New Models of High Performance Work Systems - Equality Authority

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new models of high performancework systems20 >3.2 Strategic Human ResourceManagement (SHRM)3.2.1 OverviewThe first theme examined is strategic humanresource management (SHRM). This hasbeen the traditional focus of HPWS research,and in many instances the term SHRM isused interchangeably with HPWS. SHRMis generally understood as a set of interrelatedHR practices that include staffing,performance management and remuneration,training and development, communicationand participation. The common theme in theliterature on SHRM is a set of practices thatprovide employees with skills, information,motivation and latitude, resulting in aworkforce that is a source of competitiveadvantage. Huselid’s (1995) landmark studyexamined the relationship between theuse of high performance work systems andcompany performance. His main finding wasthat greater use of these types of SHRMpractices was associated with decreasedturnover and higher levels of productivityand profitability. Similarly, Flood et al. (2005)highlighted the economic benefits associatedwith high performance work practices inpeople management, employee involvement,and training and development. 103.2.2 Measuring SHRMIn measuring SHRM practices, researcherslooked separately at two categories ofemployees. Group A comprised production,maintenance, service and clerical employees,while Group B comprised executives,managers, supervisors and professional/technical employees.For this study, 18 survey items werecompiled to create a SHRM Index, 11 whichresulted in each company receiving a singleSHRM score on the index. The 18-itemSHRM Index incorporated practices in areasincluding staffing, performance managementand remuneration, training and development,and communication and employee participation.Using the number of employees ineach occupational group, a weighted averagefor each practice was computed. The SHRMIndex had a Cronbach’s alpha reliabilityrating of 0.85, giving confidence that theSHRM Index was a reliable indicator of theextent of its SHRM practices at the timeof the survey, and represents a state-ofthe-artprofile of SHRM in medium to largecompanies in Irish industry.Table 3.1 highlights the 18 items and theiraverage score for each occupational group.The SHRM Index yields an average scoreof 48.81% across all companies and bothoccupational groups.10 In their report, Flood et al. (2005) categorised the three main areas as four components in terms of staffing, performancemanagement and remuneration, training and development, and communication and participation.11 Based on methodology employed previously by Huselid (1995), Guthrie (2001), Datta et al. (2005), and Flood et al. (2005)
workplace policies andpractices in irish industryTable 3.1SHRM Systems in Irish CompaniesSTAFFING:What proportion of your employees.....ScoreAre administered one or more employment tests(e.g., skills tests, aptitude tests, mental/cognitive ability tests) prior to hiring? 24.19%Are hired on the basis of intensive/extensive recruiting effortsresulting in many qualified applicants? 57.67%Hold non-entry level jobs as a result of internal promotions(as opposed to hired from outside of the organisation)? 34.37%Hold non-entry level jobs due to promotions based upon merit or performance,as opposed to seniority? 44.99%TRAINING & DEVELOPMENT:What proportion of your employees..…Have been trained in a variety of jobs or skills (are “cross trained”) and/orroutinely perform more than one job (are “cross utilized”)? 53.72%Have received intensive/extensive training in company-specific skills(e.g., task or firm-specific training)? 73.58%Have received intensive/extensive training in generic skills(e.g. problem-solving, communication skills, etc.)? 37.23%< 21PERFORMANCE MANAGEMENT & REMUNERATION:What proportion of your employees..…Receive formal performance appraisals and feedback on a routine basis? 67.32%Receive formal performance feedback from more than one source(i.e., feedback from several individuals such as supervisors, peers etc.)? 20.57%Receive compensation partially contingent on group performance(e.g., profit-sharing, gainsharing, team-based)? 34.44%Are paid primarily on the basis of a skill or knowledge-based pay system(versus a job-based system)? That is, pay is primarily determined by a person’s skillor knowledge level as opposed to the particular job that they hold 28.16%COMMUNIC ATION & PARTICIPATION:What proportion of your employees..…Are involved in programmes designed to elicit participation and employee input(e.g., quality circles, problem-solving or similar groups)? 36.88%Are provided relevant operating performance information (e.g., quality, productivity, etc.) 72.22%Are provided relevant financial performance information? 68.04%Are provided relevant strategic information(e.g., strategic mission, goals, tactics, competitor information, etc.) ? 67.41%Are routinely administered attitude surveys to identifyand correct employee morale problems?. 37.63%Have access to a formal grievance/complaint resolution procedure 96.17%Are organized in self-directed work teams in performing a major part of their work roles? 36.09%Average scoreHPWS Index 48.81%
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