Impact of human

resource management
on organizational
performance in
construction companies
Mark George
158064
Abstract
The research examines the impact of human resources management on project performance. A
case study on the professionals employed as contractors and consultants on Egyptian and
Jordanian construction projects. Major HRM factors were evaluated for their relationship to and
influence on project performance. Respondents provided information on how these factors were
applied and the effectiveness of their teams in relation to construction projects. They also
provided information on how the performance of the projects had actually been measured.
Results showed the influence and connection between HRM factors and the project performance.

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Table of contents

Table of Contents
Abstract..........................................................................................................................................2

Table of contents............................................................................................................................3

Introduction....................................................................................................................................4

Literature review............................................................................................................................5

HRM practices.............................................................................................................................5

Linking HRM with organizational performance..........................................................................5

Previous case studies......................................................................................................................7

Case study technique..................................................................................................................7

Statical Analysis..............................................................................................................................9

Results and conclusion.................................................................................................................10

References....................................................................................................................................11

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Introduction
Today's industrial environment is marked by uncertainty and unpredictability. Worldwide has
made a rapidly shifting economic environment that is the typical for most businesses, forcing
them to continuously improve their performance in order to maintain their market position. The
effectiveness of an organization to increase performance depends on good management choices
and accurate financial and non-financial data.

Typically, organizations base their performance evaluations on established goals that are related
to their purpose and vision, which in effect define the degree of performance they must achieve.
One of the most important assets for giving organizations a competitive lead is human resources
(HR). Therefore, a company's organizational performance may be increased through effective
human management. It offers a defined course, vision, purpose, objectives, goals, or plans. It
assists in identifying personnel with the objectives of their business, improving performance.

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Literature review

HRM practices
When compared to standard personnel management, which is primarily identified by its
operational focus, HRM is a creative approach to managing people. Additionally, HRM plays a
key and strategic function in connecting people management to wider company goals. It is an
effort to manage people while keeping the business's long-term objectives in mind. HRM
practices are the HRM actions that an organization does to accomplish its objectives. These
actions include recruiting, selecting, training, developing, evaluating performance, and
compensating employees. (Al-Sarayrah et al., 2016)

Recruitment is one method used in HRM to find potential workers. selecting workers via
selection, educating employees on ways to do their roles and preparing them for changes to come
via training and development, and assessing employees' performance via performance evaluation.
Paying employees well, analyzing and designing work, determining HR requirements, and
promoting a good work environment are all ways to reward employees (Al-Sarayrah et al., 2016)

Linking HRM with organizational performance

Organizational performance

The effectiveness of an organization to meet a set of objectives that are essential to its survival
and success, such as growing market share, maintaining profit, and maintaining a competitive
advantage, is referred to as organizational performance. ( Oyemomi, 2016)

It focuses on ensuring the organization's long-term existence, which depends on the deployment
of effective strategies and action plans. The organization's main objective is to achieve peak
performance. As a result, businesses that operate in many industries seek continually to improve
their performance by creating competitive advantages. ( Oyemomi, 2016).

Economical performance

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A measurement of an organization's financial state is its financial performance. It is the financial
result produced by management choices and their performance by an organization's workforce.
(Alrowwad, 2017).

From a number of angles, financial performance is seen as a sign of a company's financial state.
Financial metrics, which may be found in economic statements and the notes that accompany
them, are typically more variable than non-financial events. Revenue growth, profit margin,
economic value, cash flow, income, expenses, ROI, and profitability are a few examples of
financial metrics. ROA and return on equity are also included. (Ha and Lo, 2018).

Non-financial performance

Because of their importance in implementing strategies, non-financial indicators are supported in

modern methods to performance measurement. In the face of recent organizational scandals, non-
financial performance indicators have gained popularity. These measurements include a wide
range of topics, such as how employees are treated, environmental performance, corporate
governance, and charity contributions. (Amini et al., 2017)

Innovation, customer and employee happiness, staff effectiveness, participation, absence rate,
overall employee performance, organizational commitment, and inner business process success
are all included. Additionally, they assist management in determining and assessing the progress
made toward reaching organizational objectives, assessing environmental changes, and
emphasizing performance accomplishment. (Chahal et al, 2016; Alrowwad et al ,2017)

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Previous case studies
The Jordanian construction industry is the study's target population. It covers both contractors and
consultants in Jordan, as well as all workers at all management levels working for the 16
Jordanian construction firms. The sample for contractors came from "first-class" contracting
firms in Jordan. The sample for consultants was drawn from "consultancy offices" for consulting
firms in Jordan.

On the other side, a study relates to contractors professionals who are involved in construction
projects in Egypt and examines the impact of human resources management on project
performance. The relationship and impact of ten key HR Management factors (targets and
objectives, job descriptions,hiring, training, communication, leadership, team relationships,
keeping employees, trust and values, and ultimately, evaluation and incentive)on the cost and
time project performance were evaluated. An analysis of all the obtained data, descriptive
analysis, and correlation tests were used in this study. A sample of 105 respondents provided their
responses, describing how HR Management aspects were applied and how their teams' efficacy
on Egyptian building projects.

Case study technique

The sample size required for this study, based to Sekaran and Bougie (2016), is 340.After getting
prior consent from the departments of the examined enterprises, questionnaires were given to
respondents. The best strategy for choosing people from the population was determined to be
random stratified sampling. The researchers finally delivered 340 questionnaires to businesses
that were reachable and consented to accept them. The study's initial sample size was 340..

In The Egyptian case study, On Google Forms, a total of 105 contractors professionals who work
on construction projects in Egypt responded to the inquiry. Everyone had only selected one
project, which had just been completed in Egypt six years prior. The researcher used descriptive
and relations connection analysis to perform the following analyses on the quantitatively
examined data: In the beginning, descriptive analysis will show sample characteristics based on

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demographic analysis. The second step is a correlation test to see whether there are any existing
correlations between the independent and dependent variables.

Survey method

A five-element, symmetric, with a neutral midpoint was used in the questionnaire survey to

collect the necessary data from workers in Jordanian construction companies and to examine the
effect of HR management practices on organizational performance. In opposite to interval data,
likert scale data are actually ordinal in nature. Each comment was followed by a question asking
participants to indicate whether they agree or disagree.

The following approach was used to collect the data. The Jordanian Engineers Association (JEA)
produced a guide for consulting firms in 2017; the Jordanian Construction Contractors
Association published one for contracting firms in 2017. Both publications included contacts for
the researchers. The employees who would oversee the delivery of the questionnaire inside the
firms were contacted by calling the HR departments of the corporations. The firm was then
questioned by the researchers about how they wished to distribute the questionnaire. Few
questions were delivered by email, whereas most were self-administered.

In the Egyptian case study, Classifying projects by type reveals that all types of projects were
represented in the sample, with 33 projects being residential building, 29 projects being non-
residential , 25 projects being industrial one, and 18 projects being civil.

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Statical Analysis
In order to learn more about the respondents' age, gender, position, experience, and educational
level, the survey's first part included questions about their demographics. The study's primary
variables, HRM practices, organizational performance, and their dimensions are measured using
33 items in the second part. 22 questions measuring HR practices and 11 items measuring
organizational factors made up the 33 items.

The actions involved in analyzing HR needs include hiring potential workers, choosing
individuals, training employees to do their roles, preparing them for changes to come, developing
employees, evaluating employees' performance, and rewarding employees. Recruitment and
selection, training and development, performance assessment, and payment have been divided
into four areas for this study's activities.

The Statistical program was used to conduct the analysis. After the steps of obtaining, verifying,
and inputting the data, various techniques were employed to investigate the data in order to test
and respond to the research question. These techniques include the use of frequency and
percentages to characterize the demographic information of the respondents, as well as
descriptive statistics measures to define the features of the research sample. The primary factors
were described. To investigate the connections between the independent variables, a
multicollinearity test was used. Fourth, the hypotheses were tested using multiple regression
analysis.

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Results and conclusion
The results of the sub assumptions are inconsistent with the other two HR practices and are
aligned with the findings of the strong correlation between organizational performance and HR
practices. Additionally, it was confirmed that performance evaluation and training and
development had a great influence on performance.

The Jordanian research confirmed that training had a beneficial effect on organizational

performance. The beneficial effect of performance reviews on organizational performance was
also confirmed by other studies.

Similarly, the results of the case study which was done in Egypt showed a link between HR
Management factors and project real performance. There are primarily Eight factors that have a
major impact on cost performance: leadership, job description, team dynamics, employee
retention, training, staffing recruitment, and communication. According to correlation findings
relating HR Management factors to project real time performance, four factors—motivation and
appraisal factor, retaining employees, job description, and communication—were shown to be
important. Finally, the quantitative research had shown that while there is a relationship and
influence on the real project performance, not a basic relationship.

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References
Human Resources Management influence on projects performance: A Study of Contractors
Professionals Working on Construction Projects in Egypt

https://iopscience.iop.org/article/10.1088/1755-1315/1056/1/012039/pdf

The impact of human resource management practices on organisational performance in

construction companies in Jordan

https://www.researchgate.net/profile/Yousef-Al-Abdallat/publication/
347642259_The_impact_of_human_resource_management_practices_on_organisational_perform
ance_in_construction_companies_in_Jordan/links/60756cd192851cb4a9d86b92/The-impact-of-
human-resource-management-practices-on-organisational-performance-in-construction-
companies-in-Jordan.pdf

Evaluating Communication Features of Human Resource Management Practices: The

Construction Industry in Lagos State, Nigeria

http://dx.doi.org/10.3390/businesses2040030

R.J. Sweis et al. Saridakis, G., Lai, Y. and Cooper, C.L. (2017) ‘Exploring the relationship between
HRM and firm performance: a meta-analysis of longitudinal studies’, Human Resource
Management Review

https://e-space.mmu.ac.uk/623798/1/Saridakis%20et%20al.%202017%20HRMR.pdf

Al-Sarayrah, S., Obeidat, B.Y., Al-Salti, Z. and Kattoua, T. (2016) ‘The effect of culture on strategic
human resource management practices: a theoretical perspective’, International Journal of
Business Management and Economic Research

http://ijbmer.com/docs/volumes/vol7issue4/ijbmer2016070402.pdf

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Alrowwad, A., Obeidat, B., Tarhini, A. and Aqqad, N. (2017) ‘The impact of transformational
leadership on organizational performance via the mediating role of corporate social
responsibility: a structural equation modeling approach’, International Business Research,

https://pdfs.semanticscholar.org/8848/2ed1626eef8348ce838c018d7ab109948e31.pdf

Oyemomi, O., Liu, S., Neaga, I., Chen, H., & Nakpodia, F. (2019). How cultural impact on
knowledge sharing contributes to organizational performance: Using the fsQCA
approach. Journal of Business Research, 94, 313-319.

https://eprints.whiterose.ac.uk/140477/1/AAM.pdf

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