This chapter consists of the review of literature on research and writings that are relevant to the topic. The last section is a summary, synthesizing the researcher’s findings based on the literature reviewed.
The Performance Crisis
According to Connellan (1978), today’s organizations face a performance crisis, a problem of increasing magnitude. As a result, managers are now considering ways to best utilize the human resources of the organization. Managers also realise that if an organization is to maintain or improve overall performance, then the performance of the people within the organization must be the first to improve.
Chapter one has already alluded to the fact that all senior managers are now talking the buzz language of “our people are our greatest asset” and “maintaining competitive advantage” in realising their organization’s goals. As a result of the paradigm shift in the priority list of organizational assets, focus is now more than ever on how to develop this HR asset to optimise performance. Connellan (1978), further highlighted the paradigm shift when he noted that the majority of organizational problems are related to human performance. Yet, more attention and resources seem to have been directed toward solving technical and logistic problems.
Consequently, the study sought to explain and predict perceived barriers to enhancing employee performance. In particular, the study intends to provide a comparative analysis of the perceptions of the human resource (supervisor and employees) to improved performance.
The review of literature is aimed at describing public sector performance and the strategies of HRD that can be applied to enhance performance.
Research has observed that today’s organizations are no longer satisfied with their employees merely performing their duties diligently and faithfully on a daily basis. Most organizations require their employees to be committed toward achieving organizational objectives and working as part of highly effective teams, thus performing at their peak levels (Coetzee, 2005).
10
Public Sector Performance
According to Van Thiel (2002), of late, more attention, time, and money are being spent on performance measurement and evaluation in the public sector than ever before.
Seemingly, all levels of the public sector agree on the issue of performance measurement and evaluation. The different levels of the public sector include schools and universities, local governments, and other administrative agencies regarding the issue of performance, its effects and influence in shaping any country’s economy. Consequently, measuring output, outcomes, and evaluation of activities are now important elements in statements by politicians and administrators who are concerned about improving government’s performance.
However, many reasons can necessitate the need to improve public sector performance. The reasons are in response to various changes, new advancements and, most importantly, staying abreast in terms of competitiveness. Blaine and Harshak (2003), noted that in today’s economic environment, achieving heightened performance and efficiency are more important than ever to improve competitiveness, deliver better service, and reduce costs.
Public sector performance has been a focus of researchers for many years. The reason behind this is the difference of efficiency level between private and public sector organizations. Ali (2011), argues that it is necessary to distinguish between two types of performance;
1. Standard performance is the typical level of output an individual delivers in the normal course of fulfilling a role. This level of performance is influenced by the hygiene factors, which do not drive productivity but whose absence (or negative perception) can destroy motivation.
2. Elevated performance is derived from an individual exerting discretionary effort and
“going the extra mile” because of their commitment to the team/organisation and its mission and objectives.
Research by Fernandez & Moldogaziev (2011), pointed out the fact that, clearly, organisations would prefer that their employees deliver elevated performance in order for the organization to be at a competitive advantage. For more than a decade, public organizations have been adopting employee empowerment with the aim of improving performance and job satisfaction and promoting innovativeness.
11
The performance paradigm of human resource development (HRD) practice has served the field well, particularly in enhancing the relevance and impact of HRD interventions as noted by Holton III & Yamkovenko (2008). Nonetheless, some very important questions still need to be addressed regarding public sector performance. The questions include issues such as whether delivery of public services is improving or not. Also arising is a quest to compare performance in similar public sector bodies as well as enquiring if performance targets are being met. Other questions that still require answers are surrounding the issue of resource allocation as well as the sustainability of the operations of public sector bodies (Byrne, 2012).
Governments of the Organization for Economic Cooperation and Development (OECD) countries are under pressure to improve public sector performance and at the same time control their spending. Meanwhile, no blueprint has been developed for enhancing public sector productivity, OECD countries have adopted diverse approaches to reforming key institutional arrangements. Empirical evidence is said to have, among other institutional factors, suggested appropriate human resource management practices as a means to improve public sector performance (Curristine, Lonti and Joumard: OECD, 2007).
Employee empowerment has been flaunted as a management approach that enables businesses to increase competiveness, innovativeness, and responsiveness to customers. In the public sector, empowerment is similarly viewed as a means for improving the quality of public services and unleashing the creative talents of public employees. Furthermore, Fernandez & Moldogaziev (2011), highlighted that empirical findings indicate that simultaneously sharing power, information, resources, and rewards with employees improves effectiveness and productivity, organizational commitment and job involvement. Only a handful of empirical studies have examined the consequences of employee empowerment in the public sector. The same authors further propose a model of perceived performance that is tested. Perceived performance is an end result of a combination of factors, being practice, sufficient resources, knowledge sharing, cooperation at work, physical conditions, organizational rating, supervisory status, location, minority and age.
Within the Swazi government, under the Ministry of Public Service, one of the many objectives of the HR Department is to stimulate employees so as to enhance performance and productivity. Therefore, enhancing performance calls for an understanding of the employees’
perceptions of barriers prohibiting their optimum performance (www.gov.sz).
12
Strategic Human Resource Development (SHRD)
By definition, Strategic Human Resource Development (SHRD) refers to the strategic management of training, development and management/ professional education interventions, so as to achieve the objectives of the organisation while at the same time ensuring the full utilisation of the knowledge in detail and skills of individual employees. SHRD is concerned with the management of employee learning for the long term, keeping in mind the explicit corporate and business strategies (McCracken & Wallace, 2000).
Other authors claim that “strategic human resource development” is difficult to accept, choosing the “softer” expressions such as “employee development”, or “training and development”. However, the phrase now has considerable international currency and is used widely in the Human Resource Development (HRD) literature to mean the planned learning and development of people as individuals and as groups to the benefit of the business as well as themselves (Garavan, Costine & Heraty, 1995).
SHRD has received increasing research attention in recent years and this concept has been examined at multiple levels including individual, organizational and national. SHRD can provide a useful framework for leadership in designing HRD interventions that will ultimately contribute to the improvement of performance in the public sector (McGuire, David & Watson, 2007).
SHRD focuses on incorporating HRD activities within organizational goals and values to develop core capabilities that enhance firm competitive advantage. When HRD does not have a strategic role to play in the organization, HRD professionals’ knowledge of learning and performance may not be capitalized on; individual and collective learning may be difficult to achieve (Garavan, 1991).
Discovering the relationship between HRD and SHRD develops a curiosity over what the difference between the two is. The first person to have defined HRD described HRD as organized learning experiences in a definite time period that lead to an increased possibility of improving job performance growth (Yorks, 2005).
Authors define HRD as the framework for assisting employees develop their personal and organizational skills, knowledge, and abilities. HRD includes such opportunities as employee training, employee career development, performance management and development, coaching, mentoring, succession planning, key employee identification, tuition
13
assistance, and organization development. A growing body of literature is available on the emergence and growth of human resource development (HRD) and in particular HRD with a strategic focus. HRD is seen as a way of forging a relationship between human resources and strategy (Heathfield, http://humanresources.about.com).
Nadler and Nadler (1989), define HRD as organized learning experiences provided by the employer, in a specified period of time for the purpose of increasing job performance and providing growth for individuals. Human resources development is a continuing process comprising three interdependent components:
1. Investment in human resources to enhance productive capabilities.
2. Utilisation of those human resources to produce increased output.
3. Participation of the human beings who have improved resources (better education, better skills levels etc.)
Figure 2.1 The Components of HRD. Adopted from Developing Human Resources. Nadler
& Nadler (1989). Copyright 1993 by John Wiley & Sons Ltd.
Sustainable human resources development must involve all three components, as illustrated in the diagram. Effective organizations have employees who are committed and make contributions to organizational success (Marsick & Watkins,1999).
Hale (1991), pointed out that human resource development (HRD) professionals support organizational learning in order to establish performance expectations, address higher-level problem-solving skills, and account for societal outcomes. Thus, strategic HRD involves long-term development of people within the organization that fosters continuous organizational effectiveness.
Strategic HRD can be viewed as a proactive, system-wide intervention, with it linked to strategic planning and cultural change. This contrasts with the traditional view of training and development as consisting of reactive, piecemeal interventions in response to specific
Utilisation of human
14
problems. HRD can only be strategic if it is incorporated into the overall corporate business strategy (Gilley & Maycunich, 2000).
The traditional view discussed above is true for the public sector, especially in the government system of Swaziland. However, after the global recession of 2008, governments are committed to providing proactive solutions to challenges. However, successful change evolves not just from a “top-down” approach, but also from a “bottom-up” approach that takes into account the perceptions of the barriers that supervisors and employees encounter in their everyday work life.
SHRD is concerned with the management of employee learning for the long term, keeping in mind the explicit corporate and business strategies. Garavan (1991), states that when we say "strategic" we are referring to the effectiveness of the training and development programs in improving the ability of employees to perform their jobs well, thus, increasing productivity. The better they perform their jobs the higher the organization's productivity.
Garavan (1991), further highlights that Strategic Human Resource Development also means identifying and preparing capable employees to take up more responsible positions whether fairly soon or in the near future. Employees so identified are provided with adequate training of the right type.
Specific reasons have been identified as the main motivating factors for the increased interest in developing the human resource to create and maintain competitive advantage. The critical areas, according to Carbery & Garavan (1995),are to be taken into consideration by organizations as they face the future. Technology is advancing at a frenetic pace, especially in relation to the transfer and accessibility of information and the increasing ease of establishing communication networking facilities. The continuing removal of trade barriers and tariffs, the consequent globalization of markets, the volatility of consumer demand within existing markets, currency fluctuations and political upheaval are by now familiar characteristics of an environment where all is flux. The capability of people to cope and manage within such an environment is a vital element in the success of any business and ultimately a determinant in national economic performance. The new business context is prompting senior management to take a greater interest in the development of their organizations’ human resources.
The interest is not only in the private sector but also to the public sector as the focus has shifted from mere service delivery to include business orientation in government
15
operations. In research by Shanahan et.al (1995), some triggers that have generated the increased interest in developing human resources are further explained.
1. Difficulties in recruiting skilled, competent managers 2. The need to develop a more flexible and adaptable skill base
3. A demand for leadership and team building skills at all operational and administrative levels
4. A requirement for all organizational functions to adopt a strategic focus 5. The need to integrate the potential of all employees with business objectives 6. A greater emphasis on performance evaluation and management
7. The increasing necessity for human resource and succession planning.
Informed by the foregoing discussion of what entails SHRD, the discussion also suffices to point out that HR practitioners therefore, need to identify and address the perceived barriers to enhanced performance so that they can be successful in implementing the various functions of SHRD aimed at removing the barriers thus, enhancing performance.
Linking SHRD to Strategic Human Resource Management (SHRM)
Within most formulations of human resource management (HRM), training and employee development represented the vital if not the pivotal component. Researchers argued that the cases for strategic approaches to training and development are easily made if human resource management is to have significant meaning (Garavan, 2007).
A study by McLagan (1989), developed an HR Wheel that demonstrates the link between the primary functions of HRM and HRD. The HR wheel helps to understand how the functions of HRD and HRM are intertwined to ensure individual and organizational development.
16
Figure 2.2The HR Wheel. Adapted from Human Resource Development, DeSimone &
Werner (2012). Copyright 2012 by Cengage Learning.
HRM can be regarded as a general approach to the strategic management of human resources in accordance with the intentions of the organization on the future direction it wants to take. HRM can also be defined as all those activities affecting the behaviour of individuals in their efforts to formulate and implement the strategic needs of business (Abu Qayyas, 2007).
The business dictionary defines strategic human resource management (SHRM) as proactive management of the employees of a company or organization. SHRM includes typical human resource components such as hiring, discipline, and payroll, and also involves working with employees in a collaborative manner to boost retention, improve the quality of the work experience, and maximize the mutual benefit of employment for both the employee and the employer (www.businessdictionary.com).
SHRM is also an approach to making decisions on the intentions and plans of the organization concerning the employment relationship and its recruitment, training, development, performance management, reward and employee relations strategies, policies and practices. The key characteristic of strategic HRM is that it is integrated. SHRM further refers to the overall direction the organization wishes to pursue in order to achieve its goals through people. Authors argued that, because intellectual capital is a major source of competitive advantage, and in the last analysis it is people who implement the strategic plan,
17
top management must take these key considerations fully into account in developing its corporate strategies (Leolingham, 2000).
The focus of both SHRD and SHRM is becoming more clear and evident as relating to both performance and competitiveness of the organization. Five approaches to strategic HRM are identified which include the resource-based strategy and achieving strategic fit.
Another approach focuses on high-performance management as well as high- commitment management. The fifth approach emphasizes high-involvement management (Raghunath, http://humanresourceinfo.com).
The rationale for strategic HRM is the perceived advantage of having an agreed and understood basis for developing approaches to people management in the longer term.
Underlying this rationale to removing perceived barriers to enhanced performance supplies a perspective of inclusive identification of the critical issues to ensure success factors related to people can be addressed (Leolingham, 2000).
Linking Performance Improvement and SHRD
Several authors have attempted to provide a clear link between the concept of improving performance, either individual or organizational, with strategic human resource development. In their research, DeSimone & Werner (2012), stated that performance management (as one of the SHRD strategies) is a continuous process of improving performance.
Moreover, in trying to understand the link between performance improvement and SHRD, to acknowledge the relationship between individual and organizational performance is also important. The two cannot be considered in isolation, as Swanson & Arnold (1996), would argue that HRD should focus on increasing performance of the organization which basically refers productivity of the people within the organization.
The preceding argument, therefore, highlights the fact that today’s organizations which are less hierarchical and more service-oriented, will pay attention to how well their employees perform (Robbins & Judge, 2013). Moreover, HR practitioners are potentially able to make an organization more productive by closing the human performance gaps between exemplary performance and typical performance (Gu Lee, Park & Yang, 2010).
18
In the same manner that individual and organizational performance is considered, the same applies for Human Resource Development and Human Resource Management. The former is a subset of the latter. Hence, Cooke (2000), noted that a variety of predominant theories that attempt to provide a link between HRM and performance are centred on the types of strategies that have been identified to lead to superior performance.
To strengthen the argument of the link between performance improvement and SHRD, Cooke (2000), focused on three causal routes in HRM that can be used as a basis for determining good or high performance. These routes relate to the specific SHRD strategies discussed earlier.
1. Increasing employee skills and abilities (systematic training & learning strategy) 2. Promoting positive attitudes and increasing innovation (culture building &
communication strategy)
3. Providing employees with expanded responsibilities so that they can make full use of their skills and abilities (accountability, ownership & performance management strategy)
Specific HR Strategies
A number of strategies are identified in literature, which set out what an organization intends to do in certain areas of the HR function. A study by Bersin (2006), identified talent management as the most important buzzword in the field of corporate human resources and training today. Talent management refers to the continuous and integrated process for recruiting, training, managing, supporting, and compensating the employees in an organization. The question of how the organization intends to win the war for talent in the market is set out in talent management.
Continuous improvement provides a focused and continuous incremental innovation that can be sustained over a period of time. Wheatley (Cornell University), emphasized that continuous improvement provides a synergy and power that results from aligning purpose, people and values in an organization.
Knowledge management on the other hand is concerned with the creation, acquisition, capture, sharing and utilising knowledge to enhance learning and performance.
Newman (1991), also defined knowledge management as the collection of processes that govern the creation, dissemination, and utilization of knowledge.
19
Popularly referred to as recruitment and selection, resourcing is about attracting and retaining high-quality people. According to Price (www.hrmguide.co.uk), resourcing allows management to determine and gradually modify the behavioural characteristics and competences of the workforce.
Providing an environment in which employees are encouraged to learn and develop to increase their knowledge base is also an important strategy, known as learning and
Providing an environment in which employees are encouraged to learn and develop to increase their knowledge base is also an important strategy, known as learning and