HRM work leads to higher profits

A two-year research project by King’s College, London, has found that
businesses which show a high commitment to human resources management (HRM)
benefit from increased productivity and profitability.

The project also discovered that effective HRM brings high staff
satisfaction levels and well-being. More than 600 senior HR managers and 460
CEOs were interviewed from a range of companies with more than 50 employees for
the Future of Work Pro- gramme, which was sponsored by the Economic and Social
Research Council and the CIPD.

David Guest, professor of organisational psychology and human resources
management at Kings College, claims the findings show that the number of HRM
practices adopted by companies in 1999 is linked to their financial performance
in the same year.

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Prof Guest said, "Most UK employers are still not doing HRM properly.
The best way to improve productivity is to encourage more companies to do more
HRM.

"HR departments are seen by CEOs to be doing traditional things."