STRATEGIC HUMAN RESOURCE

MANAGEMENT

CHAPTER FOUR
High-performance strategy

Course Instructor:
Dr. Mohammed Abdullah Mamun
Professor
Department of Management University
of Chittagong
 LEARNING OUTCOMES

 UNDERSTANDING HIGH-PERFORMANCE WORK SYSTEM

 HIGH-PERFORMANCE WORK SYSTEM AND AMO MODEL

 CHARACTERISTICS OF A HIGH-PERFORMANCE WORK

SYSTEM

 COMPONENTS OF AN HPWS

 IMPACT OF HIGH-PERFORMANCE WORK SYSTEMS

 DEVELOPING A HIGH-PERFORMANCE STRATEGY

 INTRODUCTION
 High-performance work systems are also known as high-performance work practices which “invest
in the skills and abilities of employees, design work in ways that enable employee collaboration
in problem-solving, and provide incentives to motivate workers to use their discretionary
effort.” (You are not assigning someone any task, You are collaborating. It is a team approach.
Think about car assembly line. Discretionary means a new method, your own choice based on your
knowledge and experience. Suppose You learn from company A, You want to apply to company b)
 The aim is to support the achievement of the organization's strategic objectives.
 A high-performance strategy focuses on achieving competitive advantage by improving
organizational performance through people. (Every other resource can be copied but human capital
is almost impossible to copy, So we should gain competitive advantage using it)
 And these systems integrate HR practices into the firm’s broader strategy to enhance organizational,
financial, and operational outcomes. (Operational effectiveness means Doing similar things better
than others, now You can have sustainable competitive advantage. You have to combine HPWS/HP-
HR practices into the firm’s broader strategy To ensure organizational, financial, and operational –
Same as triple bottom line). (You can achieve the bottom line) (Finance department outcome is to
raise money, less cost, more outcomes)
 HIGH-PERFORMANCE WORK SYSTEM
Definition
 Composed of practices that can facilitate employee involvement, skill enhancement and motivation.
(Appelbaum et al ,2000)
 Armitage and Keeble-Allen identified three main themes that form the foundation of HPWS:
(1)—Foster an open, creative, and inclusive culture that is people-centered. Ensure
decision-making is well-communicated and shared across the organization (e.g., You are a
salesman in organization-Bank deposit collector/real estate who wants to create a creative
culture by changing the existing procedure. Giving discounts or buy one get one is old. You
also have to improve others because it is a teamwork.
(2)— Investment in people through education and training, loyalty, inclusiveness and
flexible working (there are some companies in our country who are doing this. They believe
in management training.
(3)—Measurable performance outcomes such as benchmarking and setting
Targets and innovation through processes and best practice. (Organization giving KPIs,
measurable performance outcome. Benchmark means best performing/performance
standards, well accepted standards)
(Can you write real examples? Can you relate this with Bangladesh? A creative culture/environment
 HIGH-PERFORMANCE WORK SYSTEM and
AMO model
HPWS

 HPWS designed to enhance the performance of both employees and

the organization.
 HPWS practices: (These also motivate the employees) Examples
—Selective Recruitment and Selection
—Extensive Training
—Teamwork
—Information Sharing and Communication
---Incentives
---Employment Security
—Reduced Status Differences
 HIGH-PERFORMANCE WORK SYSTEM and
AMO model
AMO model
 The AMO Model suggests that performance is influenced by three main
factors/components :
—Ability: Employees must have the necessary skills and knowledge (Formal
education) (learning can be also from experience while working) (3 basic skills –
technical means job related skills, managerial)
—Motivation: Employees must be motivated to perform well, which can be
influenced by incentives, rewards, and the organizational culture. (sometimes
by not getting return/reward people are not motivated, It is sometimes because of
a culture where employees are not appreciated. So a culture of maintaining
relationship, supporting, guiding, instructing, appreciating and helping needs to
be created)
—Opportunity: Employees need the opportunity to use their skills
 HIGH-PERFORMANCE WORK SYSTEM and
AMO model
Relationship Between HPWS and AMO Model

 The HPWS aims to create an environment where all three components of the
AMO model are addressed & working well. (You have to align those
components to achieve the ultimate outcome)
 By aligning HPWS practices with the components of the AMO model,
organizations can maximize employee performance and achieve better
organizational outcomes. (Like Roles Royale company allows employees to
design handmade designs / handcraft paints for their cars – Discretionary Effort).
 CHARACTERISTICS OF A HIGH-PERFORMANCE
WORK SYSTEM

 Consistent and coherent HRM system focused on solving operational problems and
implementing the firm’s competitive strategy. ((The first characteristic of HPWS is It is
focusing on solving Operational problems in The internal processes. Which are the
problems? /problems in performance? Strategies are Involvement of employees By which we
get a new design. Like Toyota allowing their employees design (discretionary) With incentives)
(Other problems in operation is your people cannot contribute to make necessary changes So that
You bring new features. By solving these problems you gain long lasting sustainable competitive
advantage. But when you selection, promotion decisions are bad then these supports are not to be
found. You cannot attract good emoloyees. Your strategy is cost effective, economies of scale. But
if you don’t have the right employess, then how come)
 It is key to acquiring, motivating, and developing intellectual assets that offer sustained
competitive advantage. Because:
—Aligns the firm’s selection and promotion decisions to validated competency models;
—Develops strategies that ensure timely and effective support for skills required by the
firm’s strategy.
 CHARACTERISTICS OF A HIGH-PERFORMANCE
WORK SYSTEM

 HPWS enhances organizational commitment by fostering trust

within workplaces and increasing intrinsic rewards for employees.

(Intrinsic vs Extrinsic Reward. Intrinsic reward is challenging work,

opportunity to work, appreciation, recognition, building trust &

relationship – Non financial)

 HPWS is a way of thinking about organizations that helps achieve

strategic human resource management by ensuring a fit between

information, technology, people, and work.

 COMPONENTS OF AN HPWS

 HPWS consists of desirable practices aligns with the 'best practice' or 'universalistic'
approach.
 No single universal set of practices exists. The effectiveness of practices depends on the
organizational and environmental context. (The situation in which you are to achieve your
objectives)
 Bundling practices improves effectiveness. Combining complementary (depending)
practices into ‘bundles’ can enhance their impact.
— For example Practices like quality circles (Germany management) are more effective
when paired with employee involvement or empowerment initiatives.
Quality Circle :
COMPONENTS OF AN HPWS
 Continued
• In Bangladesh we have department of Labor. We have a tripartite system. Labor
department gives rules and guidelines like How many working hours and overtime
hours should be applied.
• So from the Bangladesh labor directory which are the rules in guidelines? Write them
down. What are the similarities between Bangladesh and the given US department of
Labor?
• Also compare between the three author given HR Practices in HPWS & that of your
country’s labor directory.

Based on the Bangladesh Labour Directory and the requirements outlined in the
Bangladesh Labour Act, 2006 (as amended in 2016), a high performance work system
(HPWS) in Bangladeshi industries and farms is underpinned by a series of HR practices
that ensure fair, safe, and efficient work environments. These practices include:

Transparent Recruitment and Documentation

• Issuance of formal appointment letters and identity cards with photographs
• Maintenance of service books and detailed registers for every worker
(For example, every worker must have a service book that records their employment
history, as mandated by the Act.)
 Continued
Worker Classification and Employment Conditions
• Clear classification of workers (e.g., permanent, temporary, probationary, seasonal)
• Defined probation periods and rules on reappointment
(This ensures that each worker’s status is clearly determined, facilitating fair treatment and proper HR
management.)

Wage Management and Payment Compliance

• Adherence to prescribed minimum wage levels and timely payment of wages
• Payment of overtime at legally mandated rates and deductions only for permitted reasons
(These measures help maintain financial security for workers and reinforce trust in the employment system.)

Regulated Working Hours and Leave Policies

• Enforcement of maximum daily/weekly working hours, including mandated rest intervals
• Provision of annual leave with wages, based on the worker’s duration of service
(Such scheduling practices not only comply with the law but also help prevent worker fatigue and promote
productivity.)
 Continued
Occupational Safety, Health, and Welfare
• Establishment of safe working conditions through regular risk assessments and maintenance of health–safety
standards
• Mandatory formation of safety committees (in factories with 50+ workers) to conduct safety drills and monitor
working conditions
(For instance, safety committees must be active in conducting risk assessments and arranging periodic safety
trainings.)

Training and Continuous Skill Development

• Provision of on-the-job and off-the-job training programs to enhance both technical and soft skills
• Regular refresher courses to keep workers updated on new technologies and safety practices
(This helps improve productivity and aligns with the HPWS goal of continual improvement.)

Social Security and Welfare Benefits

• Implementation of social security measures such as maternity benefits, provident fund contributions, and
compensation for workplace injuries
• Adequate measures to provide healthcare, sanitation, and in some cases, housing or dormitory facilities
(These benefits build worker loyalty and reduce turnover, which is vital for a stable, high-performing workforce.)
 Continued

Worker Participation and Trade Union Rights

• Recognition and facilitation of the right to form or join trade unions
• Mechanisms for grievance redressal and worker–management consultations to ensure that
worker voices are heard
(Encouraging worker participation in decision-making processes helps create a sense of
ownership and accountability.)

Together, these HR practices—rooted in the legal framework of the Bangladesh Labour Act,
2006—create a robust system that not only ensures compliance with labor laws but also
contributes to developing a high performance work system where worker well-being, safety,
and continuous development drive overall organizational success.
 IMPACT OF HIGH-PERFORMANCE WORK
SYSTEMS

 Significant improvement in financial performance (EBIT & others)

 Positive cultural changes, such as increased cooperation and innovation. (Making necessary
changes)
 Higher levels of employee job satisfaction. (So many years Bangladeshi students are focused on
government jobs) (Employees satisfaction depends on the supervisor, If he is toxic, if he tortures
subordinates, then there is an issue) (The scope of development, nature of work)
 Better work design and communication processes.
 Use of team-based and non-financial rewards (intrinsic reward) was closely linked to improved
performance.
 Right employees in the right roles helps to adapt changing strategic circumstances. (Suppose
the role is financial analysis, and you have positioned an engineer there. How you expect good
results?)
(In your life you have 3 important decisions : Chosen higher studies, Choosing your career (which type
of work you want to do), Choosing department?)
(Next you have to make a list of 3 firms or companies in an industry having high performance work
DEVELOPING A HIGH-PERFORMANCE
STRATEGY
 DEVELOPING A HIGH-PERFORMANCE
STRATEGY (To reach org goals)
APPROACH TO DEVELOPMENT

 A high-performance strategy is focused on what needs to be done to reach the

organization’s goals.
 The aim is to create and maintain a high performance culture.
 The characteristics of a high-performance culture are that:
— Connection between strategic objectives and departments and its staff at all
levels. (Connection between division like marketing and sales)
— Employees understand their roles, goals, and accountabilities. (In teams
everyone is leader and share responsibilities)
— Jobs are meaningful (There should be alignment of capabilities of employees);
strong fit between the job and their capabilities
— people are involved in developing high-performance practices; maximize
their contribution
 DEVELOPING A HIGH-PERFORMANCE
STRATEGY
Developing a high-performance work system – Vip for exam

1. Analyze the business strategy:

— Assess business direction, strengths, weaknesses, opportunities, threats, and
HR implications.
2. Define the desired performance culture of the business and the objectives
of the exercise.
—Use key characteristics to align with organizational context and objectives.
3. Analyze the existing arrangements:
— Examine existing practices, behaviors, and attitudes, identifying gaps.
4. Identify the gaps :
— Specific practices where there is considerable room for improvement.
5. List Required Practices:
—Broadly outline necessary changes or new practices.
 DEVELOPING A HIGH-PERFORMANCE
STRATEGY

6. Establish Complementarities:
— Group practices into supportive bundles.
7. Assess Practicality:
— Evaluate feasibility, added value, and resource availability.
8. Prioritize:
— Focus on impactful, feasible practices, considering quick wins and potential
resistance.
9. Define Objectives:
— Refine objectives with clarity on desired outcomes and processes.
 DEVELOPING A HIGH-PERFORMANCE
STRATEGY

10. Get Buy-In:

— Secure support from leadership and stakeholders through involvement and
communication.
11. Plan Implementation:
— Include timelines, resource allocation, and change management strategies.
12.Execute Implementation:
— Emphasize action over prolonged planning; ensure capable project
management.
THANK YOU