Human resource developmentpractices as determinant of HRDclimate and quality orientationArif Hassan, Junaidah Hashim and Ahmad Zaki Hj Ismail

Department of Business Administration,International Islamic University Malaysia, Kuala Lumpur, Malaysia

Abstract

Purpose – The aim of the study was to measure employees’ perception of human resourcedevelopment (HRD) practices, to explore whether ISO certification leads to any improvements in HRDsystem, and to examine the role of HRD practices on employees’ development climate and qualityorientation in the organization.

Design/methodology/approach – A total of 239 employees belonging to eight organizations (fourof them ISO certified) responded to a questionnaire which measured the following variables: careersystem, work planning system, development system, self renewal system, and HRD system.

Findings – Results indicated large inter-organizational differences in HRD practices. In general,however, employees’ ratings were moderate. ISO certified companies, compared to others, obtainedhigher means on some HRD variables. Organizations with better learning, training and developmentsystems, reward and recognition, and information systems promoted human resource developmentclimate. Quality orientation was predicted by career planning, performance guidance anddevelopment, role efficacy, and reward and recognition systems.

Research limitations/implications – Comparison between ISO and non-ISO certified companiesdid yield some significant differences, yet it was difficult to conclude that the differences were due toISO certification alone as organizations in the sample were not matched.

Practical implications – The findings can be used by HR practitioners and scholars in buildingmanagement concerns and advocacy for better HRD systems and practices.

Originality/value – Very little empirical knowledge is available on this subject from transitionaleconomies like Malaysia. The study makes a modest attempt in that direction.

Keywords Human resource strategies, Human resource development, Quality standards, Malaysia,Economic conditions

Paper type Research paper

Examples from successful organizations demonstrate that they have gone a long wayto design effective human resource system. It includes effective manpower planning,recruitment and selection process, realistic performance plans and developmentoriented performance appraisal, effective learning system providing ample learningopportunities with the help of training, performance guidance, and other mechanismssuch as mentoring. It also consists of mechanisms to inculcate sense of pride in work,

The current issue and full text archive of this journal is available at

www.emeraldinsight.com/0309-0590.htm

This study was supported by a grant from the Research Center of International IslamicUniversity Malaysia, which is thankfully acknowledged. An earlier version of this paper waspresented at the 8th Conference on International Human Resource Management, CairnsAustralia, June 14-17, 2005.

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Received June 2005Revised August 2005Accepted September 2005

Journal of European IndustrialTrainingVol. 30 No. 1, 2006pp. 4-18q Emerald Group Publishing Limited0309-0590DOI 10.1108/03090590610643842

high degree of organizational commitment, introducing such organizationaldevelopment systems as personal growth labs, creativity workshops, quality circles,kaizen team building exercises just to name a few. Further, an examination of theirhuman resource development (HRD) climate, work values such as openness, trust,delegation and decentralization, quality orientation etc. system of reward andrecognition, quality of organizational communication, and empowerment of employeesamply demonstrate that successful organizations have gone a long way to bringrevolutionary changes in their HR systems and practices (Zairi, 1998).

The HRD thrust is built on the assumption that employees cannot be treated ascommodities to be hired and discarded depending on short-range whims of theorganization. They are to be nurtured and developed? Good people can fix the poorpolicies, procedure, and rules, but it is never the other way round (Lancaster, 1994).

However, organizations with innovative HR practices are not many. In fact amajority of the organizations have yet to realize the strategic importance of HR, andHR professionals have yet to be recognized as their strategic partners (Sikula, 2001).

In his forward to the book entitled HR scorecard written by Becker et al. (2001, p. ix)David Norton wrote:

The typical executive team has a high degree of awareness and consensus around financialstrategy, as well as priorities for operational process improvement . . . they have limitedconsensus around customer strategies (i.e. who are the target segments, what is the valueproposition) . . . But the worst grades are reserved for their understanding of strategies fordeveloping human capital. There is little consensus, little creativity, and no real frameworkfor thinking about the subject. Worse yet, we have seen little improvement in this over thepast eight years . . . The greatest concern here is that, in the New Economy, human capital isthe foundation of value creation . . . This presents an interesting dilemma: The asset that ismost important is the least understood, least prone to measurement, and, hence, leastsusceptible to management.

Objectives and hypothesesMost of the studies examining relationships between human resource managementand organizational outcomes have been conducted in the west with little knowledgecoming from transitional economies such as Malaysia. How far concern for HR issuesand HR development is present in Malaysian companies? This was the main objectiveof this study. The study also tried to understand if concern for quality andstandardization of work process, as emphasized in ISO 9000 series certifications, iscorrelated with improvement in the HRD practices. Finally, the study proposed toexamine how the HRD system and practices contributed to climate of human resourcedevelopment and quality orientation.

On the basis of literature review the following hypotheses were developed.

H1. HRD systems and practices will show large variations across organizations.

H2. ISO certified companies will be rated higher than non-ISO companies on HRDsystem and practices.

H3. HRD practices will significantly contribute to developing positive HRDclimate and quality orientation.

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Measure of HRD climate included top management’s concern and value for employees,congenial work environment, camaraderie, openness and freedom for experimentation,trust, team spirit, emphasis on employees’ welfare etc. Quality orientation wasmeasured in terms of customer orientation, quality consciousness, qualityimprovement, monitoring and feedback, data collection for quality improvement andfeedback, employees having a sense of pride in doing good quality work etc. The HRDpractices included: career system (manpower planning, potential appraisal andpromotion, and career planning and development), work planning (role analysis,contextual analysis, and performance appraisal system), development system (learningand training, performance guidance and development, and other mechanisms ofdevelopment) self-renewal system (role efficacy, organizational development, andaction-oriented research), and HRD system (organizational values, reward andrecognition, information, and empowerment).

HRD and organizational performanceSeveral models of HRD specify a range of practices which, if pursued, are likely tocontribute to human capital accumulation on which organizations may build itscompetitive advantages (DeGeus, 1997; Currie, 1998; McCracken and Wallace, 1997,Willis, 1997). These models basically advocate that investment in HRD byorganizations and individuals is necessary for a number of reasons; to build andretain that resource in the future and to retain that resource in the present. Results of asurvey of London university graduates conducted by Prickett (1998) showed that 90percent of them expect their employer to help their development. Holbeche (1998) foundthat one third of her sample of high-fliers would leave if they could not broaden theirskills. Organizations likewise view investments in human resource development to beimportant. Losey (1999) and Spangenberg et al. (1999) report that organizationsincreasingly seek, through sophisticated human resource development and workplacelearning strategies to develop employee competencies to enable them to respondquickly and flexibly to business needs.

Emphasis on human resource development result into several positive individualand organizational outcomes such as higher performance (Sandberg, 2000); highquality individual and organizational problem solving (Schroder, 1989); enhancedcareer plans and employability (Weick, 1996; Raider and Burt, 1996); sustainablecompetitive advantage (Winterton and Winterton, 1996; Nordhaug, 1998); higherorganizational commitment (Iles et al., 1990) and enhanced organizational retention(Robertson et al., 1991).

The relationship between HR practices and business results is built on the premisethat better deployment and use of HR practices should correlate with better businessperformance (Ulrich, 1997). On the basis of a literature review Pfeffer (1994) concludedthat employee participation and empowerment, job design including team-basedproduction systems, extensive employee training and performance contingent rewardsystem are widely believed to improve the performance of the firm. Huslid (1995), onthe basis of his study of 968 publicly traded firms, found that a one standard deviationincrease (about 25 percent) in work performance reduces turnover by 7.05 percent on aper employee basis, increases productivity by 16 percent (measured by sales peremployee) and yields a $ 3,814 increase in profits. Based on a study of 74 firms, Huslid

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and Becker (1995) created an index of each firm’s HRM system reflecting the degree towhich a firm has deployed the high-performance work system (HPWS) andconsistently found that firms with higher values on this index, other things beingequal, have economically and statistically higher levels of firm performance. Youndtet al. (1996) found that a HR system focused on human capital management wasdirectly related to multiple dimensions of operational performance like employeeproductivity, machine efficiency and customer alignment. Huselid et al. (1997) foundthat firm effectiveness was associated with the capabilities and attributes of HR staff.Further, they concluded that relationship between HR management effectiveness andproductivity, cash flow and market value were positive.

Brian et al. (2001) ranked organizations on High Performance Work Index andcompared their HR system and practices. The HPWS Index included the organizationssystem of building and maintaining a stock of talented human capital through:

. linking its selection and promotion decisions to validated competency models;

. developing strategies that provide timely and effective support for the skillsdemanded by the firms’ strategy implementation; and

. enacts compensation and performance management policies that attract, retain,and motivate high-performance employees.

Based on the HPWS ranks Becker et al. (2001) compared top ten percentcompanies with bottom ten percent on a number of measures. The result indicatedsubstantial difference between the two groups. The top HPWS group adopted HRmanagement practices which were very different from the bottom HPWS group oforganizations. The former devoted more resources to recruiting and selection,employed more vigorous training regime, established better performancemanagement and linked to the compensation system, used teams to muchgreater extent, had roughly double the number of HR professional per employee.The HR outcomes associated with this system demonstrated that compared to thepoor the best HPWS organizations developed a clear strategic intent andcommunicated it effectively to employees, their HR professionals were rated morepositively and developed a comprehensive measurement system for communicatingnon-financial information to employees. Finally, organizations with the mosteffective HR management system exhibited most dramatically higher performance:employee turnover was closer to half, sales per employee were four times as great,and the ration of organization’s market value to the book value of assets – a keyindicator of management quality, as it indicates the extent to which managementhas increased shareholders’ initial investment – was more than three times aslarge in the high-performing organizations.

Singh (2003) conducted a survey of 84 Indian firms representing major domesticbusiness sectors ranging from automobiles and auto components to, cement,engineering, iron and steel, financial services, info-tech, pharmaceuticals, paper andpower, etc. The main objectives were to examine how many HR practices have beenimplemented by the firms and the extent of links between the individual HR practicesand firm performance.

Each firm was asked to indicate the percentage of employees covered under the finalHR practices which consisted of the following:

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. use of employment test before selection;

. formal performance appraisal system;

. compensation based on performance appraisal;

. formal job description;

. non-entry jobs filled from within in recent three years;

. employees covered under formal information system;

. employees administered attitude survey on a regular basis;

. employee participation in the quality of work life program, quality circles, orlabor management participation teams; and

. average days of training received by an employee in the last 12 months.

The result indicated that there were large variations in the HR practices adopted by theorganizations included in the sample. It was also found that the combined effect of HRperformance index was significant in predicting firm’s performance as well asemployee turnover and productivity.

While most of the studies examining the relationship between HRM andorganizational outcomes have focused on hard data such as productivity, turnover ratevery few have measured the effect on soft variables like employee well-being (Edgar,2003). The present study, therefore, tried to investigate how HR practices influenceemployees’ perception of the HRD climate and quality orientation.

MethodologyOrganizations and the sampleData were collected from eight organizations, four of them had obtained ISO 9000series certifications. They represented a mix of industry, size, operation, andtechnology. Samples consisted of managerial and non-managerial staff (n ¼ 239) whovolunteered to participate in the study. They represented both the HR and otherdepartments, had on average served in the organizations for 4.31 years, and 56 percentof them were males. Table I presents background profile of the sample.

Research instrumentsRao’s (1997) HRD audit check list was used for data collection. It measured thefollowing HRD system and practices:

. Career system. This is concerned with manpower planning and recruitment,potential appraisal and promotion, and career planning and development.

. Work system. This includes: role analysis, contextual analysis, and performanceappraisal system.

. Development system. This is concerned with planned development of competenciesand includes: training and learning, performance guidance and development, andother mechanisms of knowledge sharing and competency development.

. Self renewal system. The main concern of this system is to develop role efficacy,organizational development practices, and action oriented research such asperiodic surveys for diagnostic purposes.

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. HRD system. This includes: HRD climate, organizational values, qualityorientation, reward and recognition, information sharing and empowerment.

ResultsDescriptive statisticsFigures 1-5 display mean ratings of the HRD system and practices. Responses weresolicited on a five-point scale (5 ¼ very much true; 1 ¼ not at all true).

Career systemCareer system included manpower planning and recruitment process, mechanism toappraise and promote potential employees from within, and career planning anddevelopment system that emphasized on establishing career development policies andprograms in the organization. Overall the career planning was rated moderately.Among the three facets of manpower planning and recruitment practices (A1) obtainedslightly above average score whereas, career planning and development system (A3)appeared weak. Figure 1 displays the relative standing of the three facets of careersystem.

n %

PositionManagerial 182 76.15Non-managerial 57 23.84

DepartmentHR 55 23.01Others 184 76.98Mean years working in the organization 4.31

AgeBetween 20-30 years 88 36.82Between 31-40 years 101 42.25Between 41-50 years 38 15.89Above 50 years 12 5.02

GenderMales 135 56.48Females 104 43.51

Table I.Background of

respondents

Figure 1.

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Figure 3.

Figure 4.

Figure 5.

Figure 2.

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Work planningWork planning included role analysis, contextual analysis, and performance appraisalsystem. Items measuring work planning included the system of identifying keyfunctions of various roles, developing special annual (or periodic) objectives under eachkey function in a team/or in supervisor-employee dyads, identifying a few commonattributes for all, and a few specific attributes relevant to a team/department forindividual effectiveness, self assessment of own performance and attributes,assessment by the superiors/colleagues/subordinates, performance review andfeedback, and linking review with development. All the three facets of workplanning obtained moderate scores. Among the three, work planning measures, roleanalysis (B1) was rated higher than the other two, namely performance appraisalsystem (B3) and contextual analysis (B2). Figure 2 presents the result.

Development systemDevelopmental system included learning and training issues, performance guidanceand development, and other mechanisms of coaching and development available toemployees. Items included measuring employees’ satisfaction with: training attransitional points, strategic planning of training, involvement of line departments intraining, training policy and strategy, on the job training, evaluation of training, followup, and training curriculum improvements, variety in training methodology,multi-skill training, use of other ways of training like seminars, mentoring andcoaching, self study etc. Figure 3 shows that employees were not happy and satisfiedwith different aspects of the development system. The overall mean rating was 2.88 onthe five-point scale. Other mechanisms of development system (C3) which consisted ofcoaching, mentoring, and guidance obtained the lowest score. It indicated that suchdevelopment practices are yet to become popular. The other two dimensions ofdevelopment systems were also rated below average.

Self-renewal systemThis system is concerned with ways of self-renewing and transforming theorganization. It included organizational diagnosis, organizational developmentinterventions, role efficacy status, and action research. Overall the mean ratingpresented inadequacy in the self renewal system (see Figure 4). Both action research(D3) and organizational development programs (D2) obtained low ratings. Actionresearch involved periodic surveys on various aspects of the functioning of anorganization, feedback of surveys given to employees, and implementation of thefindings of research and survey studies being conducted. Organizational developmentitems included rating of quality circles, suggestion system/kaizen, diagnostic studies,team building exercises, internal customer orientation, management of role stress, andother developmental programs. Items on role efficacy (D1) measured the degree ofopportunity that employees had in doing something significant that they felt proud of,taking initiatives, trying out new ideas etc.

HRD systemMeasures of HRD system included a 21-item HRD climate scale, 14-item values inorganizations scale, nine-item quality orientation scale, five-item scale to measure

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reward and recognition system, ten-items to measure the adequacy of informationsystem, and five-items to measure employees’ empowerment.

Human resource development climate questionnaire asked employees to rateseveral aspects of the organization such as top management’s concern for making worka pleasant experience, humane treatment and value of human resource, emphasis onemployees’ growth and development, cooperative work climate, fair reward system,freedom of experimenting with new ideas, team spirit, open communication etc.

The respondents were asked to rate organizational values and practices such asopenness, trust, initiative, freedom, collaboration and teamwork, creativity, respect forauthority, conformity, quality, decentralization, humane treatment of employees, andindividual recognition.

Perception of quality orientation was measured in terms of customer orientation(internal-external) quality consciousness, monitoring of quality improvement andfeedback, emphasis on continuous improvement in quality, and the organizationalmechanisms to inculcate value of quality among employees.

The scale to measure employees’ perception of reward and recognition systemsolicited opinion about the degree to which rewards and recognition in organizationwas based on merit and not on any other consideration, adequacy of number of rewardgiven etc.

How adequately and timely information were shared with the employees was yetanother indicator of organizations concern for their empowerment and developmentwhich was measured by the ten-item information scale.

Finally, items on empowerment included the treatment given to employees such asrespect for their dignity, autonomy, recognition, and responsibility, delegation, andparticipation in decision making.

Figure 5 shows that overall the rating of HRD system was moderate (Proportionalmean ¼ 2:95). Scores on HRD climate (H1), reward and recognition system (H4), andorganizational values (H2) were below average whereas quality orientation (H3), andinformation sharing (H5) means were close to 3.00 (on the five-point scale) indicatingmoderate level of satisfaction.

HRD practices in ISO and non-ISO companiesISO 9000 is an international quality certification system. It is a set of world widestandards – two guidelines and three quality assurance models (Halim andManogran, 1999). Unlike product standards, these standards are for the operation ofa quality management system. The purpose is to ensure that a certified organizationhas a quality system that would enable it to meet its published quality standards.(Rabbitt and Berg, 1994). Certification of whether the organization meets the ISOstandard is established by an independent third party. Table II presents the t-testresult comparing perceived HRD system and practices in the ISO and non-ISOcompanies.

Mean comparison yielded a few significant differences and they were in thehypothesized direction. The ISO companies obtained significantly higher ratings oncareer system which included manpower planning and recruitment and potentialappraisal and promotion system. Significant mean differences were also obtained oncontextual analysis (one aspect of work planning) and quality orientation (a component

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of HRD system). In all the cases ISO certified companies obtained higher mean scorecompared to its counterpart. In the rest of the cases the mean differences were notsignificant although ISO companies had always an edge over the non-ISOcounterparts.

HRD system and organizational outcomeThe data were subjected to multiple regression analysis to examine how the HRDsystem and practices contributed to employees’ perception of the HRD climate, andquality orientation. The results are entered in Table III.

The result supported the hypotheses and was in line with previous findingsindicating positive contribution of HR management on organizational outcomes.Satisfaction with HRD climate was significantly predicted by learning/training system,other mechanisms of development, action research, reward and recognition system,and information system. Together independent variables in equation explained 75percent of the variance (Adj:R 2 ¼ 0:75).

Factors that contributed significantly to employees’ rating of the quality orientationin the organization were: potential appraisal and promotion system, performanceguidance and development, role efficacy, and reward and recognition system. Togethervariables in regression explained 64 percent of the variance.

ISO Non-ISO(n ¼ 91) (n ¼ 147)

Mean SD Mean SD t-value P

A1. Manpower planning 10.43 2.27 9.80 2.30 2.08 0.03A2. Potential appraisal 16.32 3.97 15.12 4.12 2.24 0.02A3. Career planning 9.07 2.94 8.56 2.70 1.34 0.17Total career system 35.83 8.34 33.47 8.03 2.15 0.03B1. Role analysis 16.85 3.97 15.98 4.34 1.58 0.11B2. Contextual analysis 12.88 3.70 11.65 3.95 2.42 0.01B3. Performance appraisal 31.73 8.32 30.23 10.75 1.19 0.23Total work planning 61.37 14.31 58.08 17.42 1.55 0.12C1. Learning/training system 30.61 9.19 28.89 8.21 1.46 0.14C2. Performance guidance 14.98 4.37 14.08 4.17 1.58 0.11C3. Others development system 25.25 7.84 24.89 6.98 0.35 0.72Total development system 70.74 20.06 68.07 16.70 1.06 0.29D1. Role efficacy 32.13 8.12 31.41 7.34 0.69 0.49D2. Organizational development 26.17 9.55 25.91 8.84 0.22 0.82D3. Action research 14.52 5.50 14.33 5.57 0.26 0.79Total self renewal system 72.53 20.47 71.54 18.45 0.37 0.71E1. HRD climate 60.66 16.86 58.99 15.48 0.75 0.45E2. Organizational values 42.70 11.18 41.15 10.91 1.03 0.30E3. Quality orientation 28.67 7.90 26.28 6.58 2.39 0.01E4. Reward and recognition 14.09 4.93 12.95 4.43 1.80 0.07E5. Information 30.87 7.20 29.62 7.15 1.29 0.19E6. Empowerment 15.32 3.74 14.84 3.80 0.94 0.34Total HRD system 217.04 48.60 209.55 43.11 1.17 0.24

Table II.Mean comparison

between ISO and non-ISOcompanies on HRD

systems

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DiscussionIn general, the result of the study showed large variations in human resourcedevelopment practices across organizations thus supporting H1 of the study. Eachorganization was unique with respect to the HR competency. Clearly, human resourcestrategies are difficult to imitate because of path dependency and causal ambiguity(Barney, 1991; Collins and Montgomery, 1995). HRM systems are path dependent sincethey consist of policies that evolved over time. To adopt an HRM system successfully,it is necessary to understand how all relationships inside the system work (Fey andBjorkman, 2000). The range of variation in the HR system and practices was quitelarge, with some organizations scoring high on many dimensions while few othersobtained low ratings on several facets. Taken together, however, the combined scoresindicated that HR system and practices were still at its nascent stage in Malaysiancompanies. Respondent included in the study gave a moderate rating to almost all thequestions in the HRD audit checklist. It may, therefore, be concluded that the focus onemployee development is yet to come to the center stage in these organizations. This isnot surprising as similar concerns have been reported in countries like China and NewZealand (Edgar, 2003; Law et al., 2003). Othman et al. (2001) similarly reported largegaps between CEOs expectations and HR role in Malaysian manufacturing sector.Employees’ perception of HR system and practices also indicate the gap betweenemployer rhetoric (most of the companies talk of building knowledge capital etc.) andthe reality as experienced by employees. Kane et al. (1999) suggest that the failure ofemployers to operationalize HRM practices effectively may be one of the causes ofperceived HRM ineffectiveness.

HRD and ISOFour organizations, out of eight, included in the sample had obtained ISO-9000 seriescertifications. They were:

PredictorsHRD climate Quality orientation

St. b St. b

A1 Manpower planning and recruitment 0.065 20.130A2 Potential appraisal and promotion 0.079 0.183 *

A3 Career planning 20.028 0.021B1 Role analysis 0.097 0.066B2 Contextual analysis 20.016 20.109B3 Performance appraisal system 0.071 20.104C1 Learning/training system 0.119 * 0.118C2 Performance guidance and development 20.087 0.199 * *

C3 Other mechanism of development 0.249 * * * 20.059D1 Role efficacy 20.041 0.147 *

D2 Organizational development 0.038 0.074D3 Action research 0.149 * 20.045E4 Reward and recognition 0.163 * * 0.374 * * *

E5 Information 0.216 * * * 0.219Adj.R 2 0.748 0.644F 45.886 * * * 28.688 * * *

Table III.Contribution of HRDsystem on HRD climateand quality orientation

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(1) An IT company doing business in packaging designs, assembly, logisticssupply solutions, including advanced packaging services. It is a multi nationalcompany having headquarter in California, USA.

(2) A subsidiary of a local investment company having interest in infrastructurespecializing in water engineering and water related activities.

(3) A local telecommunication company having a solid strength of fiber opticnetwork, complemented with extensive cellular, pay phone, and internetnetwork.

(4) A transnational company which is global player in power and automationtechnologies.

The other four organizations that did not have any ISO certifications were:

(1) a local bank;

(2) a property development company;

(3) an IT company doing business in educational software development; and

(4) a five-star hotel owned by a Malaysian conglomerate and managed by ORIXhotel international.

Mean comparisons between ISO and non-ISO organizations showed significantdifferences on several facets of HRD system and practices which were as hypothesized.ISO certified companies obtained significantly higher ratings on career system whichincluded manpower planning and recruitment and potential appraisal and promotionsystem. Significant differences were also obtained on contextual analysis (one aspect ofwork planning) and quality orientation (a component of HRD system). In all the casesISO certified companies obtained higher mean score compared to their counterpart. Inrest of the cases the mean differences were not significant although ISO companies hadalways an edge over non ISO ones.

However, the result should be interpreted with caution as the two types oforganizations were not matched. In fact, the inter organizational comparison revealedthat one of the organizations in the sample, namely the five-star hotel was rated quitehigh on a number of HRD practices even though it did not carry any ISO certification.

HRD and organizational outcomeFinally, the study examined the contribution of HRD systems and practices on HRDclimate, and quality orientation. In general again the results were in the expecteddirection. It indicated that employees’ satisfaction with human resource developmentclimate was predicted by learning and training system, employee development system(such as mentoring and coaching), action research, reward and recognition system, andinformation system (related to internal changes within the organization, technology,company policy etc.).

The regression result also suggested that organizations which had an adequatesystem of potential appraisal and promotion, performance guidance and development,role efficacy, and reward and recognition system promoted quality orientation. Qualityorientation was measured in terms of customer orientation, continuous improvement,total quality, sense of pride etc. The result validates the HRD practice adopted by

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several quality award winning companies such as Wallace Co. Inc. and Cadillac(Winners of Baldrige quality award of USA in 1990) (Zairi, 1998).

The findings of the study reinforce the assumption that investment in humancapital brings competitive advantage to the company (Prahald and Hamel, 1990;Winterton and Winterton, 1996). Results highlight the importance of adequate HRpractices to promote employees’ trust and satisfaction. It is in line with the findings ofprevious studies showing the contribution of HRD on employees’ performance(Sandberg, 2000), organizational commitment (Iles et al., 1990), and organizationalretention (Robertson et al., 1991).

Limitations of the studyThe study had several limitations. First, the sample was drawn from a small number oforganizations. For a better understanding of the HRD practices and for makingcomparisons between ISO and non ISO groups of companies, a larger sample size wasrequired. Most of the study of this nature involves organizations as the unit of analysis.They collect mostly factual data from a single source (such as HR Manager). However,the present study was concerned with employees’ perception of HRD system andpractices, rather than how it is reported by the CEO or the HR director. However, thismethodology limits the capacity to generalize the findings to other settings. Second, formaking a comparison between ISO and non ISO certified companies otherorganizational variables should have been controlled. The present study could notdo this due to limitations of time and resources. Future studies are planned in this areawhich will take care of these limitations.

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Further reading

McCracken, M. and Wallace, M. (2000), “Towards a redefinition of strategic HRD”, Journal ofEuropean Industrial Training, Vol. 24 No. 5, pp. 281-90.

Rouna, W.E.A. (1999), An Investigation into Core Beliefs Underlying the Profession of HumanResource Development, University of Minnesota, Human Resource Development ResearchCenter, St. Paul, MN.

Swanson, R.A. (2001), “Human resource development and its underlying theory”, HumanResource Development International, Vol. 4 No. 3, pp. 299-312.

About the authorsDr Arif Hassan is an Associate Professor, in the Department of Business Administration ofInternational Islamic University Malaysia. He obtained his PhD from Patna University India. In1991 he obtained Fulbright Fellowship to work on a cross-cultural research project ondistributive justice. Dr Hassan has authored three books and has several publications ininternational refereed journals and conference proceedings. He has research interest in the area ofhuman resource development, organizational issues such as leadership, organizational justice,and organizational culture. He is a member of the Academy of Human Resource Development,International Association of Applied Psychology, and Asian Academy of Management. DrHassan teaches general management, human resource management and organizational behaviorcourses at undergraduate and graduate levels. Arif Hassan is the corresponding author and canbe contacted at: arif.hassan@gmail.com

Dr Junaidah Hashim is an Associate professor in the Department of Business Administrationof International Islamic University Malaysia. She obtained her PhD in training managementfrom University Putra Malaysia. She has worked for over 12 years in the private sectorcompanies in the HR department. She teaches courses on human resource management, trainingmanagement and compensation management. She has research publications in the areas oftraining management, and e-learning.

Ahmad Zaki Hj Ismail is an Assistant Professor at the Department of BusinessAdministration, International Islamic University Malaysia. He received his Master inManagement degree from the Asian Institute of Management, Philippines in 1985, and a PhDin Business Management from the School for Policy Studies (SPS), University of Bristol, Englandin 1998. He teaches courses on entrepreneurship, international business, human resourcemanagement etc.. His work experiences in the private sector of more than two decades includeHRM, corporate planning, and general management. Dr Zaki’s research interests include publicpolicy, HRM, SME, entrepreneurship, international business, and strategic management.

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