Sci.

Int(Lahore),27(2),1413-1416,2015

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IMPACT OF HUMAN RESOURCE MANAGEMENT ON ORGANIZATIONAL

PERFORMANCE: A FOCUS ON PAKISTAN INTERNATIONAL AIRLINE
Aiza Hussain Rana, 1Ayesha Malik, 2Summaira Arif, 3Ghulam Sakina, 4Saba Javed
Department of Business Administration, Lahore Garrison University, Lahore,
1
Lahore Garrison University, Lahore. E-mail: [email protected]
2, 3, 4,
Lahore Garrison University, Lahore
ABSTRACT: This study explores that, Organizations have many factors contributing to its success but the most important
factor that affects its operational performance is Human Resource Management. Human Resource Management is a crucial
part of an organization, is mainly concerned with management of workers of an organization. The study explores that how
Human Resource functions can
be improved to improve overall performance of the organization. The research was
conducted on Human Resource Department of Pakistan International Airlines by conducting in-depth interview with Manager
of Human Resource Department & used a structured questionnaire as research tool. This research papers elaborates that if
workers of an organization are well compensated by the organization then they will be become motivated, loyal and satisfied
with the organization and can play an important role in the success of that organization.
Keywords: Human Resource Management, Human Resource Department, Pakistan International Airline

1. INTRODUCTION
In todays competitive environment it is very important for a
company to focus on the workforce management and for this
purpose human resource management plays a vital role to
hire, train, develop and motivate workforce. Hiring talented,
efficient and motivated workforce is vital for success
because this do not require additional effort. Organizations
workforce is just like pillars on which whole company
stands and if pillars are strong then that company would be
successful. This study was conducted on Pakistan
International Airline (PIA), PIA is national flag carrier
established in 1955 [4]; provide services to more than 200
million Pakistanis on Domestic and International level.
Human Resource management (HRM) is undoubtedly been
emphasized in all world literature. Motivating, empowering,
satisfying, training and developing the personnel, providing
their behavior to fit the strategy and adapting them to the
competitive environment are the main tasks of HRM in
companies [1]. Attracting talented employees to the
business, maintaining them, their loyalty to the business,
availability of education and career development,
opportunities and service of coaching by mangers to their
employees are considered as important points [2]. Today
there are three main resources for the business e.g. human
technology & capital [2]. These three are very important for
PIA and if PIA focuses on improvement on these three
things e.g. human resource, capital and technology then it
will be successful [2].
2. HUMAN RESOURCE DEPARTMENT OF PIA
Every organization has to perform several personnel
functions in its own capacity. Every organization hire, train,
pay, motivate, maintain and ultimately retire employees.
Human Resource Department (HRD) of PIA makes policies
and procedures for the employees of PIA from induction
level to retirement. PIA is facing continuous losses from past
few years. From HRM perspective there could be several
reasons of failure e.g. inefficient workforce or unmotivated
workforce which was the main aim of this study. Now the
question arises that why the workforce is inefficient? There
could be several reasons e.g. lack of guidance, poor training
and development, lack of skills, lack of motivation, lack of

monitoring, lack of honesty, lack of education. Hiring

Talented, educated, skilled and motivated workers [2] lessens
the chances of risk. Workforce, capital & technology [2] are
basic weapon by which PIA can compete in a competitive
environment. Some major challenges which globalized
organizations face are workforce diversity, technology & E
commerce [3].
3
FUNCTIONS
OF
HUMAN
RESOURCE
DEPARTMENT OF PIA
This research paper aims to describe how HR Managers
should define & implement human resource functions
through which they can include motivated workforce into the
organization. There are several functions which HRD of PIA
performs. HRD of PIA must not only concentrate on hiring
workers in fact employee retention through better
compensation and supervisor support should also be provided
to employees [5].
Human Resource Planning
Human Resource Planning (HRP) begins with the need
analysis [6]. HRP planners must consider first the knowledge
and skills of current staff are identified by developing a skill
inventory for each employee. The second step is to forecast
HR needs for future based on strategic goals of organization.
Third step is to determine the gap between where your
organization wants to be in the future and where you are now.
Developing HR strategies to support organizational
strategies includes strategies which are required for meeting
your organizations needs in the future e.g. Restructuring,
Training and Development, Recruitment, Outsourcing and
collaboration Strategies. Companies are now using Human
Resource Information system (HRIS) for effectively plan HR
strategies [7].
Job Analysis
Job Analysis (JA) refers (Armstrong, 2002) to the process of
collecting, analyzing and setting out information about the
contents of job in order to provide the basis for a job
description and data for recruitment, training, job evaluation
and performance management [8]. In PIA JA is conducted by
first collecting information from departments regarding
vacancies and determines key requirements to perform those
jobs. In second stage of JA the analyst should critically
conduct job identification e.g. job status, duties and

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responsibilities, working conditions and what performance

standards must be set by HRD of PIA for its workers. The
last step is designing job descriptions (Job Title, Job Grade,
Job Location, Status, job Summary, working Conditions and
duties), job specifications (Education, Experience,
Languages, Physical and Mental requirements & working
conditions) and job standards (Targets/criteria). In my
perspective HRD of PIA should use experienced analysts and
planners to conduct job analysis and planning (B.Werther,
2011).
Job Design
Buchanan Job design (JD) is defined as specifying the
contents and methods of any job in such a way that the
various requirement of job holder can be effectively satisfied
[9]. Some approaches to construct an effective JD are job
rotation, job enlargement and job enrichment (B.Werther,
2011). PIA must concentrate on above mentioned approaches
for effective JD. Effectively designed jobs lead to high
productivity and satisfied employees. PIA HR managers
design jobs in a way that there will be smooth and continuous
arranged tasks that will be easy to understand. Any job in
which worker has to interact with the machinery will not be
conducted until proper is training is being given to
operational workers e.g. Engineers. A job must be designed
in such a way that it will require variety of techniques to
fulfill tasks so that workers can openly express their skills.
Recruitment & Selection
Recruitment is the process of attracting prospective
employees and stimulating them for applying job in an
organization [10]. PIA Recruitment process involves both the
internal (Job posting, employee referrals) & external sources
(Internet, newspaper) to attract talented, knowledgeable and
motivated workers. Mostly recruitment is done externally
because there will be a huge labor pool and it will become
easy for PIA to select potential and required candidates. It is
very important for recruitment process to be unbiased, free of
discrimination and to maintain equity and justice [8]. In PIA
selection should be made on merit basis e.g. person should
meet job description and final test and interview of candidate
should be conducted with the panel of judges so that
appropriate decisions could be for the selection of candidates.
Decisions should not be biased and partial in fact decisions
should be based on real results and merit [8]. If these criteria
will be followed no doubt PIA workforce will contain
efficient workers. PIA selection process involves short list
candidates, job test, selection board, medical test, offer letter
and appointment letter (HR final report, 2011).
Orientation & Placement
Once the selection process has been completed new
employees should be given an orientation in order to become
productive contributors. Orientation not only improves the
rate at which the employees will perform but also helps
employees satisfy their personal desire to feel they are part of
organizations social network (HR final report, 2011).
Placement means fixing or assigning an employee to a job.
Placement decisions should be taken by line managers.
Workers who perform best should get promotion in PIA. PIA
gives merit based promotions. Promotion could be of
different type e.g. transferring abroad, increase in salary and
promotions to upper positions. The decision of worker

Sci.Int(Lahore),27(2),1413-1416,2015

placement and promotion is taken on the basis of worker

performance, capabilities, knowledge about job and skills.
Training & Development
Training is very important for all the workers but necessary
for those who have to work on machinery and equipment e.g.
engineers usually training & development (T&D) determines
how committed is organization towards its workers [5]. PIA
should conduct proper training programs for the new entrants.
PIA should provide proper training to newly hired pilots
cabin crew and Engineers and other personnel of
organization. If PIA wants to retain potential workers e.g.
engineers etc. then it should focus on proper T&D of workers
[5]. Employee development is a joint effort which should be
undertaken by workers and PIA to upgrade the workers
knowledge, skills, abilities and capabilities. Employee
development programs make positive contribution to
organizational performance because a more highly skilled
workforce can accomplish more organizational goals.
Workforce with higher morale, career satisfaction, creativity
and motivation increase overall productivity of PIA.
Compensation & Benefits for workers
Compensation as a concept according to (Bernadin, 2007)
refers to all forms of financial returns and tangible benefits
that employee receives as part of employment relationship
[11]. Compensation is also a determinant which determines
employee retention & commitment towards organization [5].
Effective compensation and Benefit programs lead to
employee satisfaction. PIA HRD compensates its employees
and provides them benefits. PIA HRD should decide what
type of compensation, incentives & benefits should be
provided to workers to satisfy and motivate them. Several
benefits are provided by PIA to its workers. Monetary
rewards (pay for performance, incentives, bonuses), nonmonetary rewards (appreciation, certificates, status,
recognition) and benefits (Medical, Tickets, Pension) (HR
final report, 2011).
Performance Appraisal
The effort of employees can determine the success and
survival of an organization (Drucker, 1994; Barney1995), and
appraisal is potentially one way in which those efforts can be
aligned with the aims of organization, employees can be
motivated and their performance managed (Cook &
Crossman, 2004) [8]. Performance appraisal is a source to
evaluate the performance of the employees. Appraising
workers on their performance leads to motivated workforce.
PIA should use 360 feedbacks to appraise the performance of
its workers. Performance appraisal is essential because it
could be motivating tool for workers in future. Performance
appraisal is used to make placement decisions so on the basis
of evaluation of performance the organization makes
promotion or demotion decisions. Performance feedback
guides career decisions about specific career paths one should
investigate.
5. RESEARCH METHODOLOGHY
Data for this study is gathered from primary research which
was conducted on HRD of PIA and through secondary
research. This study is a qualitative study. The Research was
conducted by arranging in-depth interview with HRD
manager of PIA. During interview a structured questionnaire

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ISSN 1013-5316; CODEN: SINTE 8

containing open ended questions was used as research tool.

The data gathered from this research is accurate, factual and
qualitative.
6. FINDINGS
The findings of this research explore how PIA HRM
performs human resource functions.
Q1: About job analysis and job design.
In PIA Job analysis is conducted by collecting information
from departments regarding vacancies and determines key
requirements to perform those jobs. In second stage the
analysts critically conduct job identification e.g. job status,
duties and responsibilities, working conditions and
performance standards. The last step is designing of job
descriptions, job specifications and job standards
(Targets/criteria). PIA HR managers design jobs in a way that
there will be smooth and continuous arranged tasks that will
be easy to understand. Any job in which worker has to
interact with the machinery will not be conducted until proper
is training is being given to operational workers e.g.
Engineers. A job must be designed in such a way that it will
require variety of techniques to fulfill tasks so that workers
can openly express their skills.
Q 2, 3, 4: About Recruitment and Selection:
PIA Recruitment process involves internal and external
sources to attract talented workers. Mostly recruitment is
done externally because there will be a huge labor pool and it
will become easy for PIA to select potential and required
candidates [8]. In PIA selection is made on merit basis the
person who fulfils selection criteria and final test would be8.
selected. Interview of selected candidate is conducted with
the panel of judges so that appropriate decisions could make
be for the selection of candidates [8].
Q 5: About Orientation:
In PIA an orientation is given to selected workers in order to
make them productive contributors. Orientation not only
improves the rate at which the employees will perform but
also helps employees satisfy their personal desire to feel they
are part of organizations social network
Q6: About Training and Development
PIA provides proper training to newly hired pilots cabin crew
and Engineers and other personnel of organization. If PIA
wants to retain potential workers e.g. engineers etc. then it9.
should focus on proper T&D of workers [5]. PIA also
emphasizes on employees development because employee
development programs make positive contribution to
organizational performance, a more highly skilled workforce
can accomplish more organizational goals.
Q7: About Career development & succession planning.
PIA is providing chances of career development and
succession planning to workers through more networking, job
performance, exposure, mentors and sponsors, key
subordinates, growth opportunities and international
experience.
Q8: Incentives and benefits
PIA pays fixed salary plus increment and incentives to its
workers. Several benefits are provided by PIA to its workers.
Monetary rewards (pay for performance, incentives,
bonuses), non-monetary rewards (appreciation, certificates,
status, recognition) and benefits (Medical, Tickets, Pension).

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Q9, 10, 11, 12: About performance appraisal

According to human resource manager Performance appraisal
is a source to evaluate the performance of the employees.
Appraising workers on their performance leads to motivated
workforce.
Q 13, 14: About 360 feedback
PIA uses 360 feedbacks to evaluate workers performance
and make them more motivated for the future.
7. CONCLUSION
PIA has a huge workforce and workforce is just like an asset
for the organization. Human resource important functions are
job analysis, recruitment and selection, training and
development, compensation and benefits and performance
appraisal. Intense focus on Training and development,
compensation and benefits, career development and
succession planning leads to lower employee turnover,
employee retention, satisfied workers and ultimately
organization success. If PIA focuses on career and succession
planning of its workers then the employees will work
efficiently and effectively. Fair compensation and benefits
programs can also increase employees wellbeing and loyalty
towards organization. Hiring and workforce retention both
are important for the success of PIA. PIA HRM has a focus
on effectively managing talent and knowledge management
of employees. Due to lack of Human resource budget HRM
of PIA is unable to take initiatives which it intends to take
regarding workforce management.
RECOMMENDATIONS
Top management should make effective strategies to expand
PIAs operations, improve technology and should concentrate
on workforce management. Career planning and succession
planning should be performed by HRD for employees. HRD
should focus on the technical training programs of its
technical workers. HRD should conduct proper monitoring of
its technical and engineering staff performance to reduce the
chances of technical faults in its core fleets. HRD of PIA
must make strategies to overcome the problems of late flights
caused by technical problems and cargo problems caused by
poor performance of operational workers.
LIMITATIONS & FUTURE RESEARCH
The study is limited to one city e.g. Lahore due financial &
Time Constraints. In future we intend to explore this study
over the HRD of PIA, operating in different cities of
Pakistan. The study can also be explored by conducting
comparative studies with other international airlines.
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Meeting
Differentiation
and
Innovativeness
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(2013).

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[3] Hashim, M., & Hameed, F., Human resource management

in 21st century: issues & challenges & possible
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APPENDIX
INTERVIEW QUESTIONNAIRE
Job Analysis:
1. How do you conduct job analysis?
Recruitment and selection:
2. How many methods are used in recruitment? Which method you prefer the most?
3. What kind of factors do you keep in mind while making recruitment policies that can suit the companies goals and
objectives at the best?
4. Tell us, what are the criteria for selection process? What is the selection process which you use to select employees?
Orientation and placement:
5. Does employee orientation important for employee placement in the organization? If yes, the how much both methods
can effect each other?
Training and Development:
6. Which methods do you use for training and development of employees? How would you ensure training and development
contributes to achieving the companys strategic objective?
Career development and succession planning:
7. What steps do you take for career development of your employees? Does organization uses succession planning for its
potential employees or not?
Compensation and benefits:
8. What are the compensation and benefits programs for employees? While developing compensation and developing
programs what factors do you keep in mind?
Performance Appraisal:
9. How do you evaluate your employee performance? What techniques do you use for performance evaluation?
10. How do you appraise employees on their performance?
11. How do you give feedback to employees about their
performance?
12. Does feedback affect employees performance
positively? Do employees get motivated or not?
13. Do you use 360 degree feedback?
14. Does 360 feedback effective of not?

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