The Effects of Performance-based HRM on Organizational Effectiveness : In the Case of a Public Corporation

Abstract

This study aims to empirically verify the positive impacts of PB(performance-based) HRM on the organizational effectiveness in a public corporation. The independent variables are ‘PB staffing’, ‘PB appraisal’, ‘PB compensation’. The dependent variables are ‘JS(job satisfaction)’, ‘OC(organizational commitment)’. The results are as follows. ‘PB staffing’ shows positive impact on both ‘JS’ and ‘OC’, but ‘PB compensation’ doesn’t show positive impact on both ‘JS’ and ‘OC’. Also, it is found that both ‘PB appraisal’ and ‘PB compensation’ do not show positive impact on ‘OC’. ‘PB appraisal’ shows positive impact on ‘JS’, though. From the empirical analysis, the positive effects of the PB-HRM on the organizational effectiveness are partially verified. It is thought that these mixed results are originated from the particular situation in which the surveyed corporation is placed. After the merger of the corporation in 2009, even though it has introduced various PB-HRM systems, it has been through a harsh time such as wage freeze and return as measures of business normalization. This organizational situation may influence the verification of effectiveness of the normal PB-HRM.