Understanding the link between people and performance

Extensive and powerful research at the 'Work and Employment Research Centre', School of Management, University of Bath completed in 2003 examined the impact of people management on organisational performance.

Much past research has shown there to be a positive relationship, but none has explained the nature of this connection - in other words, how and why HR practices impact on performance. This is commonly referred to as the 'black box' problem.

The purpose of studies over 6 years at Bath was to unlock the 'black box,' to show the way in which HR practices directly link people management to organisational performance.


Researchers proved that people perform well when:

Firstly, they are able to do so because they possess the necessary knowledge and skills; when, secondly, they have the motivation to do so and do it well; and when, thirdly, they are given the opportunity to deploy their skills both in the job, and more broadly in contributing to their work groups and organisational success.

The executive summary of the final report published by the CIPD asserts that a range of 11 HR policies and practices are required to turn this into action. These were:

      • recruitment and selection,
      • training and development,
      • career opportunity,
      • communications,
      • involvement in decision-making,
      • teamworking,
  • appraisal,
  • pay,
  • job security,
  • job challenge/job autonomy and
  • work-life balance

These performance-related HR policies encourage people to exercise a degree of choice on how and how well they do their job. In other words, they help induce employee discretionary behaviour which makes people work better and improve performance. This happens because the HR policies and practices develop positive employee attitudes or feelings of satisfaction, commitment and motivation.



For a copy of 'Understanding the People and Performance Link' click here


Employer of Choice - the bottom line

How do you ensure that your organisation is a 'place where people want to do great work'?

In a study of employees at work, the Sunday Times newspaper asked the opinions of 58,000 employees to comment on their feelings about employment and their employer. Their report was a revealing guide to 'The 100 Best Companies to Work for.'


Judith Leary-Joyce, in her book 'Becoming an Employer of Choice' highlights the issue of 'career' as one of the keys to employers being identified as one of the best companies to work for. Leary-Joyce challenges organisations with these questions

      • how often are appraisals taking place?
      • how many people have personal development plans?
      • how many people have coaches?
      • how many internal mentors are passing on their knowledge and experience?
      • do people believe they can develop their career in the organisation?


Examples of Leary-Joyce's findings include the business case for creating great company culture:

      • 'Once people hear what an exciting workplace you have, they will flock to join you.'
      • 'Imagine the bottom line impact when recruitment costs fall and less time is lost as the outgoing person shift his or her attention away from the work and the incoming arrival strives to grasp the intricacies of a new job.'
      • The very best customer service operations have excellent people cultures. We can only give as much as we receive.'


She argues that your present culture has a direct impact on your bottom line. For further evidence, read her book and examine her graph in her Appendix 3 'Great companies consistently outperform the FTSE All Share'. Over the past five years the best companies would have earned an investor a compounded annual return of 12.1%, compared with a 5.8% decline in the FTSE All Share index as a whole (Statistics by Frank Russell Company)



For a copy of 'Becoming an Employer of Choice' click here

Vision, Values and the Psychological Contract

The Stuart Mitchell Group of Companies has been supporting a European-wide organisation dealing with mutual co-operation issues throughout the original 15 and now 25 member states of Europe since 2002.

Initially addressing the quality of their performance appraisal system, a request for organisational development consultancy revealed the need to commun-icate the vision and values of the organisation more clearly to all members of staff.

Fundamental to the Organisation Development consultancy was the need to address the flaws in the delivery of the organisation's Psychological Contract.

The psychological contract is defined as 'The perceptions of the two parties, employee and employer, of what their mutual obligations are towards each other'

These perceptions are created initially at the recruitment stage where expectations are created by promises from the employer, and what the employee perceives to be the employers oblig-ations or commitments.

Some of the psychological contract will be written in a contact of employment and some will just be verbalised in the form of company statements, policy or from informal chats with management.

From a performance perspective the psychological contract is essential in influencing positive employee discretionary behav-iours or effort. An employee has the ability to work as hard as he or she wishes. If employees believe they are not receiving a fair reward for their contribution, they will adjust that contribution.

It is then of paramount importance to discover what employee's perception is of this psycholo-gical contract in order to influence their behaviours.

So what are the expectations from the psychological contract? They include:

  • Reward
  • Career development
  • Opportunity to progress

For optimising employee contribution is this a clear case
of under promising and over delivering? And at what cost?

Career HORIZONS represents an opportunity to deliver at minimum cost with maximum effectiveness.

For more information, please contact us from this link: www.careerhorizons.net

Career HORIZONS is for:

  • Executives developing performance and talent management strategies
  • Human Resource Managers creating career management policies
  • Managers wanting to develop the competencies of their team members
  • Employees establishing the link between performance and career development
  • Learning and Development Specialists delivering career support programmes

delivers results:

  • Better performance by managers and team leaders
  • Focused and self directed team members
  • Savings on training and development budgets
  • Innovative and strategic thinking from everyone
  • An organizational reputation as an "Employer of Choice"


Career HORIZONS develops performance partnerships between managers and employees.

It equips both to manage and develop job satisfaction and work life balance, manage pressure and stress, improve skills and competencies, increase character and leadership maturity, and write motivational individual development plans.

Career development matters both to individuals and to organizations. There are some challenging issues that must be faced in getting it right.

Career HORIZONS helps you meet the challenges in proven and respected training and software solutions.


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