HUMAN RESOURCE

MANAGEMENT
PERSPECTIVES ON HRM
HRM is a contemporary restatement of industrial
relations and personnel management policies;
HRM is a fusion of industrial relations and

personnel management to create a new

management discipline and functions;
HRM is a resource-based approach, stressing the

potential of the individual employee in terms of an

investment rather than a cost;
HRM is a strategic/international phenomenon,
making a determining contribution to corporate
strategy and capable of being translated across
cultures. 2
THE DISTINCTIVENESS OF HUMAN
LABOUR
Specific characteristics
- infinite range of creative possibilities
- ability to be resistant/obstructive
The employment contract
The psychological contract Argyris (1960) the
perceptions of both parties to the employment
relationship, organisational and individual, of the
obligations implied in the relationship. Psychological
contracting is the social process whereby these
perceptions are arrived at.
concrete or transactional aspects
more abstract, relational clauses
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 The Employment relationship and its
implications
Employment relationships Basic propositions
special features
Unlike other resources, human
resources are embodied in people
who, in democratic societies, are
citizens with expectations about
fair and proper treatment.
Employers overriding concern is
the efficient use of resources.
Employees have multiple
concerns: fair play, status,
interesting work, opportunities
The foremployment
personal development.
relationship is
intrinsically open-ended and
incomplete.
The employment relationship
has economic, social,
psychological and political
dimensions.
The employment relationship
has in-built, structured
antagonisms it is characterised
by the potential for conflict and
co-operation.
The employment relationship
involves considerable
uncertainty, with scope for
divergent goals and 4
interpretation.
 Employment relationships
special features
To enforce the employers control
rights, the employment
relationship involves a
governance structure based on
hierarchy as well as contract.
The employment relationship
involves unequal power
relationships: corporate entities
with substantial resources .v.
individuals with limited
resources.
A counterbalancing consideration
is that, for the employment
relationship to be effective
employers require more than
compliance they require
commitment.
Basic propositions
The employment relationship
primarily involves managerial
as opposed to market relations.
These give rise to specific
governance structures that affect
worker experience and economic
The employment relationship
performance.
encourages employees to form
collective organisations to pursue
their interests, but also obliges
the state to intervene to ensure a
basic floor of rights.
Legitimating governance
structures involves a more or less
continuous process of
negotiations. 5
EVOLUTION OF HRM
How did we get to todays all the
benefits, high bonuses, big houses,
cars and even private jets ?
What do you know about American
Civil war ?
Watch the movie brut if you can !!

6
EVOLUTION OF HRM (CONT.)
Some believe that the origins of HRM lie within
employment practices associated with welfare
capitalist employers in the USA during the 1930s.
Welfare capitalists believed the firm, rather than
institutions like state or trade unions should security
and welfare for the workers.
to deter any propensity to unionise, welfare
capitalists often paid efficiency wages, introduced
health care coverage, pension plans and provided lay-
off pay.
some went further by seeking the opinion of the

employees, performance based pay, profit sharing etc. 7

EVOLUTION OF HRM (CONT.)
While some practices of HRM were evident in
the US before the 1980s, it was then when, HRM
got the approval both in the academic and
practioner field in a more widespread method.
WHAT WAS SO SPECIAL ABOUT 1980s ?

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EVOLUTION OF HRM (CONT.)
The recession of 1980-82 saw the Japanese
economy and others challenging USA for the first
time after a long period of time.
Discussion tended to focus on two issues:
The productivity of American worker, especially
compare to the Japanese workers;
The declining rate of innovation in American
Industries.

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BACKGROUND AND CONTEXT TO
THE RISE OF HRM
1. Recession
2. Competitive pressures
3. Continuous technical change
4. Decline of mass markets?
5. Changes in labour demand
Declining manufacturing employment and rising
numbers in service and information work in many
advanced economies.
Decline in blue collar work in many advanced
economies

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BACKGROUND AND CONTEXT TO
THE RISE OF HRM (CONTD.)
6. Changes in labour supply
demographic change
increased labour market participation
of women
rising educational levels
7. Impact of alternative role models through FDI
8. Influence of popular management literature
9. Decline in trade unionism many advanced
economies
10.Changing nature of work and implications for
discretion and control 11
11.Attraction of professional worker models
RANGE OF ORGANISATIONAL
RESPONSES
delayering
decentralisation

more fluid organisational boundaries

pursuit of flexibility in working arrangements

use of market mechanisms in public sector

new approaches to managing employees

Human Resource Management

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DEFINITION AND MEANING OF HRM
HRM as a generic term: Boxall and
Purcell 2000: (in R&W)
HRM includes anything and everything
associated with the management of
employment relationships in the firm. We
do not associate HRM solely with a high-
commitment model of labour management
or with any particular ideology or style of
management.
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DEFINITION AND MEANING OF HRM
HRM as a distinctive approach: Storey,
1995:
Human resource management is a
distinctive approach to employment
management which seeks to achieve
competitive advantage through the
strategic deployment of a highly
committed and capable workforce, using
an integrated array of cultural, structural
and personnel techniques. 14
BELIEFS AND ASSUMPTIONS
That it is the human resource that gives competitive edge.
Sustained competitive advantage comes from the firms
internal resources
Key internal resources must have four qualities:
they must add value
they must be unique or rare
they must be difficult for competitors to imitate
they must be non-substitutable (eg by technology)
That the aim should be not mere compliance with rules,
but employee commitment.
That employees should be very carefully selected and
developed.
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STRATEGIC QUALITIES OF HR

HR decisions are of strategic importance:

distinguish between organisational level at which
key decisions are made
Strategic:policy formulation and overall goal setting
Managerial: processes by which organisation obtains
and allocates resources to achieve strategic objectives.
Operational: day to day management of the
organisation.

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STRATEGIC QUALITIES OF HR
(CONTD.)

Managing HR cannot be a specialist management

job only
Top management involvement is necessary.
HR policies should be integrated into the business
strategy - stemming from it and even contributing to
it.
Planning
External integration matching business and human
resource initiatives.
Key objective is competitive advantage
17
CRITICAL ROLE OF MANAGERS
Proactive management
Line managers need to be closely involved both as
deliverers and drivers of the HR policies.
Much greater attention is paid to the

management of managers themselves, in

particular, to their training and development.

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KEY LEVERS OF HR
Managing culture is more important than
managing procedures and systems.
Integrated action on selection, communication,
training, reward
Importance of company philosophy or company
culture.
Restructuring and job redesign to allow devolved

responsibility and empowerment.

Importance of monitoring and control.

key levers must be internally integrated with

each other, and externally integrated with 19
business strategy.
STOREY, 1992: TWENTY SEVEN ITEM
CHECKLIST

Dimension Personnel and IR HRM

Careful delineation of Aim to go beyond

1. Contract written contracts contract

Importance of devising Can do outlook;

2. Rules clear rules/mutuality impatience with rule

Procedures/consistency Business need/

3. Guide to / control flexibility/ commitment
management action 20
 Norms/ custom and Values/mission
4. Behaviour referent practice

Monitoring Nurturing
5. Managerial task vis
a vis labour

Pluralist Unitarist
6. Nature of relations

Institutionalised De-emphasised
7. Conflict 21
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 BUT WHAT IS THE RATE OF
ADOPTION OF HR ANYWAY ?

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WHY ARE THEY BEING ADOPTED,
AND IS IT STRATEGIC?
Fashionable? Flavour of the month?
Low levels of commitment to HR planning even in
advanced economies
Considerable variation in involvement of HR

professionals in strategy formulation

Few UK examples of fully formed horizontally
integrated HR strategy

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Factor shaping Promoting high Impeding high
HRM commitment HRM commitment HRM

Policy framework, Co-ordinated Liberal market

societal regime and market economies economies
financial system Legislation Voluntarist
supporting worker approach to worker
rights and voice rights and voice
Stakeholder Shareholder
perspective perspective
Product markets predominant and
Oligopolistic predominant
Highly competitive
stable product and unstable
markets product markets
Long-term Market driven by
partnerships contracting
between culture/spot
organisations markets 30

Employer Employer marginal

dominates markets within markets
Factor shaping Promoting Impeding high
HRM high commitment
commitment HRM
Technology, skill HRM
Capital-intensive Labour-intensive
and staffing levels systems systems
High staff-to- Low staff-to-
customer ratios customer ratios

Labour markets High skill levels/

and industrial workers hard to Low skill levels/
relations replace workers easy to
Strong co- replace
operative Hostile
management- management-union 31
union relations relations or
aggressive non-
FOOD FOR THOUGHT

Given the reasons behind the

evolution of HRM from the
Personnel Management, under
what conditions we might see a
proper application of HRM in
Bangladesh?

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