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AC330 What is Human Resource Management Anyway?

Throughout 1980s organizations advanced on major innovation and restructuring programmes Large US organizations such as Chrysler and GM converted to TQM UK organizations such such as Jaguar Cars converted to TQM In academia Industrial Relations became HRM In business Personnel Management became HRM In business new HRM specialists elevated to the board General agreement - in managerialist literature at least Change is key to corporate survival Humans represent the foundation of sustainable competitive advantage

Yet False consensus tends to surround HRM Focus upon reality of competition and consequent enthusiasm for change has encouraged casual use of terminology HRM spoken of as if it represents a unified body of knowledge and practice Today will attempt to over-turn this false consensus as we consider 4 accounts of HRM 4 variously competitive accounts of the best way to manage the organizations asset

What do models do? Models of HRM: Provide an analytical framework for the examination of HRM variously identifying situational factors, commitment, management choice and competence as important variables Act as legitimation devices. For example.. They suggest that HRM is new They suggest that HRM is distinctive They suggest that HRM is uniquely suited to contemporary competitive dilemmas They provide a model for research activity insofar as they a) offer a characterization of the essence of HRM and b) establish key variables and relationships for research They provide a heuristic a simplified but nonetheless (a sometimes) useful model of the world, which, for example, suggests key practices

We will consider 4 models of HRM The Michigan Model The Harvard Model The New York Model The Warwick Model .other models are available

The Michigan Model Developed by Formbrum and colleagues in 1984 Key focus 1. Inter-related nature of organizational components 2. Need to achieve internal coherence from the linking of components Four key constituent components: Selection Appraisal Development Rewards

Development

Selection

Performance

Appraisal

Reward

Strengths Offers a simple heuristic of HRM Highlights the importance of internal coherence Focuses attention on matching internal strategies to external requirements Highlights a key tension in HRM practice

Weaknesses Model tends to prescription Model is focused upon market needs and consequent organizational needsso Model says very little about stakeholders and their interests Status of model is unclear statement of the real and existing nature of the world or overly-simplified managerialist heuristic for teaching?

The Harvard Model Developed by Beer and colleagues in 1984 Key features: 1. Inter-related nature of components 2. Need for coherence 3. Need to balance interests that transcend organization

Model composed of 6 basic components 1. Situational Factors Societal values, workforce characteristics said to impact upon choice of HR strategy 2. Stakeholder interests Stakeholder interests oblige managers to seek tradeoffs 3. HRM policy choices HRM is the outcome of situated choice-making this absent from Michigan model 4. HR outcomes These assumed to be high commitment and productivity - it is assumed that policy will/ should tap under-utilized resources

5. LR policy outcomes 1. Individual well-being 2. Orgn Effectiveness 3. Societal well-being 6. Feedback loop connecting outputs to organization and stakeholders

Stakeholder interests Management Shareholders Community

HRM policy Choices

Outcomes Commitment Congruence etc

Consequences Well-being Effectiveness

Situational Factors Business conditions Management philosophy Unions

Strengths Managers portrayed as situated choice-making actors Importance of stakeholders in wider society acknowledged Some acknowledgement of bargained nature of workplace relations Weaknesses Commitment to bargaining is weak assumed stakeholders readily incorporated into one (perhaps narrow) organizational agenda Model is prescriptive assumes certain outcomes which actual experience disputes Lists feedback and linkages between elements of model but does not offer a coherent theoretical understanding of nature of these relationships

The New York Model Developed by Schuler and Jackson (1987) This is a contingency modelso has elements in common with Harvard model Like Harvard argues the content of HRM policy must vary with business strategy. Business strategy is in turn a product of the conditions prevailing in the wider competitive environment Unlike Harvard does not pre-judge outcomes to same extent Key focus different organizational strategies call for different needed role behaviours need to ensure behavioural consistency between business strategy and HRM approach

Crudely the model differentiates between


Behaviours required for Cost-reduction strategy Repetitive, predictable behaviour Very short term focus Very low concern: quality High concern: quantity Very low risk-taking Very high concern: process Avoids responsibility Inflexible to change Comfortable with stability Narrow application: skill Low job involvement Behaviours required for Innovation strategy

New York Model argues managers need to make choices about: Planning Staffing Appraising Compensation Trainingwhich reflect important contingencies

Strengths Model has an intuitive appeal Model emphasises contextual factors Model highlights some degree of managerial choice Weaknesses This is a reworking of Theory x, Theory y? Does the model license abusecrap jobs abroad? Choice-making may be more circumscribed than model acknowledges Assumes market signals are clear and unambiguous managers do not react to market signals they enact these Model tends not to acknowledge that different HR choices may be applied within one organization

The Warwick Model Developed by Hendry and Pettigrew (1990) Might be viewed as a development of the Harvard Model Like the Harvard Model it: Highlights the importance of stakeholder and situational factors Suggests that HRM policy choices vary in relation to these wider factors Suggests coherence in practice and policy is key

Outer Context Technical Legal

Inner Context Culture Structure etc

Business Strategy Content Objectives Product market

HRM Context Role Organization

HRM Content Work systems Employee Relations

Five elements 1. Outer context 2. Inner context 3. Business strategy content 4. HRM context 5. HRM content

Strengths Places HRM in context Suggests content of HRM varies with context Suggests that content of HRM may feed back to alter context Does not assume/ prescribe outcomes Given UK origination is more sensitive to UK/ European scene Provides a basis for comparative study of HRM Weaknesses Assumes that organizations with coherent HR policies will have superior performance however linkage internal HR practices and business performance is suggested but not pursued analytically

Summary Have attempted to highlight varieties of HRM both in terms of analytical models And In terms of the varieties of HRM practice that are possible when HRM is understood in context Have attempted to show different ways in which HRM might be envisaged/ interpreted Have attempted to show the contests and controversies that exist within HRM