HRM Practices and Job Performance: Key to Define the Structure of the Egyptian Petroleum JVs

HRM Practices and Job Performance:  Key to Define the Structure of the Egyptian Petroleum JVs

Human resource management (HRM) practices are one of the main key elements that define a strong organizational framework for any entity. They represent the policies, procedures, and systems that influence employees’ behavior, attitudes, and performance. Several conducted studies have generally found a positive relationship between HRM practices and organizations’ performance. However, there are key contributors in between that should be taken into consideration.

One of these studies is ”Testing the Impact of the Human Resource Management Practices on Job Performance: An Empirical Study in the Egyptian Joint Venture Petroleum Companies”, published in International Journal of Business and Social Science, Vol. 3 No. 9; on May 2012, by Nermine Magdy Atteya, a full-time faculty staff member at State University of New York At Oswego Department of Marketing and Management School of Business Administration Oswego, New York 13126, USA

The report is concerned with enhancing the understanding of the link between HRM practices and job performance by testing mediating variables; supervisors’ job satisfaction, organizational commitment, quitting intention, negative word of mouth and organizational citizenship behavior. Testing the correlation between these mediating variables will highly explain the relationship between HRM practices and job performance.

Human Resource Management Practices and Job Performance

In this study, HRM practices were tested from job satisfaction, recruitment, and selection perspectives. This criteria enables the organizations to choose the best candidates in line with their aims and goals as well as properly respond to market opportunities and threats.

Training programs show a critical role in an organization’s success. Providing employees with a suitable training program gives them the necessary knowledge and skills to work effectively. Additionally, employees need to be rewarded as an incentive to perform at the required levels. Motivated employees greatly contribute to the growth of the organization. The HR departments in the Egyptian petroleum sector see training and development efforts as one of their priorities, according to the report.

Furthermore, performance evaluation process shows the effectiveness of HR policies in any organization. Feedback on performance improves communication between supervisors and employees. Besides, they increase loyalty and trust employees have towards their organization. In Egypt, the rate of providing feedbacks is low. When feedback is given, it is mostly a negative one.

Job Satisfaction and Quitting Intention and Negative Word of Mouth

Satisfied employees with their jobs are those who find desired outcomes. From the business side, managers believe that happy and satisfied employees are more productive. On the other hand, unsatisfied employees are more likely intending to quit and even talk negatively about their organization.

Job Satisfaction, Organizational Commitment and Organizational Citizenship Behavior

Organizational commitment is a significant sign of organizational citizenship behavior (OCB).  Committed employees would like to play more proactive roles in addition to behaving in a beneficial ways for the sake of their organization. In other words, OCB that represents the involvement of employees or reflects their sacrifice for the organization is supposed to be affected by commitment.

Furthermore, OCB can’t be directly recognized by the organization but rather it is reflected in the level of the employee’s performance. There are three types of OCB: obedience, loyalty, and participation.

Methodology and Results

In light of the previous studies, this paper creates a model to test the effect of HRM (independent factor) on job performance (dependent factor) through the mediating variables defined before.

The analysis focused on joint ventures petroleum companies aiming to specifically improve the HRM practices for the gas drilling and production teams’ supervisors. Hence, personal interviews were held with these supervisors to see their opinions about HRM practices within their organizations. Some of them expressed their annoyance from the feelings of unfairness and nepotism, especially in recruitment and selection process as well as training and development.

The interviews included a population of 4412 supervisors and section head in the joint venture petroleum companies in Egypt. A random sample of 600 supervisors was chosen, representing 17% of the population. The data collected were revised and analyzed using the SPSS statistical software package. The response rate reached about 90%.

It is worth mentioning that respondents differ in their characteristics,  66.1% of which are in their 30s, 20.2% are in their 20s, and the remaining minority are older.

Furthermore, 52.2% of the respondents possess 11 to 20 years of experience in the same organization, while about 32% possess from 6 to 10 years. In addition, 57.9% of respondents got a B.Sc. in Mechanical Engineering, while 18.7% got a B.Sc. in Petroleum Engineering, other 10.7% got a B.A. in Commerce, and 2.2% got an MBA.

A designed correlation matrix found a significant correlation among the determined variables. The matrix proved a significant positive correlation between HRM practices and job satisfaction, organizational commitment and job performance. Besides, it confirmed a negative correlation between HRM practices, job satisfaction, organizational commitment, OCB, job performance, quitting intention and negative word of mouth.

By applying ANOVA test, it is worth mentioning that the test showed that HRM practices explained 41% of the total variation of job satisfaction. Hence, the test provided statistical evidence that the more fair and impartial a company’s HRM practices are, the higher the job satisfaction rate, and accordingly the higher the job performance.

Egypt’s oil and gas sector is commonly believed to give great attention to developing, investing, and retaining its human resources. The sector adopts strategies to implement HRM practices objectively. However, managers in joint ventures companies either working in drilling, exploration, refinery or production, have to effectively control these practices. In addition, these practices have to be in line with the global changes where professional system needs to be followed by the organizations. Finally, the policies and practices should be implemented ethically and without discrimination.

Recommendations and Implications

The paper gives some important recommendations to managers in the industry. Improving HRM practices is the key element for improving the supervisory level of performance. Accordingly, petroleum organizations need to develop professional HRM system and practices. For instance, they have to provide equal supervisory opportunities; educational and training programs; promotions; compensation packages and performance appraisal.

Despite providing less job opportunities in the petroleum industry in comparison to other industries in Egypt, employees may quit their jobs or use negative words of mouth if their job satisfaction is not met. With this regard, the organization should set a system that measure job satisfaction regularly, every six or 12 months. This system will help solving any problem through professional methods and techniques as well.

On the other hand, awareness sessions, workshops and group discussions held by some professionals within the sector will greatly enhance OCB of the employees.

Additionally, providing performance appraisal feedback plays an essential role. They help supervisors to determine the performance strengths and weakness to design the proper improvement plans.


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