Organisational Development and Human Resource Management

Topics: Management, Human resource management, Strategic management Pages: 12 (3030 words) Published: October 21, 2010

Organisations today face many challenges. Organisation must adopt a more strategic perspective for managing employees. This report highlights the key role played by human resource professionals using organisational development techniques to improve the overall organisational effectiveness.


The role of Human Resource Management (HRM) seeks to maximise organisational competiveness and performance through the best practices in the management of people. Management research has also increasingly focused on identifying forms of HRM practices that can increase the performance of the firms (Arkin, 2001). Research had pointed out that a set of ‘Best-Practice’ HRM promises to improve firm performance, or financial outcomes, the closer the firms follow its prescription (Guest, 1997).

Armstrong (1992) strongly pointed out that the most valued resource in an organisation is its workforce and a coherent set of policies geared toward effective organisational performance is needed for the company to optimise its resources to gain a competitive edge.

Human resource (HR) managers nowadays undertake strategic role with management. HR managers must work with management to analyse and devise solutions the organisational problems. Usually it will involves in strategic planning and aligning HR with the organisation’s mission and strategic goals with the objective of maximising employee contributions to the overall performance of the organisation (Cieri and Kramar, 2007). Strategic management focuses on planning for producing and marketing goods and services. Swanson (2007, pg 331) defined Human Resource Development (HRD) as “a process of developing and unleashing human expertise through training and development and organization development for the purpose of improving performance”. The following section shall provide an overview of Human Resource (HR) practices.

Administration stage
In the earliest stage, HR main function was keeping records of salary, annual leave and is highly involves in administrative works. It lacks strategic integration needed for organisational survival at this stage.

Hiring, training and welfare stage
The start of focusing on employee welfare in a more professional approach happens in this stage. Organisational starts employing professionals to conduct training, practicing effective hiring and selection and improving welfare activities. Firms focus on using suitable hiring techniques that seeks out outstanding candidates who are not only possess technical expertise, but also highly committed and trainable.

Organisation Development (OD) is a planned process of change of behavioural science knowledge to the planned development and reinforcement of organisational strategies, structures and processes for improving an organisation’s effectiveness (Waddell et al., 2007). It applies to a whole system such as an organisation.

Fragmented personnel function to integrated human resource management function •In the mid 1970s to late 1990s, strategic moved from HR to OD (cited Dunn, 2006 in Girardi, 2009). Keeping good relationships between managers and employees is important as it improves organisational effectiveness. Maintaining and building effective working conditions and relationships are task associated with the employee and labour relations functions.

Human capital made up of several facets: ability, behavior, effort and time (cited Davenport, 1999 in Girardi, 2009). The people management issues look into various employee-related factors that affect the productivity at work place and their impact on a business strategy formulation. It had moved to a slightly more systemic process. In the mid 1990s, human capital was recognised to improve productivity. However, there is a lack of performance appraisal, reward systems and information disclosure. High turnover rate of employee, lack of morale and motivation, low employee satisfaction are examined as it might...
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