CHAPTER ONE

INTRODUCTION

1.1 Background to the study

Human resources management practices have a significant impact on organizational performance. Human resource management (HRM) includes tasks like HR preparation, human resources management, strategic recruiting, employee training, growth compensation management, efficiency, worker relations, health care, employee satisfaction as well as provision of employee services. A meta-analysis by Jiang et al. (2019) confirmed that HR practices have a direct and positive effect on organizational performance. They found that high-performance work practices, such as employee involvement, training, and performance-based compensation, are associated with higher levels of organizational productivity and profitability. It includes policies and practices set to improve organizational efficiency, engagement of employees and work quality (Khan & Abdullah, 2019). The effective human resources practices at the higher education level helps to retain the best talented and skilled staff, develop the expertise and skills of academic staff and build an academic and inclusive higher education environment (Nguyen, 2019; Hendriarto et al., 2021; Suroso et al., 2021; Widjaja & Aslan, 2022). Additionally, a study by Delery and Doty (2020) highlighted the importance of strategic HR practices in achieving organizational performance. They argued that aligning HR practices with the overall business strategy can lead to competitive advantage and improved performance.

One key HRM practice that has been linked to organizational performance is recruitment and selection. By hiring the right individuals with the necessary skills and qualifications, organizations can ensure that they have a talented and capable workforce that is well-equipped to drive performance (Agarwala, 2019). Additionally, effective performance management practices that set clear goals, provide regular feedback, and recognize and reward employee achievements have been shown to enhance employee motivation and performance (Deler & Doty (2020). Moreover, training and development programs that focus on building employee skills and competencies have also been associated with improved organizational performance. By investing in employee development, organizations can enhance their overall capabilities and competitiveness in the market (Delery & Doty (2020). Furthermore, HRM practices that promote employee work life balance have been found to reduce turnover rates and increase employee satisfaction, leading to enhanced organizational performance (Alam et al., 2021).

Human resource management is the strategic and coherent approach to the effective and efficient management of people in a company or organization such that they help their business gain a competitive advantage (Brewster et al., 2022). It is designed to maximize employee performance in service of an employer’s strategic objectives being responsible for overseeing employee benefits design, employee recruitment, training and development, performance appraisal (DeNisi et al., 2022).

Statement of the Problem

The relationship between human resource management (HRM) practices and organizational performance has been a subject of extensive research globally. Effective HRM practices, which encompass recruitment, training, performance management, and relations, are crucial for enhancing productivity, job satisfaction, and overall effectiveness (Ajadi, 2022). Globally, organizations are increasingly recognizing that effective HRM practices are vital for achieving a competitive advantage. However, many organizations still face challenges related to the alignment of HRM with overall business strategies. A study by Jiang, K., & Liu, D. (2020), elucidated the gap between intended HRM practices and their actual implementation, indicating that inconsistencies can lead to employee disengagement and diminished organizational performance.