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The Importance of Human Resource Management

Powerful Essays
Armstrong (2006) defined Human Resource Management as a strategic deployment of an organisation's most valued assets; the people working there, who individually and collectively contribute to the achievements and the objectives of the business. Links between HRM and performance are predominantly focused on the following practices: sophisticated selection and recruitment methods, training, teamwork, performance-related pay and employment security (Wall, Wood, 2005). Products can be copied, methods of production can be changed and optimized, companies can move from one continent to the next trying to exploit geographical advantages however, the one inescapable truth is that a strong, talented workforce still exists as the most valuable asset in an organisation.

In general terms, it is possible to summarise HRM as being concerned ‘with maintaining and ideally maximising organisational performance and profit’ (Bernadin, 2007). This is accomplished by managing the human resources with a focus on expanding the customer base that gives profit to the company (Bernadin, 2007). Taking this to be true it becomes obvious why HRM is reasoned to influence organisational performance because, quite simply, HRM is integral to the functioning of each and every department in an organisation because ‘it can take direct influence on the people working there’ (Bernadin, 2007). The relationship between HRM and performance has been explained in numerous ways; however, the most rudimentary is that HRM practices are ‘additive’ (the more the better, e.g. Guest & Hoque, 1994), and that they enhance performance regardless of circumstance (a universal effect, e.g. Pfeffer, 1994 cited in Wall, Wood, 2005). Ichniowski et al. (1997) explain that when HRM pract...

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Wall, T, Wood, S, (2005) The romance of human resource management and business performance, and the case for big science. Retrieved 20th March from http://keats.kcl.ac.uk/pluginfile.php/643686/mod_resource/content/2/WallWood-RomanceHRM.pdf
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