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Human resource management (HRM) is essential in every organization. It entails all management practices and decisions, which impact all people working for the organization. The performance and effectiveness of employees and their dedication to achieve the set goals and objectives are promoted by HRM. This calls for harmonious and appropriate relationship with employees as well as for understanding of how to utilize them. Good management practices and human relations are vital in the management process, success as well as for enhanced performance of the organization.

In many organizations human resources are an essential asset and a resource that has to be properly managed. Human resource managers need to take a strategic approach to managing employees, ensure their knowledge improvement and use, and develop their skills and abilities. A good strategic approach ensures that HR manager is responsible for influencing all discussions concerning goals and priorities, organizational activities, and thus designs policies that focus on achieving the same.

This paper focuses on the nature and practices of human resource management in organizations. Specifically, it focuses on employee motivation as an issue in people management and on its impact on the performance of Starbucks Corporation (the chosen organization in this case). The paper also evaluates contemporary theories of motivation and various regulations and technologies used in implementing the same. Moreover, the link between motivation and the quality level of Starbucks Corporation is analysed.

Section I

Overview of Starbucks Corporation

Starbucks Corporation was established in 1971 as a coffee bean roaster. The company is situated in Seattle. Since its inception, it has rapidly grown to become a universal coffee firm. Starbucks operates 20366 stores in different nations across the globe. Company’s sales grew by 84% in 1991. By 2002, the firm had opened more stores raising the number from 17 to 5688. Moreover, it expanded its operations to more than 30 countries across the globe. In 2005, Starbucks was named the 11th best firm to work for in the United States of America. It was then named the 16th best in 2006. At the same time, the Financial Times selected it as one of top ten workplaces in the United Kingdom. 

The firm earns profit by roasting, selling a variety of tea and coffee drinks as well as unique coffee beans. There are a number of reasons behind the success of Starbucks Corporation besides its sale of quality coffee. The firm is known to have excellent customer service as well as a good working environment. The company boasts of its relaxing cafes, which make it pleasurable for its customers to socialize. Company's prices are reasonable, which attracts customers of all ages to the stores. Moreover, it is known for its effective employee management strategy, which is a key to any company's performance. At Starbucks, employee turnover rate was 65%, while that of the managers was 25 % annually. The rates of other chain retailers range from 150% to 400% for employees and 50% for managers. This means that in comparison to other companies, Starbucks’ employee turnover rate is lower on average. Therefore, Starbucks is the best business model for employee management strategies, including employee motivation, cooperation of teamwork, and customer satisfaction.

General Identification about Employee Motivation

According to studies, employee motivation is an essential factor for the successful performance of any organization. Employees are believed to be the largest and most important asset of any company, and the degree of their motivation determines their performance, productivity as well as prosperity. Motivation creates a working environment that ensures best performance.

Types of Motivation

Intrinsic motivation

This is a kind of motivation that is determined by enjoyment or interest in the performance of a job and subsists within a person. It is not influenced by external factors. Employees, who are motivated intrinsically are more likely to undertake a task willingly. They also work towards enhancing their skills with an aim of improving performance of the organization.

Extrinsic motivation

With extrinsic motivation, employees work with an aim of achieving an outcome. Extrinsic motivation comes from the outside rather than from within a person. This means that it is a kind of motivation that is influenced by external factors such as rewards. The majority of individuals are influenced by extrinsic motivation. For instance, organizations that motivate their employees by giving rewards, better pay, recognition, providing a good work environment, training, and ensuring good work relations have been evidenced to perform better as compared to those that do not motivate their employees extrinsically.

Ways of Motivating Employees


If an employee completes a task as expected by his/her employer, they have succeeded. Their success calls for appreciation, which is recognition from the manager or supervisor. Employee recognition encourages employees by boosting their spirit and giving them satisfaction. As a result, there is increased performance. 

One-on-one coaching

The term coaching is used to refer to employee development. Employees are not concerned with how much their employers know until they feel that the employer cares for them. The only cost incurred in this is the time. Employers should ensure coaching of their employees as this works as a natural stimulant to better performance.


This entails training employees to ensure the company keeps up with the trend in the industry. Due to technological advancements, companies need to continually train their employees to maintain competitive advantage. Employee training means improving their skills. Studies reveal that though it takes time, employee training enhances employee performance while increasing the performance of the firm.

Career path

Employees need to know what is possibly in store for them. This includes any opportunities for growth in the firm. Many managers tend to forget this aspect of employee motivation. An organization can set a career path by promoting employees internally. This sends a message to employees of a company that there are opportunities for growth. 

Good work environment

 A good working environment encourages employees to deliver. A company should ensure that it creates a favourable environment that makes employees feel good while working. The workspace should be spacious with comfortable furniture for maximum performance. In addition, the working area should be well ventilated for free air circulation for employees not to feel as if they were in a cage.

The Impact of Employee Motivation on Starbucks Corporation’s Performance

The Starbucks Corporation believes that motivation is a significant business factor in their production process. Human resources need to be motivated in order to increase their passion to work. This will result in higher returns as compared to buying plenty facilities and equipments.

According to Starbucks Corporation’s chief executive officer, the success of the company is greatly determined by its employees, and not by the coffee it sells. Continually building up employees’ working experience and offering opportunities for promotion is the way to function sustainably. The company has created an excellent training and education policy for its employees that is believed to enhance performance. The Starbucks Corporation has an interactive structure, which makes employees inspire themselves in their tasks, therefore, attaining a greater level of company’s effectiveness.

Starbucks managers treat all employees equally. This can be proved by the fact that all people are referred to as ‘partners’. The gap between employees and managers is very narrow, and this has been achieved by co-working with front line employees. This has ensured maintenance of a good management system, which has made employees enjoy their tasks.Enthusiasm of employees has helped increase the number of customers and retain the existing ones, a factor that has been linked to superior performance of Starbucks over the years.

The company has an effective communication channel for staff, and great importance is placed on labour conditions. For instance, working schedule for employees is planned by managers, who put into consideration their needs. Interviews are conducted on a weekly basis to identify such needs. In addition to a Partner View Survey is carried out every two years. With a help of this survey managers are able to obtain information on what needs to be improved and what issues have to be addressed. Employees are also involved in policy formulation and plans development, and their opinions are taken into consideration. This has resulted in the formulation of effective and innovative strategies for the well-being of Starbucks. These measures combined have resulted in enhanced performance of the company.

Starbucks Corporation provides welfare policies such as medical insurance, commodities discounts, and vacations for all employees. Besides, it also gives overtime benefits to employees, work more than 20 hours every week. The company is very distinctive in that it has allocated its employees stock dividends with a free scrip issue, which enables them to obtain benefits from the same. As a result of this, both Starbucks Corporation and employees have a similar goal, and this motivates them to boost sales in order to earn higher profits.



Section II

Contemporary Theories of Motivation

The Expectancy Theory

According to this theory, the tendency to perform in a specific manner depends on the expectation that a specific outcome will follow the performance as well as on the reaction of an individual to the outcome. In essence, employee motivation is a result of how much an employee is in need for recognition. Expectancy theory focuses on the following relationships:

  • Effort-performance relationships: the possibility that efforts of an employee will be rewarded in performance appraisal;
  • Performance-reward relationships: the degree to which an individual believes that good performance appraisal will lead to recognition;
  • Rewards-personal goals relationship: concerned about how a reward appeals to the employee; 
  • Employees decide on whether or not to perform at the workplace. This is a decision that is dependent on employee's motivation.        


  • Expectancy theory is based on employees' self-interest. The employee, who wants to get optimal satisfaction by reducing dissatisfaction;
  • It is not concerned about what is real; rather it focuses on expectations and perceptions;
  • It is focused on rewards.

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