THE RELEVANCE OF STRATEGIC HUMAN RESOURCE MANAGEMENT ON THE PROFITABILITY OF A MODERN BUSINESS ORGANIZATION

THE RELEVANCE OF STRATEGIC HUMAN RESOURCE MANAGEMENT ON THE PROFITABILITY OF A MODERN BUSINESS ORGANIZATION

[A CASE STUDY OF ZENITH BANK NIG. PLC. LOKOJA]

ABSTRACT

The negligence of the importance of Strategic Human Resource Management to Organizational Success has led to the failure of many organizations in Nigeria. Based on this problem, the study examines the relevance of strategic human resource management to the success and profitability of a modern business. Questionnaire was used to collect the primary data from Zenith bank Nigeria plc. Lokoja branch which was used as the case study. Simple frequency and percentage inference where used to analyze data collected. The questionnaire were designed using likert simple method. Chi – square as a statistical tool was used to test the three(3) hypothesis developed whether to accept or to reject the null hypothesis(Ho). Results from this study shows that “strategic management of human resource in an organization actually contributes to its profitability. Results also shows that “all other resources of an organization are useless without the human resources to plan and manage them. It was also discovered that “well trained personnels where needed for the profitability and growth of any organization. The researching then made some recommendation.

CHAPTER ONE

INTRODUCTION

Modern business is full of challenges. To face these challenges, organization should recognize the fact that human resources are inevitable. This is because of their role as the prime mover or initiator of all activities.

According to Donnelly e’tal (1992) human resources management is the process of accomplishing organizational objectives by acquiring, retaining, screening, selecting and placing personals in an organization.

Retaining efficient individuals matters a lot to an organization relative to the attainment of its objective. If   capable and efficient personnel’s regularly leaves an organization. It becomes necessary to hire personnels on a regular basis. This increase cost and saves times and no organization wants to incure unnecessary cost.

Strategic human resources management on other may be regarded as an approach to the management of human resources that provide a strategic frame work to support long team business goals and outcome. This approach is concerned with longer term people issues and macro – concern about structure, quality, culture, values, commitment and matching resources to future need.

Some critics often question the contribution of human resources management to the overall profits of the company or organization. They claim that human resources department does not contribute directly to the organizations profit to such critics, the following questions are posed and they demand qualified answer

1.     What is the cost of low moral, inefficient and low productivity?

2.     What are the benefits derivable from employees full efficiency and proficiency through training and development?

3.     What is the cost of accidents and resultant compensation, absenteeism, and payments of workmen’s compensation?

4.     What is the likely cost of incessant or large –scale labor turnover?

1.1   BACKGROUND OF THE STUDY

In any organization (whether public or private), results are achieved through people. People make organizations. human beings are the life of every enterprise .Indeed given conditions perfect competition the only way one organization can out ship its competitors is by possessing a more effective team of employers and managers .the profitability and even the survival of an enterprise depends upon the caliber of the work force

One of the most important task facing management is to select, maintain and if possible, improve the asst .peter ducker believes that “management “main task is to select the managers of tomorrow“. Selection of candidates is not only concern in engaging the require number of people: it is also concern in measuring their qualities. It is not a matter of satisfying a company’s present needs it is an activity which influences the shape of the companies’ future. The cumulative results of selecting the right candidate predetermine the future health of the enterprise. Precisely because it is difficult and expensive to remove incompetent, unsatisfactory or inappropriate staff today, it is necessary to reduce selection mistakes to a minimum.

All these negative effect of neglecting the importance of the human resources in an organization .are what necessitated the need for this research work. Many organization Nigeria today still neglect or pay little attention to this area of management in their respective organization .many organization still don’t have human resources management department in their organization instead the function of this department is being transfer to other department that do not specialize in these field.

Also many organizations often question the contribution of human resources department to the over all profits of the organization. Unlike the sales, account, or production departments. This research work will be an eye opener to them to realize that these departments are overseen by human being. The effective and efficient performance of these human beings is the main function of the human resource department.

Organization that don’t pay proper attention to the management of their human resources, face the prospect of seeing their profits go down in the near future.

1.2 STATEMENT OF THE PROBLEM

The statement of the problem is concerned with the inevitable consequence rising from lack of solution to the problem being investigated.

This problem will be listed as follows:

1.     Low morale, inefficiency and low productivity of workers

2.     Decrease in the company’s profit

3.     High labour turnover

4.     Absenteeism and non-payment of workers compensation

5.     Insufficient funds for investment

6.     Sustainability and long-run survival of the organization.

1.3   SIGNIFICANCE OF THE STUDY

Those who have misconceptions about the relevance of human resource management will be enlightened through this study. This research work will show if there is any effects of workers morale and efficiency to the profitability of an organization. Finally the research will show the various contribution of the human resources management department to the profits of an organization

1.4 OBJECTIVE OF THE STUDY

The objectives of this study are as follows:

1.     To enlighten organization on the relevance of human resources management

2.     To reduce labour turnover through proper human resource management.

3.     To show the importance of having a human resource management department to handle all personnel issues of an organization.

4.     To show that an organization can not survive without a well organized and trained team of employees.

5.     To show that proper management of human resource as an effect on the profitability.

1.5   RESEARCH HYPOTHESIS

Hypothesis is a tentative answer to a research problem. It is an intelligent or education guess concerning some variables. There are two types of hypothesis, the null hypothesis (H_O) and the alternative hypothesis (HI). Hypothesis’s in a very real sense is the core of the study. It guides the researcher in planning the course of the inquiry, in choosing the kinds of data needed, in deciding the proper statistical treatment and examining the result of the study.

The hypothesis for this research work is as follow:

1.     Hi: Strategic human resource management affects the profitability of an organization.

Ho:    Strategic human resource management does not affect the profitability of an organization.

2.     Hi: All other resources of an organization are useless without the human resources to plan and manage them.

Ho: All other resources of an organization are not useless without the human resources to plan and manage them.

3.     Hi: Well trained personnel’s are needed for the profitability and growth of an organization.

Ho: Well trained personnel’s are not needed for the profitability and growth of an organization.

1.6   SCOPE OF THE STUDY

This research work will be looking mainly at the relevance of strategic human resource management on the profitability of a modern business organization; using Zenith Bank Nig. Plc. Lokoja as a case study. This research will also talk about the priority recognition of human resource management, management of individuals, the importance of strategic human resource management and the contributions of human resource management to the organizations profit.

1.7   LIMITATIONS AND CONSTRAINTS OF THE STUDY

Limitations are the factors which affect the result of the study. There is hardly any research project without some limitation affecting it in one-way or the other. The limitations encountered during the course of this research are as follow:

1.     Collection of Information: There were limitations in getting all the required information needed for the research as some of the information’s where not forth coming due to lack of co-operation and secrecy the part of the respondents.

2.     Financial Limitation: There was also financial limitation, because to carry out a research of any kind you need money and being a student my finances are limited.

• Time Constraints: The time required to get the research done is limited being an academic requirement to finish your studies and research takes a considerable amount of time e.g two years.

1.     Secrecy: The respondents being questioned were reluctant in giving relevant information needed for the research work. They see the questions being asked as trying to probe them.

2.     Illiteracy: There was limitation of illiteracy on the part of some of the respondent. It is difficult for people who cannot read and write to appreciate the need to supply relevant research information.

1.8   Definition Of Terms

Definition of some terms in this research will be given so as to give an explanation of the meaning of such terms in the context in which they are used. They include;

1.     Leadership Behaviour: – This can be described as the influence exerted by the leaders on their subordinates as regards their jobs and clarifications of what is expected of them. Its such subordinate will be satisfied by the intrinsic demands of the unstructured task and be highly motivated by the extrinsic rewards associated with their employments.

2.     Goal Path Theory: – An objective of object toward which a person strikes. A theory is a set of generalizations which can be used to describe observed events or predicts future events.

3.     Organization: – This is a group of people in a defined territory and working together to achieve stated objective.

4.     Management: – This is defined as the process by which managers create, direct, maintain and operate a purposive organization through systematic, coordinated operative human efforts.

5.     Job: – An entity but complex inter – relations of tasks, roles, responsibility, interaction, incentives and rewards.

6.     Performance: – An act by which a given task is done or executed.

7.     Leadership: – This is an act or process of exerting positive influence over other people so that they will strive willingly and enthusiastically towards the accomplishment of goals and objectives.

8.     Motivation: – This is concerned with how behaviour gets started is energized, is sustained, is directed and stopped.