Professional Documents
Culture Documents
CHAPTER-1
INTRODUCTION
Human resources are the people who work for the organization. Human resource
management is really employee management with an emphasis on those employees as
assets of the business. In this context, employees are sometimes referred to as human
capital. As with other business assets, the goal is to make effective use of employees,
reducing risk and maximizing return on investment.
HRM Practices impact on the outcomes such as employee satisfaction, commitment,
employee retention, employee presence, social climate between worker and management,
employee involvement, employee trust, employ loyalty, organizational fairness (Tiwari
and Karunesh, 2012). So these outcomes and HRM practices can lead to firm
performance such as profits, market value of the company, market share, increase in
sales, productivity, product service quality, customer satisfaction, development of
products/services and future investment( Delery,1998)
Human Resource Management (HRM) of developing and least developed countries to
that of developed countries is significantly different. So, are the multinational companies
still being able to transfer their HR practices while running a business in the developing
and least developed world? If not, what practices do they tend to localize? If they
hybridize, how would the hybridized individual HR set look like?
In Nepal, HRM In most organization is still managed in a traditional manner. The
financial institution has become more conscious about human capital. They have started
establishing human resource departments to carry out all HRM functions. They have also
started emphasizing on organizing training and development programs for employee, in
addition for providing congenial work environment ( Baniya,2004).
In the organizations or firms, human resource management (HRM) practices as a
mediator between HRM strategy and HRM outcome. Sheppeck and Militello (2000)
focus HRM strategy into four groups: employment skill and work policies, supportive
environment, performance measurement and reinforcement and market organization
whereby Guest (1997) divides into three categories: differentiated on innovation, focus
on quality and cost-reduction. However, there are many definitions in previously
researches on HRM strategy, but all strategies used to achieve the same organizational
goal through HRM practices.. Ruwan (2007) empirically evaluated six human resource
(HR) practices (realistic job, information, job analysis, work family balance, career
development, compensation and supervisor support) and their likely impact on the
Marketing Executive Turnover. A long the same line, Abang, MayChiun and Maw (2009)
two components of human resource (HR) practices namely, training and information
technology have direct impact on organizational performance. In addition, Zaini, Nilufar
and Syed (2009) four HRM practices showed that training and development, team work,
HR planning, and performance appraisal have positive and significant influence on
business performance. Altarawmneh and al-Kilani (2010) examine the impact of human
resource management (HRM) practices on employees turnover intentions.
performance
appraisals,
employee
motivation,
Employee
satisfaction,
Commercial Banks. Based on the objectives of the study following hypothesis have
been stated :
H1 : There is positive and significant relationship between Training and
Development and HR Practices
H2 : There is positive and significant relationship between pay practices and HR
Practices.
H3 : There is positive and significant relationship employee motivation and HR
Practices
CHAPTER-II
LITERATURE REVIEW AND THEORETICAL FRAMEWORK
This chapter provides conceptual framework of the study and deals with the review of
empirical studies associated with the impact of HRM practices on employee satisfaction
of Nepalese commercial banks.
2.1 There are several studies on human resource practices on employee satisfaction. The
major studies are shown in table 2.1
Table 2.1: Review of major studies
Studies
Walton(1985)
Major Findings
The relationship between employer and employee and associated
with human relation movement and the concept of high
(2004)
Noe et al( 2006)
Schaffner (2001)
behavior by employee.
the relationship between job training and productivity, however
job training tends to be lose value when the workers change job,
therefore the organization or firm increase the cost of keeping
Batt (2002)
such
as
autonomy,
team
Porter (1982)
work.
Motivated employees are prime factor to attain desired level of
performance as motivated workforce makes all possible efforts to
Oosthuizen (2001)
The human aspect of human resource management is concerned with The relationship
between employer and employee and associated with human relation movement and the
concept of high commitment work practices developed by (Walton, 1985).
Likewise, Bradley, Petrescu and Simmons (2004) observe the impact of human resource
management practices and pay inequality on workers job satisfaction. On their study
employ many HRM practices such as work organization, recruitment and pay practice as
independent variables and job satisfaction as dependent variable. The results show that
the pay practice is positively associated with the job satisfaction.
Job Training In general, training is refer to a planed effort facilitate the learning of jobrelated knowledge, skill, and behavior by employee (Noe et al., 2006).
Schaffner (2001) on his study assert the relationship between job training and
productivity, however job training tends to be lose value when the workers change job,
therefore the organization or firm increase the cost of keeping trained position filled.
Notwithstanding, there is in doubtfully of the relationship between job training and
turnover.
Many studies have been overcome the suspicion such as Batt (2002) finds that highinvolvement practices such as autonomy, team collaboration, and training are related to
reduce employee turnover and increased productivity. Furthermore, Hequent (1993)
clarify the negative correlation between training and turnover in a number of companies
Entwistle (1987) explained that motivational factors enhanced the employee performance
as well as organizational performance. Organization can only synergize its performance if
its employees are satisfied & well-motivated to work.
Jones and George (2008) explained motivation as psychological factor that directs an
individual's behavior in an organization towards positive contribution into organizational
productivity. In contemporary world, organizations are providing monetary and
nonmonetary rewards to its employee in order to keep them motivated which are
precondition for optimum organizational performance (Mitchell, 1973).
According to Porter (1982), motivated employees are prime factor to attain desired level
of performance as motivated workforce makes all possible efforts to perform up to the
mark. Oosthuizen (2001) described that prime function of HRM is to keep employees
motivated towards their work and positively affects employee attitude in way that they
work with full zeal and zest for achievement of organizational goals i.e. output
maximization and optimum productivity.
Shrestha (2009)
Pandey(2008
Pant (1993)
analysis. It can act like a map that give coherence to empirical inquiry as the theoretical
framework are potentially so close to empirical inquiry, take different from depending
upon the research questions or problems.
The theoretical framework describes the link between the HR practices and the employee
satisfaction of the Nepalese Commercial banks. In the theoretical framework for the
analysis of the study and for the measurement of the employee satisfaction we have taken
employee satisfaction as the dependent variable and is measured through three
independent variables i.e. employee motivation, pay practice and training and
development
Indep EmployeeD
e
p
e
s
a
tis
fa
c
tio
n
Paypractices
enden
nden
t
t
variab
varia
s
les Paypracticbele
The different theoretical research and empirical studies have been concluded to analysis
the impact of human resource practice on employee satisfaction in banking sector.
Several theories have been proposed to explain the variables for human resource practices
but there has no universal agreement.
A few scholars have studied the impact of human resource management practices on the
banking industry. Very few study have addressed the human resource management
practices has address the outcomes of employee satisfaction in the Nepalese commercial
banks.