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For what and whom?

In a discussion about the effect of HRM initiatives on outcomes, we need to ask ourselves: What does the organization aim to reach? What are the objectives? For example, we see that private organizations often focus on performance and measure productivity or quality, whereas public organizations focus on public value for citizens. These outcomes have implications for the HRM initiatives that work for employees in these sectors.

We know that desired outcomes differ per context, that is it depends on the sector, the industry, the country, the ownership situation and the strategic objectives of the organization. If we look at the sector, we see that private organizations often focus on performance and measure productivity or quality, whereas public organizations focus on public value for citizens. These outcomes have implications for the HRM initiatives that work for employees in these sectors. We know that employees in the public sector are not motivated by financial rewards and that in this sector, monetary rewards will not lead to higher performance. Instead, the job content and the idea of providing public value motivates people in this sector.

If we want to know which HRM initiatives work, we also want to distinguish between organizational strategies. An organization that competes based on costs and tries to be the cost leader in the market might focus on return on assets or return on investment, but organizations that compete based on differentiation might rather focus on innovative outcomes or quality. The HRM initiatives that help to achieve these outcomes are different per strategic focus. Research has indicate that innovative organizations are more effective when they offer HRM initiatives that focus on the job design practices, such as granting autonomy, having task variety and providing feedback to employees.

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This article is from the free online course:

The Future of Human Resource Management (HRM)

University of Twente