Advantages of Best Practice and Best Fit
Strategic Human Resources
Management
Advantages of Best Practice and Best Fit
Advantages of Best PRACTICE
Best practice will increase the skills of the current workforce, and with recruiting it will reinforce the culture of a highly skilled work force (Mullins, 2005). The best practice approach is often justified by arguing that consistency brings efficiency to the organization (Jennings et al. 2009) In the same way Best practices can be also viewed as a key theme in the development of strategic human resource management, and if all organizations are identified, have obtained a commitment to best human resource management practices and implemented these practices, then all organizations will benefit from it and see to the improvement of organizational performance. (Beardwell and Claydon,2004).
Best practice models can take many forms. Although some people advocate a common set of human resources practices to improve the performance of all organizations that apply them (Pfeffer, 1994, 1998),others focus on the high-commitment model (Walton, 1985; Guest 2001) And participatory practice (Wood, 1999), it reflects a basic assumption that a firm commitment to organizational goals and values will provide a competitive advantage.
According to Greer (2001) The human resources practice system has a positive impact on company performance. Overall, the employee skill system is significantly related to the increase in the total return on assets. Therefore, companies that use high-performance skills to enhance their practice systems generally have higher returns. In the same way Treen, (2000) explains that best practices improve the skills of existing employees in the organization and support the recruitment of highly skilled employees. High performance as a way of organizing work so that front-line workers participate in decisions that have areal impact on their jobs and the wider organization. (Armstrong, 2009)
Arthur,(1994) explains that Compared with the control system,the commitment system leads to higher productivity, lower scrap rate and lower employee turnover rate.
As per Armstrong, (2009) below mentioned are some characteristics of Best Practice.
ü Links the firm’s selection and promotion decisions to validated competency models.
ü A basis for developing strategies that provide timely and effective support for the skills demanded to implement the firm’s strategies.
ü Enacts compensation and performance management policies that attract, retain and motivate high performance employees.
Based on concepts from expectancy theory (Vroom 1964; Lawler 1971) best practice HR will result in higher levels of quality, productivity and low rates of absenteeism and wastage (Guest D 2001). In the same way ‘Best practice’ advocates positively value low turnover, this is because other related policies and procedures ensure that the right employees are chosen in the first instance. (Meloney and Morris, 2005)
Advantages of Best FIT
The best-fit model is
measured as a variation from standard models of Harvard, Michigan and York and
is called “matching model” for HRM (Sparrow and Hiltrop 1994).Human resource management has the "best fit" strategic aspect
or adapts personnel to the organizational needs expressed in the organizational
strategy, while others view human resource management as a means to improve
organizational performance (Beardwell and Claydon,2004).Gordon
and Kaswin,(2010) explains that best fit approach is most effective in the area
of attracting employees and employee retention. Beardwell and Claydon, (2004)
stated that The best-fit method means a built-in
capability that can flexibly adapt to changes in the external environment, so
that the business changes logically.
Stone, (1982) Describes a suitable selection tool for employees who
choose vacant positions, as shown below.
ü Interviews
ü Skill tests
ü IQ tests
ü Psychometric Test
ü Aptitude and competency bases assessments
ü Reference check & network interviews
The
most appropriate underlying premise is that the close integration of
organizational strategy with other systems (including rewards) can improve
organizational efficiency. Although the idea that
pay should be linked strategy is not new ( Schuster and Zingheim 1992, 1993).
According to Armstrong,
(2014) best fit will be more effective
if perfectly adopt to the policy of strategic configuration. In the
same way as Delery
and Doty, (1996) describes one of the other advantage of best Fit approach is
to focus on the relationship between unique patterns or configurations. Armstrong (2009) further explains that the
concept of best fit emphasizes the human resources strategy should be consistent
with the organization ’s background and environment. "Best fit" can be
understood through vertical integration or consistency between organizational
business and human resources strategy.
Video
: 1 Best fit and Best Practice
Source : acsendis.com
References
Armstrong, M ( 2009) A Hand Book of Human Resources
Management Practice, 11th Edition.
Armstrong, M ( 2014) A Hand Book of Human Resources
Management Practice, 13th Edition.
Arthur, J. B. (1994) Effects of human resource systems
on manufacturing performance and turnover. Academy of Management Journal, 27,
670-687.
Gordon, A.A. and Kaswin, J.L., 2010. Effective
employee incentive plans: Features and implementation processes.
Jennings,
J. E., Jennings, P. D., & Greenwood, R. (2009). Novelty and new firm
performance; the case of employment systems in knowledge-intensive service
organizations. Journal of Business
Venturing, 24, 338–359.
Mullins, L. J. (2005). Management and Organizational
Behavior.
Pfeffer, J. (1994) Competitive Advantage through
People. Boston, MA: Harvard Business School Press.
Pfeffer, J. (1998) The Human Equation: Building
Profits by Putting People First. Boston, MA: Harvard Business School Press.
Sparrow, P. and Hiltrop J.-M. (1994): European Human Resource Management in
Transition, Prentice Hall.
Stone, T.H., 1982. Understanding personnel management.
Dryden Press. Treen,
D. (2000), Strategic Human Resources, Ivey Business Journal, 64(3): 63-67.
Walton, R. (1985) ‘From control to commitment in the
workplace’, Harvard Business Review, Vol. 63, March–April.
Wood, S. (1999) ‘Human resource management and
performance’, International Journal of Management Reviews, Vol. 1.
Zingheim, P. and Schuster, J. (2002)
Reassessing the Value of Skill-Based Pay. WorldatWork Journal, 11(3), p. 72-77.
Agreed on your views. Adding further, though best fit and best practice has its own advantages Jeroen (2019) states that the best fit is more effective and practical than best practice. The author further explains that this is also the basis of evolutionary theory, where it is captured by the credo "survival of the fittest". He also evidenced the study of Global Innovation 1000 study & McKinsey’s Organizational Health Index, which concluded that the focus should be relatively small to have high concentration to achieve strategic alignments, heading towards organizational success.
ReplyDeleteThank you Kobigah for your value addition, it also was argued by Schuler and Jackson (1987) that to achieve the maximum effect it is necessary to match the role characteristics of people in an organization with the preferred strategy.
DeleteAnd in addition of that Both theories aim to achieve high performance in organizations. (SIKYR and Sekerin, 2018). Claim that these models could be classified as ‘matching models’ because of their common aim is to match the human resources strategy with that of the corporation. The best fit and best practice school of SHRM focuses on the fact that close alignment between organizational strategy and other systems is respected. Lawler (1995) states that all organizational systems must start with business strategy because it specifies what the company wants to accomplish, how it wants to behave, and the kinds of performance and performance levels it must demonstrate to be effective.
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