Does Investors in People affect organisational performance: a relevant question?

Ever since the introduction of Investors in People (IiP), a management framework for high performance invented by the UK Government aimed at improving the UK’s industrial performance, there has been indistinctness about whether IiP actually improved organisational performance. The academic literature gives conflicting evidence and almost 25 years after the first exposure to IiP this issue has not been settled yet. The paper aims to discuss these issues.

In this paper the literature on the effects of IiP on organisational performance is collected and discussed, to try to give a definitive answer on the question what the effect of IiP is or should be.

After reviewing the evidence, the paper raises the question whether asking the question if IiP increases organisational performance is actually a relevant one. This is because IiP was originally intended to be the standard against which organisation could be evaluated and subsequently rewarded for excellent human resource management (HRM) practices. In the core this means that IiP consist of a set of by experts agreed upon indicators related to HRM practices which together form the yardstick against which organisations are measured.

This paper is the first one to actually create clarity of what the IiP standard actually is and how it should be perceived and applied by organisations and academics alike.