ABSTRACT
The study examines the impact of selected human resource management practices on organizational productivity in selected oil companies in Port Harcourt. Rivers State. The study also examined the effect of corporate culture on Human resource management practices and organizational productivity. The cross sectional survey design was adopted. Data were drawn from 143 managers, Head of Departments and supervisors out of a population of 223 managers, HODs and supervisors in the five selected oil servicing companies in Port Harcourt. The instrument used for data collection was a self designed questionnaire. A total of 129 questionnaires were retrieved and 107 analyzed. Spearman’s rank correlation statistical tool and partial correlation coefficient of the statistical package for social science were used to test the hypotheses. The findings revealed that performance appraisal is significant related to profitability and organizational growth. There is a significantly relationship between training and profitability as well as organizational growth. Corporate culture was also found to positively affect the association between human resource management practices and organizational productivity. Based on these findings it was concluded that the effective management of the organizations human capital is necessary ingredient in achieving a more sustainable workforce development thus promoting a more successful cohesive work environment. Therefore, it was recommended that organizations should not be passive concerning the effective management and development of their human capital. Deliberate effort should be made to achieve that through training and development. Also organizations should sensitize their employees to exhibit altruistic, team oriented and interpersonal behaviours by instituting relevant policies, training and group discussions.
CHAPTER ONE
INTRODUCTION
- BACKGROUND OF THE STUDY
Today firm’s success to a great extent depends on the capabilities of its members. Firms may acquire the capital and technology, but it is human resources (HR) that will help firms face and overcome the challenges of business globalization (Tan and Nasurdin 2012). As capital can be generated, so can technology also be generated, but the human resources for its growth and development, these resources include Human Resources (HR) Financial Resources (HR) that will practically determine the potentials of an organization in terms of its production, marketing and expansion in the market place (Minbaeva, 2005).
The success of businesses is directly linked to the performance of those who work in that organization. Underachievement could be as a result of workplace failures. Because employing the wrong people or failure to predict fluctuations in hiring needs can be very costly, therefore it is important that you put effort into human resource management. In many organizations in Nigeria, training is an important management tool for effective performance and for organizations to perform well, resources should be well utilized and customers well served. To achieve that, all of an organizations human and materials resources must be well utilized in the right way and at the right time to create high quality products at minimal cost sparrow (1994). Barney, (1986; 1991) is of the opinion that human resource is one of the organization’s resources, a practice which enable them to achieve a competitive advantage, and a subset of those that leads to more superior and sophisticated long term performance.
Human resource management is a generic term that can have many diverse meanings which also includes the process that identifies current and future human resources requirements for an organization to achieve its goals and objective. Schuler and Jackson (1987) defined HRM practices as a “system that attracts, develops, motivate and retains employees to ensure the effective implementation and the survival of the organization and its members”. It means predicting and organization’s future demand and supply for labour, based on its business needs; and subsequently formulating and employing the strategies required to meet these needs. It involves establishing a gap analysis between current human resource supply and future demand. Strategies are then developed to address the gap and some of these strategies may involve recruitment, internal staffing, development, training, contracting and also partnering, and activities that have to do with downsizing. Vetter, (1967) “defined human resource management practices as the organizational activities directed at managing the pool of human resources and ensuring that the resources are employed towards the fulfillment of organizational goals” (Schuler and Jackson, 1987).
Human resource management is also a process by which organization human resources are identified, determined and planned in an organization, in order to meet both its short term and long term requirements. Human resource practice is usually based on the concept that people in the organization are the most important resource of an organization. Generally it is more interested with suitable resource the business needs to take care of both its longer term need and as well its short term needs in terms of both its quantity and quality.
Owing to all the afore stated facts, the study of human resource management practice in Nigeria organization is very essential considering the strong competition in organizations lately. Also the rate of inefficiency and ineffectiveness on the utilization of manpower; that serves as integral and important factor in the production process in industries coupled with frequent policy changes by government and technological changes pose serious challenges to organizations.
Success in human resource management practices generally results in boosting organizational productivity, especially improving productivity is important at many levels. At a global level, increased productivity means using less resource to produce goods and services, or producing better goods and services with the same resources (Kendrick,1984); (Kopelman,1986); (Riggs & Felix,1983). At a national level, productivity influences both economic and non-economic outcomes (Fleishman,1982); (Kendrick,1984); (Kopelman,1986); (Mali,1978); (Riggs & Felix,1983). At the individual firm level, increased productivity leads to reduced prices and better quality, which in turn leads to an improved market position relative to the competition at the individual level, increased productivity can lead to better quality life (Campbell,1988).
Productivity has always been the major target management. The main aim of every profit-oriented organization is to increase profitability and minimize cost. This is the essence of high productivity. In order to gain a high level of productivity, organizations must be well armed with the major factors of production and be able to utilize them efficiently.
However, special attention must be given to labour, as it is the most essential factor of production that no organization can afford to disregard. Productivity is an area of major interest of management in any organization. It is this concern for increased productivity that necessitates the efforts by organization to select from a pool of qualified candidates or persons who are best suited for the job.
Productivity is the driving force behind an organization’s growth and profitability. Productivity is the co-relationship that exists between output of goods and services of workers of the organization and input of resources, human and non-human, used in the production process. In other words, productivity is the ratio of output to input. The higher the numerical value of this ratio, the greater the productivity (Onah, 2010). Productivity has been defined as the measure of how well resources are generated and utilization for accomplishment of a set result. It is reaching the highest level of performance with the least expenditure of resources (Mali,1978). Most managers attempt to produce more output with less input. This means that productivity is concerned with the overall effectiveness and efficiency of getting things done. It means making more from what you have and working smarter rather than harder.
Studies abound in the area of human resource management practices and organizational productivity. However most of the work done in this area were carried out in developed economies of the USA and European nations and results from those studies cannot easily be replicated here considering the cultural difference which affects the way business activities are carried out in most west African nations. This study however seeks to establish the relationship between human resource management practices and organizational productivity in the oil servicing industry in Nigeria.
- STATEMENT OF THE PROBLEM
Given the increasingly volatile and complex socio-economic structure of our business organizations in Nigeria, two basic factors are critical for business success: capital and the human resources.
Capacity failure is one of the greatest problem of employees productivity, i.e. the employee not having the capacity to perform his job correctly this could be as a result of business globalization new technologies or political factors. Employees without the required man power training will spend more time to perform a task leading to time and resources wastage and low productivity.
Another problem of employee productivity is posed in form of poor working condition which hampers the production of employees. For example, standard health facilities will serve as a form of protect for the life of the workers in case of any hazard on the job, they have some assurance of some income. This assurance of income will to a great deal minimize any inhibitory fears of the workers devoting themselves fully to their work (Mondy and Noe, 2006).
Another problem of employee productivity relates to the absence of fringe benefits, when employees in a particular firm in the industry feels they don’t get as much benefits as their contemporaries in the industry this could affect their level of commitment towards their work which will in turn affect their productivity. A good example of this can be seen in the reduction of certification allowance by Saipem which was done without any restriction as the firm is not an active member of the NUPENG (Nigerian Union of Petroleum and Natural Gas Workers) PENGASSON (Petroleum and Natural Gas Staff Association of Nigeria) union like some other firms in the industry. This created a high uproar and dissatisfaction among employees in the organization and such could lead to low productivity and commitment form an employee (Swathi, 2014).
Capacity under utilization is another problem faced by many oil and gas firms in Nigerian, most times employees are not allowed to do the job they were really employed to do as services of expatriates are always preferred to that of local employees. The NNPC in 2014 said it needed about seven billion dollars to bring expatriates who would work on the Nigerian Refineries to enable them work to full capacity: However the new NNPC director did not see the need of foreign expatriates as he used local engineers to rehabilitate the refineries and get them running again, although none of the refineries is working at full capacity yet. When and electrical engineer is placed to do the job of a mechanical engineer the case of low productivity will surely arise as it will take the employee more time to perform the task than it would have taken and expert to perform such function.
