7CO02 How do they benefit employers and employees. Do they benefit equally? How?

Question 8 (AC2.4)
Explain the view that high-performance work practices benefit both employers and employees when they are introduced or enhanced. Illustrate your answer with examples.

(Some pointers):

  • Start with the definition of high performance work practices
  • How do they benefit employers and employees. Do they benefit equally? How?
  • Give specific examples

From Study Guide:

Links between people practice and employee outcomes (satisfaction, commitment, engagement, wellbeing, retention, absence). By now, you should have already covered a great deal of research and readings on approaches and models to HRM.

In this Assessment Criteria we will explain how high-performance work practices are associated with positive organisational and employee outcomes. High-performance work practices (HPWPs) You will find many examples of High Performance Working Practices but for this study guide we are using the best practice 7 components by Pfeffer (1998). If you have all of these components then you are more than likely to create high performance work systems.

A growing body of research evidence confirms that ‘HPWS’ are worth the investment of time and effort. Aligning human resource practices to treat employees as valued owners and partners adds value and optimises opportunities to create and maintain competitive advantage. So what makes HPWPs work?

  • Commitment of the top management team and leadership are responsible for creating an aligned and committed corporate culture that is essential to creating an effective HPWS organisation
  • Organisational leaders who adopt aligned HPWS systems are rewarded by employees who are more committed to their organisations and more willing to engage in discretionary behaviour that are key to profitability and competitive advantage
  • Leaders need to be committed to values that resonate with employees, and embody those values in their own lives · The notion of employees as owners and partners
  • The importance of organisation fit · Getting ‘the right people on the bus’ · Delegating and empowering employees
  • Creating an organisation-wide culture of learning (Adapted from Caldwell and Floyd, 2014) HPWS are a combination of best-practice and contingency approaches to HRM. HRM practices are typically ‘outside/in’ and are concerned with both vertical alignment and vertical integration. Research such as Understanding the black box (Purcell et al, 2003) looked to prove the relationship between HPWS and improved organisational performance. Let’s now discuss HPWS’s impact on employee outcomes/experience 39 ©Watson Martin 2022 Assessment criteria 2.4 indicative content lists the positive employee outcomes as being related to HPWS. · Satisfaction · Commitment · Engagement · Well-Being · Higher Retention · Lower Absence.

Let’s debate these outcomes further. Satisfaction – does this mean job satisfaction or satisfaction with reward etc? Satisfied means basic needs are met, does it really say that these can’t be improved? It means that satisfaction is good enough to be taken off the table. Commitment – it goes without saying that if employees receive best practice HRM they are likely to show discretionary effort and commitment to the organisation, particularly when they are treated like partners and shareholders in the business. Engagement – what is engagement and what makes it different to motivation? Engagement is longer term than motivation.

Well-being – happy people keep well – is that true, is it proven? Not having to worry about job security or reward and not feeling stress in the job, only the discretionary effort that you want to put in, may not increase well-being but it certainly wouldn’t be a detriment to wellbeing. Flexible working and agility and flexibility are more likely to increase well-being. Retention – this is one to be careful of as no organisation wants to keep poor performers, so this is finely balanced with performance management systems.