to proficiency and performance excellence.

Benefits of SHRM

Ensure high efficiency.

It provides a clear business strategy and a vision for the future.

Ensure business profits thorough competency.

Supply economical intelligence that may be suitable in the strategic planning process.

Recruit, retain and motivate human capital.

Development and the retention of highly competent human resources.

Supply information concerning the company's internal strengths and weaknesses.

Through SHRM external opportunities and threats that may be vital to the company's success can be identified and analyzed.

Ensure that people development concerns are addressed systematically.

Meet the expectations of the customers efficiently.

Barriers of SHRM

Barriers to the effective SHRM implementation are complex. The primary reason is a shortage of growth strategy or the failure to implement one. Other major obstacles are summarized as follows:

Interdepartmental conflict.

Commitment of the whole senior management team.

Plans that incorporate internal resource with external requirements.

Limited time, money and the resources.

The statuesque approach of employees.

Fear of failure of senior level managers to take up the strategic steps.

Diverse work-force with competitive skill sets.

Ramifications for power relations.

Highly confrontation because of the deficiency of cooperation from the bottom level of organization.

Struggle that comes through the reasonable labor institutions.

Presence of an active labor union.

Rapid structural changes.

Prompting the vision and mission of the change effort.

Economic and the market forces influenced the adoption of strategic HRM.

Global HRM:

With the beginning of globalization, organizations big or small have stopped to be local and they have become global organizations. And this has amplified the workforce multiplicity and sensitivities attached with cultures have risen like never before. All of this steered towards the development of Global Human Resource Management.

Even those companies who take themselves exempt to transactions across geographical boundaries are associated to the broader network globally. They are in some way reliant on upon the organizations that may have not even heard about it. There is interdependence among organizations in various areas and functions.

The main function of global HRM is that the companies transfer a local plea in the host country in spite of maintaining an international sense. To demonstrate, any multinational / international corporation would not like to be referred to as local, however the same company wants a national touch in the host country and this is where the challenge lies (Juneja).

We may therefore, count the objectives of global Human Resource Managemnet as follows:

Create a petition that is local without negotiating upon the global identity.

Creating responsiveness of cross cultural sensitivities in the middle of managers globally and employment of staff across geographic boundaries.

Training upon values and feelings of the host country.

Strategic role of HRM in such a state is to certify that HRM policies are in cycle with and in the support of the organization's strategy, structure and controls. Precisely, whenever we talk of structures and controls, the following become worth citing in the context of global human resources management.

Decision Making: There is a definite degree of centralization of operating decision making. Relate this to the International strategy; the core capabilities are kept centralized and the rest are decentralized.

Co-ordination: A high degree of harmonization is required in awareness of the cross cultural sensitivities. In addition to this awareness there is also a great need for cultural control.

Integrating Mechanisms: Many participating mechanisms operate instantaneously.

Here also the role is no diverse i.e. hiring individuals with obligatory skills to do a specific job. The challenge here is emerging tools to promote a corporate philosophy that is almost the same everywhere excluding that the local sensitivities are dealt with.

Also, decisive upon the top level management or key positions gets fairly tricky. Whether or not to select a local from the host country for a key position or organize one from the headquarters assumes importance; and lastly whether or not to have a constant hiring policy globally remains a big trial.

However an organization can choose to hire conferring to any of the staffing policies cited below:

Ethnocentric: Here the Key management spots are filled by the parent country's persons.

Polycentric: In polycentric staffing strategy the host country nationals manage divisions whereas the positions at the headquarters are held by the nationals of the parent company.

Geocentric: In staffing policy the finest and the most knowledgeable individuals hold key positions regardless of the nationalities.

Geocentric staffing policy seems to be the best when it originates to Global HRM. The human resources are organized productively and it also supports build a solid cultural and informal management network. The other side is that human resources come to be a little expensive when hired on geocentric basis. Moreover the national immigration policies may bind implementation. Global HRM therefore is a very puzzling front in human resources management. If one is able to slow down the right string in designing the structures and the controls, the task is half done. Divisions are held together by global HRM; diverse subsidiaries can function and maneuver coherently only when it is empowered by efficient structures and controls.

Functions of HRM:

Human Resource Management comprises of the development of a perfect combination among traditional administrative functions and the wellbeing of all of the employees within an organization. Employee maintenance ratio is directly proportional to the way in which the employees are behaved, in yield for their communicated skills and experience. A Human Resource Manager preferably empowers inter-departmental employee relations and encourages scope for down-the-rung worker communication at various levels. The ground is an imitative of system theory and corporate Psychology. Human resources have acknowledged a number of related clarifications in time, but continue to preserve the need to confirm employee wellbeing. Every organization now has a special Human Resource Management Department to cooperate with representatives of all economic factors of production. The department is accountable for the progress and application of current research on strategic improvements while hiring, terminating and training staff (Borade). The HRM Department is responsible for:

Implement resource strategies to successively create and withstand competitive advantage.

Develop positive connections between workers, to ensure organized and constructive enterprise efficiency and development of an identical organizational culture.

Generate a platform for all employees to prompt their goals and provide the essential resources to realize professional and personal agendas, fundamentally in that order.

Innovate the new functional practices to minimize risk and produce an overall sense of belongingness and accountability for the organization.

Select the required workforce and creating provisions for expressed and guaranteed payroll and benefits.

Understand and relate employees as individuals, thus categorizing and identifying the individual needs and career and the professional goals.

Identify areas that suffer absence of knowledge and inadequate training, and therefore provide educative actions in the form of workshops and training seminars.

Empower the corporation, to efficiently meet strategic goals by managing human resources successfully.

Preferably, HRM Department is accountable for an interdisciplinary inspection of all staff members in the business environment. This strategy calls for applications from varied fields such as psychology, legal studies, industrial engineering, sociology, and a serious understanding of theories relating to post-modernism and industrial structuralism. The division bears the responsibility of altering the available task-force or hired personalities into strategic business associates. This is realized via devoted change management, knowledge management and focused employee administration. The HR purposes with the individual goal of motivating and encouraging the workers to demonstrate their determination and add significance to the company. This is attained via various management procedures like workforce planning and recruitment, the orientation and the training of hired task-force and employee preparation, administration and appraisals.

Education in Pakistan:

It is widely recognized that education is among the single most important factor contributing to poverty alleviation. Education plays a predominant role and has a cross cutting effect on all aspects of human life. It is a vital investment for human and economic efficiency. Education in Pakistan is administered by the Ministry of Education of GOP. The educational institutes are the concern of the provincial governments and having said that however, the federal government mostly contributes in the syllabus development, recognition and some funding of research. The education in Pakistan is mostly divided into 5 levels: primary (grades 1 to 5); middle (grades 6 to 8); high (grades 9 and 10), leading towards the Secondary School Certificate or SSC; intermediate (grades 11 and 12), leading towards a Higher Secondary School Certificate; and the university packages taking to graduate and advanced degrees. For high secondary and secondary school certificates and diplomas, Inter-Board Committee of Chairmen (IBCC) is in charge for the issuance of equality status; while, Higher Education Commission (HEC) issues equivalence at the graduate level and the post graduate level. According to the figures of 2000-2004 English is vastly increasing and spreading in country, with the population of 18 million Pakistanis (11% of the population) having the knowledge over the English language making it the 9th largest Nation in the world that speaks English and the 3rd largest English speaking country in Asia. On top of it, Pakistan produces approximately 445,000 graduates from universities and 10,000 computer science graduates per year (Wikipedia, 2011).

Public Expenditure on Education as percentage to GDP is lowest in Pakistan as compared to other countries of the South Asian region. According to official data, Pakistan allocated 2.5% of GDP during 2006‐07, 2.47% in 2007‐08, 2.1% in 2008‐09 and 2.0 % in 2009‐10 which shows persistent declining trend (Farooq, 2009-10). Knowledge is the acquisition of basic skills of how to read, write and the proficiency. In other words, Literacy is the meaningful attainment, development and use of the written language. In Pakistan, the explanation of literate is constructed at the time of population census. In the Population Census of 1998, a literate person was defined as "one who can read newspaper and write a simple letter in any language" (Authority). Overall literacy rate (aged 10 years and above it) is 57% (69% is for males and 45% is for females) compared to the 56% (69%, which is for males and 44% which is for females) for the year 2007‐08. The data gathered shows that the literacy remains higher in areas that are urban (74%) as compared to the in rural areas which is (48%), and is more prevalent for men (69%) as compared to the women which is (45%). However, it is evidently clear from the data that overall female literacy is significantly on the rise, but progress is not even across all the provinces of the country. When analyzed provincially, the literacy rate in Punjab was at (59 %), Sindh was (59%), Khyber Pakhtunkhwa was (50%) and Balochistan was at (45%) (Khan, 2008-2009). In Pakistan there are a total of 128 universities registered under the HEC; according to the figures of 2009-2010 there are a total of 70 universities in the public sector and 58 universities in the private sector. In the AJK there are 2 public and 2private universities, in the Balochistan there are 6 public and 2 private universities, in Islamabad there are 14 public and 3 private universities, in the Northern Areas there is only one public university, in the NWFP there are 13 public and 9 private universities, and in the Punjab there are 21 public and 17 private universities and in the Sindh there are 13 public and 25 private institutes (HEC, 2009).

Universities Ranking:

The universities in Pakistan are ranked under the following criteria i.e.; Students (17%), Facilities (15%), Finances (15%), Faculty (27%) and Research (26%). HEC divided the universities under 6 different groups (HEC, Ranking of Universities , 2009), of which details are as follows:

Agriculture/ Veterinary

University Names

Total Score


University of Agriculture (UAF), Faisalabad



NWFP University of Agriculture, Peshawar



University of Arid Agriculture, Rawalpindi



Sindh Agriculture University, Tandojam


Business / I.T

University Names

Total Score


Lahore University of Management Sciences (LUMS), Lahore



Institute of Business Administration (IBA), Karachi



Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Karachi



Iqra University, Defence View, Karachi



Lahore School of Economics, Lahore



University Names

Total Score


Pakistan Institute of Engineering and Applied Sciences, Islamabad



National University of Sciences & Technology, Rawalpindi



Ghulam Ishaq Khan Institute of Engineering, Swabi 



University of Engineering. & Technology (UET), Lahore



Mehran University of Engineering. & Technology (MUET), Jamshoro


Health Sciences

University Names

Total Score


Aga Khan University, Karachi 



Liaquat University of Medical and Health Sciences, Jamshoro



Baqai Medical University, Karachi 



Zia-ud-din Medical University, Karachi


Art/ Design

University Names

Total Score


National College of Arts, Lahore



Textile Institute of Pakistan, Karachi



Indus Valley School of Art & Architecture, Karachi



University Names

Total Score


Quaid-i-Azam University (QAU), Islamabad



University of the Punjab, Lahore



University of Karachi, Karachi



University of Peshawar, Peshawar



Bahauddin Zakariya University, Multan



Government College Lahore University, Lahore



Isra University, Hyderabad



International Islamic University, Islamabad



University of Sindh, Jamshoro



Hamdard University, Karachi


According to the reports and the websites of (Baty, 2010), (Academic Ranking of World Universities, 2010), (QS World University Rankings, 2010), (World's Best Universities, 2010) none of the Pakistani educational institute has been listed in the top 300. Pakistan has been struglling with its educational system. A very low amount of international students have been enrolled in these institutes.

This research is about identifying a path for the institutes which they can follow and get into the top list, and by doing that they will not only contribute to the society but also to our country. My focus will be on the HRM practices which can be used as a compelling factor for the success of the educational system of the pakistan. HRM practices has a positve effect on the firm's financial and non-financial performance which will ulimately lead to the firm's productivity (Ahmad & Schroeder, 2003), (Huselid, 1995), (Arthur, 1994), (Bae & Lawler, 2000), (Becker & Gerhart, 1996), (Singh, 2004).

Research Objective:

The objectives of this research are listed as below:

Put emphasis on the importance of the HR and the HRM for the top management.

Identification of the best HRM practices.

Create a link between the HRM and the organizational performance.

Measure the extent to which the HRM practices are applied in the education sector of Pakistan.

Quantify the effects of the HRM practices with the organizational performance.

Provide recommendations for the educational institutes regarding the HRM.

Research Significance:

The significance of the research is as under:

No other published research is available in the context of HRM practices and the organizational performance (education sector of Pakistan).

This research will provide the benchmarks for the new researchers.

A large sample of institutes have been taken out of educational institutes working in Pakistan.

This research will highlight the key areas of improvement, for an educational institute.

With the implication of the correct HRM practices identified by this research the educational sector will move towards the productivity.

Limitations of the Research:

The limitations of the research are as under:

The actual data of the performance of an institute was not publicly available.

The perceived performance of the organizational was taken as the dependent variable.

The respondents of the questionnaire were not comfortable while filling out the questionnaires.

Very limited data is available regarding the HRM and the organization performance in light of an educational institute.

Thesis Overview:

The thesis is divided into six chapters outlined below:

Chapter 1, this chapter looks into the HRM comprehensively, and then focuses on the educational sector of the Pakistan, and its current standing. Later on the research objectives, limitations and its significance are listed.

Chapter 2 discusses and reviews the relevant literature pertaining to the HRM practices and its effect on the organizational performance. HRM practices are examined and key components are identified through various literature. These components are used to find the best model for the best HRM practices which are used to structure this research.

Chapter 3 describes the research methodology used in the study and it also discusses the development of the survey instrument, sampling methodology and the sampling frame and its measurement.

Chapter 4 presents the empirical findings from the data and the data analysis.

Chapter 5 discusses the implications of the research and findings and how this relates to the current research in the area of HRM & the OP.

Chapter 6 covers the conclusion and the recommendations along with the limitations and the future research directions.