The impact of HRM practices on organisational performance: The case study of some selected Rural Banks

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This research looked at the impact of HRM practices on organisational performance in the case of some rural banks in the Ashanti region of Ghana. Research over the years, has established significantly a positive correlation between HR practices and organisational performance. The assumption underpinning the practice of HRM is that people are the organisation’s key resource and organisational performance largely depends on them. Therefore, if an appropriate range of HR policies and processes are developed and implemented effectively, HR will make a substantial impact on organisational performance. However, the majority of the rural banks in Ghana are yet to catch the HRM cold. The objectives of the study were to examine the general HR practices and programmes of the rural banks, evaluate the perceptions of employees on HR practices and programmes of the rural banks and establish the impact of properly managing human resources on the performance of these rural banks. This study surveyed four branches each of four rural banks with total respondents of 150 made up of 40 managerial employees and 110 non-managerial employees. The response rate was 98.66% which represented 40 managerial employees and 108 non-managerial employees. The study employed two sets of 8 and 10 HR practices categorised questionnaires for managers and employees respectively. Purposive and convenience sampling techniques were applied to managers and employees respectively. The findings of the study revealed that HR practices are improperly planned; implemented and managed by non-HR experts and that the practices, programmes and policies of these rural banks are lowly perceived by their employees. The study also showed that the enormous benefits of properly managing human resources are lost to these rural banks. It was recommended that rural banks should dedicate a department to HR for the proper management of human resources through whom competitive advantage could be created.
A thesis submitted to the Department of Managerial Science, Kwame Nkrumah University of Science and Technology in partial fulfillment of the requirements for the degree of MASTER OF BUSINESS ADMINISTRATION (HUMAN RESOURCE).