A Comparative Study on Employees Belief about Implementation of HRM Practices in Government and Private Power Sector Organizations

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1 A Comparative Study on Employees Belief about Implementation of HRM Practices in Government and Private Power Sector Organizations Amita Prajapati 1 and Prof. (Dr.) Naresh K. Patel 2 1 (Asst. Professor, B. P. College of Business Administration, Gandhinagar, Gujrat, India) 2 (Dean, Faculty of Management and Information Sciences, Dharmsinh Desai University, Nadiad, India) Abstract: Human Resource Management (HRM) practices work as a source of competitive advantage as effective HRM practices have significant impact on the performance of the employees as well as an organizational performance which contributes in reducing employee turnover and raising employees productivity. With this point of view the paper has been written to check the employees belief about implementation of HRM practices specifically, recruitment and selection, training and development, performance appraisal, compensation, work life balance in the power generation organizations and to compare the HRM practices followed by government and private power sector organizations. For the same data were gathered from 80 respondents i.e. 40 from each sector. Data was collected by using questionnaire and analyzed by using descriptive statistical tools. The result showed that except training and development, all other null hypothesis was rejected. It can be concluded that both the organizations are practices sound and similar types of practices with respect to recruitment and selection, performance appraisal, compensation and work life balance. Training and development practice was also implemented by both the types of power sector organization moderately. Keywords: recruitment and selection, training and development, performance appraisal, compensation, work life balance I. INTRODUCTION In the era of competition, Human Resource Management (HRM) practices work as a source of competitive advantage. Many researchers found that effective HRM practices have significant impact on the performance of the employees as well as an organizational performance which contributes in reducing employee turnover and raising employees productivity (Kundu & Malhan, 2009; Alusa & Kariuki, 2015; Savaneviciene & Stankeviciute, 2012; Singh & Kassa, 2016). Though the organization is customer centric organization, primarily they need to become employee centric organization. Employees are one of the vital resources of the organization who manage the other resources of the organization. If employees are satisfied and motivated, they contribute towards the success of the organization. Therefore the contribution of human resource management (HRM) to the overall attainment of organizational goals is increasingly acknowledged (Budhwar, 2000 cited in Singh & Kassa, 2016). India is one of the developing countries and for any developing country power is one of the vital sectors as it directly related with infrastructure and urbanization. During 1980s, Gujarat Power Sector faced heavy losses due to rural electrification. After the introduction of LPG Policy and Electricity Act 2003, there have been noticeable changes found in the Gujarat Power Sector scenario (GoG report). The report on 24X7 Power for All Gujarat (2016) indicates that gradually power companies have started making profit since Compare to earlier, presently there are many private power sector organizations along with the government sector are working which creates the competitive environment. Moreover, it found that private sector is dominant player in power generation. They are also expanding their generation capacity to meet the requirement (as per govt. report). The expansion obviously requires the more talent and also creates the challenges in front of the management to hire, to motivate and to maintain the talent to remain competitive. The present study focuses on the employees belief about HRM practices being implemented in government and private power sector organizations for remaining competitive. To achieve the main objective, the following subobjectives were set: 1. To assess the practices regarding recruitment and selection being implemented in government power 2. To assess the practices regarding training and development being implemented in government power Page 26

2 3. To assess the practices regarding performance appraisal being implemented in government power 4. To assess the practices regarding compensation and benefits being implemented in government power 5. To assess the practices regarding work life balance being implemented in government power sector and private power sector organization II. LITERATURE REVIEW HRM practices HRM practices are the set of process used by the organization for hiring, motivating and retaining talent in the organization. Schuler and Jackson (1987) defined HRM practices as a system that attracts, develops, motivates, and retains employees to ensure the effective implementation and the survival of the organization and its members. HRM practices a set of practices used by organization to manage human resources through facilitating the development of competencies that are firm specific, produce complex social relation and generate organization knowledge to sustain competitive advantage. According to Edwin B Flippo, Recruitment is the process of searching the candidates for employment and stimulating them to apply for jobs in the organization. It is a process of locating and encouraging job seekers to apply for present or future job opening in the organization. Recruitment is the function preceding the selection. The main objective of the recruitment process is to accelerate the selection process. Selection is the process of differentiating between applicants in order to identify and hire those with a greater likelihood of success in a job. This process must be bias free for the selection of competent person. Training and development means changing what employees know, how they work, their attitude toward their work, or their interaction with their co-workers or supervisor. According to Jack Halloram, training is the process of transmitting and receiving information related to problem solving. Mathis and Jackson define training as a learning process whereby people learn skills, concept, attitudes and knowledge to aid in the achievement of goals. Organization may provide on the job training or off the job training, it may be in house training or external training; it may be management development programmes or executive development programmes for the enhancement of skills, abilities and knowledge of the employee. Gamage and Imbulana, (2013) revealed that that there is a significant positive relationship between Training & Development and the employee productivity and employee job satisfaction and a significance negative relationship between Training & Development and the employee Absenteeism. Appraising the performance of individuals, groups and organizations is a common practice of all societies (Bagul, 2014). According to Dale S. Beach, performance appraisal is a systematic evaluation of the individual with respect to his or her performance on the job and his or her potential for development. A systematic and bias free appraisal process helps in motivating and retaining the talent. It can be formal or informal. Compensation can be defined as all of the rewards earned by employees in return for their labour. It includes direct financial, indirect financial and Non- financial compensation. Compensation as a concept according to (Bernadin, 2007) refers to all forms of financial returns and tangible benefits that employee receives as part of employment relationship. Compensation and benefits is an important aspect of HRM as it helps to keep the workforce satisfied, motivated (Kaur & Poonam, 2015) and committed. Compensation and benefit issues are not to be taken for granted by employers because not only pay but also fringe benefits influences the kind of employees who are attracted to, and remain with an organization (Odunlade, 2012). It should be based on performance of the employees. Work life balance refers to the level of prioritization between personal and professional activities in an individual s life and the level to which activities related to their job are present in the home ( There are some motives for applying work life practices in the organization like keep the employees motivated and performed well (Ioan, Codruta & Patricia, 2010). Satindre (2013) revealed that work life balance is associated with various quality life conditions i.e. Job Satisfaction, Work Stress, Career Growth, Turnover, Absenteeism, Appreciation and competitive environment Impact of HRM Practices on Organization Good HRM practices are instrumental in helping achieve departmental objectives and enhance productivity ( HR practices are primary indicator of job satisfaction to the work (Mottaz, 1985). There is positive relationship between HRM practices and job satisfaction (Gopinathan & N.S, 2014). Apart from that good HR practices like flexible training, transparency in appraisal programme, on and average good compensation system, flexi timing and opportunity for growth helps in effective management of human resources (Tripathy & Tripathy, 2008). Employees are more committed and are more willing and likely to work harder if they perceive that their on-the-job contributions are valued. Many researchers have revealed the significant relationship between HRM practices like compensation; empowerment and appraisal are critical factors for employees satisfaction as well as employee loyalty (Hassan, 2013). HRM Practices not only helping Page 27

3 in managing and retaining the employees but also helps in improving financial performance of the firm i.e. increasing firms profitability.(hyde et al., 2008; Joseph & Dai, 2009) Thus, following hypothesis would be proposed from the literature review: H1: Govt. and Pvt. Power sector organizations perform differ on HRM Practices H1a: Govt. and Pvt. Power sector organizations perform differ on recruitment and selection practices H1b: Govt. and Pvt. Power sector organizations perform differ on Training and Development practices H1c: Govt. and Pvt. Power sector organizations perform differ on Performance Appraisal H1d: Govt. and Pvt. Power sector organizations perform differ on Compensation and Benefits H1e: Govt. and Pvt. Power sector organizations perform differ on work life balance III. RESEARCH METHODOLOGY This paper was based on descriptive research and primary data have been gathered with the help of a questionnaire comprising two sections. The first section covered 07 background questions, and the second section covered 5 human resource management practices containing 27 statements. The respondents were asked to rate statements on a five point rating scale highly agree to highly disagree. The questionnaire was filled by 80 respondents (as mentioned in Table 1) of Ahmedabad Gandhinagar based power generation organizations. The snowball method of sampling was used for approaching the respondents. 40 respondents were belonging to Govt. power sectors and Pvt. Power Sectors each. Table1: Sector wise number of respondents Type of Organization Respondents (in No.) Respondents (in %) Govt. Sector 40 50% Pvt. Sector 40 50% IV. DATA ANALYSIS The collected data has been analyzed by using statistical tools like mode, frequency distribution and weighted mean to check the extent and direction of prevalence of HRM Practices and related factors in Power Sectors. Mode and Weighted mean were also used to see the difference between HRM practices in Govt. and Private Power Sector Organization. HRM Practices of Govt. Power Sector and Private Power Sector Organization were compared by using cross tabulation. Chi-Square was used to assess the significant differences regarding HRM Practices between Govt. Power Sector and Private Power Sector Organizations. V. RESULT The primary data were analyzed to check the HRM practices implemented by government and private power sectors. Table 2 depicted the sector wise characteristics of sample. The sample included both male (74) and female (6). Respondents were belonging to the age group of less than 25year were 03, between years were 38, between years were 22 and above 45 years of age were 17 respondents. Majority of the respondents are graduates i.e. 41 and others were post graduates and below graduates i.e. 20 and 17 respondents respectively. The sample also included the different levels of management people like lower level 26, middle level 45 and top level 9 respondents. The sample also represented the respondents field of work i.e. technical and non-technical respondents 68 and 12 respectively with total years of experience years average. Table2: Sector wise Characteristics of Sample Variables Types of organization Categories Pvt. Sec. Govt. Sec. Total Gender: Male Female Age: Less than 25 years above Education: Below Graduate Graduate Post Graduate Any others Level of Management: Lower Level Middle Level Top Level Page 28

4 Field of work: Technical Non- technical Total Years of work experience (avg.) Further the sector wise data were analyzed and calculated modular values of each variable and presented in the table 3 which shows the extent and direction of prevalence of HRM Practices. Respondents were agreeing towards the majority of the variable but in V2 and V3 respondents were highly agreeing and neutral respectively. V2, V14 & V21 have multiple modular values for Govt. Power Sector and in the table smallest one was mentioned i.e. 3 (neutral). The data also depicted Sector wise inverse response for V3 i.e. 2 (disagreeing) in Pvt. Sec. and 4 (agreeing) in Govt. Sec. In both the types of organization, respondents were agreeing that they could manage their personal and professional life as organization is providing flexi time facility. From the modular value it can be concluded that private sector organizations are paying more than government sector as. modular values are 5 and 4 respectively. Table3: Modular Value with description of variables Modular value Variable No. Description of Variables Pvt. Sec. V1 There is an existence of systematic recruitment and selection process, in my organization. V2 My selection procedure in this organization is one of the proud feeling moments of my life. 5 3 * V3 People frequently found name of my organization in NEWS paper, TV or Internet. 2 4 V4 Most of the people are familiar with the name of my company. 3 3 V5 There is an existence of fair recruitment and selection process in my organization. V6 My organization has well planned training and development activities for the employees. V7 In my organization, training is imparted on the bases of need assessment. 4 3 V8 There is an existence of Executive development and Management development programs for the employees in my organization. V9 My organization has system of internal training only 3 4 V10 My organization has system of internal and external training both 3 4 V11 My organization provides diverse training opportunities to the employees. V12 There is an existence of formal and informal appraisal systems in my organization. V13 In my organization, the top level management is bias in Performance Appraisal. 3 3 V14 V15 Performance appraisal system is positive linked with salary, promotion & incentive in my organization 4 3* Performance appraisal system is able to create the mirror image of the person s performance in my organization. V16 Performance appraisal system helps people set and achieve meaningful goals in my organization. V17 Performance appraisal system gives constructive criticism in a friendly and positive manner in my organization. V18 My organization offers good additional benefits to the employees. 5 4 V19 My organization offers attractive compensation package to the employees 5 4 V20 My organization offers promotion and other economic rewards based on performance. V21 My organization offers right non monetary incentives 3 3* V22 My organization offers all statutory benefits to the employees. V23 My organization is organizing social functions for the family members of the employees. 3 4 V24 There is an existence of flexi time facility in my organization. V25 Employees are able to manage and spend adequate time with their family along with 4 3 Govt. Sec. Page 29

5 the job in my organization. V26 My organization also supports the employees in their personal matters. V27 It is a usual activity for me to share my organization s achievement with my family, friends and relatives. *Multiple modular value and smallest one was mentioned Further all the sub variables were grouped into the main variable i.e. recruitment and selection; training and development; performance appraisal; compensation and benefits and work life balance and their frequency distribution table were prepared and depicted as Table No. 4. In both the sectors, respondents were agreeing towards the implementation of HRM practices in their organizations but compare to Govt. Power Sector organization, in Private Power Sector Organization more respondents were agreeing towards the effective implementation of HRM Practices except Training and Development. Table4: Sector-wise frequency distribution of variables Variables Responses Pvt. Sec. Govt. Sec. Total Total Number % Number % Number % Agree Recruitment Neutral Disagree Total Training and Development Performance Appraisal Compensation and Benefit Agree Neutral Disagree Total Agree Neutral Disagree Total Agree Neutral Disagree Total Agree Work Life Balance Neutral Disagree Total Apart from frequency distribution, to check the dominance of variables, weighted mean was calculated. According the collected data, the highest score variable was recruitment and selection (3.935) while lowest score variable is performance appraisal (3.504) in general as well as in both the types of organization. Though performance appraisal score was lowest, it was also moderately implemented in both the organization (3.504>2.5). Both the sectors required to more focus on performance appraisal as modular value was 3 (Neutral) for the sub-variable (the biasness in the performance appraisal programme). The second highest variable was compensation and benefit for whole sample but it was not for the Govt. Power Sector. Training and development stood the second highest variable for the Govt. Power Sector. It was also surprising that work life balance stood a third level in both the types of organizations. This focused on good balance between professional and personal life. In short, mean score showed that both the types of organizations gave equal importance to HRM practices. Table5: Weighted Mean and Chi square of variable Variables Weighted Mean Chi -square Pvt. Sec. Govt. Sec. Total Recruitment and Selection Training and Development Performance Appraisal Compensation and Benefits Work Life Balance Page 30

6 Further to test the hypothesis, chi-square test was run and the result is portrayed on table No. 5. The result revealed that only H1b was accepted i.e. training and development practices (0.1439). It can be concluded that there was significant difference between use of training and development in government and private power organizations. Others H1a recruitment and selection, H1c Performance appraisal, H1d compensation and benefits and H1e work life balance were rejected as <0.5. So it can be concluded that there were no significant difference between the use of recruitment and selection, performance appraisal, compensation and benefits and work life balance by government and private power sector organizations. VI. DISCUSSION AND IMPLICATION During 1980s, Gujarat Power Sector faced heavy losses due to rural electrification. After the introduction of LPG Policy and Electricity Act 2003, there have been noticeable changes found in the Gujarat Power Sector scenario (GoG report). The report on 24X7 Power for All Gujarat (2016) indicates that after 2014, power companies have started making profit. This could be the result of many factors but we cannot ignore the HRM practices implemented by the organizations. Human resources have power to enhance the Excellency of the organization. The analyzed data also showed that both the types of power generation organizations were implementing HRM practices moderately. Human resources are the assets for the organizations. The people (human resources) in an organization, when looked after and provided with, will certainly pay back in terms of better results, better performance and enhanced productivity. So the study has practical implications for the organizations. Organizations can definitely emphasize on excellent HR practices for raising effectiveness and efficiency. As nothing is perfect, the study has also some limitations like data was collected from limited area it could be wider. Second the questionnaire was used to collect the responses of the respondents and only single independent variable was analyzed. The further research can be expanded by using various independent variables. VII. REFERENCES [1] Alusa, K., & Kariuki, A. (2015). Human Resource Management Practices, Employee Outcome and Performance of Coffee Research Foundation, Kenya. European Journal of Business and Management, 7(3), [2] Aswathappa, K. (2005). Human Resource and Personnel Management Text and Cases. New Delhi: Tata McGraw-Hill. [3] Bagul, D. B. (2014). Study Of Employee s Performance Appraisal System. Scholarly Research Journal for Humanity Science & English Language, 1(2), [4] Bernadin, H. J. (2007). Human resource management: An exponential approach (4th ed.). NewYork: McGraw-Hill Irwin. [5] GOPINATH, R., & N.S, S. (2014). A Study on HRD Practices and its Impact Towards Job Satisfaction in BSNL, Three Different SSAs. GLOBAL JOURNAL FOR RESEARCH ANALYSIS, [6] Hassan, M. e. (2013). 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