HUMAN RESOURCE MANAGEMENT AND ORGANIZATIONAL PERFORMANCE OF CONSULTING FIRMS IN THE NIGERIAN CONSTRUCTION INDUSTRY

1.1 Introduction

Human resource management and organisational performance are positively correlated, and human resource practices and aspects have a significant influence on an organization's ability to perform (Osman, 2012). Human resource management is the concealed asset of an organization. It offers value by enhancing organisational performance and strengthening resilience in the face of turbulence when incorporated into an operational system.

Human resources management is a crucial and necessary job that takes place inside an organization, whereas human resources relate to the people who work for a company. Recruitment, remuneration, organisational growth, benefit wellness, communication and training, performance management, and any other actions linked to the attainment of the organization's goals are all included in this role (Ayesh, 2012).

As a prelude to other parts of this study, this chapter will discuss the background upon which this study was initiated, the statement of problems that led to this study, the Aim and Objectives of the study. Others are Significance of the study, Scope of work, Research hypothesis and questions, Limitation of the study and Definition of terms.

1.2 Background of Study

The Nigerian Construction industry is deemed to operate by diversified workforce, hence managing human resource issue deems to be a challenging task. However, as the role of Human factors in the process of business and productive activities, Human Resource Management is the key factor which has the immediate impact to the organizational structure, especially in the Construction Industry, so Human Resources are the most valuable source of Capital (Phan, 2012).

According to Wikipedia (2001), HRM is a function in organizations designed to maximize employee performance in service of their employer’s strategic objectives. HRM is primarily concerned with how people are managed within organizations, focusing on policies and systems. HRM departments and units in organizations are typically responsible for a number of activities, including employee recruitment, training and development, performance appraisal, and rewarding (e.g., managing pay and benefit systems). HRM is also concerned with industrial relations, that is, the balancing of organizational practices with regulations arising from collective bargaining and governmental laws.

HRM is the process of managing people in a company/firm as well as managing the existing interpersonal relationships. These two processes are key in the success and growth of a business. Human resource management is the management process of an organization’s workforce, or human resources. It is responsible for the attraction, selection, training, assessment, and rewarding of employees, while also overseeing organizational leadership and culture and ensuring compliance with employment and labour laws (Anthony and Kothai, 2014).

HRM is a product of the human relations movement of the early 20th century, when researchers began documenting ways of creating business value through the strategic management of the workforce, (Wikipedia 2004). HRM is concerned with managing people within the employer-employee relationship. Specifically, it involves the performance of people in achieving the organization’s objectives and the satisfaction of personal employee needs. HRM can be a major contributor to the success of the enterprise. HRM has been regarded in various industries as one of the most critical elements of business success.

The successful implementation of HRM functions are elements for improving personal, team and organizational performance, Dainty, Belout and Gauvreau, (2004). A number of authors state that the basic functions of HRM include planning, job design devising position descriptions, employee selection/recruitment, employee training, performance appraisal systems, reward systems, employee relationships and employee’s health and safety according to Druker et al., (2003).

Human resource management has a significant influence in the QS firms. Although construction technologies and management techniques have advanced rapidly, project managers still need to pay more attention to people management. Human resources still account for the majority of costs in most construction projects (Loosemore et al., 2003). International construction projects normally require a longer time span and more parties are involved (Chan and Tse, 2003).

Human Resource issues have positive and adverse implications for construction industries in all countries (Ofori, 2003). HRM is also a significant aspect of the whole planning and project management process in construction projects, in particular international construction projects that involve foreign firms as collaborators or competitors (Bon and Crosthwaite, 2000; Mawhinney, 2001).

The complex international construction climate, caused by increased global price competitiveness, development of technologies, changing industry and employment legislation, and changing workforce composition has prompted project managers to utilize their employees more effectively to gain competitive advantage and project success. In recent years there has been a widespread realization that improvement of HRM performance is a critical element to achieving improvement in efficiency, productivity and cost effectiveness in the construction industry. Howes and Tah (2003) describe how the situational model of HRM, the staff performance model of HRM and the socio-technical model of HRM are being implemented in the construction industry.

In view of this research, the aim of looking at the relationship between HRM and performance of contractors’ organization in the Nigerian construction industry is based on the review of the research questions. This will aid us to know level at which HRM practices has improved the performance level of the contractors’ organization in the Nigerian construction industry as well as its contribution to the Economy.

Therefore, in Nigerian Construction Industry where the research was carried out, the activities that was conducted is to know the Human Resource Management and Organizational Performance of Consulting Firms.

1.3 Statement of Problems

Investigation revealed that construction companies experience many challenges in human resource management and development because of the high number of temporary staff, Alvin (2011). This he says is mainly due to the fluctuation in the demand of the industry not to mention the subjective reasons (i.e. specific procedure in production, material and technology) that limit the workers decision making process.

According to Adeagbo and Oyemogum (2012), human resource development is not regularly practiced in most construction firms in Nigeria. Majority of the firms are small and medium sized with more semi-skilled and unskilled work force than skilled work force. Lack of timely project delivery of construction projects are influenced by lack of full commitment by workers due to the company’s reward system which causes them job dissatisfaction.

Great expenditures of time, money and resources, both human and material, are wasted each year because of inefficient quality management procedures. A serious limitation that recent reviews of the literature points out is that the link between HRM and organizational performance is considered like a ‘black box’, i.e., lack of clarity regarding ‘what exactly leads to what’ (Gerhart, 2005).

1.4 Aim and Objectives of Study

The aim of the study is to assess the impact of Human Resource Management and Organizational Performance of Consulting Firms in the Nigerian Construction Industry. In achieving this aim, the following specific objectives were laid out as follows:

1. To determine the level of Human Resource Management practices amongst consultants in the Nigerian construction industry;
2. To identify the Human Resource Management practices that influence performance of consultant’s organization; and
3. To determine the relationship between Human Resource Management practices and organization performance measured in terms of growth.

1.5 Research Questions

The study came up with research questions so as to be able to ascertain the above stated objectives. The specific research questions for the study are stated below as follows:

• What is the level of HRM practices amongst consultants in the Nigerian construction industry?
• What are the HRM practice factors that influence the consultant’s organization performance?
• What is the relationship between organization performance (in terms of growth) and HRM best practice?

1.6 Significance of Study

This study will show the importance of HRM in Quantity Surveying organizations and as well as its influence on employees in Quantity Surveying firms in the Nigerian construction industry.

The result of the study will also show the importance and the impact of HRM practices in the development of construction projects in the Nigeria construction industry. The study will also show the relationship level between HRM and contractors and its contribution to the Nigerian economy.

An assessment of the study would provide valuable information on the Influence of Human resource management on organization performance of contractor’s in the Nigerian construction industry.

1.7 Scope of Study

The scope of the research is focused on the Human Resource Management and Organizational Performance of Consulting Firms in the Nigerian Construction Industry.

1.8 Limitations of the Study

During the course of this study, there were some problems encountered which stood as limitations to the research work. Some of the limitations include:

1. Time Constraint:The time frame given to accomplish this project was very short due to school academic calendar and it was carried out under pressure which made the researcher not to implement some necessary features.
2. Establishment Policies:Establishment policies posed a serious limitation as most staffs are not ready to release information needed for this research work. There were lots of information needed from the staffs of this establishment to enhance the study which took them time to release or they did not release at all for security purposes, hence the scope was reduced.
3. Financial Constraint: Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).
4. Initial Cooperation Delay from Respondents: A particular limitation of this work came as a result of the respondent refusal to offer their cooperation at the initial time they were contacted. This contributed in making the success of this research study difficult.

1.9 Definition of Terms

Human Resources:

This is the part of the management process that specializes in the management of people in work organizations

Management:

Management may be seen as a science or as an art. The image of management as a science is based on the view that experts have accumulated a distinct body of knowledge about management which, if studied and applied, can enhance organizational effectiveness.

Employees:

This refers to people that are paid to work

Staffing:

This deals with obtaining people with appropriate skills, abilities, knowledge and experience to fill jobs in the work organization

Rewards:

This involves the design and administration of reward systems. Practices include job evaluation, performance appraisal, and benefits

Job Evaluation:

This is the determination of the worth of a job to an organization

Job Satisfaction:

Job satisfaction is the quality, state, or level of satisfaction which is the result of various interests and attitudes of a person.

Consulting Organization / Firm:

A consulting firm / organization is a firm of one or more experts (consultants) that provides professional advice to an individual or an organization. The primary purpose of a consulting firm is to provide access to industry specific specialists / consultants and subject matter experts.