In their book, ‘Managing Human Resources,’ Luis R. Gómez-Mejía, David B. Balkin, Robert L. Cardy  contest that there is a two-way relationship between organisational and individual challenges

The most important individual challenges today are matching people and organisations,  productivity, empowerment,  job security, motivation and engagement


Research suggests that HR strategies contribute to firm performance most when the firm uses these strategies to attract and retain the type of employee who best fits the firm’s culture and overall business objectives.

For example, one study showed that fast-growth firms perform better with managers who have a strong marketing and sales background, who are willing to take risks. However, these managerial traits actually reduce the performance of mature firms that have an established product and are more interested in maintaining (rather than expanding) their market share.

According to CIPD, faced with competing priorities, individuals are likely to focus on those aspects of their role that are directly linked to their individual performance in order to avoid sanctions.

If specific individual targets do not ‘add up’ to the common goal, employees pursue activities that support their personal performance and career goals over other priorities that can improve the performance of the team as a whole.

Survey respondents highlight that judgements on how appropriate their decision is can be subjective and prefer to ‘err on the side of caution’.

A company’s overall vision is not always clearly translated into specific objectives for individuals, resulting in competing priorities in cross-functional teams.

Organisations fail to benefit from workforce diversity by continuing to use unduly subjective methods of selecting and rewarding staff.

By aiming to eliminate undesired behaviours, organisations can create frameworks that restrict the scope for discretion and unconventional judgement.

For example, organisations may introduce people management systems aimed at fairness of outcomes (pay, benefits and rewards), but the mechanisms to ensure that managers apply the procedure fairly and consistently are ineffective or absent.

In addition, resource constraints make it difficult for managers to remain flexible to staff needs, while some cost-cutting solutions only add more processes to manage (for example managing contractors).


Productivity is a measure of how much value individual employees add to the goods or services that the organisation produces. The greater the output per individual, the higher the organisation’s productivity.

In a “knowledge-based economy” driven by technology, the success of organisations will depend more and more on the value of intangible human capital. This capital may be “the creativity of their designers (Apple / Intel Corp), the proficiency of their software architects (as at Sun Microsystems Inc.), the knowledge of marketers (Procter & Gamble Co., for instance), and even the strength of the internal culture (as in the case of Southwest Airlines).”

From an HR perspective, employee productivity is affected by ability, motivation, and quality of work life.

Employee  ability ,competence in performing a job, can be improved through a hiring and placement process that selects the best individuals for the job; It can also be improved through training and career development programs designed to sharpen employees’ skills and prepare them for additional responsibilities.


Many firms have reduced employee dependence on superiors, placing more emphasis on individual control over (and responsibility for) the work that needs to be done.

This process has been labeled empowerment because it transfers direction from an external source (normally the immediate supervisor) to an internal source (the individual’s own desire to do well). In essence, the process of empowerment entails providing workers with the skills and authority to make decisions that would traditionally be made by managers. The goal of empowerment is an organisation consisting of enthusiastic, committed people who perform their work ably because they believe in it and enjoy doing it ( internal control ).

Empowerment can encourage employees to be creative and to take risks, which are key components that can give a firm a competitive edge in a fast-changing environment.

To encourage risk taking, General Electric past CEO Jack Welch exhorted his managers and employees to “shake it, shake it, break it.”


The traditional system in which individual employees report to a single boss (who oversees a group of three to seven subordinates) is being replaced in some organisations by the self-managed team system. Employees are assigned to a group of peers and, together, they are responsible for a particular area or task.

According to two experts on self-managed work teams:

“Today’s competitive environment demands intense improvement in productivity, quality, and response time. Teams can deliver this improvement. Bosses can’t. . . . Just as dinosaurs once ruled the earth and later faded into extinction, the days of bosses may be numbered.”

Case studies on the effectiveness of self-managed work teams suggest that many firms that use teams enjoy impressive payoffs.

For example, company officials at General Motors’ Fitzgerald Battery Plant, which is organised in teams, reported cost savings of 30 to 40 % over traditionally organised plants.

At FedEx, a thousand clerical workers, divided into teams of 5 to 10 people, helped the company reduce service problems by 13 %.


Most individuals cannot count on a steady job and regular promotions.  For employees,  job insecurity is a major source of stress and can lead to lower performance and productivity.


Motivation and engagement energise, direct, and sustain performance.

Among the influencing factors  are work design, matching of employee and job requirements, rewards and recognition.

Managers are limited in the range of instruments they can use to motivate a diverse workforce. And in the absence of behavioural indicators, achievement of operational targets is the main objective factor that differentiates individual performance.

A growing number of companies recognise that employees are more likely to choose a firm and stay there if they believe that it offers a high quality of work life. A high quality of work life is related to job satisfaction, which, in turn, is a strong predictor of absenteeism and turnover.

According to an i4cp  survey, 93% of higher performers measure employee engagement, compared with 79% of lower performers.

93% of higher performers utilise employee engagement surveys, compared with 78% of lower performers. Ninety percent of high performers report the use of satisfaction surveys for such measures, compared with 68% of lower performers.

A firm’s investments in improving the quality of work life also pay off in the form of better customer service.



Based on Managing Human Resources, by Luis R. Gómez-Mejía, David B. Balkin, Robert L. Cardy. Publisher: PH Professional Business