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Individual Human Resources Practices Affecting Firm Performance

Individual Human Resources Practices Affecting Firm Performance. HR Practices. Positive Performance Effects. Compensation. Productivity (lagged), growth. Broad-based stock options. Performance relative to industry (P), sales and customer satisfaction (in upscale markets).

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Individual Human Resources Practices Affecting Firm Performance

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  1. Individual Human Resources Practices Affecting Firm Performance HR Practices Positive Performance Effects Compensation Productivity (lagged), growth Broad-based stock options Performance relative to industry (P), sales and customer satisfaction (in upscale markets) Incentive-based compensation Profit sharing ROA, ROE, shareholder returns, survival Diversity Minority hiring during downturns Shareholder returns Employment Countercyclical hiring Shareholder returns Downsizing (employment and assets) ROA Early retirement programs Shareholder returns (with good returns prior to announcement) Employment security ROA Human resource outsourcing Financial performance (P), innovation (P)

  2. Individual Human Resources Practices Affecting Firm Performance HR Practices Positive Performance Effects Industrial Relations Shareholder returns Decertification elections (union retained) Productivity Positive labor relations (unionism) Strikes (11-29 days) Shareholder returns Internal Labor Market Internal career opportunities ROA (prospectors), ROE (prospectors) Motivation Decentralized decision making Operational outcomes (P) Open-book management Numerous reports of goals obtained (A) Participative decision making ROA (defenders), ROE (defenders) High-performance work teams Quality, labor productivity Reduced status differentials High-performance firm adoptions (A)

  3. Individual Human Resources Practices Affecting Firm Performance HR Practices Positive Performance Effects Performance Management Results-oriented appraisals ROA Staffing Cognitive tests Profit, sales growth, overall performance Selectivity Performance relative to industry (P) Succession of “outsider” CEOs ROA (with low firm diversification) Structured interviews Profit, profit growth Profit, profit growth, overall performance Validation studies Profit, overall performance WABs and BIBs Sales growth Yield analysis of recruiting sources Training Training Performance relative to industry (P), productivity

  4. Challenges of a Diverse Workplace • Impact on Work Groups • More creativity and innovation • Less Cohesion • Potential increase in conflict • Impact on the individual employee • Bias in evaluation • More difficulty in developing and maintaining professional relationships • Less satisfaction with the job • Higher rates of turnover

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