SIGNIFICANCE OF HR POLICY FOR AN ORGANIZATION
A machine with a defective or missing part will not function as well as it should, and may break down
entirely. Similarly, an organisation with a defective or missing element will not work well. The strategic
significance of any element of an organisation becomes clear when that element is missing or broken.
This could be true of a structural element, such as a department or team, or a more abstract,
functional element, such as a policy or procedure.
o Synthesising general lessons about the strategic significance of HR policy for an organisation, as
illustrated by examples of how a business can be impacted when policy fails
HR Policy 2
Significance of HR Policy for an organization
As in the case of a machine which breaks down when one of its parts is not
functioning effectively or when it is missing, an organization’s performance is threatened
when one of its departments is dysfunctional or neglected. The need for HR involvement in
strategy is inevitable and companies that do not involve the HR in policy are bound to
experience difficulties in achieving their objectives. This paper explains the importance of an
HR policy and how its failure may impact an organization’s performance in a significant
HR has been hailed as one of the most influential department within the organization.
This is because it manages employees who are considered the organization’s most important
asset. According to Watson (2005), HR policy provides guidelines governing employees,
including how they should behave and execute their roles to meet organizational objectives.
HR policy guides performance through providing guidelines on employee roles and
responsibilities, scope of performance and terms of contract or employment (Storey, 2007).
In its absence, the organization may not be in a position to follow up employee performance.
This creates a gap in employee accountability and could therefore result in low productivity.
HR policy ensures consistency within the organization and as established by
Armstrong (2014), HR policy is key in ensuring that employees deliver consistent results.
Through providing performance aspects, HR policy ensures that employees work towards
meeting their targets. An example is performance appraisal included in the HR policy, which
ensures that employees maintain consistent performance to ensure that they are rated highly.
When the HR strategy is aligned with the overall company strategy results are likely to be
more consistent and effective in enhancing organizational success (Watson, 2005).
HR policy provides a workplace structure; providing guidelines regarding working
hours and leave, performance expectations, disciplinary action, work environment, workplace
HR Policy 3
safety and communication channels among others (Bamberger, Biron & Meshoulam, 2014).
Lack of a structure would be chaotic for the organization, leading to performance issues.
According to Bamberger, Biron and Meshoulam (2014), policy sets clear guidelines that can
be followed to enhance organizational processes by ensuring orderliness. This way, the
organization is likely to run smoothly, as opposed to where there is no HR policy, thus
HR policy in most organizations ensures that most regulations related to employee
rights are adhered to. The HR policy in most cases contains information such as equal
employment clauses, employee relations and membership in trade unions, health and safety
and termination guidelines (CIPD, 2014). These are important in ensuring that employee
rights are protected and that the organization is compliant with the law. It also means that
employees are aware of the organization’s position based on various issues that affect job
security, such that the organization can attract and maintain the right talent. Lack of a HR
policy presents great risks in terms of meeting legal obligations and could subsequently
influence performance (Storey, 2007).
In conclusion, it is clear that HR policy is a major prerequisite for organizational
success; given that it provides guidance, order and structure, which are necessary in running
the organization. All other departments depend on HR to ensure that employees can provide
optimal service through guidance from the HR policy. The lack of a HR policy within the
organization therefore resembles a machine which with a missing component, such that the
organization is likely to fail. Similarly, a HR policy that is not working effectively could
impact organizational performance in a significant manner.
Armstrong, M. (2014) Armstrong’s Handbook of Human Resource Management Practice.
13th ed. London: Kogan Page