We believe in a holistic model of human resource management practices that integrate into each other as outlined below:
Many researchers such as Huselid et al, Patterson et al and Guest have proven a significant link between the overall human resource management (HRM) effectiveness and organisational performance.
For example Huselid (1997) found an increase of one standard deviation in overall human resources management effectiveness corresponded to:
Many other studies have found similar results and provide a compelling reason to invest in initiatives that enhance HRM effectiveness.
Watson Wyatt researched 30 human resources practices grouped into the following 4 areas and rated companies based on their excellence in these human resources practices and policies:
After surveying more than 400 publicly listed US companies and analyzing the relationship between the excellence in human resource practices and objective financial data.
The study found that over a 5 year period, total returns to shareholders were nearly twice as high for high rating companies (103%) as for low rating companies (53%), based on their excellence in HRM practices.
In addition they found excellence in selection to have the most potential for shareholder gain (10.1%) followed by clear accountability and rewards (9.2%), flexible work practices (7.8%) and communications integrity (4%).