Organization Behavior
Competitive Advantage through Human Resource Management Practices
Human Resource Management Practices
Competitive Advantage through Human Resource Management Practices
HUMAN RESOURCE Management
Human Resource Management involves all those activities which are related to the management of workforce or employees of an organization. It is also one of the core functions which managers perform at the workplace. Human Resource Management entails activities like recruitment and selection, training and development, performance assessment, compensation, leadership, and motivation at large (Chadwick & Dabu 2009). Basically, Human Resource Management focuses on recruitment, management, guidance, and motivation of employees in an organization. In the past, HRM was just restricted to two core functions: employee management and motivation. Now, it has emerged as one of the biggest strategic issues in the business world (Kandula 2007).
With the passage of time, the scope and functions of Human Resource Management have also increased. Now, it also involves employee safety, benefits and wellness programs, communication needs, cultural diversity management, and various other functions (Dowling & Welch 2008). HRM is also considered as a strong tool which can help an organization in strengthening its competitive standing in the marketplace. Industrial relations, organizational development, talent management, brainstorming, succession planning, and cultural diversity management are the major practices which can give an organization a competitive advantage in its industry.
This paper presents a comprehensive discussion on how organizations can realize a competitive advantage in their industry through human resource management practices. The opening section describes how the human capital can become a competitive strength for an organization followed by an extensive literature review and discussion on the contribution of different human resource management practices towards organizational competitiveness and sustainability. The paper concludes by highlighting the major outcomes of the discussion.
COMPETITIVE ADVANTAGE THROUGH HUMAN RESOURCE
Management PRACTICES
Every organization has a Human Resource department which is responsible for effective management and development of its workforce. It not only supervises the activities of all organizational members, but also takes part in various strategic decisions of the company. An effective Human Resource Management enables the organization's employees to work more productively and contribute towards the organization's success and competitiveness (Lengnick-Hall, Lengnick-Hall, Andrade, & Drake 2009). There has been a great debate on the importance of Human Resource Management for an organization. Researchers are now more ardent towards knowing the significance and contributions of HRM practices towards providing a competitive advantage to organizations. It is widely believed that the success of organizations in each of their functional areas and business affairs is largely dependent on the performance of their workforce. The knowledge, skills, and competencies which organizational members possess ultimately benefit the organization in serving its customers in a more effective and efficient way and building strong relationships with its stakeholders (Armstrong 2007).
How Human Resource can become a Competitive Advantage for an Organization?
Researchers believe that the biggest and the most precious asset which an organization possesses is its manpower or human resource. This asset can make a real difference if the organization truly shows a deep concern towards its efficiency and development. An organization may possess highly advanced technology, strong financial position, or large customer base. But these are the strengths which can also be possessed by many other organizations in the same industry. The real and long-term source of competitive advantage is the human resource of the organization. Human resource can give all types of competitive strengths to an organization. For example, it can give creative ideas, bring innovation, improve the organization's sales and financial performance, and make it stand among the most successful organizations in the industry (Seymen 2006). Human Resource is the only asset of an organization which can benefit the organization in all its activities and business affairs. Moreover, it can help the company in building and maintaining strong relationships with its customers, supply chain members, regulatory bodies, and other key stakeholders.
Although every activity and practice in the Human Resource Management is aimed towards improving the organization's performance in one way or another; there are certain practices which can truly provide a competitive advantage to the organization and contribute towards its success, prosperity, and sustainability in its industry (Klett 2010). These HRM practices are now discussed below in detail:
1. Recruitment and Selection:
Recruitment and selection of employees is one of the core functions of Human Resource Department. The basic purpose of this exercise is to find...
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