Human Resource Management

Project

“How Can HRM Practices Assist In Developing High Performance?”

Submitted to: Ajmal Waheed

Submitted By: Kanwal Naeem

Zonish Inayat

MBA-III-A

Submission Date: 10th May, 08.

Department of Administrative Sciences

Quaid-I-Azam University

Islamabad.

1

Acknowledgements

We truly express our gratitude towards our respected teacher, Mr. Ajmal Waheed who

helped us a lot in carrying out this project. We would like to express our gratitude to all

those who gave us the possibility to complete this project. We want to thank the Human

Resource Management Department of Mobilink® Pakistan for giving us permission to

use departmental data. We want to thank Mr. Hasan Arshad, human resource specialist of

Mobilink who gave us his valuable time and provide us with the information on the

practices of human resource department. We would like to thank our parents and siblings

who helped us in difficult times. Thus with great love and appreciation, we dedicate this

report to all the above-mentioned people and to all the readers of this report.

2

Table of Contents

o Executive summary V

1. Company’s Profile 1

1. Staffing and Compensation Department 1

2. Organizational Development Department 1

3. Human Resource Operations Department 1

4. Human Resource Project Management 1

2. HRM Practices and High Performance Work System 1

2.1. HRM Practice 1

2.1.1 Employee Recruitment Planning 1

2.1.2 Selection of Employees 2

2.1.3 Workforce Alignment 2

2.1.4 Orientation 2

2.1.5 Creating Supportive Cultures 2

2.1.6 Reducing Status Differences 2

2.1.7 Employee Motivation and Retention Practices 2

2.1.8 Empowerment Practices 2

2.1.9 Providing Extensive Training and Development 3

2.1.10 Feedback / Performance Appraisal 3

2.1.11 Linking Compensation Directly to Performance 3

2.1.12 Promotion and Career Development 3

2.2 Human Resource Management (HRM) Practices and High Performance Work

System (HPWS) / High Involvement Organizations / High Commitment

3

Organizations 3

3 Mobilink GSM in the Context of HRM

4

3.1 HRM Practices and High Performance Work System of Mobilink 5

3.1.1 Recruitment 5

3.1.2 Orientation of New Employees in Mobilink GSM 5

3.1.3 Workforce Alignment 6

3.1.4 Selective in Hiring 6

3.1.5 Motivation 6

3.1.6 Disclose Full Information 7

3.1.7 Team Work and Empowerment 7

3.1.8 Training and Development 8

3.1.9 Performance Appraisal 9

3.1.10 Compensation 10

3.1.11 Career Development 10

3.1.12 Grievance procedures 10

3.1.13 Exit Interviews 11

4 Recommendations 12

4.1 Change in performance appraisal method 12

4.2 Growth opportunities/career planning 12

4.3 External recruitment 13

Conclusion 13

References 14

4

Executive summary

The report on the project “how HRM practices assist in developing a high performance

work system” starts with the introduction of the company Mobilink GSM whose human

resource management practices are studied to analyze the impact of HRM practices to

develop high performance work system. After introduction of the Mobilink, HRM

practices are described in relation with their function to improve performance. After the

theory describing the HRM practices, the HRM policies of Mobilink like recruitment,

selection, orientation, exit interviews, training and development, performance appraisal,

empowerment, grievance handling etc. are described in detail with live examples of these

practices to describe how they assist in developing a high performance work system.

After the detailed description of Mobilink’s HRM practices some recommendations are

given to remove flaws and for further improvement of Mobilink. In the end conclusion is

drawn.

5

Mobilink Global System of Mobile GSM

2. Company’s Profile

Mobilink a, pioneer of Global System of mobile (GSM) technology, was originated in

1994 and is providing the best cellular services in Pakistan. Mobilink in Pakistan is

market leader in mobile communication. Mobilink has got huge market share of 42%. It

has 2.4 million users. Mobilink has 5000 skilled, energetic and educated professionals

with vast experience consisting of 4500 permanent and 500 temporary employees. It has

more than 5,000,000 connections and six codes 300, 301, 302, 306, 307, and 308. Its

network consists of more than 200 franchises and more than 700 retail outlets with the

coverage of more than 315 cities and towns. In Mobilink, employees are given necessary

and comprehensive orientation before starting a job. Moreover other training programs

including on-the-job and off-the-job are also arranged to keep the skills of employees up-

to-date. Competitors of Mobilink are (a) Telenor, (b) Warid, (c) Paktel, (d) Ufone, (e)

Instaphone and (f) PTCL. The Human Resource Department of Mobilink is sub-divided

into four departments as under:

1. Staffing and Compensation Department

2. Organizational Development Department

3. Human Resource Operations Department

4. Human Resource Project Management

6

3. HRM Practices and High Performance Work System

3.1. HRM Practices

3.1.1. Employee Recruitment Planning

To recruit, organizations adopt methods such as (a) job postings within the organization,

(b) advertising to attract external applicants (c)

employee referrals, (d) Databank, (e) walk in

candidates and (f) colleges and universities

(wikipedia, n.d).

.

3.1.2. Selection of Employees

Three human resource practices that are used in selection are (a) emphasizing person-job

fit, (b) favor person-organization fit and (c) emphasize person-future fit.

3.1.3. Workforce Alignment

Company with aligned workforce has (a) the right types of people, (b) in the right places at the right times and (c) doing the right things right.

3.1.4. Orientation

Orientation consists of: (a) Department level orientation and (b) Generic or

organizational level orientation.

3.1.5. Creating Supportive Cultures

Organizations create supportive cultures by effective communication.

3.1.6. Reducing Status Differences

To reduce status differences organizations provide employees with same uniform, lunch

and equal parking facilities.

3.1.7. Employee Motivation and Retention Practices

7

Three human resource strategies to motivate and retain employees are (a) create a family-

like community, (b) favor interesting and rewarding jobs and (c) rely on fair

compensation (wikipedia, n.d).

3.1.8. Empowerment Practices

A number of different human resource management programs to empower employees are

(a) informal participative decision-making programs

(b) job enrichment (c) continuous improvement (d)

self-managed work teams and (e) disclosing

essential information (wikipedia, n.d).

3.1.9. Providing Extensive Training and Development

Types of employees training are (a) Induction Training, (b) On-the-job training / In-

House Training and (c) Off-the-job training / External Training (wikipedia, n.d).

3.1.10. Feedback / Performance Appraisal

Performance appraisal methods are: (a) assessment centres, (b) behaviorally Anchored

Rating Scales (BARS), (c) human resource accounting method (d) the Critical Incidents

File, (e) the Rating Scale, (f) ranking, (g) management by Objectives (MBO), (h) the

Narrative Method and (j) 360 degree performance appraisal (wikipedia, n.d).

3.1.11. Linking Compensation Directly to Performance

The amount of pay is less important than its perceived fairness or equity. People may

compare themselves to others (a) doing the same job within the same organization, (b)

working in the same organization, but performing different jobs and (c) doing the same

job in other organizations (wikipedia, n.d).

3.1.12. Promotion and Career Development

In Organizations, career development means (a) how individuals manage their careers

within the organization and between organizations and (b) how organizations structure

the career progress of their members. Businesses used to partner with employees to carry

8

out employees' career planning and development. Now, businesses view career

development primarily as the employee’s responsibility (Managementhelp, n.d).

2.2Human Resource Management (HRM) Practices and High

Performance Work System (HPWS) / High Involvement

Organizations / High Commitment Organizations

Effective use of HRM practices such as: comprehensive

recruitment and selection procedures, job design,

training and participation programs and those that

address employee motivation such as performance appraisal systems closely linked to

compensation, improve employees' knowledge, skills and abilities, and development of

High Performance Work System and ultimately improves firm’s performance.

High performance work system is a specific combination of human resource (HR)

practices, work structures, and processes that maximizes employee’s decision making

ability, knowledge, skill, commitment, and leads to flexibility, innovation, information

sharing and improvement.

In an increasingly competitive business environment, where sources of competitive

advantage are scarce, strategic HR management can provide such an edge. A high

quality, highly motivated workforce is a difficult advantage for competitors to replicate.

HRM practices develop High Performance Work System as they (a) select employees

with required competencies (b) provide an interface between an owner and the firm's

current employees, (c) produce a climate of trust and confidence that contributes to long-

run firm effectiveness and efficiency, (d) motivate and empower employees and (e)

create sense of responsibility.

Use of systems of high performance work practices (i) Diminishes their employee

turnover; and, (ii) Increases their productivity (sales per employee) and corporate

financial performance (stock market value to book value) (Google-analytics, August 28,

2006).

9

3. Mobilink GSM in the Context of HRM

We will be explaining the Human resource management of Mobilink GSM. Mobilink has

a very well defined and well-structured HR department and its various policies of

keeping each employee a productive part of the organization are intoned with the

corporate world’s requirement. Employees in the company are largely committed to their

organization and have shown progress in the company. The people at HR department of

Mobilink say that “we are not the admin assistants

but business partners”. At Mobilink, HR

department’s belief is that "Our people are our

greatest asset”. They take great pride in

acknowledging the contribution each one of them makes.

3.1HRM Practices and High Performance Work System of Mobilink

3.1.1 Recruitment

To recruit, Mobilink prefers its own employees and goes outside only when fully

qualified person is not available. Channels which Mobilink uses to recruit are (a) current

employees, (b) employees referrals (c) advertise internally as well as externally, (d) Head

hunters/executive search organizations, (e) walk in candidates, (f) job fairs (g) and

colleges and universities. Application forms are available online also. At customer

service Department, panel interviews are conducted. In all other departments of

Mobilink, individual interviews are conducted.

As Mobilink prefers its own employees, it provides career opportunities and job security

to its employees. This preference motivates and helps to retain current employees and

increases employees’ commitment. But as the company does not search for workforce in

external market it might not get more talented, competitive and skilled workforce.

3.1.2 Selective in Hiring

10

The human resource department of Mobilink considers many factors while selecting an

employee for any available position. The objective is to find the most appropriate

employee to fill the position, who will in turn produce the most productive output for

the organization. To hire they match applicant’s knowledge, skills and competencies

with their requirements. Mobilink emphasizes person-future fit that focuses on the

potential long-term contribution of applicants, often to the extent that they are willing to

leave positions open until they find the best and brightest new employees.

Because of the careful and long selection procedure, Mobilink hires the employees with

better knowledge and skills. They select competent

employees with decision making abilities,

knowledge, skill, commitment, flexibility,

innovation and information sharing competency,

which are characteristics of High Performance work System.

3.1.3 Workforce Alignment

Mobilink ensures that the right person will be selected and positioned at the right place

and will do right things right which leads to achievement of firms goals and high

performance. Mobilink aligns its workforce on the positions which match with their

skills, knowledge and competencies. These people in the right places at the right times

effectively utilize their skills and, thus, Mobilink gets the most out of its employees’

knowledge and skills. So the company with people doing the right things right has

employees that always act in ways that help the company succeed.

Right person right productivity = profits.

3.1.4 Orientation of New Employees in Mobilink GSM

The objective of orientation is to acquaint all new employees with the basic structure and

rules of Mobilink. A new employee is provided with the Orientation CD which contains

Organizational charts and other information related to Mobilink. Email is also sent to

give general information to the new employees. Mobilink provides orientation at two

11

levels (a) Department level orientation within the first week of the employment, (b)

Generic or organizational level orientation within 30 days of employment.

Orientation program of Mobilink motivates old as well as new employees; reduces

turnover rate, improves image in market and achieves commitment of employees. Old as

well as new employees get chances to understand Mobilink in a better way. Besides

senior and junior employees meet and share information. In short, orientation program of

Mobilink leads to High Performance Work System and ultimately Mobilink’s

performance. Employees of Mobilink confirmed that the company provides them with

effective orientation.

3.1.5 Disclose Full Information

To disclose essential information to employees, Mobilink has a publication policy.

According to which report on all Mobilink activities, booklets, news articles and

newsletters are published. Sound communication in Mobilink also allows each employee

to know exactly what is expected as far as her/his responsibilities and organizational

mission statement, and what is happening within each organizational area.

Communication between management and “shop floor employees”, who deal with

customers and organizational processes, is encouraged at Mobilink.

These reports and publications, communication between management and ‘shop floor’

employees, communication of grievances and understanding of responsibilities and

organizational mission achieve information sharing, better performance, committed and

motivated workforce and ultimately customers’ satisfaction. Employees of Mobilink

admit that mostly their supervisors and colleagues provide information and help.

3.1.6 Motivation

The human resource management department of Mobilink motivates its employees by (a)

creating a family-like community, (b) providing interesting and rewarding jobs, (c)

giving fair compensation and awards, (d) providing sports and recreational facilities like

membership at Islamabad Club and ladies club, (e) sponsors social events and outside

12

activities, (f) regular company-wide meetings with managers, (g) participating in

different community welfare programs, (h) providing feedback and (j) providing training.

These motivating measures lead to better performance and productivity, commitment,

enhancement in employees’ skills, abilities and knowledge, reduction in turnover and

encouragement of information sharing that is High Performance Work System.

Employees of Mobilink acknowledge Mobilink’s

efforts to provide friendly and creative environment.

3.1.7 Team Work and Empowerment

Team work gives better results than that of individuals. At Mobilink teams are made to

work. Mobilink makes sure that employees should be inculcated with the habit of out of

the way thinking by assigning them motivational and recreational projects. Teams at

Mobilink (a) develop goals and plans, (b) enhance communication among members, (c)

develop and maintain positive relationships among members, (d) solve problems and

make decisions on a timely basis, (e) successfully manage conflict, (f) clarify roles for

team members, (g) operate in a productive manner, (h) exhibit effective team leadership

and (j) provide development opportunities for team members. To empower employees,

Mobilink uses self management work teams and disclosure of essential information.

Team building and empowerment at Mobilink strengthen sense of responsibility and

motivation by providing employees with the opportunity to attain intrinsic rewards from

their work, such as a greater sense of accomplishment and a feeling of importance. Team

building uses a diverse array of employee skills and capabilities more effectively,

improves performance, reduces turnover, increases employees’ involvement and

creativity and information sharing. In short, develops High Performance Work System.

3.1.8 Training and Development

The aim of training and development in Mobilink is to provide staff with the necessary

skills and knowledge to fulfill the organization’s corporate and business plan. All

training sessions are delivered in a highly participative style, introducing topics in a

challenging and thought-provoking way in which, exercises and case studies are used. At

Mobilink, training is provided at three levels that is (a) organizational, (b) operational and

(c) personal level. At the start of each year, a training calendar is issued by the HR

13

department of the company. This year 2008, the theme for training is Customer

Excellence Culture. This training is mandatory for all the employees of Mobilink. At

Mobilink, training is need based and employees can fill a need analysis form and

highlight training needs and can give suggestions. Employees are trained technically or

non-technically and periodically either locally or abroad according to pre-planned

programs. The Human resource department conducts a meeting with department heads at

the end of the training program to focus on the

individual discipline and performance during the

training program.

Effective training and development of Mobilink promotes organizational understanding,

improves staff communication and self understanding, enhances self esteem, provides

employees with greater opportunity to grow and succeed within the company, upgrades

capabilities of employees, provides guidance and individual counseling, motivates

employees, improves performance, reduces turnover and encourages information sharing.

In short, develops High Performance Work System. Employees of Mobilink said that the

company provides training programs that are relevant and helpful in their career

development.

3.1.9 Performance Appraisal

At Mobilink, managers follow a regular schedule in providing feedback to employees;

they provide a formal review program to evaluate work performance and to promote

communication and discussion of job performance with respect to past performance.

Performance appraisal is done on an annual basis (from January 1st to December 31st)

for which online performance appraisal system is used. A printed form containing list of

the competencies is mailed to the managers on which, managers rate employees by using

point scale. The performance appraisal is up to second line that is employee, his

immediate supervisor and his supervisor’s boss. Managers empower employees to

monitor their own work and performance. There is a separate section in the performance

evaluation form for employees. Employees are free to give feedback about their

evaluation and to identify their problems, needs and suggestions and then at the end of

14

the process, human resource department asks supervisors and employees about the

problems and their solutions.

At Mobilink, to evaluate customer relation officers’ performance “mystery shopping” is

also used in which a well trained person is sent to

check whether the officers are behaving well with the

customers or not. The officers don’t know who the

mystery shopper in the customers is.

Performance appraisal system of Mobilink links compensation to performance due to

which employees are motivated and committed. It also allows management to assess the

performance of the Mobilink as a whole. It also identifies training needs and promotions

and as a result employees’ skills and knowledge is improved. It identifies employees’

weaknesses and strengths due to which employees discover areas to improve and grow

and ultimately improves productivity and Mobilink’s performance. But the system lacks

opinions of employees regarding their supervisors. This is the reason that the employees

at Mobilink are not entirely satisfied with the performance appraisal system.

3.1.10 Compensation

Mobilink provides its employees with market competitive salaries, both through financial

and non-financial means such as intrinsic and extrinsic rewards and incentives to attract,

reward, and retain employees, which are reviewed at frequent intervals.

This compensation system of Mobilink ensures that salaries are competitive and equitable

which attract and retain the services of competent qualified employees, provides fair and

equitable compensation, motivates employees, improves employees’ commitment and

increase labour productivity and performance. Employees of the Mobilink said that

Mobilink pays market competitive salaries and according to their expectations.

3.1.11 Career Development

Mobilink supports the development of its employee’s skills and abilities with an aim to

increase their potential. According to Mobilink’s managers, employees are responsible

for their career development. Mobilink prefers to promote its own employees. Mobilink

15

prefers long term commitment of its employees due to which employees get career

improvement opportunities.

These career improvement opportunities motivate employees; reduce turnover, increase

employees’ commitment and performance and ultimately develop High Performance

Work System and improve Mobilink’s performance. But proper career development and

counseling of employees is still missing.

3.1.12 Grievance procedures

At Mobilink, the human resource department provides

all employees with a voice within the organization. If

there are any grievances, the employee is able to freely communicate these with the

appropriate people. There is a formal set of procedures that are used to ensure that all

matters are dealt with fairly, equally and by ‘the book’, i.e. staff can be assured that a

reliable process is available to resolve issues.

By handling grievances, Mobilink retains and motivates employees, improves

productivity and performance, enhances and creates commitment within the employees

and achieves employees’ satisfaction and better performance.

3.1.13 Exit Interviews

At Mobilink, exit interviews are conducted to ask whether there was any problem which

compelled the employee to leave. These interviews provide the basis for analysis to find

out reasons of exit. The main reason is that the telecom sector is highly competitive.

Talented and skilled workers can easily get job. For better pay and benefits, employees

leave the organization. But this problem is a generic problem of whole telecom sector.

To reduce turnover and to retain employees, Mobilink pays market competitive salaries

and employees of Mobilink admit it. Besides, Mobilink prefers its own employees and

provides lifetime employment. Problem has been resolved to some extent.

16

Thus, in a nutshell, bundle of HRM Practices of Mobilink are contributing much to its

performance jointly. These practices are interrelated; single practice cannot lead to

performance development. Mixture of all can lead to high Work Performance System. As

a result of these effective practices, employees are more talented, skilled, competent,

empowered, committed, motivated and productive. Due to its effective and productive

workforce, Mobilink is a High Performance Work System. Its performance is shown by

its market share as compared to that of its competitors. Market share of Mobilink and its

competitors in 2007 was (a) Mobilink: 42.2%, (b) Ufone: 21.9%, (c) Telenor: 16.6%, (d)

Warid:16.6%, (e) Paktel: 1.9% (f) and Instaphone:

0.5%. High profits of Rs. 2 billion in 2007 are a proof

that the company is satisfying its customers.

Mobilink’s HRM practices and employee perceptions have the potential to impact on

customer satisfaction. Through HRM practices, employees of Mobilink obtain valuable

information about the organization and the way it is managed. When these employees

deal with customers they bring in the interaction, their perceptions of HRM practices of

Mobilink. When customers meet a satisfied and enthusiastic employee, their perceptions

of the service are likely to reflect the positive encounter. In a nutshell, Mobilink is using

its effective HRM Practices to develop High Performance Work System in order to

achieve High Performance.

4 Recommendations

4.1 Change in performance appraisal method

Mobilink should use the 360 degrees feedback in performance appraisal. This feedback

would come from subordinates, peers, and managers in the organizational hierarchy, as

well as self-assessment, and in some cases external sources such as customers and

suppliers or other interested stakeholders. The human resource management department

should ensure that the ratings come from only those individuals who know the person

receiving the feedback long enough to get past first impressions, but not so long as to

17

begin to generalize favorably. The 360 degrees feedback will not cause any financial or

economic burden on Mobilink as only the method of performance appraisal will change.

The 360 degree feedback will provide two way evaluations. As Mobilink have a

supportive and cooperative culture so the supervisors and managers will be ready to

receive a feedback from their subordinates.

4.2 Growth opportunities/career planning

The human resource department of Mobilink should provide growth opportunities to its

employees. This can be done by career planning which would enable both the employees

and managers to be cognizant of their individual and organizational needs and to consider

the changing business world and any personal life cycle changes when formulating their

goals. The human resource department of Mobilink

should appoint a career counseling resource person

who can help employees plan their careers and

inform them of possible avenues for training and development. Appointment of this

resource person will be feasible for Mobilink because it is a sort of long term investment.

And its benefits are more than its costs because employees with clear goals and aims are

more productive.

4.3 External recruitment

Mobilink prefers to recruit internally. This is a business which is in hyper growth. They

need more number of employees to capture the arising opportunities. Internal

recruitment will cause the managerial job openings to be filled by promoting the lower

staff and the existing staff may feel they have the automatic right to be promoted,

whether or not they are competent. So, with business expansion and growth they need to

focus on external recruitment as well.

Conclusion

Human resource is one of the most exciting and challenging departments of the

organizations. People are very important in any organization. Because it is the people

who start the business activity, run systems, make all business decisions. Human resource

is such a resource which manages all the other resources of organization. Keeping this

fact in mind all the organizations who want to survive in the coming era have to pay

18

special attention to their human resource departments. The best practices of human

resource management are used to develop and improve organizational employees, who,

in turn are able to enhance performance of the organization and develops high

performance work systems. Any HRM practice alone cannot enhance the performance of

the company unless it is combined with other practices of human resource management.

So a proper linkage must exist among all the practices to achieve high performance work

system.

References

Google-analytics (August 28, 2006), Implementing a High Performance Work System, retrieved April 23rd 08, from http://www.google-analytics.com/urchin.js.

Managementhelp (n.d), Career development, retrieved April 23rd 08, from http://www.managementhelp.org/js/breadcrumbs.js.

Wikipedia (n.d), human resources, retrieved April 23rd 08, from http://en.wikipedia.org/skins.

19