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Due to lack of coherent theories that discuss the field of Human resource management, there has been development of strategic human resource management that is well understood on how it affects the employee's performance through discussion of various theories that affect them. These theories attempt t o make clear strategic and non-strategic determinants that affect the human resources practices (Schuler, & Jackson, 2007).
Strategic Human Resource Management (SHRM) is defined as the numerous activities that affect the behaviors of the individuals that are working in an organization so that they are able to formulate and implement fully and with ease strategic needs of the organization. SHRM deals with macro-organizational approach that ensures that HRM are able to accomplish their function and organizational role as expected by the objective of the company. Therefore, at broader definition can describe the SHRM as a pattern whereby, planned human resources are applied and activities put in place in pursuit of organizational goals (Holbeche, 2009). This definition differentiates it with the human resource management by ensuring that it integrates the function of the human resource with strategic management process in achieving the company goals. This is done by ensuring that the employee of the company has been incorporated in the organization through boosting their performance. It also emphasizes coordination among different human resource management functions and practices that are able to integrate the organization with employees and the customers to ensure tat the company objective has been realized.
Therefore, SHRM gives clear exposition of interest, their variation as well as their interrelationship to several theories that are capable of discussing they impact competitiveness in the organization setup through ensuring that the performance of the employees are at their per. Through SHRM, it is possible to oversee the political and institutional determinant of the human resources management to a level that will enhance decision making in a company.
Strategic theoretical models of human resources management
In attempt to show the way the way strategic human resources management is applied to ensure that the employees performance is enhanced according to Armstrong 2000), six macro-level organization theories are to be discussed. They range from the field of organization, finance and economics. Four theories will be applicable to strategic human resources management decisions that will be incorporated in the organization to ensure that performance of the employees towards the attainment of their goals is increased. The other two theories are mostly inclined on the political and institution determination of various practices of human resources management. These theories explain non-strategic and non-functional determinants of the HRM to ensure that their roles are understood in the strategic management and specifically to ensure that their personnel are boosted their job morale.
SHRM ensures that the resources one being personnel acquire a competitive advantage to ensure that this is incorporated in the organization. This can only be attained through ensuring resource heterogeneity of a firm, which includes physical, human and organizational capital, and firm resources immobility. The most volatile resources that may cause failure of all the others are the human resource (Millmore, 2007). By altering the management skills, either an organization can increase their morale and therefore increasing their performance or they can be killed off their morale to thus decreasing the competitive edge of the company. The following theories are explored to ensure that this competiveness in an organization and the way they affect the performances of the employee.
Behavioral perspective theory
This theory focuses on the behavior of the employees in coherent with company strategy to enhance performance in the organization. It shows that employment practices are mainly to ensure their attitudes and behaviors are controlled to ensure that they perform. Their behaviors are turned around to ensure that they are kept in a competitive edge to minimize labor turn over in the organization to increase the company consistency in production output.
The altitude of people in the organization depends on specific altitudes and behaviors that are specific to the organization. To improve the competitiveness of the employees in the organization, this theory suggests that several things have to be done to the employees. There must be rationale linkage through ensuring that they are able to do innovation that will make the organization be at competitive edge(O'Connor, & Hernandez, 2009). The other strategy is ensuring that their work quality is enhanced through training and ensuring that the reduction of cost is incorporated to make sure that the organization has an impact in competitiveness of the market place through employees' performance.
Cybernetic systems theory
This is a theory that ensures that the human resource management provides required input to the business to ensure that it has competitiveness in the business sector. This ensures that by providing these inputs to the systems, it is ensures that the organization has good output at the end. This theory postulate that each individual in the organization is engaged in patterned activities with an aim of producing common output. The system ensures it is capable of providing several inputs to the employees to make sure that they are ion a competitive edge in their execution of the job. Such inputs as money and technology are paramount as discussed in this theory to ensure that they are able to have as little strain as possible. By embracing technology, the employees have an advantage of executing their service faster and better therefore increasing their performance. The system also talks of transformation of energy within the system to ensure that the execution of the work inn the company is done with ease.
By the application of input-throughput- output model in the organization, the human resource is capable of controlling the employee's behaviors towards good performance of the company. This is by ensuring that the turnover of the product is improved in the company and labor turnover is lowered. The model suggests that the competence of the employees to deals with the competition of the organization depends with the ability of the human resource to ensure that they have necessary skill to deal with the jobs they are executing (O'Connor, & Hernandez, 2009). Therefore, this ensures that the organization has the ability to negotiate with the employees tom ensure that they have been handed appropriate knowledge, skills, and the ability to execute appropriate business plan in pursuit of competency in their job. Therefore, cybernetics theory ensures environmental and internal adjustments and monitoring to ensure that it creates impact on the way the employees perform in the company to bring it to a competitive edge.
Agency /transaction cost theory
This theoretical model approach is a strategic management literature that has been applied to explore employees' behaviors. This theory explores the finance and economics human exchange in the pursuit of ensuring employees competency. This theory tends to study the diversification of the employees in strategic management and internalization and restructuring the employees' ability in pursuit of their ability to increase their performance (Millmore, 2007). This theory is responsible of linking the variable that appears in the organization through different approaches of the employees group at all the organization level.
The other aspect of strategic human resources management theory that will ensure that an organization sees an increase of its employee performance to the extent of benefiting an organization against its competitors is the Resource-Based View (RBV ) of the firm, which is a theory that states that each and every organization has got its own unique resources that can be used by the organization to overcome or keep at per with its competitors , and the resources in this case to the human resource manager are the employees of the company / organization. Therefore In order for the company to realize an increase in the Employee's Performance, (Storey, 2007) strategic human resources management is put in place in order for the employee's performance to be increased in the organization and with an improvement on the employees performance this will automatically ensure that the company is able to reduce some of its weaknesses or / at the same time offer stiff competition to its competitors (Priem & Butler, 2001).
In strategic human resources management, the human resource manager should be able to check on the best measures that can be used by the company to overcome the competition that is being offered by its competitors, therefore in the Resource -Based View the human resources will have to employ his/ her powers in ensuring that all the employees are motivated in order to improve there performance, (Priem & Butler, 2001) and when the organization is hiring its new employees the human resources manager and his team should make sure that they pick the best qualified people personnel that will be in a position of offering the company competitors with stiff competition thus making the organization the best and top performing against its competitors in its line of operation (Priem & Butler, 2001).
In order for the organization to have a long-term performance record the company has to apply Resource -Based View theory (RBV) this will be more applicable if the organization offers its employees with the relevant equipments that will ensure that the employees have the right working atmosphere and at the same time ensure that the employees have the best machines/ equipments that will enable them to enjoy and perform there jobs with ease and interest, with these measures put in place the employees will be happy in the work place and at the same time there performance will rapidly increase resulting to improved output of the employees , (Storey, 2007) thus ensuring that the competitors of the company aren't able to compete with it as its goods / and services are outstanding, a good example is when in a Gold mining company where well trained employees who provided with mining equipments and they are assured of compensation incase of any injury while on the work place , the employees will be delighted with the company as there output will be increased thus offering the other mining companies with competition(Priem & Butler, 2001).
Resources Dependence Theory (RDT) is another theory that should be implemented in order to realize an increase of employee performance, Resources Dependence Theory studies on how the external resources of an organization affect the behaviors of employees of a given organization; the theory claims that the surrounding atmosphere of an organization will affect the behaviors and motivation of the employees (Selznick, 1979).
Resources Dependence Theory assumes that all the organizations depends on the constant of resources, in most of these cases the employees performance is reduced due to lack of money, (Salancik, 1979) skill and technological equipments when conducting there job, and without these elements in place the employees productivity will go down to the extent of the company failing to perform its function because of the unmotivated employees.
The human resources manager should be able to make an evaluation of how the other companies motivate there employees, this will in the process help the organization to know on the ways the competitors evaluate motivate there employees, thus making the human resources manager provide the companies employees with the basic requirements that will ensure that the employees will be having a good flow valuable resources, in that the human resources manager will improve the employees performance by offering them increased salaries that will make the employees perform thus enabling the company perform better than the competitors(Salancik, 1979).
Technology is another reason that will enable the company to be very competitive with its competitors, the human resources manger should be in a position of providing its employees with the relevant technological devices that will ensure that the company employees are well motivated to the extent of doing there job effectively, this will eventually make the employees improve on there performance thus making the organization have an improved ability that will offer its competitors with the stiff competition to the other company (Salancik, 1979).
The human resources has to expose the his / her employees with thorough training that will make the organization compete strongly with its competitors therefore the training will ensure that the employees are well motivated to the extent of improving there performance of the organization and also increasing the performance of the employees. As in the case where the human resources offers the employees with proper recruiting board members for its employees, have set correct production structures, (Salancik, 1979) have sufficient external organization links and have other sufficient organizations strategies that will make sure that the workers are motivated and at the same time there productivity is improved and also offers other organizations with the required competition.
The last strategic human resources management theory to be employed is the Institutional Theory. Which in this case the theory will mainly focuses more on the aspect of social structure of the work environment, (Garson, 2008) which in this case will include the aspects of the rules, norms, routines, schemes that will be there to ensure that the social behaviors of the employees in the work place are well taken care of in order to make sure that the workers are more productive than other companies.
In the theory is was conducted in prisons were it emphasized on the importance of the prisoners to the prison warden, thus clearly indicating that the nature of an individual is clearly influenced by the cultural beliefs, myths, symbols and informal arrangements of the organization, (Garson, 2008)therefore this case the human resources manager has to implement some beliefs that will have a positive impact to the employees and at the same time ensure that the practices put in place will provide an atmosphere in which it will thrive and defeat its competitors as the organization will be providing its employees with the atmosphere that will make the company and workers to provide competitors with the required competition(Garson, 2008). a great example is when the organization subjects its workers to be more freedom of communication and expression to the top managers freely this will make the managers and the employees feel motivated as they will be in positions that will make them feel appreciated with the top managers thus resulting to the employees being more productive and in the process company realizing a lot of strengths than it competition (Garson, 2008).