Human Resource Is The Most Important Asset Of An Organization

Topics: Human resource management, Management, Human resources Pages: 6 (1300 words) Published: June 7, 2015
In this fast moving day and age, organizations 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.


References: Reynolds, J, Caley, L and Mason, R (2002) How Do People Learn?, London: Chartered Institute of Personnel and Development
Denton, R., Goldman L., Graham, M., Reilly, C., and Twardak, M.A. (2004). ‘Human Resources Your Most Valuable Assets’, [Internet]. Available from: [Accessed 18 May 2014].
Upson, M. (2011). ‘What is Strategic Human Resource Management?’ [Internet] Available from: [Accessed 18 May 2014]
Oswin, J
Borthwick, F. (2011), ‘People can be an Organizations Core Competence’ [Internet] Available from: [Accessed 20 May 2014]
Adelman, F
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