Chapter 2
Conceptual Background and Literature Review
Theoretical Background of the Study:
Employee Relationship Management (ERM) is a strategic approach to managing interactions
and relationships with employees to foster a positive working environment. The theoretical
foundation of this study is based on several organizational and behavioural theories that
emphasize motivation, engagement, and mutual trust:
1. Maslow’s Hierarchy of Needs – Employees seek not just financial rewards but also
emotional and psychological fulfilment, which can be provided through positive
relationships.
2. Herzberg’s Two-Factor Theory – Recognizes the importance of hygiene factors (company
policies, interpersonal relationships) and motivators (recognition, responsibility).
3. Equity Theory (Adams, 1963) – Suggests that employees seek fairness in treatment and
reward. If the relationship is perceived as unfair, it impacts motivation.
4. Social Exchange Theory (Blau, 1964) – Posits that the employer-employee relationship is
based on reciprocal benefits. Positive ERM strategies can enhance trust and loyalty.
5. Organizational Support Theory – Suggests that when employees feel valued and supported
by the organization, they develop a sense of obligation and commitment to the organization’s
goals.
INFOWIZ, as a growing IT and industrial training company, can greatly benefit from
understanding and applying these theories to enhance productivity and employee satisfaction.
Literature Review:
A review of past research helps in understanding how ERM strategies have evolved and what
challenges remain. Here is a compilation of 20 scholarly reviews and their contributions:
1. (Avkiran, 2000). Most of the literatures and findings from past researchers said that
having positive Employee skills increases the productivity in the organization since the
number of conflicts is reduced. Furthermore, these studies said that people with good
Employee skills can generally control the feelings that emerge in difficult situations and
respond appropriately instead of being overwhelmed by emotion.
2. Helen Rainbird (2003), “job Change and Workplace Learning in the Public Sector: The
Significance of New Technology for Unskilled Work”. Workplace learning and the
employment relationship in the public sector-Relevant training to the employers is
unenriched necessarily for employees thus the author makes an argument on analysis of
training and development is needed in understanding the context of relationship of
employees. This article examines the impact on the organizations work on the workplace
learning, employee manager’s strategies towards the study. The qualifications of
employees existing is utilized purely; development needs are often frustrated, job designs
concerning issues, progression routes occupations, entitlement needs are to be addressed.
3. Jo, S., & Shim, S. W. (2005), “Paradigm shift of employee communication: The effect of
management communication on trusting relationships”. He stated that Paradigm shift of
worker communique: The effect of management verbal exchange on trusting
relationships. Notwithstanding the reality that relationship be normative competition
suggests that a beneficial organizational weather leads to inexperienced method overall
performance, empirical studies has not addressed the trusting relationship as a variable
mediating organizational climate and job pride or general performance.
4. Payne A & Frow P (2006), “Customer relationship management: From strategy to
implementation”. In his look, he discovered that worker courting control, from the
attitude of method formula and implementation. He start with the aid of reviewing the
origins and role of ERM and highlighting the significance of adopting a cross-useful
method to ERM strategy formula. He have a look at opportunity strategies to ERM
approach developmentand, the use of an 'interplay research' method; suggest a model that
addresses both ERM method and implementation.
5. Kaliski(2007) believed that effective employee relations enhances positive
communication and attitude between management and employees, promotes the overall
wellbeing of employees during their tenure at the company and helps in preventing and
resolving problems involving employees' that affect work situations. Employee
relationship management entails the ability to, balancing life and work needs, employee
needs open, the ability of the organization to keep good relations with its stakeholders
including trade unions, employees, suppliers and customers and measuring and
monitoring results.Organizations normally engage in various employee relationships
management practices to develop healthy relationships and extract the best out of each
team member.
6. According to Rose (2008), under the unitary perspective, trade unionism is outlawed and
suppressed as it is viewed as an illegitimate intrusion or encroachment on management‘s
right to manage; trade unions are regarded as an intrusion into the organization from
outside, competing with management for the loyalty of employees.
7. According to Stallard (2009) studies have shown that employees in an organization with
a strong positive employee relations are more engaged, efficient in the performance of
their duties, and less likely to leave the organization for another. In addition, an
organization with healthy employee relations creates a bond that promotes trust,
cooperation and esprit de corps between the employers and the employees. This tendency
as asserted has the potential in enhancing the skills and the abilities of the employees in
the achievement of the organizational goals and objectives. Most importantly, employee
relations ensure that the relationship between the employers and the employees are
managed appropriately within a stipulated policy framework. It is therefore against this
background that this paper tends to examine employee relations and organizational
performance by reviewing the extant literature..
8. Sadikoglu, E., & Zehir, C. (2010), “investigating the effects of innovation and employee
performance on the relationship between total quality management practices and firm
performance”. He positioned that investigating the consequences of innovation and
employee usual overall performance on the between standard first-class manipulate
practices and company ordinary overall performance. The effects from studies of the
relationship. The look at additionally offers managerial and studies implications, studies
boundaries, and hints for future research.
9. Sanjeet Singh, Gagan Deep Sharma and Navneet Khattra (2011),”Impact of Human
Resource Management on the Organization”. The study concludes that HRM plays the
vital role in the organization as it helps to plan career, to achieve personal as well as
organizational goals, to solve conflicts, to manage work force diversity and to meet
requirement of the globalization.
10. Muhammad Ikhlas Khan (2012), “The Impact of Training and Motivation on
Performance of Employees”. The study was did to identify the effect of certain factors on
the employee’s 14 performance. The study found that there are two factors influencing
employeesperformance that are training and motivation in the organization.
11. Stroh Meier, S. (2013), “Employee relationship management — Realizing competitive
advantage through information technology”. In his study said that worker relationship
management (ERM) constitutes a rising fashion of dealing with human assets thru
constructing and retaining individualized and collectively precious relationships with
personnel based totally on data technology. As a result, a primary popular define of an
exciting and ambitious idea is offered. Based at the outline, essential implications for
similarly conceptual elaboration, theoretical basis and empirical assessment of ERM
derived to indicate guidelines for destiny research.
12. Dr.D. Xesha and Dr. K R Subramanian (2014), “The Impact of Employer Employee
Relationships on Business Growth”- The objective of the study is to know the employer
employee relationship and impact of organizational response. The researcher found that
the organization has to grow and survive in the current business environment they need
to find resources to update continuously their technologies and information needs.
13. Richard Saundry, Carol Jones and Gemma Wibberley(2015), “The Challenge of
managing informally”- As line managers holds more responsibility for the management,
their priority for informal approach at workplace issues has been replaced by a more
rigid adherence to procedure and policy. It is by lack of confidence and expertise in
conflict management and a fear of repercussions of mishandling difficult issues. It is not
possible to generalize from a limited sample, therefore this suggested changes requires
further exploration to assess whether it have been evidenced in organizations’ more
widely.
14. Thomas Katua Ngui (2016), “Relationship between employee relations strategies and
performance of commercial banks in Kenya” The objective of this research is to
scrutinize the relationship amongst employee relation plans or strategies of employee
relation along with the execution of commercial banks. The researcher concludes that
development and documentation of commercial bank strategies and on the whole of the
banks strategies has not linked to each other.
15. Dr. K.R. Subramanian (2017) had done research on the topic “Employer employee
relationship and impact on organization structure and strategy” the objective of study to
identify impact of relationship between employee-employer in the organization. The
result of study was that organizational structures regulate the flow of information within
the organization, which leads to effects on both the strategic intent and the realized
strategy of business organizations
16. Richard Hannis Ansah (2018), “Importance of Employer Employee Relationship towards
the Growth of a Business”- The objective of this research is to present evidence-based on
the information to readers on the importance of the Employer Employee relationship for
the growth of the business. Researcher found that the business owner shared a positive
result that relationship plays an important role towards businesses as they add up to the
growth of the business.
17. Ugoani, John ( 2020), “Effective Delegation and Its Impact on Employee Performance” -
The results show that effective delegation provides psychological empowerment and a
collaborative, coordinated and comprehensive managerial technique for motivating and
evaluating employees over their performance.
18. Ali, B. J., & Anwar, G. (2021), “an Empirical Study of Employees’ Motivation and Its
Influence Job Satisfaction”. The study examines the relationship between the balance
scorecard perspectives and job satisfaction at banking sector. An Empirical Study of
Employees’ Motivation and its Influence Job Satisfaction - The results show that
nonreward incentives have a better impact on employee success because they encourage
them to be more environmentally conscious.
19. SARANYA (2022) This research focuses on a comprehensive evaluation of studies on
employee relationship management and its effects on organisation growth and HR
benefits. Critical reviews of literature from several nations and businesses are included in
the research. However, availability, accessibility, and incorporation of all essential works
are limited. Recently, employee engagement and development research has gained
importance in human resources.
20. RENUKA DEVI.P (2023) Using information technology to develop and sustain
personalised and mutually beneficial employee relationships is an emerging trend in
human resource management. An organization's greatest asset is its employees.
Employees must work together and contribute equally to a single objective. ERM is
fairly new, therefore little is known and agreed upon. The study clarifies the topic and
draws research conclusions.
21. Abdullahi Aliyu Maiwada (2024) In the modern global marketplace, organisations have
moved from traditional communication techniques to employee motivation and
engagement strategies. This change highlights the need of strategic internal
communication, a new but growing corporate topic. Employees are increasingly doing
public relations duties in the modern workplace.
Research Gap:
While numerous studies emphasize the importance of employee relationship management in
large corporate settings, there is limited research specifically focusing on *medium-sized
training and IT service providers like INFOWIZ. Most literature generalizes ERM strategies
for multinational or metropolitan corporations, ignoring the **unique interpersonal dynamics,
startup culture, and flat hierarchies* found in training-centric firms.
Key Gaps Identified:
* Lack of data on ERM strategies in regional firms in North India.
* Limited empirical studies on how training-oriented companies manage employee relations.
* Sparse literature on digital communication tools and their specific impact in firms like
INFOWIZ.
Conclusion:
This chapter summarizes the theoretical theories and research that have shaped our
understanding of employee relationship management. Despite abundant literature, there is a
significant gap in the implementation of ERM principles in medium-sized, skill-
development-focused businesses like INFOWIZ. Addressing this gap through the current
study will yield useful insights from both academic and managerial perspectives.
