Companies that score highly tend to be strongly geared towards creating a good working environment for their employees and being innovation led.
new report
has delivered compelling evidence to suggest a strong link between
effective people management and business success. The result of a
two-year study, the report suggests that organisations with a
comprehensive approach to people management perform better than those
without, indicated by higher profits per employee, higher profit
margins and higher productivity. It also identifies 12 core measures
that any organisation can track to assess the impact of their people
management practices on business performance.
People and the Bottom Line has been produced by the Work Foundation and
the Institute for Employment Studies (IES). The research involved
developing and testing a framework of people management practices with
nearly 3,000 employers to assess their impact on organisational
performance. The researchers collected data from each organisation and
assessed performance across the framework of measures. Their analysis
suggests that organisations which adopt a range of people management
practices – from resourcing to employee engagement, skills development
to job design – can achieve substantially stronger performance than
employers that invest in just one area.
The results indicate that if a business increases its investment across
a number of people management practices by around 10%, it could secure
an increase in gross profits per employee of over £1,500 per annum.
David Lammy, Parliamentary Under-Secretary of State for Skills, said,
"This report represents an important development in understanding the
extent to which good people management lies at the heart of successful
organisations."
Simon Jones, Acting Chief Executive at Investors in People (UK), added,
"This is a ground-breaking study. It delivers compelling evidence of
the role that a proactive approach to people management and skills
development can play in business success. It shows that people
management must be woven into the DNA of any organisation that wants to
maximise its performance – it cannot be piecemeal or tokenistic.
"The good news for employers that want to check the effectiveness of
their HR practices and identify opportunities for improvement is that
the report also offers a practical framework for doing so."
The report also identifies 12 core measures that are most effective in
helping employers track the impact of their people management practices
on business performance. These cover areas as diverse as recruitment,
development plans and employee appraisals. This framework provides
clear guidance for employers, who can adopt its measures to assess
their own people management practices and identify opportunities for
improving their performance. This means the report not only provides a
compelling business case for good people management but also a route
map for maximising and measuring its effectiveness on an ongoing basis.
Other key findings from the report are as follows:
- Younger firms tend to score better against the key indicators than longer established organisations
- There
is no ‘levelling off’ in terms of the business benefits that good
people management can deliver – even where companies are investing in
their workforce, there is evidence of the benefits of doing more
- Companies
that score highly tend to be strongly geared towards creating a good
working environment for their employees and being innovation led.
Article Source: http://www.theukarticledirectory.co.uk/.
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