Best Practices vs. Best fit

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Best practices vs. best fit


BestPractices vs. Best fit

Intoday`s world, businesses are facing incredible competition from thehighly increase in growth of improved information technologies,changing environment evidenced by globalizations, deregulations, andlabor markets. For companies or firms to achieve the direly neededsuccess in their operations, they should put in place several factorsthat will improve their performance and result in the reduction ofcosts, speed up the market, improve the quality of products, alwayscreate the new process and manufacture new products.

Becauseof the different changes that are taking place in the business field,employees are believed to be very crucial part of the company and areconsidered as assets in the enterprise. Therefore, more companies arecoming up with ways and strategies that will focus on the integrationof the human resource management in the success of the entirebusiness and the formulation of goals, visions, and setting of theenterprise standards. The strategic human resource is considered thebackbone of business performance (Milkovich,Newman &amp Milkovich, 1999).Managers and academics view it as a complex process in which studiesare ongoing to reveal its primary purpose of determining theperformance of the company. Thus, different approaches are usedincluding the best fit and the best practice.

Whichis the best?

Thebest-fit approach is mostly involved in ensuring that all the humanresource strategies put in place are all suitable to the differentcircumstances of the organization, and its culture, externalenvironment as well as its operational processes. Therefore, itmainly focuses on the notion that different human resource strategiesshould work towards given needs of both the company and its people.Best fit also focuses on what works best and what does not work inconnection with the enterprise, the management decides on what isapplicable and pertinent, and the lessons that can be learned andadopted with an idea of getting what can well fit in the company`sstrategic and its operational requirements. The whole process beginswith the analyzing all the business needs considering its culture,values, technology, and processes that illustrate what should bedone. Later on, it can be used to change, mix and choose thedifferent ingredients of the best practice and finally develop anapproach applicable in alignment at various business needs(Milkovich,Newman &amp Milkovich, 1999).

Onthe other hand, best practice states that there is the specific setof human resource practices that can easily be applied in anyorganizational context and the long run bring an outstandingperformance in the business and deliver valuable outcomes to all thestakeholders of the business including the employees. For theperformance to be better and stronger, all the practices should bepacked together with an intention of harmonizing and balancing oneanother and create positive synergies between the two.

Accordingto different sources, the best-fit approach remains to be vitalcompared to the best practice. In fact, many critics andcommentators, view the best-fit approach as the best since it has anenormous appeal to the human resource personnel since it positionsthem as the first level strategic partners when it comes tomanagement process and decision-making. The reason being, best-fitapproach widens the range of better judgment when it comes toavailability to them all.

Thecritics tend to attack the best practice approach because thisapproach views by urging that the discrepancy between the beliefs inbest practice pertain to the intangible assets including the humanresource, which allows the firm to operate better than itscompetitors. This poses a major question as how the universalism ofthe best practice square with the view that only some resources androutines remain significant, and that they are vital despite thembeing rare and imperfectly imitable. Again, it is almost impossibleto have a universal practice because what works for an individualcompany does not necessarily work best for another company.


Paymentand compensation system should align with the company`s or businessstrategy meaning that in case there is the change in any businessplans it should equally change the compensation system. IBM is oneof the companies that use objective, internal alignment, externalcompetitiveness employee contributions, and management as thestrategic dimensions for compensation. Decisions are made based onthe five key model of rewards, and they are put together to come upwith a uniform strategy used by an organization as a compensationstrategy(Stavrou, Brewster &amp Charalambous, 2010).The objective is the way compensation supports business strategyleading to it to adapt to the cultural and universal regulatoryenvironment.IBM employs internal alignment to decide on how differentthe various types of skills can work done should be paid within thecompany. Also, external competitiveness determines how compensationshould be positioned or what forms of wages should be used againstthe competitors, for instance, they offer exclusive and exceptionaldeals than their competitors. Employee contribution strategy demandsthat employees` performance should be reviewed after six months tocheck on improved performance, skills, and continuous learning andthus increase the compensation. Management is bound to decide on whoshould be involved in the determining the employee`s compensation. Asopposed to whole food approach, which states that there should be nosecret on what the employees are being compensated, IBM encouragessome secrecy and limited transparency in paying the employees. Thecompensation system is tailored towards cost cutting in which all thestakeholders are expected to do more using the fewer resourcesavailable(Stavrou,Brewster &amp Charalambous, 2010).


Milkovich,G. T., Newman, J. M., &amp Milkovich, C. (1999). Compensation.T. Mirror (Ed.). Burr Ridge, Ill.: Irwin/McGraw-Hill.

Stavrou,E. T., Brewster, C., &amp Charalambous, C. (2010). Human resourcemanagement and firm performance in Europe through the lens ofbusiness systems: best fit, best practice or both?. TheInternational Journal of Human Resource Management,21(7),933-962.

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