Review and Critically Evaluate the Relevance and Contribution of HR to Essay

Review and Critically Evaluate the Relevance and Contribution of HR to Organisational Success and Effective Change Management - Essay Example Armstrong defines human resource management as a â€Å"strategic and coherent approach to the management of an organisation’s most valued assets – the people working there who individually and collectively contribute to the achievement of its objectives† (cited in Stolt, 2010, p.2). This paper will critically evaluate the relevance and contribution of HR to organisational success and effective change management. Contribution of HR to organisational success In the today’s competitive business environment, HR plays a pivotal role in determining the organisation’s operational efficiency and profitability. As Wright (2003) believes, many of the corporate scandals over the last few decades can be attributed to the failure of HR. A number of studies have indicated that HR evidently contributes to organisational success. Importance of service sector has been steadily increasing for the last two decades and hence the economy tends to be more service based. Hence, it is essential for organisations engaged in service sector to keep their workers motivated and productive. According to Valencia (n.d), there is a close connection between employee motivation and employee productivity. Studies point that financial incentives and other employee benefits are the best ways to keep employees motivated. A firm’s HR management deals with all types of employee benefits including healthcare, retirement, dependent care, college tuition, and worksite accident claims (NC Department of Health and Human Services, 2012). In addition to employee benefits that are mandated by law, organisations voluntarily provide their employees with some additional benefits. For this purpose, HR managers explore employees’ actual family needs and thereby make the firm’s employee benefits packages flexible enough to help the company save money (Reference for Business, 2012). Even in manufacturing and traditional industries, competitiveness has become o ne of the major determinants of organisational success and therefore firms in these sectors frame strategies that facilitate economic and effective use of their resources. It is evident that human capital is the most important resource of an organisation and hence effective HR strategies would assist the firm to make its employees more productive. Increased productivity would directly contribute to an increase in revenues and thereby profitability. In the view of Cohen et al (n.d), HR is a better strategy to ensure the firm’s long term sustainability. Evidences suggest that improved HR would be beneficial for an organisation to eliminate unnecessary costs resulting from production wastage, employee motivation programs, and rigorous sequence of quality checks (The Strategic Human Resource Management Model, n.d). HR system aids an organisation to ensure that its training programs are designed on the basis of focused and topical methods (Management study guide, n.d). Deb (2006) opines that effective human resource management may be a potential way to encourage employee creativity and thereby seize more expansional opportunities. When an employee is allowed to use his creativity, he may get the feeling that ‘it is my organisation’ and such an employee’s view would directly contribute to organisational productivity. In order to ensure organisational su