Introduction

In this fast moving day and age, orgaWhnizations place emphasis on having that

competitive advantage above all others in the market. The important elements that

contribute to this added advantage stem from technology, marketing strategy, excellent

customer service and many more. However, human resource is still the most important

element/asset in an organization that links back and is the core to those elements

mentioned. The success or failure of an organization is largely dependent on the calibre of

the people working therein. Bontis et al (1999) suggests that undeniably human resource

in the organization is the combination of knowledge, intelligence, skills and expertise

which provide each organization with its distinctive character. Furthermore, to ensure the

long-term survival of an organization, it is through proper motivation that encourages

human resource, change, innovation and the capability to learn. We will discuss further

the importance of human resource, how it can impact an organizations performance as

well as certain strategies organizations can implement to address this issue.

The Importance of Human Resource

The abilities of human resource can’t be replaced by any machine and is largely linked to

an organization’s profitability. They are also regarded as the prime asset of each

organization and businesses need to invest into it to ensure their survival and growth.

Organizations have to ensure that they obtain and retain a committed, well-motivated and

skilled team. By providing opportunities for learning and continuous development,

organizations will be able to address and grow future talent as well as develop the

inherent capacities of each individual. Armstrong and Baron (2002) states that the many
organizations are recognizing the fact the it is the people coupled with their individual

skills, knowledge and experience that play a significant part in the involvement of

providing organizations with the competitive advantage as well as growth and success.

Organizations today are now focusing on the human factor to provide insight and

contributions to improve productivity. Consecutively, one of the key roles of an

organization is strategic human resource management. In reference to Purcell et al (2003),

HRM practices include the following:

· Attracting, developing and retaining high-quality people

· Talent management

· Working environment – core values, managing diversity, leadership,

work/life balance, employment security

· Job and work design

· Learning and development

· Managing knowledge and intellectual capital

· Increasing motivation, commitment and role engagement

· High-performance management

· Reward management
What we can see clearly is that it boils down to people – human resource which is the

asset and backbone that drives the goals and directions of each organization. Moreover,

all aspects above point to facts that show how without a doubt, human resource is

associated in generating performance outcomes.

Impact to an Organization’s Performance

By practicing the above mentioned points effectively, organizations will be able to match

the right people based on the strategic and operational needs of the organization.

Furthermore, having the right person who ‘fits’ the culture and strategic requirements of

an organization will increase performance, productivity, innovation and a higher level of

personal customer service. Research by Huselid (1995) suggests that the link between

human resource and organizational performance is shown through productivity, in turn,

this is influenced by employee motivation, an employee’s financial performance is largely

connected to the reward structures, motivation and training provided. To achieve this,

many successful organizations provide individuals the flexibility and independence

coupled with a stimulating and interesting work environment.

The biggest challenge faced by organizations is retaining talent. Employees have basic

human needs and the challenge to retain valuable employees would mean organizations

taking the steps to asses and satisfy the future needs of its people as well as providing the

opportunity to develop and enhance the natural abilities. Finding the cause and tackling

them with the right strategies would reduce employee turnover likewise create greater

commitment to the organization. One of the major causes of turnover is dissatisfaction

with career prospects and it is something that organizations should recognize. To address

this issue, organizations which provide a climate of learning in forms of coaching,

mentoring and training will essentially allow employees to obtain new skills and develop

levels of competency required. Focusing on sharing learning opportunities as well as

sharing knowledge to both individuals and the organization will also encourage a

systematic flow and retention of information and learning within the organization.

Another way to ensure growth of human resource is by introducing a management

succession plan that identifies individuals who meet future requirements and indicate a

development or leadership plan required.

Developing an environment which encourages and recognizes high performance in areas

such as levels of customer service, growth, productivity, quality, profits, and value will

empower employees to establish a trust between managers and subordinates by

associating themselves with higher management issues. Creating opportunities to have

open conversations with employees is the key as well to have honest communication that

would address that front. Encouraging individuals to relate and carry out the core values,

willingly contribute to achieving organizational goals increases motivation, commitment

and engagement in their role. Winning the “hearts and minds” of employees is a sign of

commitment as they will identify with the organization, exert themselves more on its

behalf, thus ensures and assures both the individual and organization that the investment

yields returns on both sides.

Conclusion
Each organization is dependent on various levels ranging from operations, sales,

marketing, accounts to management and so on to fully function. It is clear that an

organization’s human resources play a major part in having a competitive advantage.

Therefore, it is the organization’s responsibility to produce a framework which

encompasses a learning culture within the organization. As suggested by Reynolds et al

(2002), how a person gathers new knowledge, skills and capabilities is by learning,

whereas the way to promote learning is the organization’s part to carry out the necessary

training. That said, a healthy and productive work environment that encourages growth in

each individual will definitely impact an organization’s performance. Implementing the

right strategic human resource development strategies, policies and practices will in

succession allow your human resource to perform at its optimum level and ensure that the

organization has that competitive advantage. To conclude, I agree that human resource is

the most important asset in an organization.

References

Bontis, N, Dragonetti, N C, Jacobsen, K and Roos, G (1999) The knowledge toolbox: a

review of the tools available to measure and manage intangible resources, European

Management Journal, 17 (4), pp 391–402

Armstrong, M and Baron, A (2002) Strategic HRM: The route to improved business

performance, London: Chartered Institute of Personnel and Development

Purcell, J, Kinnie, K, Hutchinson, S, Rayton, B and Swart, J (2003) Understanding the

People and Performance Link: Unlocking the black box, London: Chartered Institute of

Personnel and Development

Huselid, M A (1995) The impact of human resource management practices on turnover,

productivity and corporate financial performance, Academy of Management

Journal, 38 (3), pp 635–72

Reynolds, J, Caley, L and Mason, R (2002) How Do People Learn?, London: Chartered

Institute of Personnel and Development

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