Effects of human resource management practices on financial performance of selected agricultural firms in the sugar industry

Human resources are the source of achieving competitive advantage because of its capability to convert the other resources (money, machine, methods and material) in to output (product/service). The competitor can imitate other resources like technology and capital but the human resource are unique. People are one of the most important factors providing flexibility and adaptability to organizations. People (managers), not the firm, are the adaptive mechanism in determining how the firm will respond to the competitive environment. This study was guided by resource based theory. The study applied descriptive research design. In this design, the researcher does not manipulate the variables under study but instead, examines the variables in their existing condition. The study targeted middle level managers in selected agricultural firms in the sugar industry. In total the sample size will comprise of 134 respondents. The main research instruments that were used in this study were questionnaires. Data analysis involved both descriptive and inferential statistics using SPSS (Statistical Packages for Social Sciences) Computer package. Qualitative data was analyzed thematically. Correlation was used to analyze the degree of relationship between the variables in the study. The coefficient of correlation (r), determine the degree (strength) of relationship and its value is between -1 and 1. Regression was used to obtain an equation which describes the dependent variable in terms of the independent variable based on the regression model, (regression is used to determine the type of relationship). Further, factor analysis was undertaken in order to obtain a detailed perceptual and attitudinal aspects of the data. Data was presented in the form of frequency distribution tables, graphs and pie charts that will facilitate description and explanation of the study findings. The findings showed the correlation between Human Resource Management practices and financial performance of selected agricultural firms in the sugar industry. Abbreviations HRHuman Resource HRMHuman Resource Management HPWSHigh-performance work system SHRM –Strategic Human Resource Management RBVResource Based Value KSAOsKnowledge, skills, abilities, and other characteristics Operational Terms Financial Performance: The performance is defined in short as service, morale and profits of a firm. In this case, the financial ratios have been used as a tool for measuring the financial performance. Compensation:Total of all rewards provided to employees in return for their services. Performance appraisal: The formal assessment and rating of individuals by their managers at, usually, an annual review meeting. Selection through Recruitment: Designed to choose people who match organizational norms through interview, assessment and tests Job flexibility: Job flexibility can be measured quantitatively i.e. temporary work (also known as numerical flexibility), part-time work and flexible working hours or qualitatively i.e. employee involvement, job rotation, work autonomy, teamwork and the possibility of using multiple skills. RetentionThe ability of an organization to retain its employees FlexibilityNumber of potential alternative uses to which employee skills can be applied Performance ReflectionHow employees’ collective knowledge, skills and abilities impact an organization. Effects Of Human Resource Management Practices On Financial Performance Of Selected. DOI: 10.9790/5933-06422243 www.iosrjournals. org 23 | Page