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Innovation and HRM: Towards An Integrated Framework
Innovation and HRM: Towards An Integrated Framework
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Blackwell Publishing Ltd.Oxford, UK and Malden, USACAIMCreativity and Innovation Management0963-1690Blackwell Publishing Ltd, 2005.June 2005142108117ARTICLESINNOVATION AND HRMCREATIVITY AND INNOVATION MANAGEMENT
This paper explores the connection between innovation (management) and human resource
management. Much has been written about the both concepts separately, but there is no
integrated conceptual framework available for the combination of the two. Our goal here is
to develop such a framework. We do this in a number of steps, starting with a presentation
of the existing approaches and models with respect to innovation (management) and HRM.
This is followed by a search for the linkage between the two traditions, as a starting point for
an integrated model and an in-depth case study regarding the link between innovation and
HRM, in order to further develop our model. We conclude with the presentation of our model
and with suggestions for further research.
Phase
Activities
Signal processing Strategy Resourcing Implementation
• the channels for communication and partic- ‘best fit’ models. The best practice approach
ipation in work and decision-making towards HRM can be seen as a reaction to fail-
(information and communication, leader- ures by finding empirical evidence for a ‘best
ship, participation, etc.). fit’ approach and one that stresses the univer-
sal importance of a number of HRM practices.
All these areas can be further refined into The idea underpinning the best practice school
specific policies and practices. For our pur- is that a firm will see improvements in its per-
poses, however, these broad categories will formance if it identifies and implements best
suffice. practices. A well-known example of this
Since the beginning of the 1980s, there has approach is by Pfeffer (1994, 1998), with his list
been an increasing awareness of the impor- of 16 practices (later condensed to seven) for
tance of linking HRM with business manage- gaining a ‘competitive advantage through
ment, including business performance. people’ and ‘building profits by putting peo-
Regarding the linkage between organization ple first’. Another example of this approach is
strategy and HRM, three approaches, or the so-called AMO (ability, motivation and
‘schools’, have been developed (Boxall & Pur- opportunity) model by Boxall and Purcell
cell, 2003): (2003). The resource-based approach to HRM
• the contingency or ‘best fit’ approach; has been developed since the 1990s, and
• the best practice approach; focuses on the discovery of an exclusive fit
• the resource-based approach. between the resources of a firm – human and
non-human – and its objectives. Supporters of
The contingency or ‘best fit’ school includes a this school (such as Barney, 1991) are espe-
range of models that advocate fitting HR strat- cially interested in conditions that make
egy to its surrounding context. Examples of resources valuable and scarce, inimitable, non-
these are the connecting of HRM strategies to substitutable and appropriable. In HRM, the
three basic types of organizational strategies resource-based view has mainly been ‘trans-
by Miles and Snow (1984), namely: defenders, lated’ as the management of capabilities and
prospectors and analysers. Other examples are (core) competencies.
the framework by Schuler and Jackson (1987), In the HRM approaches and related
in which they link HR practices and outcomes research over the last decade most of the
with ‘generic firm strategies’ as defined by emphasis has been given to the linkages
Porter (1980) and the recent more evolutionary between organizational strategy, strategic
practices to specific types of innovation, such resource flow and performance and rewards
as product, process and organizational inno- not only play an important role in product/
vations (de Leede, Looise & de Weerd- service innovation, but also in process and
Nederhof, 1999; Looise & van Riemsdijk, organizational innovation. Furthermore, HRM
2004). Based on our literature review, we practices linked to organizational and task
expected connections between product inno- design, and to information and participation,
vations and HRM practices such as staffing are important both for process innovation and
and developing activities and special forms of for product innovation. Only very specific
reward; and between process and organiza- HRM practices seem to have a stronger link
tional innovations and HRM practices such as with one specific type of innovation. Examples
job and organizational design and employee of these are the role of creativity in product/
participation. However, in the case study, such process innovation, and the role of employee
connections were not that clear. What we see participation in the implementation of new
from the case study is the close interrelated- work methods. However, even in these
ness of the various types of innovation and the instances, the practices are not restricted to
role of HRM. This makes it difficult to relate one type of innovation.
specific HRM practices to specific types of On a second reflection, it seems that the case
innovations. HRM practices such as human study provides more evidence for there being
a connection between specific HRM practices From the innovation side, HRM should be
and the phase of the innovation process within viewed as a strategic and integrated field con-
all the three types of innovation. First, they tributing to the organization as a whole, and
had to select the right product champions and not just as fragmented practices supporting
to foster creativity. In the early years of setting specific innovation activities, types or even
up the new factory in The Netherlands, their phases. From the HRM side, innovation must
role was almost exclusively staffing and the not be seen, in a rather static way, as only a
design of HR systems in the field of human one-time strategic choice for the organization
resource flow. The main priority was to attract as a whole, but related to all kinds of dynamics
a workforce with the appropriate capacities. inside and outside the organization. Further-
During the introduction of the mini- more, we propose focusing on the two levels
companies, the role of HR became broader: mentioned before: the level of the organization
it included the design of the work system, and the level of the innovation activities. This
adjustments to the reward system, the devel- leads us to the following integrated model for
opment of middle management and enhanc- innovation and HRM (see Figure 3).
ing the opportunities for employee influence. In our view, the integration of the two fields
Subsequently (and to an extent simulta- is only possible if we start with an organiza-
neously) the focus in the HR area was on cre- tional strategy aiming for innovation – not just
ating and maintaining a capable and cost reduction or quality – and ending with an
motivated workforce. A large part of the HR organizational outcome such as innovation
activities was devoted to the development and success or extent of innovativeness, in terms of
use of an extensive training programme. In the number of new products and/or services,
final year, the major role for HRM became implemented new processes or organizational
closing the factory. changes. Between these two, mutually con-
nected, moments of goal setting and results-
measuring, we see two levels of integration.
An integrated model for innovation The first level is the organization as a whole,
and HRM aiming to create an innovative organization,
with the help of a deliberate HRM strategy.
In summarizing our findings from the case Within this strategy, choices have to be made
study and the literature review, we have to for specific HRM practices, or for specific ways
look for a model in which the strong points of of dealing with standard HRM practices, in
both innovation and HRM approaches are order to achieve HRM outcomes that contrib-
combined, and the weak points minimized. ute to becoming an innovative organization.
In this context, we can also speak of ‘HRM issue is how to measure HRM and in-
innovation’: traditional HRM practices, such novation outcomes, and their mutual
as work systems, HR flows, rewards and connections.
employee influence, have to be renewed to be 2. What HR practices are appropriate in the
in line with the innovative strategy of the various innovation stages? This question
organisation. In the past fifteen years, several focuses on the level of specific innovation
authors (including Bolwijn & Kumpe, 1990, activities, stages, projects, etc. In our
1996; den Hertog et al., 1991; Looise, 1996; scheme, we have simply mentioned a num-
Schoemaker, 1998) have made proposals to ber of possible HR practices that could be
bring HRM innovation into line with organi- related to the different phases of innova-
zational innovation but, until now, not much tion. Through new research, these ideas
empirical research has been done in this field. need to be verified and specified. As we
For the second level, we have chosen to use have commented earlier, a lot has been
the several stages of the innovation process written, in the innovation literature, about
from the model of Tidd, Bessant and Pavitt the connection between specific innovation
(1997), believing that these can also be seen as phases, or activities, and specific HRM
innovation activities or projects. Each of these practices. However, most of this literature
stages requires specific HRM practices, such as is rather normative in nature and it would
the assignment of specific tasks, the develop- be good to have further empirical evidence.
ment of specific expertise or the opening of In this context, we also want to look for a
specific channels for creativity in the signal more comprehensive approach in which
processing phase. However, the assignment of specific so-called bundles of HRM practices
specific tasks and the development of specific are related to certain innovation activities,
expertise, the opening of channels for influ- phases, etc. We believe that our scheme can
ence from different sides, the fulfilment of serve as a starting point for this type of
good leadership for the strategy phase, the research. Lastly, in this research line, there
recruitment of a competent workforce, the needs to be more interest in the innovative
assignment of tasks, the balancing of rewards effects of the interaction between innova-
and the planning of the further development tion phases or activities and HRM practices.
of the workforce also play a part in the 3. What interactions are there between the
resourcing phase and – in a different way – general level and the specific level (or levels
also in the implementation phase. since there can be several innovation
Our integrated model on innovation and phases/activities/projects at the same time
HRM exposes at least three broad areas of within one organization)? This line of
research questions: research focuses on the interplay between
the general and specific levels, in connec-
1. What are the interactions between innova- tion to an innovation strategy and the mea-
tion strategies and HRM innovation? This surement of innovation outcomes. In our
concerns the general level of the organiza- opinion, this is the most relevant, but also
tion: the interaction between innovation as the most difficult, part of our proposals for
an organizational strategy (‘becoming an future research. It concerns the question of
innovative organization’) and HRM inno- how to combine preparedness for innova-
vation. In this context, researchers need to tion and HRM in general with an ability to
be aware of the fact that HRM practices are focus on specific innovation activities and
embedded within external (societal, legal, HRM practices.
institutional) and internal (historical,
structural, cultural) contexts and cannot be
changed overnight. For example, changing References
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