Arguments Supporting the ‘Best Practice/ Best Fit’ Approach towards Strategic HRM
The essay aims at providing an overview on human resource management (HRM). It is a term used for describing the formal systems devised for managing people in an organization. The responsibilities of human resource manager fall under three main categories that include staffing, benefits and employee compensation and designing or defining work. The essay will address the key arguments in support of the best fit or best practice approach towards strategic HRM. The essay will also discuss how the approach will influence the HR professionals. One will also find discussions on how the best fit or the best practice approach remains married to the different organizations that includes worker cooperative or public service operations such as the hospitals or the schools or nongovernmental or nonprofit organization or community. The essay will also put forward how the approach to strategic HRM helps in meeting sustainable and ethical corporate obligations on a global scale.
According to Pfeffer (2014), the ‘Best Practice’ approach helps in highlighting the relationship between defined Human Resource (HR) practices and the organizational performance defined based on the employee satisfaction and commitment. The set of the best practice can take various forms with some advocating practices for enhancing the organizational performance. While the ‘Best Fit’ approach towards strategic human resource management helps in exploring close relationship between the strategic management and the HRM through consideration of the nature and the influence of the vertical integration. In vertical integration, the benefit gained through the establishment of a closer link between the HR practices and policies to business objectives. However, both the theories aim in achieving higher organizational performance. According to the claims put forward by Kline (2015), both the approaches are classified as the matching models since they possess a common aim of matching the strategy of human resource with the organization.
The ‘Best Fit’ approach focuses on the closer alignment between the organizational strategy and the other systems. Chang (2016) however puts forward that all the organizational systems should begin with an organizational strategy since it specifies the wants of the company, the way it behaves, the types of performance and the performance levels it should demonstrate for being effective. The ‘Best Practice’ approach acknowledges the importance of the business on the performances. Therefore, whether it is the ‘best fit’ or the ‘best practice’ approach, both acknowledges the needs of the organizational staffs. Both the concepts require employees for achieving their goals. Hence, both the approaches possess hiring and staffing procedures and strategies. Both the systems consider, recruitment, selection, testing and staffing. Reilly & Williams (2017) put forward suggestions that both the approaches represents mutually compatible bunch of the HR policies that helps in promoting higher levels of employee commitment and motivation thereby positively impacting the performance of the organization. These policies include extensive training, selective hiring, employment security and structure that help in encouraging employee participation. It also includes the pay policies compared to the competitors of the industry.
Impact of the Approach on HR Professionals
Reward is also a vital issue with the application of each of the approach. According to Ledford (2014), both the approaches agree on the fact that the presence of an external and competitive reward package is necessary for not only attracting but also retaining the employees. Therefore, the ‘Best Fit’ approach emphasizes the importance of the external competitiveness for retaining and attracting the employees. However, in order to be effective the reward system should distribute it in a manner that makes the employees satisfied when they make a comparison of the rewards received by the other individuals performing similar kind of job in similar type of organization. According to Marwah, Jain & Thakar (2014), the advocates of ‘best fit’ approach, good performers usually look out for organizations where they get a reward and recognition for their performance. Thus, there exists a view that presence of an external competitive reward system plays a key role in attracting the appropriate candidates and retaining them.
The best practice or best fit approaches impacts certain practices of the HR professionals that includes the selection process, training practices, reward system and employee participation. The essay puts forward an elaboration of each of the practices. For instance, the HR manager of a company X pursues a selected employment approach as the ‘best practice approach’ since it aims at attracting the skilled personnel that not only connects to the higher performance ethics but also lives up to the quality standards (Kehoe & Wright, 2013). However, the new hires needs to go through a probation period and prove their dedication for work in the trainee program. However, for the already established operations, experienced employees are promoted from within of the company. This falls under the ‘best fit’ approach, that aligns the HR goals with the corporate quality strategy. Thus, it remains coherent with the strategy of the company that helps in binding best employees by rewarding them with long-term achievements thereby keeping the intellectual capital and ensuring competitive advantage in the fields of knowledge, quality and performance.
For the training practices, Company X applies the ‘best fit’ strategy aiming at enhancing the employee ability, their business and technical knowledge through investment in an internationally recognized best practice training method (Keep, 2014).
As far as the reward system is concerned, Company X discovered an individual performance system as one of the key components towards the development of the employees which would also act as one of the core strengths through unbeatable motivation. This refers to the utilization of a ‘best fit’ approach that mints the human resource to the strategic objectives of the organization (Bratton & Gold, 2017).
The Alignment of ‘Best Practice/ Best Fit’ Approach to Different Organizations
Company X considers employee participation as the ‘best fit’ approach since it has an open door policy where the employees can directly contact the management (Alfes et al., 2013). However, the minimum supervisory management of the flat hierarchies leads to lower barriers of communication and wider opportunities of taking responsibilities. As participation represents one of the key criteria for evolution for employee remuneration, so Company X has a higher employee participation rate. Thus, the ‘best fit’ approach helps in supporting the key competency, innovate quality and sustainable competitive advantage as the key strategic objectives.
A cooperative worker represents the local workers who deliver the needs of the community. A co-operative worker thus adopts values of self-responsibility, self-help, equality, democracy, solidarity and equity as the ‘best practice’ approach (Song et al., 2017). Their approach also includes following the principles of open and voluntary membership, democratic control of members, independence and autonomy, economic participation by the members, training, education and information, concern for the community and the inter cooperative cooperation.
The operation of the public sector involves studying the behavior of the employees and within the Knowledge Intensive Public Sector Organization (KIPSOs) as the ‘best fit’ approach. It might however seem as an unusual thing given the need for the competitive pressures, limitation in the identification of the benefit and cost for implementing innovative ideas and short of opportunities for incentivizing the employees’ financial needs (Bason, 2018). Thus, KIPSOs requires innovations for ensuring the long-term success for the survival. Many states and countries drove through the ‘best practice’ approach of managerial changes for improving the productivity of organizations belonging to the public sector.
For a health education program, a community might ignore that there might be a possibility where a larger portion of population might speak little or no English or might be an illiterate in a particular language (Aguinis, Gottfredson & Joo, 2013). The program can be made adaptable if the community finds a ‘best practice approach’ of adapting it to the circumstances of the situation.
Nongovernmental and not for profit organization adopts the ‘best practice’ approach that covers climate change or human rights while others focuses on the aspects of management and governance for creating a framework and ensuring effective operations (Fowler, 2013 ).
According to Epstein (2018), the ethical and the sustainable goals functions as a consultative agency thereby providing the departments or the business units with not only knowledge but also ‘best practice’ approach. This not only helps in the sustainable development of the business products and the process thereby buttressing an organization through sustainability plans across firms. The sustainability area might play a directive role in adopting ‘best practice’ approach as auditor, monitoring processes and practices and seeking explanations for unachieved goals. For instance, purchasing department could undergo auditing based on the goals of hiring and selection process of not employing child labor as a ‘best practice’ approach.
Conclusion:
On a concluding note, one can say that both ‘best fit’ and ‘best practice’ approach offer the companies powerful means for determining the process of human resource management. Through the essay, one can find that similar types of ‘best practice’ strategies approaches across companies of varied geographies are impossible since there exists regional differences in law and culture, work related practice, characteristics of motivation and culture. On a similar note, ‘best fit’ strategy adopted by neglecting internal capabilities and environmental forces can lead to the failure of the HR in the international markets. Therefore, the ‘best practice’/ ‘best fit’ approach needs analysis and should be adapted for suiting localized needs of the international subsidiaries for paving the pathway for the achievement of the overall global competitive advantages through human resource.
References:
Aguinis, H., Gottfredson, R. K., & Joo, H. (2013). Best-practice recommendations for defining, identifying, and handling outliers. Organizational Research Methods, 16(2), 270-301.
Alfes, K., Shantz, A. D., Truss, C., & Soane, E. C. (2013). The link between perceived human resource management practices, engagement and employee behaviour: a moderated mediation model. The international journal of human resource management, 24(2), 330-351.
Bason, C. (2018). Leading public sector innovation: Co-creating for a better society. Policy Press.
Bratton, J., & Gold, J. (2017). Human resource management: theory and practice. Palgrave.
Chang, J. F. (2016). Business process management systems: strategy and implementation. Auerbach Publications.
Epstein, M. J. (2018). Making sustainability work: Best practices in managing and measuring corporate social, environmental and economic impacts. Routledge.
Fowler, A. (2013). Striking a balance: A guide to enhancing the effectiveness of non-governmental organisations in international development. Routledge.
Keep, E. (2014). Corporate training strategies: the vital component. New Perspectives, 109-125.
Kehoe, R. R., & Wright, P. M. (2013). The impact of high-performance human resource practices on employees’ attitudes and behaviors. Journal of management, 39(2), 366-391.
Kline, R. B. (2015). Principles and practice of structural equation modeling. Guilford publications.
Ledford Jr, G. E. (2014). The changing landscape of employee rewards: Observations and prescriptions. Organizational Dynamics, 43(3), 168-179.
Marwah, A. K., Jain, S., & Thakar, G. (2014). Implications of human resource variables on supply chain performance and competitiveness. International Journal of Engineering (IJE), 8(1), 11.
Pfeffer, J. (2014). Business and the spirit: Management practices that sustain values. In Handbook of workplace spirituality and organizational performance (pp. 43-59). Routledge.
Reilly, P., & Williams, T. (2017). How to get best value from HR: The shared services option. Routledge.
Song, H., Tucker, A. L., Murrell, K. L., & Vinson, D. R. (2017). Closing the productivity gap: Improving worker productivity through public relative performance feedback and validation of best practices. Management Science, 64(6), 2628-2649.
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