Human Resources has developed significantly in recent decades and continues to do so. Nonetheless, key human resource best practices have endured over time, acting as a guide for human resource practitioners. But what exactly do they comprise, and why are they so crucial? In this post, the discussion of the best human resource practices will be further explained to ensure excellent HRM.
Human Resource Management
Human Resource Management (HRM) is defined as the policies and procedures necessary to carry out the routines of human resources in a company, such as staff development, performance management, remuneration management, and fostering employee engagement in decision making.
Related: What is human resources management?
What are human resource practices?
Human resource practices are strategic endeavours in nature. They act as a vital navigation system in conjunction with your executive business plan. The basis for how your company's human capital will perform on your behalf is formed by key HR practices.
HR practices include developing a method for reviewing and measuring the advantages of a certain employee incentive program. Other examples include developing a program to decrease work-related injuries and establishing a framework to assure compliance with employment rules.
Human Resource Practices vs Human Resource Activities
Before we get started, it's crucial to grasp the difference between HR practices and HR activities because the two might be confused if we don't. Both are required for an HR department to attain its full potential and for an organization's human capital investment to be maximized.
HR practices are concerned with HR's strategic operations. They should be in line with the executive business strategy and serve as a basis and guide for managing the company's personnel.
Some examples of HR practices include:
- Establishing the HR department's objective and aims
- Fair and performance-based compensation
- Assessing the effectiveness of programs
On the other hand, HR activities are the everyday actions used to put HR practices' strategies into action. They enable the HR department to achieve its mission and objectives.
HR activities may include:
HR practices and HR activities address what a company wants to accomplish and why it wants to do it. HR practices should lead to HR activities in a logical evolution, with actions corresponding to practices. An organization should not consider one more important than the other or to even leave out one, as this will disrupt the effectiveness of what the organization could become.
Human resource departments prosper when their human resource best practices and activities are integrated and coordinated, allowing the organization to benefit.
Human resource best practices
Human resource best practices are the notion that there are universal HR principles that provide firms with optimal business success regardless of the company or sector.
In HRM studies, there are two schools of thought on managing people. The best fit is the first, and human resource best practices are the second.
- According to the school, the best fit Human resource policy should coincide with corporate goals. Translating to the HR team focusing on not only the organization's demands but also on employee demands.
The best fit should not be overlooked. HR goals should be aligned with your organization's overall goals so that HR, business, and strategy departments are all on the same page. You're implementing strategic human resource management when you can combine these two notions and achieve human resource best practices and best fit.
- The human resource best practices school argues that a set of universal Human Resource best practices lead to greater organizational performance. According to proponents, specific bundles of HR operations, independent of the organizational context or sector, help organizations achieve a competitive edge.
What are examples of human resource best practices?
1. Providing security to employees
The first Human Resources best practice is job security. Work is a steady aspect of most people's lives since life is unpredictable. People come to work primarily to have a job to support themselves and their people.
Between the employee and the employer, there is a legal contract (work in exchange for money) and an informal contract (you put in some further effort, we take excellent care of you). Employees who have a secure job may go home after work and care for themselves and their families. Security is a fundamental idea that underpins nearly everything HR does.
When job security is compromised, such as during a restructuring or layoff, the consequences are felt immediately throughout the firm.
Organizations gain from job security because it helps them retain their employees. For example, when employees are laid off, the organization generally suffers the most. They're the ones that put money into hiring and developing these individuals. This is an expensive procedure. If the company makes little effort to retain its employees, they are more likely to depart and work for a rival.
2. Selective hiring: Hiring the right people
A business can't just hire everyone; it needs competent candidates. Great people are sought after by companies because they add the most value. This is due to regulatory constraints, organizational diversity goals, and the fact that a more varied workforce is more representative of society. Building a disciplined and fair selection procedure should be prioritized as well. This may be quite useful in gaining a better grasp of overall consumer behaviour and the demands of various consumers.
According to research, the difference in performance between an average and a great performer might be 200-400%! This is true for a wide range of enterprises and careers.
Recruiting the right people is important to achieving a competitive advantage.
We may utilize various recruitment techniques in today's digital age to make the best choice. More and more businesses closely monitor their recruiting metrics to assess how well they are performing.
Common selection tools include reference checks, organized and unstructured interviews, IQ testing, and personality tests. These (pre-employment) assessments uncover three crucial candidate attributes.
- Capability: Can the person perform the job? Does the individual possess the necessary technical and soft skills? Is the person qualified for the position?
- Trainability: Can this individual be trained to enhance their skills? Does the person have the ability to learn and grow?
- Commitment: Will the employee be dedicated to their work and to the organization? Will we be able to keep this individual after they have gotten up to speed and is fully functional?
3. Self-managed and effective teams
We all know that reaching goals requires collaboration. When it comes to establishing success, high-performance teams are essential for every firm.
Teams provide value because they bring together people with varied experiences and viewpoints to work toward a common goal. This suggests that multiple ideas are produced to help attain the goal. The greatest ideas are then picked after they have been evaluated and blended.
Cognitively varied and psychologically secure teams are the most effective. This implies that team members may come up with unique ideas and feel comfortable sharing them and discussing them.
Building and nurturing high-performance teams is one of HR's primary responsibilities. Belbin's Team Role Inventory is a well-known instrument for team formation and cooperation. Effective human resource management (HRM) immediately supports teamwork by including employees in the formation of teams. This may be done in a variety of ways. Some methods include evaluating team performance and recognizing team excellence.
Personality tests can also help you understand how other team members think and act. One of a manager's major tasks is to understand these procedures. This is why many management courses concentrate on it.
Different tools make collaborating easier. Communication software, feedback tools, project management tools, and other task and goal planning software are just a few examples. These can help teams communicate more effectively and efficiently.
Finally, HR must encourage the organization's various units to collaborate. A team is frequently a subset of a larger entity, such as a department or another team. These larger organizations must also collaborate. Facilitating this allows a company to become more efficient and productive. Organizational Network Analysis is one of the strategies that may be used.
4. Fair and performance-based compensation
To begin with, if you employ the appropriate individuals, you'll want pay them above average. You want to maintain these people and pay them well since they are the most valuable to your company. However, there are certain downsides to paying someone more than the market wage. It deters bad employees from leaving.
If you're consistently hiring world-class workers, you'll need to pay above-average wages.
Financial (base) salary and employee benefits are examples of a fair compensation package. Market trends in your profession and neighbouring fields must be followed (many of the best employees may come from other career areas). This will help determine the average hourly rate and how your company fits within the compensation package.
Second, individual awards should be linked to the many contributions that employees make. These are performance-based incentives.
Individuals are driven to optimize this result by connecting organizational performance outcomes with individual rewards. It also gives the employee a sense of ownership.
Consider profit-sharing, shared ownership, and stock options as examples. These are fantastic approaches for building employee commitment to the company's long-term goals and keeping high-potential personnel. Compensation is a crucial component of effective talent management.
However, this type of co-ownership is not right for everyone. The model below is a useful tool for determining the importance of individual employees.
Source: HR Daily
You want to retain your "Criticals" in particular as an organization. They are individuals with unique abilities (i.e., those that are difficult to replicate) who are extremely important to the company. As a result, senior managers, most of whom fall into this category, are frequently granted these perks.
5. Training in relevant skills
After you've hired the best individuals for the positions required, you need to make sure they stay at the top of their game. This is even truer now, as the rate at which technology advances is increasing dramatically. This is where learning and growth come into play.
How do we build an organization where the rate of learning keeps up with the rate of change? Learning has evolved into a means of being inventive, accelerating growth, and maintaining a competitive edge.
Employers are increasingly putting money into skill-specific training. The quantity of on-demand courses has skyrocketed, according to the Economist's Lifelong learning special report. Everyone has access to the internet and can learn anything anytime and from any location.
In addition to formal education (secondary education, post-secondary, diploma, tertiary education), on-the-job training is vital. This is part of the 70|20|10 rule, which is commonly quoted:
- 70 percent of learning comes through difficult assignments; 20% comes from developmental connections, and 10% comes from formal courses and training.
Learning is becoming increasingly vital for the most recent generations, such as the Millennials and Generation Z. Younger employees, according to Gallup, value learning and personal development far more than older generations.
The next generation of employees is actively seeking growth opportunities and sees them as a means of progressing in their careers. Employee turnover is associated with not providing these opportunities.
6. Creating a flat and egalitarian organization
This human resource best practice in human resource principles is based on the Japanese management's egalitarian norms. Although we just observed that certain people are more important to the organization's success than others, this information should not be presented in this manner. Employees should be treated as an essential component of the organization because they are despite the position.
This is reflected in Japanese workplaces via identical canteens, business uniforms, and comparable sick and vacation leave policies. An egalitarian culture like this indicates that everyone deserves equal respect and may help to promote idea-sharing.
7. Making information readily available
It is critical to share information. Many huge firms deal with how you keep track of who knows what and who may need more information.
Sharing knowledge is so crucial, for 2 main reasons.
To begin, open communication about strategy, finances, and operations develops trust among employees. It also serves to discourage rumour and unfavorable casual talk. Employees are actively involved in the company.
Secondly, if you want your employees to share their ideas, they must have a thorough grasp of the company's operations.
When adopted, human resource best practices constitute the foundation of effective Human Resource Management. However, implementation is insufficient; best practices must also be consistent with the rest of the company's operations. We can only establish an HR department that provides value and genuinely supports the company if our human resources are aligned with the organization's goals.
Related Article: 7 Workplace Practices That Ensure Employee Happiness
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Related Article: Human Resources skills: A guide to HR Professionals
Richard Mapfuise is a Business Consultant at Industrial Psychology Consultants (Pvt) Ltd, a business management and human resources consulting firm.
Phone: +263 242 481946-9/481950
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