Education, Performance Management and Competitiveness as Instruments for Developing Skills for Human Resources in Organizations1

Adelino José Ferreira Monteiro1, João Carlos de Oliveira Matias2, Elizabeth Real de Oliveira3 1 Universidade da Beira Interior, Covilhã [email protected] 2 Universidade da Beira Interior, Covilhã [email protected] 3Universidade Lusíada de Vila Nova de Famalicão [email protected]

Abstract Higher education plays an important role in our societies. Considering the universalizing era and the change in the universities' mission and a move towards high- quality performance and organizational excellence, it is important to understand the linkages between the different stakeholders. This paper aims to infer, if Higher Education and Performance Management, are instruments for the transformation of human resources, and if they contribute effectively towards organizational competitiveness. The creation of organizational value is strongly influenced by the quality of management and the qualification of human resources. The work presented here is part of a PhD thesis, and reports on the findings of a survey directed to stakeholders within Higher Education.

Keywords: Human Resources Management, Performance Management, New Educational Paradigms

The concept of education in the European Community is contributing to major operational changes in the Portuguese educational system. The aim of these changes is to find a matrix that identifies guiding trends and propose lines of action, helping the acquisition of skills, focused on the collective mobilization of the common good. A current trend in this field reflects the need to face education throughout life, as a source of progress and personal responsibility in the construction of a common destiny (Delors, 1998: 11-30).

In parallel with the changes occurring in Higher Education towards a new paradigm of teaching centered within the acquisition of competences, the business environment is also evolving. According to current forecasts, the companies of the twenty-first century do not guarantee jobs for life as they have a reduced life expectancy due to global competition, rapid technological change and the innovation capacity of competitors. These new paradigms mean that the life cycle of active workers is higher than the life cycle of employing organizations which forces workers to bet on the knowledge in order to develop new careers, new relationships and new skills to be able to be flexible. According to Drucker (1994), the competitive advantage

1 The work reported in this paper was co-financed by FCT (PEst-OE/EME/UI4005/2011) and carried out within the research centre Centro Lusíada de Investigação e Desenvolvimento em Engenharia e Gestão Industrial (CLEGI). of organizations is derived from the individual knowledge of workers, which enhances competitiveness. Performance appraisal is an unavoidable element of organizational life (Brown, 1988), and is intrinsically linked to competences analysis and development. According to Vroom (in Mitchell 1982, quoted by Cunha et al, 2004:61), performance results from the interaction between individual skills and motivation, whereby, being null one of these factors, it will also be null the resulting performance. A poor performance may be the result from well driven people with lack of abilities or, very skilled persons without motivation. Studies of Schmidt and Hunter (1998) concluded that "intellectual ability is the best predictor of functional performance."

Seixo (2007: 16) considers that performance management contributes towards the efficiency and effectiveness of organizations. There are many decisions in modern organizations that depend on performance management, and they are widely used in most organizations (Burkhalter & Buford, 1989; Davis, 2001; Wanguri, 1995). They are an important piece of the process by which organizations attempt to direct themselves in order to achieve their objectives, and they have been considered a key component in the success of organizations (Grote, 2002; Pettijohn, Parker, Pettijohn, & Kent, 2001; Rasch, 2004).

Establishing the linkages between the role of higher education, in developing the adequate skills for businesses needs, and performance management as a business tool, seems crucial towards competitiveness.

Research Question and Methodology

The research question underlined in this paper, and later, divided in five specific research hypotheses is:

“Continuous Education, split between Higher Education Institutions and within Business contexts, ensures the acquisition and renewal of skills that contribute to improve performance and increase competitiveness?”

Research Hypothesis:

H1 – Life Long Learning requires an effort of continuous progression in order to acquire comprehensive skills that contribute to sustainable economic growth of societies. H2 – Qualified human resources influence value creation and promote performance and competitiveness. H3 – Performance evaluation values the formative dimension and can be understood as a management tool that promotes the qualification and mobilization of people within organisations. H4 – The operationalization of the link between the school - the University in particular - and Organizations is necessary for society to achieve levels of efficiency and effectiveness consistent with high levels of development. H5 – The sustainable development of societies is possible only if the Education, Science and Labour are agents of progress and economic growth by mobilizing the skills and value creation to gain a competitive advantage.

Empirical work under this research was carried out through a survey. For the structure of the survey the authors followed the steps suggested by Barañano (2008: 83). It was intended to collect data that would help to answer the research question and address the 5 research hypothesis.

A pre-test survey was carried out to a sample of respondents of the universe in order to collect suggestions and refine the survey. The Universe of the survey was university lecturers and researchers. The authors used a mixed questionnaire (open and closed questions) and questions in the solution tree were chosen to allow obtaining the information sought to avoid monotony in their fulfillment.

Questions were organized in six blocks: A - Identification; B – Higher Education C - Performance Assessment; D - Competitiveness, E – Education and Business and F- Open Question.

Because the investigation has been disseminated through online platforms it prejudices accuracy regarding the exact size of the sample and, secondly, that the answers fit the target. However, it is reliably to consider that the results are representative, since the dimension of "reporting population - population closely related to population goal, set when you cannot know the universe, is the basis for sampling, Barañano (2008: 83).

In order to ensure accuracy and a high degree of reliability and therefore credibility of the results it was considered for the study a sample embodied in the following terms: a) Total number of surveys sent directly to the recipient: 150; b) Propagation factor2: 10 c) Total number of potential recipients: 1500

According to Coutinho (2011: 87), it is considered that if the sample is representative if are received 15% responses, which in this research is equivalent to 225 responses. Since we received 246 that correspond to 16,4% of responses, we consider the sample representative.

2 Assumption originated and identified in the pre-test by observation and analysis of all respondents. Results

Closed questions were statistically analysed. The open question was analyzed according to the following structure:  Group the information according to the research hypothesis raised;  Identification of innovative factors that contribute towards the research. The first set of questions was concerned with general information regarding the respondents. Most of respondents were aged between 41 and 60 years old (62%). 47% were female and 53% male. Regarding academic qualification, the sample comprised 29,64% PhD, 31,23 Master degree, 35,18% Graduation. Only 3,95% presented other types of qualification. Most of respondents are currently working at Universities. The second set of questions was related to evaluate the perceptions of respondents regarding Education role in general. The following table presents the results within this category.

Table 1 – Education Results % Questions Scho Yes No Org. Cost Inv. ol School must teach values such as: solidarity, 6 equity, empathy, trust, loyalty, truth, 98 2 discipline, fraternity and freedom The state investment on education is currently 7 40 60 adequate to the existent needs - - The school – university in particular – should 8 90 10 develop skills of practical application - - Life long learning develops technical and social 9 skills that contribute to economic 80 20 development 58 32 Which is the best place for the workers to 10 both develop their qualifications? - - 10 Human resources development is a cost or an 11 3 97 investment for organizations? Portuguese youth have an excess of academic 12 61 39 - - qualifications and lack practical experience? - - Business associations should participate in the 13 82 18 development of high education degrees?

From an analysis of the responses it is relevant to see that approximately 60% of respondents consider that the investment the state makes in education, especially in higher-skilled occupations, it is not appropriate to the needs of our country. 90% of respondents believe that the School, the University in particular, should develop simultaneously theoretical and practical skills. About 80% believes that education develops lifelong skills that contribute to the country's economic growth and 58% consider that it is in the school that employees improve their general skills against 32% who think that it is in the business context.

Only 3% of respondents felt that the development of human resources was a cost for companies / organizations and not an investment. Probably because our sample is constituted manly by people that work in higher education. 61% of respondents believes that the Portuguese youth lack practical skills, and 82% believe that business associations should be involved in the construction of higher education curricula.

The third set of questions was related to performance evaluation. The following table presents the results obtained within the questions of this section.

Table 2 – Performance Evaluation Results % Questions Increas Decreas Con/De Yes No Fear e e t 76 4 Performance management contributes 14 towards a better performance of the Maybe tasks 20

Anxiety created by the evaluation 28 37 15 process weakens the normal Maybe organizational functioning 35 - - People less motivated are more 16 disruptive of the organizational 53 47 environment When there is a fit between the organizational culture and the people 17 94 6 within the organization, there is better individual and group performance Performance management confronts 64 8 people in their “comfort area” and Neither decreases 18 - - contributes to increase or decrease their nor increases motivation 28 The wage conditions and career - 19 advancement are the only causes of 29 71 motivation which improve performance A motivated employee, 18 13 gives a guarantee of an efficient and 20 effective performance that contributes Not always to achieve the objectives of the 69 organization The organization where you work 21 possess any type of performance 85 15 - system? 22 Your last performance evaluation was 20 41 objective and the final result was just, In some areas serious and transparent 39 Performance evaluation of your organization raises fears in people or, 23 - - 84 16 conversely, generates confidence and determination

With these questions the authors intend to understand the perceptions regarding how evaluation of performance contributes towards organizational development. The respondents (76%) considered that performance management contributes towards organizational development. The great majority of respondents (94%) consider that human resources improve their individual and group performance when tuned with the organizational culture. Regarding the question about wage conditions, 71% of respondents considered that money is not the only motivator. This group indicated other factors, such as: “self- esteem”, “personal recognition and appreciation by non-monetary means”, “professional pride”, “recognition by the scientific community”, “good atmosphere”, “recognition of merit”, “personal and social recognition”, “emotional satisfaction”, “desire to improve”, “I like the profession and working conditions", "health insurance, pension supplements and leisure activities", " accumulation of knowledge and experience”, "assurance of continuity in the workplace”, “institutional environment”, " flexible hours”, " availability of canteens, childcare facilities, gym", "public appreciation", "prospects for development and personal fulfillment”.

The fourth set of questions was related to competitiveness. The following table presents the results obtained within the questions of this section.

Table 3 – Competitiveness % Questions Yes No FI CT The training offered by your organization has 27 27 24 contributed to increasing productivity and In some cases competitiveness 46 The suggestions given by employees of your 30 21 25 organization have contributed to improve the In some cases processes for improving the productivity and competitiveness 49 - - 29 19 Not always In your organization moral values are respected (eg, 26 52 solidarity, sharing, justice and equity) towards a competitive environment The competitive performance is more dependent on internal factors(endogenous) of the 27 - - 50 50 organization or the global competencies of employees / workers 28 In the exercise of your profession, your 93 7 - - contribution to the improvement of competitiveness, helps develop the sustainable growth of your organization The role of the state, local and 51 8 29 international, is important for organizations In some cases to increase their competitive ability 41

With these questions the authors intend to understand the perceptions regarding if competitiveness is, or is not, related with organizational development. And if this competitiveness is related to the organizational and moral values.

Question 30 of the survey allowed respondents to identify the factors that contribute the most for increased competitiveness. The results are showed in table 4. Competence was the highest ranked factor, followed by efficiency and effectiveness.

Table 4 – Factors that contribute more towards competitiveness Degree of Importance (-) (+) 1 2 3 4 5 COMPETENCE 3% 2% 3% 22% 70% EFICIENCY AND EFFECTIVENESS 3% 3% 4% 27% 63% INNOVATION 3% 3% 8% 38% 48% QUALITY 2% 4% 6% 33% 55% PRODUCTIVITY 2% 3% 8% 42% 45% PERFORMANCE 2% 2% 9% 32% 55% INFRASTRUCTURES 1% 7% 33% 45% 14% KNOW-HOW 1% 4% 9% 34% 52% MANAGEMENT 1% 6% 18% 44% 31% TECNOLOGY 2% 5% 11% 53% 29%

Regarding to the connection between Higher Education institutions and other organizations, the objective of the survey was to understand how effective this articulation is. Results are presented in the following table.

Table 5 – Linkages between Higher Education Institutions and Surrounding Business Environment % Questões Yes No Sec. H.E. The business community can improve the scientific - - 31 research of companies cooperating with the research 99 1 centers of universities The state must mobilize the institutions that 32 have expertise to optimize the exchange between 94 6 Education and Businesses Interaction between theory and practice contributes to 33 99 1 improving organizational competitiveness 34 The real approximation between universities and 99 1 businesses facilitate better career choices on behalf of the students and suits business needs. tailored to the needs of companies The experimental component in enterprises should 35 - - 76 24 begin in secondary school or just in higher education There is a need for further studies regarding methodologies of linkages between Higher Education and 36 97 3 Businesses in other countries (e.g. France and Germany) and benchmark to Portuguese reality 59 28 Does a higher education institution can be considered as 37 depends a business, in certain specific areas 13 - - Permanent interaction between education institutions 38 and businesses contributes towards entrepreneurship 97 3 encouraging young people to create their own business Is it possible to renew knowledge and competences, without mobilizing people towards higher qualifications 39 11 89 and value creation, without involving Education institutions

The last set of questions were open ended questions. The authors treated 89 diversified answers that were grouped and classified using a coding system developed for that purpose, according to the research hypothesis initially raised. Results are showed in the following Tables.

Table 6 – Coding System Categories F % C Competences Development in Higher Education and within Business 30 22,2 1 Context C HR Qualification and Value Creation within Business Context 38 28,2 2 C Performance Management as an element of Continuous Assessment 35 25,9 3 C Competitiveness and Interaction between Higher Education and 32 23,7 4 Business Context

Table 6.1. – Category C1

Interaction, with a responsibility sense on behalf of the organisation, bearing in mind social equity in order to achieve a greater good. Education given by Example. Punctuality, continuous knowledge acquisition, autonomous discipline, commitment and responsibility. Interaction, deepened and systematic, between businesses needs and Higher Education offers (degrees). Increase of technologic degrees incorporating social issues Creating a scholarship of training needs linked between education, schools and businesses in order to create manpower to respond to different market needs increasingly competitive and constantly changing. Contents oriented to the real needs of businesses and citizens. Creation / strengthening of interaction between company technicians and teachers in which the first go to school observe and teaching the students and the second will teach business and observe the employees. Development of education throughout life by updating scientific and technical standing. Table 6.2. – Category C2

Qualificação dos RH com vista a melhorar o QE dos colaboradores e o quadro de diplomacia interna geradora de um bom ambiente de trabalho. Investimento nas infra-estruturas essenciais ao ensino e investigação aplicada que permita gerar inovação e também no capital humano como fator de crescimento socioeconómico. Criação de uma cultura ‘simbiótica’ escola/empresa. Aproveitar os recursos internos da organização para promover formação, partilhar experiências e criar fluxos de brainstorming. Lideranças honestas e competentes geradoras de fluxos positivos com retorno social. Reconhecimento do valor pessoal, técnico e profissional dos colaboradores como elemento de promoção na organização. Estabelecimento de redes internacionais de conhecimento.

Table 6.3. – Category C3

Focus on organizational improvement as indispensable elements for the good individual performance. Enhancement of collaborative practices (sharing), merit and competent performance (positive discrimination). Ease of access to leadership (valued opinion), the bureaucratic process and information and training. Assessment of performance as a tool to support management, a factor of mobilization on the organization's mission, encouraging the development of people and improving the quality of services. Instruments of performance assessment measured on the basis of cooperation because the excess of individual competition may hinder the sharing and efforts to achieve common goals. Working by objectives and monitoring compliance. Training for inter-organizational sharing of best practices and professional conduct. Ensuring equal opportunities to all employees starting for the differential performance originate corrective actions to allow the organization on the one hand, be more competitive and, secondly, more able to objectively reward competence. Definition of clear objectives, precise and strategic discussion (shared) systematic goals and results.

Table 6.4. – Category C4

Value far more, in the faculties of engineering, prototyping, functional equipment and patents than the publication of scientific papers. Universities should be construed as incubators of prototype equipment that can be produced in Portugal. Improving business confidence with respect to the real capacities of schools. Schools disciplined, demanding, and directed to human values in all levels of education, especially basic, key elements for improving the competitiveness and national productivity. Celebration of research protocols on specific projects, including developments in the acceptance of Master's and PhD. Training and individual performance viewed as an asset for the group / organization thus generating companies more competitive and, consequently, also a country more competitive. Final Considerations

Higher education is one of the organizations which play a crucial role in the development of a society. After analyzing the results of the survey, one is left with the notion that the hypotheses for this study were confirmed by the convergence of opinions of respondents.

The school in general and universities in particular have a duty to mobilize all their students to acquire values and promotion of pure and noble principles aligned with good preparation of intellectual, scientific, cultural, professional and human nature.

Organizations also have a social responsibility to follow that ensure the sustainability by satisfying present needs without compromising future generations, helping thus to build a better world.

One gets the clear idea that education, divided between the School and Organizations, must create the best conditions for the development and acquisition of skills that are useful to professional life, making Human Resources more competitive in facing the challenges of the current market.

This study is polycentric with interrelated elements, requiring that the subjects treated, not to be understood individually, but classified as an organic whole directed to the result of the performance of individuals and organizations.

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