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The Impact of Human Resource Management Practices on Organizational

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International Journal of Engineering and Information Systems (IJEAIS)
ISSN: 2000-000X
Vol. 1 Issue 9, November – 2017, Pages: 165-178

The Impact of Human Resource Management Practices on

Organizational Performance
Moazzma Mehmood1, Muhammad Awais2, Muhammad Moiez Afzal3, Iram Shahzadi4, Usman Khalid5
Department of Human Resource Management, Gift University, Gujranwala, Pakistan1
Department of Business Administration, University of the Punjab, Gujranwala, Pakistan 2. 3 & 4
Quaid-e-Azam University, Islamabad, Pakistan5

Abstract—The purpose of this study is to examine the impact of human resource management practices on organizational
performance. A total of 90 employees from public and private universities comprising of both academicians and supporting staff
responded to the survey. The survey questionnaire had 49 items covering selected HRM practices and universities performance.
The findings suggested that management might be able to increase the level of the commitment in the organization by improving
satisfaction with compensation, policies, and work conditions. Companies should involve their employees as they are viewed as an
indispensable source of competitive advantage. One way of increasing the job satisfaction at the workplace is expanding the
interactions level with employees in staff meetings and rising guided discussions of topics related to these issues. Open
communication or information sharing promote fast decision making. It will influence commitment and job satisfaction among
employees. If the employees are well aware of the organization environment, their duties, and objectives, they can better perform
their tasks, and it helps the organization to enhance their productivity. A highly committed and competent workforce allows
companies are succeeding these strategies and gain a competitive advantage as long as these procedures are communicated and
the workforce is involved in both the formulation and implementation phases.

Keywords—Training, performance appraisal, employee participation, job definition, compensation, employee job satisfaction,
organizational performance

1. INTRODUCTION
Organizational performance is the overall growth of an organization (Drucker, 2002). Human resource is the most important
asset in any organization. It is necessary for the organizations to manage their employees effectively and efficiently. Human
resources play a vital role in any organization. It, thus, requires the considerable attention of the management so that employees
can work up to their full potential (Ahmad & Schroeder, 2003). Human Resource means individuals or staff or workforce within
the boundary of an organization they are responsible for performing the tasks assigned to them and they aim to meet the
organization objectives and make the profit. Human resource can provide a sustainable competitive advantage by giving them
different practices (Huselid, 1995). A company's success depends upon the people who are working in the organization. Human
resource considered more important asset in any organization (Vlachos, Tsamakos, Vrechopoulos, & Avramidis, 2009). In any
organization, the employees must be treated as a valuable asset; the organization's mission will be achieved in a better way if their
skills would be developed. In the presence of the competitive environment, the success of any organization depends upon the
capabilities and the caliber of their Human Resource and their programs and practices (Rehman, 2011). If there are no human
resource management practices, then company always face the difficulties and not able to perform in the competitive society.
Company current and potential human resources are essential considerations in the development and for the execution of its
strategic business plan (Huselid, 1995). Human resources include individuals, staff or workforce within or even outside the
boundary of an organization who are responsible for performing the tasks assigned to them. The main aim of an organization's
human resource team is to help the organization in achieving its objectives. Human resource helps the organization in making
sustainable competitive advantage (Huselid, 1995).

Human capital, at times, is irreplaceable (Awan & Sarfraz, 2013). Despite this enormous importance of human capital,
organizations don't pay attention to their employees. An organization should consider it's employees’ valuable asset as employees
contribution to the organization will help the organization in achieving its vision and mission. The capabilities and skills of human
resources help the organization in surviving in the competitive environment (Rehman, 2011). The effectiveness of even highly
skilled employees will be less if they are not motivated to perform. However, HRM practices can affect employee motivation by
encouraging them to work both harder and smarter (Huselid, 1995). The employee participation encourages the employees it boost
the employees in an organization (Syed & Yan, 2012). Likewise, Lew (2009) noted that employees play a strategic role in

Corresponding Author’s E-mail: 26awais@gmail.com

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improving ratings in key areas like the process and product quality, the reputation of the organization and in maintaining relations
with society. Dissatisfied employees may cause problems for the organization (Syed, Yan, 2012). Human Resource Management
(HRM) is concerned with the efficient and effective utilization of human capital of the organization. HRM policies and practices
may either help or constrain employees in performing their roles (Ngo, Foley, Loi, & Zhang, 2011). In the last two decades. The
issue of the impact of HRM on the organizational performance received the considerable attention of researchers (Huselid, 2006).
Past studies showed that employee participation is positively related to performance, satisfaction, and productivity of an employee
(Pfeffer, 1995). Employee satisfaction has always been an important issue for organizations (Bhatti & Qureshi, 2007). Few
practices (in fact, few organizations) have made job satisfaction a top priority, (Bhatti, Qureshi, 2007). Human resource
management practices are training, performance appraisal, employee participation, job definition and compensation shows a
positive impact on employee job satisfaction and organizational performance. Past empirical research has mostly investigated the
effects of HRM practices on financial performance and some on efficiency and employee turnover (Ahmad, Schroeder, 2003).
Human resource management practices provide the organizations a sustainable source of competitive advantage(Barney, 1995).
Human resource practices mean the process or the functions that used to manage the employees and it directed the firm toward the
development (Lado & Wilson, 1994). Employee's performance depends on how efficiently firm manages them by using their
operations. The performance of the employees is the output of the performance of the workers it efficiently enhances the
organization operations (Hameed & Waheed, 2011).

In last ten years, Pakistani universities improved their ranking by attracting and retaining excellent and experienced
academicians and support staff. The increasing contribution of Pakistani universities for national economies and other partnering
nations made it an essential sector for research and analysis. Despite this growing importance, universities are facing problems in
attracting and retaining talented people. It requires an appraisal of HRM policies of an organization. From HRM point of view,
considerable attention was given to the issue of the influence of HRM practices on employees' compensation and selection (Becker
& Gerhart, 1996). In Pakistani tertiary education sector, the link between job satisfaction and with organizational performance is
not explored very much (Bhatti, Qureshi, 2007). During the last decade, the Human Resource Management field has shifted from a
micro focus (Fey, Björkman, & Pavlovskaya, 2000). However, we chose best-fitted practices like training, performance appraisal,
employee participation job definition and compensation as independent variables (Amin, Khairuzzaman Wan Ismail, Zaleha Abdul
Rasid, & Daverson Andrew Selemani, 2014). If the employee would satisfy, then it enhances the organizational performance.
Today the employees are facing many challenges in the organization if organization workers are not satisfied, then it is not possible
to increase the productivity level of the organization. Although the influence of HRM policies on organizational performance in the
tertiary education sector was recently evaluated (Amin, Ismail, 2014) but it the research model did not incorporate job satisfaction
as mediator. As we did not find any research in Pakistani education sector which had explored the impact of HRM policies on
organizational performance using job satisfaction as the mediator, so we decided to explore this link. This research aims to evaluate
the mediating influence of job satisfaction between HRM practices and organizational performance.

2. LITERATURE REVIEW
A growing body of empirical research has examined the effect of certain human resource management practices on the firm
performance. Although there is a long list of human resource practices that can affect independently or collectively on the
organizational performance (Beh & Loo, 2013). Human resources are considered the most important asset of an organization, but
very few organizations can fully harness its potential (Ahmed, Schroeder, 2003). We had taken some important human resource
practices which affect the organizational performance. There is increasing interest in the notion that complementary bundles of
human resource practices enhance organizational performance (William, 2010. In Pakistan, we have chosen this topic because
there is the very little scope of human resource in Pakistan. Today, work attributes involve mental challenge which leads to
satisfaction and dissatisfaction (Becker, 1997). Job satisfaction is a significant factor, so that's why we take job satisfaction as
mediating variable. Job satisfaction remains a variable that has been relatively little studied in economics and industrial relations
(Clark & Oswald, 1996).

2.1. Training
Training is an action of teaching a person, a particular skill or type of behavior. Training refers to the methods used to give
new or present employees the skills, knowledge, behaviors and other abilities they need to perform their jobs (Amin, Ismail,
2014).Training is improving the one's capability, capacity, productivity, and performance. Training is intended to modify
individual's skills or attitudes (Harold, Fedor, 2003).Training is positively associated with the job satisfaction, and job satisfaction
is positively associated with the organizational performance (Jones, Jones, Latreille, & Sloane, 2009). Complexities of tasks are
increasing so there is the need to learn modern skills (Amin, Ismail, Selemani, 2014).

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2.2. Performance Appraisal
Performance appraisal is the process to access the individual performance and productivity. It means how well he or she is
performing on the job and establishing the plan for improvement (Amin, Ismail, 2014). Performance appraisals are employed to
determine who needs what training, and who will be promoted, demoted, retained, or fired. When people perceive an imbalance in
their outcome-input ratios relative to others tension is created (Ramlall, 2004). If it is not present in an organization, it caused many
problems like low morale, decreased employee productivity and low enthusiasm to support the organization, and it declines the
organizational performance (Amin, Ismail, Selemani, 2014).

2.3. Employee Participation

Employee participation is the process in which employees are involved in decision-making processes, rather than simply
acting on orders. Employee participation is part of a process of empowerment in the workplace (Wegner, 1994). Employee
Participation is defined as a process in which influences are shared among individuals who are otherwise hierarchically unequal
(Syed, Yan, 2012). Employees participation known as the employee involvement in decision making, persuade the involvement of
stakeholders at all levels of an organization in the examination of problems, development of strategies and implementations of
solution (Helum. Armstrong, Graham, 2006). Participation of employee can satisfy the employee's needs and the employee
involvement boost the job satisfaction, so it shows the positive association between them (Syed, Yan, 2012).

2.4. Job Definition

Job definition means the job description in the organization. Job description covers the tasks, duties, and responsibilities. If
these are clear, then it can enhance the organizational performance. It defines the duties, and the tasks responsibilities that are
expected of the employee and the company expect from him to perform (Amin, Ismail, Selemani, 2014). The job definition is the
combination of the knowledge skills and abilities (Bryant, 2002). The majority of hiring mistakes could be prevented if the people
responsible for the hiring simply did a more effective job of determining exactly what they were looking for before they started to
look for the candidates. The job description is a living and effective document that dictate success (Manning, 2012).

2.5. Compensation
Compensation means the pay, money, monetary tool awarded to someone. Compensation is a pay practice one of the human
resource management practices which normally refers to pay, wages, salary, and benefit, etc. (Tooksoon, 2011). Compensation is
the reward system a company provides to an individual who is excellent (Amin, Ismail, 2014). Reward system is based on the
performance of the employees that ultimately enhances the firm performance (Syed, Yan, 2012). The compensation system in any
organization has a significant effect on the employee's productivity and the organization’s growth. Performance-based
compensation has a positive effect on employee and organizational performance (Vlachos, 2009).

2.6. Job Satisfaction

Employee satisfaction is the terminology used to describe whether employees are happy and contented and fulfilling their
desires and needs at work. Job satisfaction is concerning one's feelings or state of mind regarding the nature of their work
(Tooksoon, 2011). Job satisfaction defined as a pleasurable or positive emotional state resulting from the appraisal of one’s job or
job experience (Bhatti, Qureshi, 2007). It defines attitude individuals have about their jobs results from their perceptions of jobs
and the degree to which there is a good fit between individuals and organizations (Jehanzeb, Hamid, & Rasheed, 2015). Job
satisfaction is a significant factor in many studies, and it acts as a mediating variable and an issue in the organization (Jehanzeb,
Hamid, Rasheed, 2015).

2.7. Organizational performance

Organizational performance means the organization sales growth, market share growth, financial growth and the overall
growth of an organization. Organizational performance encompasses three specific areas of firm outcomes: (1) financial
performance (profits, return on assets, return on investment, etc.) (2) Market performance (sales, market share, etc.) and (3)
shareholder return (total shareholder return, economic value added, etc.) (Richard, Devinney, Yip, & Johnson, 2009).

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3. RELATIONAL THEORETICAL BACKGROUND
3.1. Training on Job Satisfaction
Training plays an important part in job satisfaction. Providing formal and informal training experiences, such as necessary
skills training, coaching, mentoring, and management development can further influence employees’ development (Huselid, 1995).
Human capital theory defines some labor is more productive than others because more resources invested into the training of the
labor (Ramlall, 2004). As A Result of the training, job satisfaction needs to be applied to influence the workers to stay longer in
their organizations (Tooksoon, 2011). Training is necessary because many changes come in a competitive environment. The
current market nowadays faces increasingly rapid amount of changes in technology, system, and products (Awan & Sarfraz, 2013).

3.2. Training on Organizational performance

Training is an important factor for productivity as higher productivity observed in firms that result of training (Tan & Batra,
1995). If the employee couldn't understand the job, then he would prefer another job so the company can enhance the employee
productivity by investing more money in the employee training. There is a relationship between job training and productivity;
however job training tends to be losing value when the workers change job. Therefore,the organization or firm increase the cost of
keeping trained position filled (Tooksoon, 2011). Employee productivity generated more revenue (Rehman, 2011). A high level of
a skilled and competent workforce can contribute to the firm's success by developing a comprehensive and internally cohesive
human resource management system (Beh, Han Loo, 2013).

H1: An emphasis on providing training has significant positive effect on a) employee Job Satisfaction and b) organizational
performance.

3.3. Performance Appraisal on Job Satisfaction

It is the very important factor we take it as an important human managerial practice because this study conducts in Pakistan
and most of the organizations ignore the employee merit-based promotion (Syed, Yan, 2012). Performance appraisal is the driver
of the employee performance. If the employees perform better it leads toward the job satisfaction of employees (Syed, Yan, 2012).
If the employee is internally satisfied or happy with his or her job, then it shows the productive results of an organization.
Employees who get the fair appraisal system are more satisfied with an organization than other employees. Therefore, promotion is
associated with low employee turnover (Fey et al., 2000). Fair chance of promotion can enhance the employee productivity, and
employees react more satisfied with an organization. The employees are more passionate and satisfied when an organization gives
them a fair chance of promotion (Syed, Yan, 2012). There is a significant relationship between the performance appraisal and the
job satisfaction (Ali & Ahmed, 2009)

3.4. Performance Appraisal on Organizational performance

A sense of performance appraisal provides the sense of fairness and justice among the employees who are valued to an
organization (Pfeffer, 1995). If the performance appraisal is merit-based and without any biases, then it enhances the productivity
of the organization. Reward theory links the fair promotion and the job satisfaction. It means the change in the ranking system
(below to above level) enhance the motivation level of employee and enhance the productivity of the organization (Lawler III,
1986). High-performance organizations persistently sought to recognize and rain valuable force contributions made by employees
(Agarwal & Ferratt, 1999). Good managers recognize people by doing things that acknowledge their accomplishments, and they
reward people by giving them something tangible.

H2: Performance appraisal has significant positive effect on a) employee job satisfaction and b) organizational performance.

3.5. Employee Participation in Job Satisfaction

If the organization involve the employees in the decision making, then it motivates the employees and employee happy with
his or her work. Employees’ involvement fulfills their self-actualization need. According to the Maslow’s need hierarchy theory, in
self-actualization, organization provide training, provide challenges and encourage creativity (Ramlall, 2004). Managers have
responsibility for creating such environment in which they use the full potential of employees. If the employer fails, then it causes
the poor performance, employee frustration, lower job satisfaction and increases the withdrawal of organization (Steers & Porter,
1983). Participation of employees satisfies the employees it fills the self-actualization need, and it enhances the productivity of the
employees (Syed, Yan, 2012). It shows that there is a positive relationship between them.

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3.6. Employee participation in organizational performance
Participative decision making can be evaluated regarding various outcomes, including workplace democratization, reduction
of industrial conflict, and employees' involvement indecisions (Cotton, Vollrath, Rroggat, 1988). There is the link of participative
approach theory between the employee participation and the organizational performance (Amin, Ismail, Selemani, 2013).
Company gives a chance to their employees to exchange information and ideas (Mohammad A. Binyaseen, 2010).

H3: The Employee Participation has significant positive effect on a) employee Job Satisfaction and b) organizational performance.

3.7. Job Definition on Job Satisfaction

Job description includes all the task duties and responsibilities. If these are clear to the employees it increases the satisfaction
level of the employees and enhances the organizational performance as well. If the employees are well aware of the organization
environment and their duties, objectives then they are better to perform their tasks, and it helps the organization to enhance their
productivity. Proper job description and job specifications help the employees to grow (Manning, 2012). Conducting job analysis
and subsequently providing employees with the job description prevents the situation in which the employees do not know what is
expected of them (Abeysekera, 2007). If an organization defines the outlines, responsibilities, working conditions and expected
skills, then the employee can give the better results and more satisfied (Amin, Ismail, 2013).

3.8. Job Definition on Organizational performance

Job description plays an important role in the organizational performance. It defines the duties, and the tasks responsibilities
that are expected of the employee and the company expect from him to perform (Amin, Ismail, 2014). If the job is clear, then
employees efficiently manage their work, and it helps the organization to motivate and retain the employees. So, if company make
clear the job description then it enhances the organization productivity as well.

H4: The job definition has significant positive effect on a) employee job satisfaction and b) organizational performance.

3.9. Compensation on Job Satisfaction

Compensation is the pay, wages, salary, and benefits. If the company give rewards to the employee based on his performance,
it motivates the employee and enhances the satisfaction level of employee (Tooksoon, 2011). Compensation has some correlation
with job satisfaction as well. Along the same line, the relationship between pay practice and job satisfaction is useful to influence
the motivation of employees' work then achieved higher productivity. According to the Efficiency Wage Theory, firm that paying a
higher wage can sometimes increase work's productivity (Tooksoon, 2011). If an organization gives high wages, the employee
satisfaction becomes high which lead the high productivity. In other words, a higher wage increases effort by increasing workers'
loyalty to the firm (Akerlof, 1984).

3.10. Compensation on Organizational performance

Performance-based compensation has a positive effect on the employee and organizational performance (Cardon & Stevens,
2004). We chose this practice in our research because it is the dominant predictor (Vlachos, 2009). Performance-based
compensation is viewed as an ingredient in organizational incentive system that encourages the individual performance and
retention(Uen & Chien, 2004). Incentive planes in any organization enhance the satisfaction level, and the employees show loyalty
toward an organization. To be effective compensation practices and policies must be aligned with organizational objectives
(Vlachos, 2009). Employees think it is the employer mechanism to control their behavior. When an organization institutes
performance contingent compensation, the employees are motivated to focus on long-term organizational performance rather than
short-term gains (Huselid, 1995).Therefore, in an ever competitive business environment, many companies today are attempting to
identify innovative compensation strategies that are directly linked to improving organizational performance (Amin, Ismail,
Selemani, 2013).

H5: The use of performance-based compensation has significant positive effect on a) employee job satisfaction and b)
organizational performance.

3.11. Job Satisfaction on Organizational performance

Job satisfaction is an individual cognitive, affective and the evaluation reaction on the job (Tooksoon, 2011). Job satisfaction
is widely studied work-related attitude in the field of the organizational behavior (Tooksoon, 2011).The higher job satisfaction

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relates to the organizational performance(Hackman & Oldham, 1975). Low level of employee job satisfaction tends to have a low
level of commitment and productivity(Wong-Riley, 1989).if in any organization there is no job satisfaction then there is high
intention to leave the job. The work environment is an important factor in the job satisfaction and the organizational performance
(Tooksoon, 2011). If employees have a high level of satisfaction, it will lead towards less turnover and high organizational
performance (Amah, 2009).

H6: A positive relationship exists between the employee job satisfaction and organizational performance.

3.12. Research Framework

This study examines whether there exists a relationship between human resource practices and the performance of companies
in Pakistan. There are five independent variables including training, performance appraisal, employee participation, job definition,
compensation. While there is only one mediating variable which is employee job satisfaction and also only one dependent variable
which is organizational performance.

Figure 1 Theoretical Framework

Figure 1 shows the relationship between independent and dependent variables as a direct effect and through mediating variable as
well. We have developed seven hypotheses from H1 to H7 which shows direct as well as indirect relationships. It is also separately
showed in Figure 1 that black arrow relations show direct relationship, while red line arrows show indirect association.
4. METHODOLOGY
4.1. Data Collection
The data was collected from the questionnaires. It was distributed equally to academicians and support staff at all faculties
and administration offices. Data was collected from the universities of Gujranwala sector including PUGC (Punjab University
Gujranwala Campus), UCP (University of Central Punjab), and Gift University. The sampling technique that was being used in this
research was non-probability sampling technique, which includes convenience sampling technique. We had selected the sample of
50 administrative staff like teachers and the other employees who were working in different departments of universities and 40
support staff. This sample size was enough to get the results. In this research, the total number of variables were seven, and each
variable had seven questions in it. The sample size was 90 because it was Qualitative research design and due to the shortage time
limit, it was enough. The Sample size was limited due to the limitation, and these results couldn't be generalized (Batt, 2002). The
Questionnaire survey tool was used to collect the data. The structured questionnaire was used and this research based on the Self-
developed instrument on Likert scale.

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4.2. Study Design
In this study, we want to check the effect of human resource management practices on organizational performance. Moreover,
this research needs to cover the relationship between the variables. We were intended to check whether the association actually
existed between the variables which the researchers presented in the framework and if yes then what could be the possible factors
for that. The statistical tools which were being used in this research were Anova, T-Test, and Regression. We chose the regression
because it told us the relationship between independent variables and dependent variable. In this research, there were different
variables, and various questions like, training was the independent variable and we checked whether it was positively or negatively
related to the organizational performance. In model summary, the adjusted R square told us about the model fitness. We used
ANOVA, to know the significance level of the best-fitted model, and it also presented whether the sample size applied to the
population or not. We run T-Test which told us that sample was applicable on population or not. This test also helped to see
whether the hypotheses were accepted or rejected. Also, regression was done in this research, to show there was a significant
relationship between the variables.

5. STATISTICS AND RESULTS

5.1. Regression (Model #1)
Table 1 shows that all the independent variables explain 56% to the dependent variable and the model is best fitted up to 56%.
It also shows that 44% are the other variables that did not explain this model. It might be the other variables which didn't
considered due to the limitations. In table 1, 46% can be adjusted by adding the independent variables. It gives us an idea of the
scatter of the points around the line of regression. The table shows that .23028 scattered.

Table.1 Model Summary

Model R R2 Adjusted R2 Standard Error

1 0.745 0.555 0.463 0.23028

Note: Dependent variable; job satisfaction (JS). Independent variables; compensation(C), employee participation (EP),
performance appraisal (PA), job definition (JD) and Training (T)

5.2. ANOVA
The value of F is statistically significant at a level of 0.05 or less, and this suggests a linear relationship between the variables.
Statistical significance at a .05 level means there is a 95 percent chance that the relationship between the variables is not due to
chance. On the other hand, the value of the P is less than the 0.05 then it will be significant, and the hypothesis which you stated
will be accepted. The significance level must be less than .05, and it shows that independent variables how much explain the effect
of the dependent variable. After that F=5.998 and P=0.001 is statistically significant.

Table.2 ANOVA

Model 1 Sum of Square Mean Square F Significance

Regression 1.591 0.318 5.998 0.001

Residual 1.2731 0.53

Total 2.863
5.3. T-Test
Training (T) is an independent variable that value is .133 (see table 2) which shows that 13% training effect on the dependent
variable. Performance appraisal (PA) is the independent variable that value is .368 which shows that 37% performance appraisal
effect on the dependent variable job satisfaction. Employee participation (EP) is an independent variable that has value -.187 which
shows that -19% employee Participation negatively or no effect on the dependent variable (job satisfaction). The regression
equation is presented in many different ways, for example:

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Multiple Regression: Y = a + b1X1 + b2X2 + B3X3 + ... + BtXt

Job satisfaction=1.311+T (.133) +PA (.368)-EP (.187) +JD (.106) +C (.510)

So the above equation shows that if the per unit change comes in the independent variable T then Y=-.133 so all the variables
could be explained as well as above. The value of the P is less than the 0.05 then it will be significant, and the hypothesis which
you stated will be accepted. In the above table, the T significance level is .03 which shows that it is lower than the 0.05 so this is
significant, and the hypothesis which we stated in our study is supported. On the other hand, the p-value in the PA is .009 which
shows that is greater than the 0.05 and the hypothesis which we stated is supported. The significance level of EP is -.156 which
shows that it is higher than the 0.05 and negatively related. Therefore this is insignificant, and the hypothesis which we stated in
our study is not supported. In the above table, JD significance level is .049 which shows that it is lower than the 0.05 so this is
significant, and the hypothesis which we stated in our study is supported. If the employee knows about the job description, then it
shows the employee satisfaction (Khan, 2010). The significance level of C is .000 which shows that it is lower than the 0.05 so this
is significant, and the hypothesis which we stated in our study is supported.

Table.3 Coefficients (T-Table)

Standard
Variable Beta T-Value Significance Hypothesis
Error
Constant 1.311 0.696 1.883 0.032
T 0.133 0.128 1.036 0.031 Supported
PA 0.368 0.127 2.865 0.009 Supported

EP -0.187 0.122 -1.464 -0.156 Not Supported

JD 0.106 0.152 0.697 0.049 Supported

C 0.51 0.123 4.153 0 Supported

Note: Dependent Variable; Job satisfaction (JS).

5.4. Regression (Model #2)

In this table, R-value is .377 it shows the strange positive correlations of the model and the model is reliable up to 38%. R-
square represents the amount of variation in the outcome that can be explained by the independent variables in our model. In the
above table, it shows that all the independent variables explain the dependent variables up to 30%, and the 56% the model is best
fitted.

Table.4 Model Summary

Model R R2 Adjusted R2 Standard Error

2 0.377 0.302 0.012 0.32887

Note: Dependent variable; organizational performance (OP). Independent variables: compensation(C), employee
participation (EP), performance appraisal (PA), job definition (JD) and training (T)

It also shows that 70% are the other variables that explain this model; it might be the other variables which we didn't consider
due to the limitations. In the above table, 10% jump can be adjusted by adding the independent variables. The standard error
another name is the standard deviation of y about the regression line. It tells us how much the observed values differ from the
values on the regression line.

5.5. ANOVA
Table.5 ANOVA

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Model 2 Sum of Square Mean Square F Significance

Regression 0.578 0.116 1.068 0.002

Residual 2.596 0.108

Total 3.173
Firstly, see here the significance level then see the F-test outcome that mentioned earlier as giving a measure of the absolute fit
of the model to the data. Here, the F-test outcome is highly significant because p-value is less than .005, as you can see in the last
column, so the model does fit the data. On the other hand, the t value or the p-value also shows the significant level of the study
and also shows that it is supporting your hypothesis or not. If the value of the P is less than the 0.02, then it is significant, and the
hypothesis which you stated will be accepted. The significance level must be less than .05, and it shows that independent variables
how much explain the effect of the dependent variable. First of all check the significance level if it would be satisfied then we can
see the value of the F. so according to the table Significance or p-value is .002.

5.6. T-Test
In the above table, constant are the intercepts. Training (T) is the independent variable that value is 2.745 which shows that
27% training effect on the dependent variable (organizational performance). Performance appraisal (PA) is the independent
variable that value is .150 which shows that 15% performance appraisal effect on the dependent variable (organizational
performance). Employee Participation (EP) is an independent variable that has value -.125which shows that -13% employee
Participation negatively or no effect on the dependent variable. The regression equation is presented in many different ways, for
example:

Multiple Regression: Y = a + b1X1 + b2X2 + B3X3 + ... + BtXt

Organizational performance =2.745+T (.263) +PA (.150)-EP (.125) +JD (.161) +C (.012)

So the above equation shows that if the per unit change comes in the independent variable T then Y=-.263 on the other hand if
the per unit change comes in the PA then Y=.150 so all the variables could be explained as well as above. In the above table, the T
significance level is .030 which shows that it is lower than the 0.05 so this is significant, and the hypothesis which we stated in our
study is supported. On the other hand, the p-value in the PA is .042 which shows that is less than the 0.05 and the hypothesis which
we stated is supported.

Table.6 Coefficients (T-Table)

Standard
Variable Beta T-Value Significance Hypothesis
Error

Constant 2.745 0.995 2.76 0.011

T 0.263 0.183 1.439 0.03 Supported

PA 0.15 0.16 0.82 0.042 Supported

EP -0.125 0.121 -0.684 -0.501 Not Supported

JD 0.161 0.218 0.742 0.024 Supported

C 0.012 0.176 0.663 0.039 Supported

Note: Dependent Variable: organizational performance (OP).

Performance appraisal gives the sense of fairness and justice among the employees, and it could enhance the organization
productivity (Pfeiffer, 1995). The significance level of EP is -.501 which shows that it is higher than the 0.05 and negatively related
that's why this is insignificant, and the hypothesis which we stated in our study is not supported. Employee participation has

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relatively small impact on the organizational performance (Wagner 1994). In the above table, JD significance level is .024 which
shows that it is lower than the 0.05 so this is significant, and the hypothesis which we stated in our study is supported.

5.7. Regression (Model#3)

Table.7 Model Summary

Model R R2 Adjusted R2 Standard Error

3 0.369 0.336 0.105 0.3129

Note: Dependent Variable; organizational performance (OP).Independent Variables: job satisfaction (JS).

The P value tells you how confident you can be that each variable has some correlation with the dependent variable, which is
the important thing. In this table, R-value is .369 it shows that the strange positive associations of the model and 37% the model is
reliable. In the above table, it shows that 34% all the independent variables explain the dependent variables and the 34% the model
are best fitted. It also shows that 66% are the other variables that did not explain this model it might be the other variables which
we didn’t consider due to the limitations. In the above table, 11% jump can be adjusted by adding the independent variables. The
standard error another name is the standard deviation of y about the regression line. It tells us how much the observed values differ
from the values on the regression line. It gives us an idea of the scatter of the points around the line of regression. The table shows
that .31290 scattered.

5.8. ANOVA
In the table, if the value of the P is less than the 0.003 then it is significant, and the hypothesis which you stated will be
accepted. The significance level must be less than .05, and it shows that independent variables how much explain the effect of the
dependent variable. First of all check the significance level if it would be satisfied then we can see the value of the F. It also
indicates that the combination of these variables significantly predicts the dependent variables. In the table Significance or p-value
is .003 .the p-value shows that we are confident that we use the correct variables for our study. After that F=4.413 and is
statistically significant.

Table.8 ANOVA

Model 3 Sum of Square Mean Square F Significance

Regression 0.432 0.432 4.413 0.003

Residual 2.741 0.098

Total 3.173

5.9. T-Test
This is a linear regression and Job satisfaction is the independent variable that beta value is .338 which shows effect of 34% of
JS on the dependent variable.

Linear Regression: Y = a + BX

Organizational performance =2.358+JS (.338)

It shows that the variation in the dependent variable concerning the independent variable. If the independent variable X is zero
than dependent variable Y is equal to the constant and the constant is 2.358. So the (Y=2.358). So the above equation shows that if
the per unit change comes in the independent variable JS then Y=-.263.On the other hand, the value of the P is less than the 0.05
then it will be significant, and the hypothesis which you stated will be accepted. In the above table, the JS significance level is .045
which shows that it is lower than the 0.05 so this is significant, and the hypothesis which we stated in our study is supported.

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Table.9 Coefficients (T-Test)

Standard
Variable Beta T-Value Significance Hypothesis
Error
Constant 2.358 0.75 3.145 0.004
JS 0.338 0.185 2.101 0.045 Supported
Note: Dependent Variable: Organizational performance (OP).

6. CONCLUSION
The objective of the study is to examine the impact of human resource management practices on organizational performance
and to examine the effect of human resource management Practices on the Job satisfaction (Mediating Variable and on the
organizational performance (Dependent variable). The study revealed that human resource management practices have a significant
impact on organizational performance (Amin, Ismail, 2014). It has been found that university performance can be attributed to
HRM practices including training, performance appraisal, employee Participation, job definition, and compensation. In our study,
all the hypothesis accepted except the employee participation. Training variable has the significant positive effect on the job
satisfaction and organizational performance ( Amin, Ismail, 2014). The appropriate training program for both academicians and
support staff is helpful for the universities to organize the employees efficiently which help the universities to continue to improve
the skills of employees(Qureshi, Franceschini, & Lastras-Montano, 2010). Furthermore, performance appraisal is guided by the
performance management policy (Guest, 1997).Similarly, The employee Participation is rejected. In Pakistan, in Public
universities, the decision taker is the Government and the top management (Wagner, 1994). The Research conduct with the small
sample size and sample is collected from both the public and private universities of Gujranwala. One of the significant limitations
of this study is the small sample size thus the findings are not generalizable (Amin, Ismail, 2014). The Gujranwala is the congested
area, and the culture varies from city to city it might be a reason. Companies intending to gain a sustained competitive advantage
should help their employees participate actively decision making processes and involve them in the day-to-day problems (Mansour,
198).

Compensation and the job definition both practices have the significant positive effect on the job satisfaction (Syed, Yan,
2012). Since HRM practices have a significant impact on organizational performance, managers need to implement them in an
integrated and coherent manner (Chen, 2009). Organization including universities need to attract and retain talents and leverage
them for competitive advantage (Khan, 2010). Furthermore, employee Participation has the negative relation with the job
satisfaction because if the organizations don’t involve their employees they think that they are not important for the organization it
decline the motivation level of the employees in the universities. This sample size is not sufficient enough to reflect the factual
image of the organizations functioning in Pakistan in context with measuring the relationship among employee participation, job
satisfaction (Bhatti, Qureshi, 2007). Human resource practices have the significant direct link with the job satisfaction (Hamid,
Rasheed, 2015). Job satisfaction is positive effect because if the employee is happy then he is more loyal and enhances the
productivity (Chen, 2009). So it is important to follow the best human resource management practices, in order to enhance the
performance of employee which ultimately would lead to the profitability

7. PRACTICAL IMPLICATIONS
The findings suggested that management might be able to increase the level of the commitment in the organization by
increasing satisfaction with compensation, policies, and work conditions. Companies should involve their employees as they are
viewed as an important source of competitive advantage (Huselid, 1995). Succeeding to attract, retain and motivate a skilled
workforce helps universities (Batt, 2002). Employee Participation hypothesis is rejected due to some reasons which are mentioned
on the above paragraph. In our point of view the employee Participation is the core practice the universities must focus on it. Most
of the Pakistani organizations do not see employee participation as a driver of better employee performance but this is the most
important practice (Bhatti, Qureshi, 2007). One way of increasing the job satisfaction at the workplace is increasing the interactions
level with employees in staff meetings and increasing guided discussions of topics related to these issues. Participation approach
should be implemented at the workplace. Employees should be interviewed to determine their perceptions of management's ability
to address the workplace issues. Consequently, management and the supervisors should allow the employees to participate in
decision making on issues which affect the employees. Public universities should build KPI for the better involvement. Recently
an effort was made by the Ministry of Higher Education to develop KPI for governance of public universities in Pakistan Amin,
Ismail, 2014). The five main KPIs resulted from the study were research, publication, internationalization and linkage, teaching,
supervision and leadership which are also reflected in the KPIs of the selected university.

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Open communication or information sharing promote fast decision making. It will influence commitment and job satisfaction
among employees (Amin, Ismail, 2014). Changes should take place in the working environment and universities should make
efforts to increase organizational commitment that can enhance the job satisfaction. The universities should establish the close
relationship with the employees and support the family system culture in the organization. It implies that increasing employee
involvement and participation in decision making regarding their career plans will significantly enhance university performance
(Syed, Yan, 2012). If the employees are well aware of the organization environment and their duties, objectives then they were
better to perform their tasks, and it helps the organization to enhance their productivity. Proper job description and job
specifications help the employees to grow (Manning, 2012). Job Description plays a vital role in the organizational performance.
So, company if clear the job description then it enhances the organization productivity as well. If the employees involved, then it
would increase the engagement level with the organization universities lead toward the top rank. If the employee would be happy
with his or her job and with the organization, then it would increase the performance of the organization. Job satisfaction is the
employee attitude toward his or her job (Tooksoon, 2011).A highly committed and competent workforce helps companies
succeeding these strategies and gain a competitive advantage as long as these strategies are communicated and the workforce is
involved in both the formulation and implementation phases (Syed, Yan, 2012).

8. LIMITATIONS AND FUTURE RESEARCH AREAS

Firstly, in this study, we used a small size sample to analyze the impact of human resource management practices on organizational
performance. As the behaviors of employees change with changing the environment and organizational practices, so we should
collect data more than one time and compare the results. Future research should include more universities both public and private.
Also, future researchers should also consider moderating variables such as university culture, organization climate, labor market,
and legal & the regulatory environment.

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