Best Practice

lass="article_content">				should encourage involvement by employees. This
Introduction				implies that the best practice model is against
Best practice as a human resource and development				job-based approaches where employees are paid
strategy attempts to link two issues i.e. human				according to their merits. Instead, it advocates for pay
resource strategies and competitive advantage. This				systems that are based on skill and rewards and
perspective is founded on the belief that human				bonuses are given to employees when the company
resource and development strategies can cause				has achieved success. Therefore the best practice
employees to become committed and highly motivated				model moves away from the traditional methods of
towards their organisation. Consequently, such				measuring employee performance through
employees are expected to contribute towards				performance appraisals. More focus is placed on
improvement of the company’s performance.				creating a sense of concern within the employees
Reward systems form a critical part of best practice				about the performance of the organisation. Also pay
policy because they still fall under human resource				systems are dependent on the nature of business
strategies.				success mad not on the merits employees have.
The organisation to be examined is John Lewis				Pfeffer (1998) points out some disadvantages of the
Partnership. This company is a worker co-op. It is one				traditional reward systems where merits were the
of the most exemplary companies when it comes to				most important aspect at that time. These are;
implementation of best practice strategies. This is				- The merit system creates fear culture within the
because all the employees within the organisation are				organisation
part owners of the organisation. The organisation				- employees mainly focus on short rather than long
focuses on addressing all their needs whether in the				term goals
reward section or elsewhere. On the other hand, the				- employees do not care about how the organisation
employees pay back these efforts through				performs
commitment and best performance. Best practice has				- it devalues team work because emphasis is on
formed one of the organisation’s key strengths.				individual performance
Strategic capability and degree of sophistication of the				- it is subject to biases and politics
strategic Human resource and development effort				In light of these disadvantages, it became necessary
John Lewis partnership has made sure that training is				to adopt a reward system that addresses these
part of its human resource and development efforts.				pitfalls. One should take note that best practice policies
This is because it realises the value of this best				remain stagnant even when the organisation’s
practice strategy. Pfeffer and Velga (1999) explain the				strategic direction changes.
importance of training and development of skills within				Some of the theoretical frameworks contained in this
any organisation. A company that takes its employees				model were spearheaded by Huselid (1995) and
through training solidifies their contribution to the				Pfeffer (1996). The best practice model is such that a
company. This is because such employees get				company that adopts this form of practice attract the
equipped with the ability to make decisions in their				best human resource personnel there is out there. This
work. On top of this, such employees have high levels				implies that the strategy the company adopted will be
of initiative and will try their utmost best to improve				influenced greatly by these valuable staff members
their organisational contribution. Skill development is a				and thus leading to organisational success. One can
characteristic part of the John Lewis Partnership				therefore conclude that policies within this type of
because employees who feel the need to improve				strategy precede business strategy.
their skills are given opportunities to do so through				The main relationship between best practice and an
training schemes.				organisation’s strategic imperatives is that it
Youndt et al (1996) emphasise that training is one of				provides a basis for achieving an organisation’s
the most fundamental aspects of best practice				pay objectives. Lawler (1996) states that an
models. However, these same authors also add that				organisation first needs to identify its reward system
training should be integrated into other development				objectives. This is because the objectives act as a
activities like staffing, job rotation and others. They				basis for measuring the effectiveness of the pay
claim that no amount of training will contribute towards				systems and they also act as guidelines. Some of the
organisational development if employees are not				objectives are;
granted the permission to practice those acquired skills.				Objectives of reward systems
This means that an organisation should try its best to				Attract and retain employees;
grant work autonomy to its employees and to				Motivate performance;
empower them through training. John Lewis has				Promote skill and knowledge development;
achieved this very well. In other retail companies, line				Contribute to corporate culture;
managers are given minimal responsibilities. Most of				Reinforce and define structure; and
them are expected to consult with higher authorities in				Determine pay costs’ (Lawler, 1996)
order to decide on issues. However, the company				These objectives have contributed greatly towards
under study has eliminated that problem by training				achievement of John Lewis Strategic intent. These
those members of staff (so that they can have				shall be examined in detail. The first link between the
necessary skills) and then allowing them to make				latter mentioned acts is attraction and retention of
independent decisions. They believe that this is a form				employees. For the organisation under study; John
of investment into human capital since most of these				Lewis, there is a need to attract best quality individuals
employees feel valued.				because the retail sector is highly competitive. This is
According to the Classical and Human relations				highly relevant since there are instances when labour
approach, an organisation’s structure and				markets become stringent. Pfeffer (1998) suggests
operation are affected by certain situational factors				that there is a link between what amount a firm pays
such as technology, size and environment. However				to its workforce and the quality of employees it is able
best practice advocates like Burnes (2000) came up				to attract. This theory is seen clearly in the John Lewis
with a contingency theory. He believes that a reward				partnership where the company paid millions in
system within any company can affect the way it				bonuses to its workforce. This caused an increase in
operates or how it is structured. Pfeffer (1994)				the company’s performance as seen from its
believes that best practice companies should have a				favourable market shares.
structure that places staff members into groups.				Huselid (1995) adds that attracting the right employees
Those groups should be such that they have the ability				is not just something that is achieved by a pay system.
to make their own decisions. Another aspect of best				It is also something that needs to be combined with a
practise firms is that they ought to have reward				meticulous selection process. The organisation needs
systems that are compact in nature. This implies that				to ensure that thee are well qualified candidates in
there should be minimal differences between different				large numbers. the importance of the selection process
members of staff so that most employees within the				is that a candidate may feel honoured to belong to an
organisation operate in a relatively independent manner				organisation that takes its selection process seriously.
with the ability to make their own decisions. John				This can be carried further to imply that the
Lewis’ strategic capability in this aspect of				organisation also values people and this means that
structure is demonstrated by the division of the				those employees will feel privileged to belong to the
company into departments. These departments work				organisation. This is exactly what has occurred at John
together to achieve gaols and have been granted				Lewis Company.
relative autonomy. One can consider them as teams.				Delery and Doty (1996) assert that whenever there is
Also, the company gives almost equal rewards to all				a low employee turnover, employees will feel more
members of the teams. One can therefore conclude				obliged to perform because they are assured of their
that the company’s structure is a clear depiction				job security. They highlight the importance of knowing
of its best practise strategy. (Pfeffer, 1994)				that one will not loose their job. This is because it will.
Why and whether human resource strategy is seen				prevent them from worrying about this and instead
as adding value				focus on tasks at hand. Pfeffer (1994) goes on to add
Best practice strategies have definitely added value to				that low employee turnover is quite necessary when
the organisation. This is because the approach has				trying to create a family friendly culture within an
motivated performance within the organisation.				organisation. This means that workers will feel at home
According to the Equity and expectancy theories				in their work environment. They will also be challenged
(main components of the best practice model) put				intellectually and consequently enjoy their work
forward by Adam (1965). It can be seen that there are				experience. This is also toped up by a good reward
two aspects in motivation. The first is the input made				system. John Lewis is characterised by such practices
by an employee and the second is outcome which				since it has a rigorous selection process, high
normally comes from the respective organisation. The				employee retention and a strong organisational culture.
ratio between these two aspects needs to be equal				Contribution Human resource and development can
otherwise employees will loose motivation to perform.				make towards achieving the organisation’s
This is where the term negative inequity stems from.				strategic intent
Here, an employee’s input is not matched to				Best practice as a human resource development
outcome from the organisation. There is a need for				strategy can help an organisation achieve its strategic
justice to be administered in this area otherwise				intent through creation of a unique corporate culture.
employees will lack motivation.				Drennan (1992) describes corporate culture as the
Hertzberg (2001) came up with a two factor model to				way things are done within any organisation. It can
illustrate the importance of performance motivation as				either impede or promote organisational effectiveness
part of best practice strategy. He asserted that				depending on its implementation.
factors causing job satisfaction were quite different				John Lewis partnership should ensure that it promotes
from those ones causing job dissatisfaction. He places				organisational effectiveness through the following
more emphasis on factors that cause job satisfaction				ways. It should try as much as possible to reinforce its
such as the nature of work, responsibilities in the				value in areas such as innovation, quality, performance
workplace and recognition of achievement. This is				and teamwork as suggested by Armstrong (1999).
something that is quite different from simply increasing				Lawler (1996) adds that an organisation can create a
salaries. Pay can be considered as a factor that can				culture through best practise approaches by
cause job dissatisfaction and should be dealt with so				encouraging the following;
as to have time to concentrate on other important				-participation
aspects. This is the reason why John Lewis does not				-innovation
simply increase employees’ salaries. It				-entrepreneurship
appreciates achievement and places more emphasis				-eliminating too much bureaucracy
on the latter rather than the former. This is the reason				-encouraging competency
why its best practice strategies have added value to				Lawler (1996) goes on to add that organisations should
the company. John Lewis realised that payments				deal with two aspects in order to change their
simply alter behaviour but do not change the attitudes				corporate culture and to achieve their strategic intent.
causing these behaviours as stated by Kohn (1993).				This can be done through communication and the
Kohn (1993) and Pfeffer (1998) solidify this stand point				decision making process. John Lewis should make sure
by adding that the financial aspect is not the only thing				that it continues to maintain open and transparent
that matters. This is because the absence of it could				channels of communication about its reward systems.
be taken as a form of punishment by the organisation.				This will eliminate any uncertainties among members of
This is the reason why John Lewis uses its aspect of				staff and will contribute towards their commitment. The
partnership to motivate employees rather than just				Company should also go out of its way to maintain a
focusing on financial issues. These same authors				participative approach in decision making. Lawler (1995)
assert that if a company only focuses on this type of				notes that companies that have failed in the past are
approach, it may prevent employees from tapping their				those ones that adopted autocratic methods of
full potential. John Lewis realised this and this is why				governance; these are characterised by secrecy and
the partnership adds other factors into the equation.				top down communications. The Company should stick
For example, employees within the organisation have				to these best practice principles in order to achieve
the power to hire or fire leaders within their council				their strategic intent.
upon giving justification of their reasons for doing so.				Conclusion
Employees in the Company also have the freedom to				Best practise is a human resource strategy that
air out their grievances and misgivings about some of				affects overall organisational strategy. According to
their administrators. Such approaches move away				the best practice approach, reward systems
form the financial aspect of motivation and				contribute to organisational culture. However, pay
consequently add value to the firm.				should not be the only thing that takes precedence.
Kohn (1993) adds that it is possible to motivate				There should be adequate consideration of decision
employees without the need to increase their pay. He				making powers, communication channels and job
claims there are three C’s that employees can				enrichment. If these latter three factors are
add to their organisation in order to add value. These				implemented by companies, then they will achieve
include Choice; where an employee should be given				competitive advantage. The John Lewis has been on
the opportunity to participate in decisions affecting the				the frontline of best practise strategies because it is a
company. This is an aspect that John Lewis has				worker and most of their decisions are participative.
perfected through voting power granted to its				Reward systems within this company encourage
employees. Also, that they have an internal magazine				equity and this is why it has been recorded increased
where suggestions on governance are given and the				profits in the recent years.
administration reciprocates. The second C is the issue				Reference:
of Collaboration. Here there should be a two-way				John Lewis (2007): Interim Financial report. Retrieved
exchange of information between the company and				24 March, 2008 from:
the employees. The third C put forward by the same				Pfeffer, J. and Velga, J. (1999): Putting people first for
author is Content where organisations should go out of				organizational success;
out their way to enrich employees’ jobs. This is				Academy of Management Executive, 13 (2), p. 37-48
an aspect that John Lewis has also incorporated into				Youndt, M. A. et al (1996): Human Resource
their management style since employees work in				Management, Manufacturing Strategy, and Firm
teams, line managers have considerable amounts of				Performance; Academy of Management Journal, 39,
responsibility and yet there are always new technical				p836-66
issues faced John Lewis. All these qualities deal with				Pfeffer, J. (1998): Six Dangerous Myths About Pay;
the content aspect of motivation thus adding value top				Harvard Business Review, May-
the company.				June, p. 109-119
Pfeffer (1998) asserts that employees can add value				Pfeffer, J. (1994): Competitive Advantage Through
to an organisation when there is equity within the				People: Unleashing the Power ofthe Workforce,
organisation. Any given company should realise that an				Boston, MA: Stanford Graduate School of Business;
employee will only be motivated when they receive				Harvard Business
appreciation for their efforts. This appreciation should				School Press
be equal among all members of the organisation. Most				Burnes, B. (2000): Managing Change: A Strategic
organisations have made the mistake of sharing profits				Approach to Organisational
among managers and top administrators yet this is				Dynamcis, Harlow: Financial Times; Prentice Hall
quite a big misconception. All members of the				Adams, J. (1965): Inequity in Social Exchange. In
organisation should receive equal treatment in this area				Advances in Experimental Social
because it will be a justifiable issue. Al members within				Psychology, vol. 2, ed. L. Berkowitz, p. 267-299; New
the organisation will feel just as importance as the he				York: Academic Press.
other and it will strengthen the bond within the				Herzberg, F. (2001): One More Time: How Do You
organisation. John Lewis has recognised this truth. It				Motivate Employees? Harvard
has given a lot of emphasis on equality. In the year				Business Review, 81(3), p. 87-96
2007, the Company distributed fifty five million pounds				Huselid, M. (1995): The Impact of Human Resource
fairly and equally among all members of staff.				Management Practices on
Relationship between Human Resource and				Turnover, Productivity and Corporate Financial
development activities and the strategic imperatives				Performance; Academy of
facing the company				Management Journal, 38 (3), p. 635-72
One of the most crucial aspects of human resource				Kohn, A. (1993): Rethinking Rewards; Harvard Business
and development activities within the organization				Review, 71(6), p. 48-49.
under study is reward systems. Reward systems				Lawler, E. (1996): The Design of Effective Reward
have a direct and fundamental link between strategic				Systems. In Motivation and
imperatives facing the Company and overall				Leadership at Work, sixth edition, eds. R. Steers, L.
effectiveness achieved by the company. This is				Porter and G.Bigley, p. 527-550.
because pay systems can be modified so as to align				New York; McGraw Hill International Press
themselves with overall goals and objectives of the				Delery, J. and Doty, D. (1996): Models of Theorizing in
organisation consequently becoming part of the				Strategic Human Resource
businesses strategy within the organisation. It is				Management: Tests of Universalistic, Contingency and
important for companies to have business strategies				Configurational Performance
first. This is because business strategies provide a				Predictions; Academy of Management Journal, 39(4),
guideline that will help a given organisation have a				p802-35
sense of direction. Business strategy defines the way				Armstrong, M. (1999): Employee Reward. 2ndedition.
the firm will operate and what level of performance				London: CIPD
should be expected. Therefore, business strategy is				Lawler, E. (1995): The New Pay: A Strategic Approach;
the foundation for rewards systems within the best				Compensation and Benefits
practice model.				Review, 27 (4), p.
The best practice model is such that reward systems

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