Human Resource Management Practices Influencing Organization Performance: A Case Study of Equity Bank Kenya

Abstract

Abstract An organization’s performance is often seen as an indicator of market acceptance and success. Performance is considered top strategic priority for most firms yet only few companies achieve optimal performance and even fewer maintain it. The outcome of HRM practices on organizational performance has been given different perceptions, predominantly on the relationship between HRM practices and their effect on organizational performance especially on private banks. It is therefore prudent to look into HRM practices and their effect on organization performance targeting Equity bank Kenya Ltd. This study sought to establish the effects of human resource management practices on organizational performance. The objective of the study was to investigate the effect of recruitment and selection, HR training and development, reward management and employee relations on organizational performance in a Kenyan bank. The study was guided by three theories Resource-Based View Theory, Social Exchange Theory (SET) and Human Capital Theory. The study adopted a descriptive research design. Study population consisted of 113 management staff of the target bank headquarters in Nairobi. Stratified proportionate random sampling technique was used to select the sample. Simple random sampling was used to select 34 respondents by taking 30% from each stratum. Primary data was collected using structured questionnaires and analyzed using descriptive statistics and outcome presented on tables and graphs. Results showed that training programs and rigorous selections positively influenced performances. Excellent induction too influenced performances. Rewards management on the other hand was not fair since it was not done on merits and this affected bank performances, and on employee relations Individual grievance and disciplinary policy and practice influenced performances. The study concluded that among the four variables rigorous recruitment and selection and employee relation significantly influenced the organization performance.