CRITICALLY DISCUSS TO WHAT EXTENT HIGH-PERFORMANCE WORK

SYSTEMS (HPWS) REPRESENT A SUSTAINABLE APPROACH TO MANAGING

EMPLOYEES

Student Name
HERIOT WATT UNIVERSITY  - EDINBURGH BUSINESS SCHOOL
 A high performance work system (HPWS) is a collection of HRM techniques intended to
advance staff members' abilities, motivation, and engagement to give a company a long-term
competitive advantage. The usage of the HPWS places an emphasis on employee participation
and demonstrates a commitment to establishing a corporate culture that is more focused on
commitment than control. This culture is at the heart of any organization that uses the HPWS
systems. The culture of high-performance business, on the other hand, places an emphasis on the
pursuit of excellence and has high expectations for its employees in terms of their qualifications,
level of competence, and level of involvement in the ongoing process of making the organization
better. Additionally, individuals on high-performing teams are highly focused on providing
brilliant outcomes. These individuals have specialized experience and complementary talents,
and they work together to generate productive results. By taking the appropriate approach to
performance management, the organization will provide them with the ability to collaborate with
one another, grow professionally, and produce the greatest quality of work. The present essay
highlights and critically discusses a few sustainable approaches used in the HPW System to
manage employees in effective manner, considering the productivity and finances of
organization

One of the foremost approaches in HPW to ensuring employee Security is vital. To avoid
employee responsibilities, many companies downsize and hire part-time and contract workers,
but these strategies rarely generate new streams of revenues or improve profitability in long
term. HPW systems foster high-trust relationships with employees to foster commitment and the
positive behaviour that modern organizations require to thrive. In the past, prosperous electric
company Lincoln Power offered permanent hiring after three years. However, those policies of
employment security that demonstrate a commitment to employees and their well-being are most
effective when coupled with careful recruitment of individuals who fulfil organizational
objectives and job needs. Scholars have demonstrated that companies build trust with their new
hires when security regulations are employed. It is also observed that their employees perform
better and are more dedicated toward organization’s goal, and reap the benefits.

Furthermore, before appraising new hires, organizations precisely identify employees'

essential skills and characteristics. It makes it more logical to base hiring decisions on job
requirements rather than academic credentials. Identifying non-trainable attributes like integrity,
respect, and service orientation increase staff retention and long-term compatibility. One of the
largest vehicle rental firm “Rent Automobile” in the U.S, has employed selective hiring to recruit
human resources from half of the college class. The emphasis of enterprise on hiring former
collegiate with great interpersonal skills has contributed to the company's exceptional customer
service reputation and market leadership. Jim Collins, a management scholar, asserts that "great"
organizations hire suitable personnel.

HPWS cultures value goal setting, therefore a decentralized decision-making approach is

viable. HPWS firms empower employees to provide excellent customer service and achieve
optimal organizational results by imparting decision making throughout the organization. HPWS
companies trusts workforces by incorporating well trained managed teams with autonomy and
broad discretion in decision making. The self-succeeded crews can boost initiative, but they need
substantial accountability and training in reporting assignment progress. Taking an example of
customer service is legendary at the Ritz-Carlton Hotels. Ritz-Carlton delivers service excellence
through decentralizing decision-making to all workers. Each employee was allowed to incur the
expense up to $3000 to serve the customer efficiently and achieve the hotel's objective.
Decentralizing decision making and empowering staff have been shown to enrich customer
happiness and profits in service-oriented companies. However, there are few decisions needs to
be taken on time to avoid losses and here is the need of balance in HPWS companies. Also, it is
not necessary that every time this approach works well in favour of organization. Also, the
interdependent team members must be accountable, and critical customer-related work is done
because the collaborative responsibility strengthens corporate principles and personal ownership
at all levels.

Another approach of HWPS is a high result based compensation structure that rewards all
employees for the company’s success fosters shared objectives and amplifies cognizance of their
contributions to success. The employee performance-based compensation is most effective in a
high-performance, profit-sharing culture. Fair, contingent remuneration guarantees workers a
portion of their wages. The sharing of profitability by the team engenders social responsibility
towards the organization and team members. As part of its commitment to superiority and
quality, Whole Foods, an American grocery store that sells natural and organic foods, has created
this social structure. Since the company’s beginning, fortune has named it one of the “100 Best
Companies to Work For” and bestowed numerous accolades on its ideals. Paying for
performance necessities that organizations build improved criteria of excellence and explain to
employees how they create value for customers and the organization. However, sometimes a few
of those are rewarded who look busy but do nothing, which later create discouraging
environment for productive employees.

Furthermore, most HPWS organizations emphasize dedicated trainings over supervised

management training. The training of employees to solve problems, take responsibility for the
quality and suggest process changes shows confidence in the hired staff and dedication to a
result-based compensation structure. HPWS carefully examine the training needed to achieve
organizational goals and then invest heavily in helping people succeed, unlike many
organizations that consider training a wasteful investment. The job-specific training increases
employee ownership, dedication, and ability to achieve critical organizational goals, according to
research. The Men's Wearhouse apparel firm has grown by investing more in staff training and
cultivating a culture of employee support than its competitors. In 2014, it acquired the Joseph A.
Banks brand. The successful organizations recognize the necessity of building a corporate-wide
"learning culture" to help all employees to create value and improve service quality in today's
highly competitive global marketplace. At the same moment, companies need to have a bird eye-
view on the expenses incurred on training and the financial productivity.

In today’s technology world, HPWS considers all employees capable of contributing

valuable suggestions and organizational modifications. The wage disparity and the use of codes
such as language, wardrobe, and physical space might signal to workers that a company views
position hierarchically rather than as an equal contributor. According to Stephen R. Covey, trust
is built by nurturing and growing individuals within a company. Reducing status barriers,
empowering individuals, and appreciating them builds commitment and trust. One of the largest
independent dealers of DRAM memory modules for personal computers, Kingston Technology
removes the status barriers by encouraging open cubicles and eliminating private secretaries. So,
creating a culture that appreciates and empowers people is the most efficient way for bosses to
demonstrate how they feel about their staff. However, sometimes these strategies create biasness
and a grouping amidst employees who carries same thoughts on any agenda which can be crucial
in future.

Also, the dissemination of strategic, financial, and performance data demonstrates to the
workers that they are trusted allies who can use the data to help the organization prosper. The
motivated and well-trained employees require information to ensure the success of their
organization. Many traditional companies refuse to share information with their staff or train
them on how to use it to achieve their goals, thereby losing opportunities. One of the successful
International Harvester, Springfield Remanufacturing Corporation remanufactures transportation
items, uses "open book management" to share information with employees in order to assist them
in performing their jobs, achieving their goals, and taking control of their lives. In a knowledge-
and insight-based global economy, organization-wide information is vital. But, information is the
key to every solution therefore at the same time, the organizations ensure that understand of
employee on “Loos Lips, Sink Ships”

Companies that use HPWS incorporate almost all of the aforementioned sustainable
approaches to manage human resource. However, negative effects may be produced if businesses
routinely make use of an HPWS to surge the demands that are put on employees and to devalue
individual resources. This may result in the companies' inability to meet those demands. HPWS
practices can lead to stress because they increase the demands of the job. Moreover, when there
is a lack of trust between members of a team, that team will struggle to cooperate toward a
common goal and will instead prioritize the members' individual issues. This will make it much
more difficult to achieve success. There will be a adverse impact on the efficiency and
productivity of the team if there is a lack of trust.

According to the conclusions of different researches conducted on HPWS, firms with a

scattered strategy to increase high levels of commitment, high levels of trust, and high levels of
performance have a substantially lower rate of success than those with an integrated plan. In
today's organizations must be proficient of accomplishing both alignment and compliance,
notwithstanding the inherent paradox that results from their success simultaneously. This is a
prerequisite for the company. Nonetheless, it is possible to fulfil these seemingly conflicting
organizational goals through the deployment of the necessary human resource management
(HRM) components contained within an HPWS. Successful organisations in the modern
economy require their employees to stretch themselves to achieve ambitious targets. It is
essential to demonstrate the discipline to meet quality standards, showcase a desire to help and
assist team members in completing tasks, and earn the trust of others by exhibiting their
dedication to the long-term welfare of the organisation and its members. In order for a company
to be successful in the modern economy, it must ask its employees to reach challenging goals,
display the discipline to satisfy performance requirements, and demonstrate a desire to support
and assist team members.

Eventually, the dedication of the top management team and leadership at the top is
responsible for the development of a committed and aligned corporate culture, which is crucial
for the building of a successful HPWS firm. It appears that organizational leaders that use
aligned HPWS systems are rewarded with employees who are more dedicated to their
organizations and more likely to engage in the extra-role behaviours that are crucial to the
profitability and competitive advantage of the organization. This growing body of evidence
demonstrates that CEOs of organizations that adopt aligned HPWS systems are rewarded with
more dedicated staff. Those in charge of leading outstanding organizations must have an
awareness of the complexities required for success in today's businesses, a dedication to values
that people can identify with, and an embodiment of these values in their own lives.

The fact of the matter for small and medium-sized enterprises is; when high-performance
work systems (HPWS) are implemented with a focus on a culture-wide integration of values,
maybe just as beneficial to them as they are to larger and more complex organizations.
Companies and their executives who fail to adopt linked HPWS elements are likely to see a rapid
decline in their competitive position in today's fast-paced economy, leading to their demise as
they fail to keep up with the ever-changing globe. This is because neglecting to implement
aligned HPWS features places businesses in a situation where they cannot successfully compete.
Some of the other potential drawbacks of HPWS is that it can be expensive to implement and
maintain, as it demands significant investment in technology and training. Additionally, it can be
difficult to measure the impact of HPWS, as it is difficult to quantify the benefit of improved
morale or greater motivation. Finally, HPWS can also lead to employees feeling overworked or
overwhelmed, as they may be expected to take on more tasks or work longer hours in order to
meet the organization’s goals.

In conclusion, HW can be beneficial to organisations if implemented correctly. However, it is

important to consider the potential drawbacks before implementing such an approach, as it can
be expensive and difficult to measure the impact. Ultimately, whether or not HPWS is beneficial
to an organisation will depend on the specific circumstances and goals of the organisation, as
well as to increase revenues by making workers feel like they have a stake in the company's
success.
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