Strategies for Human Resource

Management
A CRITICAL ANALYSIS OF UBER & ADOBE
Lecturer Name: David Wallace

Module/Subject Title: Strategies for Human Resource

Management

Module Code: B9MG133

Group Members: Yvonne Rinke (10565805) 1 Semester

Paul Luckey (10551515)

Akaraka Ogini (10558258)

Gautham Balasubramani (10549421)

Oluseyi Akintoye (10554765)

Word Count: 4,398

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TABLE OF CONTENTS
List of Abbreviations....................................................................................................................IV

List of Figures...........................................................................................................................................V

List of Tables...................................................................................................................................V

Introduction......................................................................................................................................1

Amazon...............................................................................................................................3

Introduction Amazon....................................................................................................................3

Analysis of Amazon’s HRM-System...................................................................................................3

Organisation................................................................................................................3

Reward Management........................................................................................................5

Employee Relations.................................................................................................................5

People Resourcing...................................................................................................................6

Amazon’s Best Fit - Alignment of Business Strategy and HR-Strategy.....................................7

Amazon’s Best Practices – Recommendations Towards a High Performing Organistaional

Culture......................................................................................................................................9

Conclusion Amazon............................................................................................................................10

Uber...................................................................................................................................12

Introduction Uber.......................................................................................................................12

Analysis of Uber’s HRM-System......................................................................................................13

Organisation..............................................................................................................13

Performance Management...................................................................................................14

Employee Relations...............................................................................................................15

Uber’s Best Fit – Alignment of Business Strategy and HR-Strategy........................................18

Uber’s Best Practices – Recommendations Towards a High Performing Organisational

Culture...................................................................................................................................18

Conclusion Uber..................................................................................................................................20

Conclusion.....................................................................................................................................22
 II
Bibliography....................................................................................................................23

Appendix..........................................................................................................................33
 IV

LIST OF ABBREVIATIONS
HPWP High performance work practices

HR Human Resource

HRM Human Resource Management

PM Personnel management

VFH Vehicles-for-hire
 V
LIST OF FIGURES
Figure 1: Patent of Wristband Monitors I Source: (USPTO, 2018).........................................4

Figure 2: Protests at Amazon’s Michigan Warehouse I Source: (Palmer, 2020)...................5

Figure 3: Amazon's HRM-System..................................................................................................7

Figure 4: Amazon Recommendations to HPWP........................................................................10

Figure 5: Example of Uber's Rating System | Source: (Detmers, 2019)..............................14

Figure 6: Uber & Lyft Drivers Demonstrate For Decent Pay & Benefits | Source: (ARN

Staff, 2020).......................................................................................................................16

Figure 7: Uber's HRM-System......................................................................................................17

Figure 8: Uber Recommendations to HPWP.............................................................................19

Figure 9: HR-System Template Used For Analysis..................................................................33

Figure 10: Best Practices for HRM..............................................................................................37

Figure 11: Guest's HRM Framework Model | Source: (Guest, 1989; 1997)..................38

LIST OF TABLES
Table 1: HR-Configurations Models..............................................................................36

Table 2: Twenty-Seven Points of Difference | Source: (Storey, 1992)...................39

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INTRODUCTION
Human Resource Management (HRM) deals with the question of the extent to which

human resources (HR) are managed effectively and specifically in line with corporate

strategy (Gunnigle, 2017). This topic is also increasingly seen in companies as

important for sustainability and long-term success. This report discusses the analysis of

Amazon and Uber's HRM-systems and their alignment with corporate strategy (See

Appendix A.1). In addition, based on the analysis of best high performance work

practices (HPWP), recommendations for an effective organisational culture are

given.

We found out that both Amazon and Uber pursue the strategy of cost leadership, or

cost reduction, as a business strategy. This generic strategy of competitive advantage

was defined by Michael Porter in 1980 (See Appendix A.2). Cost advantages are

achieved through continuous efficiency and the search for cost reduction in all areas of the

company. Cost control is one of the key issues in pursuing this strategy. In addition, market

share is built up through low prices, maximising economies of scale and pursuing

technological innovation (Miller and Friesen, 1986; Porter, 1980).

Furthermore, Amazon and Uber, both use a hard HRM approach rather than a soft

HRM approach (See Appendix A.3). According to Gunnigle (1992), the hard HRM

approach focuses on maximising performance within the company. The HR is in no way

different from other resources, and therefore the goal is to achieve low-cost and effective

HRM (Gunnigle, 1992).

Regarding the alignment of the business strategy with the HR-strategy of Amazon and

Uber, both companies apply the HR utilisation strategy (See Appendix A.4) founded by

Randall S. Schuler (1989). Schuler's idea of utilisation is characterised by the fact that

companies recruit their employees on the basis of simple technical skills that are available

without additional training. This means that with this strategy the company does not invest

much in HR and saves costs due to lack of training. Moreover, the recruitment process is
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very short-term and less time consuming. The focus is on technical fit and maximum

efficiency. Schuler also calls this an "employment-at-will policy", as only the skills relevant

to the position are needed, employees can be replaced quickly. They are often under high

pressure and unsure whether they can stay with the company in the long-term. In addition,

the utilisation strategy places a strong emphasis on the aspect of performance evaluation.

Companies want to work as efficiently as possible and reduce costs through a high

level of performance. (Schuler, 1989)

In analysing the HRM-systems, we focused on the work of Lepak and Snell (2002) and

Monks et al. (2013). In 2002, Lepak and Snell carried out a study of HR-configurations

(See Appendix A.5). Despite the fact, that every company’s main philosophy is unitarist,

Monks et al. (2013) took a step deeper and analysed the role of HR-philosophy and

HR- processes to understand the HRM-system of companies. For this report, we focused

on two HR-configurations: compliance-based and productivity-based, which are discussed

in more detail in the following chapters.

Lastly, we have made recommendations regarding best practices both companies can

implement for a high-performance culture. When making these recommendations, we

focused on the best practices identified by Pfeffer (1998), Huselid (1995) and Delery and

Doty (1996) (See Appendix A.6). We believe that our recommendations for each company

would help in achieving their organization’s goals as well as benefit employees at Uber

and Amazon. A greater understanding of a company’s HR system, as well as their

philosophy, policies, and practices can help an organization better manage their

employees and achieve what they have set out to do; below is our analysis to provide

more in depth on Amazon and Uber’s HR system as well as how we believe they can better

their organisation.
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AMAZON

INTRODUCTION AMAZON

Amazon is a US listed online trading company founded in 1994 by Jeff Bezos and

offers products and services in e-commerce, digital streaming, cloud computing and

artificial intelligence (Amazon, 2020d; Hall, 2018). By offering a wide range of

products, Amazon is able to record a constant growth in revenues and continuously

increase its brand value. As a result, the company was listed in the top 100 most

valuable global brands in 2019 (Kantar, 2019).

Amazon follows Porter’s cost leadership strategy as an upstream business strategy and

aims to minimise its operational costs as much as possible. The company achieves this by

using advanced computing and networking technologies to maximise operational

efficiency and reduce costs. Competitive advantages are generated by continuously

improving the technological infrastructure through high investments in R&D and

technology. (Smithson, 2017)

Additionally, Amazon strives to offer the lowest possible price (Amazon, 2020a) further

supporting the company is pursuing a cost leadership strategy. As a result of Amazon using

Porter’s (1980) cost leadership strategy, Amazon has implemented Schuler's (1989)

utilisation HR-strategy. This report analyses whether and to what extent Amazon applies

and implements the HR-utilisation strategy in relation to the cost leadership strategy

through four blocks of Amazon’s HRM-system.

ANALYSIS OF AMAZON’S HRM-SYSTEM

ORGANISATION

Amazon’s organisational goal is driven more by technology than by human capital.

Amazon is strongly focused on being the most technically proficient HR organisation in the

world (Emond, 2018) and maintaining the smallest possible teams. Regarding their

job
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design, Amazon focuses especially on numerical flexibility, one of Guest’s (1997) HRM key

goals (See Appendix A.7), which is confirmed by Amazon’s two-pizza rule: a team should

be small enough to feed its members with a maximum of two pizzas (Hern 2018). In

addition, investments have been made in wristband monitors to keep performance

warehouse workers under constant surveillance and to inform managers if a worker takes

too many breaks between tasks (Guendelsberger, 2019; Nield, 2018). This underlines

Amazon's belief that investment in technology rather than in human capital tends to

lead to the least possible inefficiency.

FIGURE 1: PATENT OF WRISTBAND MONITORS I SOURCE: (USPTO, 2018)

These examples also show Amazon’s productivity-based HR-configuration that follows a

hard HRM approach that fits in a utilisation HR-strategy. According to Monks et al. (2013),

this HR-configuration is more focused on maximising employee efficiency and productivity,

Amazon’s main goal.

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REWARD MANAGEMENT

Amazon's job evaluation practices also endorse a hard approach and utilisation strategy

with a productivity-based configuration. Amazon is criticised for putting pressure on

employees to improve performance at all times, even by working overtime if necessary

(All Answers Ltd., 2018). The use of the wristbands that monitor workers at all times shows

that workers are subject to very strong pressure to perform, emphasising Amazon’s focus

on productivity and how performance objectives are based on quantifiable results (Monks

et a., 2013).

In terms of grade and pay structure, the cost reduction strategy is evident. Amazon workers

FIGURE 2: PROTESTS AT AMAZON’S MICHIGAN WAREHOUSE I SOURCE: (PALMER, 2020)

earn approximately 10 % less than similar jobs in other companies (The Economist, 2018).

Amazon has also advertised raising the minimum wage to $ 15/hour to enhance its

image, but at the same time did not report that existing bonuses would be discontinued

(Amazon, 2020b; Long, 2018). Nevertheless, the internal increase of the minimum

wage shows equity amongst peers, and a straight salary, which again represents a

productivity-based HR-configuration (Monks et al., 2013).

EMPLOYEE RELATIONS
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Employee relations at Amazon are strongly restricted. Employees do not have the

opportunity to organise or bring their concerns to management underscoring indications of

an unitarist HRM model. In 2020, an employee was fired for encouraging his colleagues

to protest against the bad crisis management during the pandemic and for better

health care (Bellafante, 2020). Furthermore, petitions for the improvement of the sick leave

and for the extent of hazard pay and childcare for warehouse workers were ignored

and the employees who took the initiative of this petition were dismissed (Zaveri,

2020).

Moreover, communication within Amazon is strongly individualistic. There is an internal

phone directory which employees can use for a secret feedback to their colleagues’

supervisor and thus offers high potential for sabotage and

exploitation (Kantor and Streitfeld, 2015). This individualistic orientation indicates

Amazon uses an HRM model rather than personnel management (PM) (See Appendix

A.8). The employees mostly focus on their own performance and try outperforming

their colleagues. Furthermore, it creates a competitive nature in the company which is a

criterion for a productivity-based HR-configuration (Monks et al., 2013).

PEOPLE RESOURCING

Amazon seeks to recruit the best qualified employees, and therefore strives to improve its

processes for recruiting and promoting employees (Amazon, 2020c). This practice shows

the public that human capital is important, and that success depends on hiring excellent

people. However, Amazon's HR practices result in low employee retention: they try to

attract people by offering interesting and challenging jobs, but many employees claim

that managers demand too much from them, so that the work-life balance is not right

(Heskett, 2015). This results in employees staying at Amazon for one year on average

(The Economist, 2018). Additionally, Amazon hired over 20,000 contract workers in
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2019 for the Christmas season, who had to pay for transport provided by the agency

themselves (Butler and Jolly, 2020).

Again, Amazon practices show a hard HRM approach and low investment in human capital,

as they try to achieve high performance by putting pressure on employees, ignoring

their work-life balance and making them pay for transport to reduce costs. Although striving

for the selection of the best qualified employees is a commitment-based HR-

configuration, strong tendencies towards a productivity-based HR-configuration are in

the majority and cause employees to suffer from high stress due to too much pressure

(Monks, et al., 2013).

The following figure summarises Amazon’s HRM-system.

FIGURE 3: AMAZON'S HRM-SYSTEM

AMAZON’S BEST FIT - ALIGNMENT OF BUSINESS STRATEGY AND HR-

STRATEGY
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For analysing the alignment of Amazon’s business strategy and HR-strategy, the vertical

fit between these strategies is examined. We also ask if HR is involved in the business

strategy and if it has a leadership role in the business.

The upstream decision of Amazon was to pursue a cost leadership strategy. This first-order

decision that the company pursues effected the second-order downstream decisions such

as Amazon's structural processes being geared towards achieving maximum performance,

productivity, and reducing costs as much as possible. As discussed earlier, the goal of cost

reduction is achieved through a high degree of efficiency and policies such as the two-

pizza rule. This leads to third-order decisions regarding human resource policies.

Amazon uses the HR-strategy of utilisation and achieves the highest performance through

constant monitoring of the employees. By using wristbands to monitor performance in

warehouses and phone directories to provide anonymous feedback on the working

behaviour of their employees, managers have the opportunity to keep staff on the desired

performance levels. This is further illustrated by Amazon cutting bonuses in in order to raise

the minimum wage to $ 15/hour and still keep costs low.

Amazon’s HR approaches of utilisation fit with their business strategy of cost leadership,

but HR is not completely involved in their business strategy: the management style is highly

criticised because employees are under constant pressure and fear for their jobs as soon

as their performance is no longer adequate. A productivity-based HR-configuration is

linked to negative outcomes and employee motivation can decrease (Monks et al., 2013).

The resource-based view of Amazon is focused on investment in new technologies to

control employees’ performance. The cost leadership strategy is realised at the expense

of employees, which could lead to problems in the long-term. It is therefore advisable

to invest more in human capital to ensure long-term success. Investing more in human

capital leads to more capability and thus the knowledge stock to more competitive

advantages. The fact that human resources at Amazon tend to take a back seat means
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that employee motivation suffers in the long term. An improvement could be achieved by

implementing a better performance management system. For example, employees who

have not yet reached their performance target could be offered more training and

development opportunities. This could lead to a softer HRM approach and thus more

employee commitment, which would reduce the high fluctuation rate at Amazon.

AMAZON’S BEST PRACTICES – RECOMMENDATIONS TOWARDS A

HIGH PERFORMING ORGANISTAIONAL CULTURE

Amazon is striving for an efficient organisational culture. In order to analyse the

best practices, they use to achieve this goal, we focused on the work of Pfeffer

(1998) and Huselid (1995). Amazon already uses some HPWP: they use selective hiring,

which Pfeffer sees as a goal of effectiveness and performance (Pfeffer, 1998; Huselid,

1995), as well as self-managed teams, which can lead to higher performance and job

satisfaction (Pfeffer, 1998), through the two-pizza rule (Connley, 2018).

However, Amazon shows a lack of investment in people to achieve commitment and

motivation. According to Pfeffer and many other authors, staff training is an important

work practice that leads to competitive advantage (Delery and Doty, 1996; Huselid,

1995; Pfeffer, 1998). Amazon should offer training to employees who show poor

performance rather than punishing them for poor results. This implementation could lead

to greater employee commitment and lower turnover, which will support their cost

leadership strategy through greater job satisfaction. Satisfied employees can help the

organisation to achieve high performance. In addition, performance-related rewards could

help to motivate people to do their jobs well rather than just doing them for fear of

dismissal.

Regular feedback could also be introduced to maintain employee engagement and

increase motivation. Telling employees what went well and what could be improved helps

employees understand what managers expect from their employees. Employees will then
 10
have a sense of doing meaningful work and that their contribution is essential to the

success of the business. Regular feedback from managers could also reduce competition

among colleagues who use the phone books for anonymous assessments.

Currently, the culture is heavily performance-based, which leads to high pressure and

turnover. Huselid (1995) found that more investment in HPWP would lead to higher

productivity, financial performance and lower turnover rates. If Amazon succeeds in

implementing the proposed best practices, the corporate culture would benefit, employees

would identify more with Amazon, and long-term success would result.

The following figure summarises the recommendations to HPWP.

FIGURE 4: AMAZON RECOMMENDATIONS TO HPWP

CONCLUSION AMAZON

Amazon's cost leadership business strategy has resulted in Amazon’s use of a utilisation

HR-strategy to align their business strategy with their HRM-system. Amazon's HRM-system

shows that they take a hard HRM approach, where employees are treated as dispensable
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resources that are of low value. Low investment in people and high investment in

technology to control people shows that they are highly numerically and financially

motivated. In order to better align its HR-strategy and thus achieve better performance,

Amazon should invest more in HR to achieve higher HR capability and long-term

success. In addition, good practices such as employee training and regular feedback

can help to ensure the best alignment with their business strategy and thus long-term

commitment and motivation.

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UBER

INTRODUCTION UBER

Uber is a publicly traded company that was founded in 2009 that provides vehicles-for-

hire (VFH) via a mobile app. Once customers download Uber’s app, they are able to

request drivers who are contracted by Uber (Lowe, 2017). Since their inception, Uber has

become a prevalent source of transportation in over 66 countries and 507 cities (Lowe,

2017). Uber uses an up and coming, ever increasingly popular workforce referred to

as “the gig economy,” which uses independently contracted workers to perform jobs

(Meijerink and Keegan, 2019). Due to Uber using contracted workers, they have found

innovative ways to mould their own HR-strategy which we will take a closer look at. Uber’s

main strategy for their business follows Porter’s (1980) cost reduction strategy. Uber’s

upstream strategic decision to follow a cost-reduction business strategy has resulted in

Uber using a utilisation, compliance-based HRM-system (Lepak and Snell, 2002; Schuler

and Jackson, 1987) that has implemented hard HRM approaches that are often more

in line with PM than HRM. Examples of where these hard PM practices are most significant

in Uber’s utilisation, compliance-based HRM-system blocks are examined below.

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ANALYSIS OF UBER’S HRM-SYSTEM

ORGANISATION

One of the most significant examples of Uber’s utilisation HR- strategy is in their

drivers’ job design. Uber has specifically designed the job of their drivers so that

they are independent contractors rather than traditional employees. In fact, Uber’s entire

business hinges on their drivers being independent contractors (Berg and Johnston,

2018). Moreover, the job design of Uber drivers requiring no unique knowledge or skill and

being very defined and simple directly reflects Lepak and Snell’s (2002) criteria of

a compliance-based HRM-system (Hansen, Guttel, and Swart, 2019). By classifying

drivers as independent contractors, Uber is escaping the requirement of providing

benefits for their drivers, pay that meets minimum wage, paying drivers for the time

they drive to the passenger, reimbursing drivers for expenses incurred while working, and

other regulations they would have to abide by if they switched their drivers to

employees (Berg and Johnston, 2018; Lowe, 2017). Uber’s job design and the way it

affects the drivers’ pay is highly reflective of PM’s overall objective of focusing on

limited goal of improving cost effectiveness.

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PERFORMANCE MANAGEMENT

The consequences of undertaking a cost leadership business strategy are also seen in

Uber’s performance management, job evaluation, and training. Another cost reduction

variable Uber has executed is their dismissal of managers (Rosenblat and Stark,

2016) and replacing them with passengers and technology. Uber does not employ

managers for their drivers, instead they use a 5-star grading system that passengers

complete after a ride. Uber has evaded the cost of hiring managers altogether and

essentially use passengers as “middle managers” by performing tasks of managers

(Rosenblat and Stark, 2016) through this program.

This system averages a driver’s reviews, and if a driver falls below an average of 4.6

(Rosenblat, 2015) they are suspended from the app and unable to drive for a period of

time (Berg and Johnston, 2016). The strict, rigorous rules of drivers meeting a grade of

FIGURE 5: EXAMPLE OF UBER'S RATING SYSTEM | SOURCE: (DETMERS, 2019)

4.6 or above is a prime example of Uber’s hard, tight management approaches as well

as their cost leadership business strategy and utilisation HR-strategy (Porter, 1980; Valos,

2010).
 15
Uber relying on passengers to execute managerial performances and investing in the

technological app has resulted in training and development coming from the app as well.

After passengers leave reviews such as “the driver was too talkative”, the driver will

receive a message from Uber with a link to a website that offers advice on how to interact

with riders (Rosenblat et al., 2017). Uber’s reliance on these technology-based training

websites and avoidance of investing in human capital or training and development further

highlight their cost reduction business strategy by displaying their tight control, and

rigorous standardisation (Porter, 1980; Valos, 2010) as well as their compliance-based

HR-configuration considering that drivers are graded on pre-set rules and regulations

(Lepak and Snell, 2001).

EMPLOYEE RELATIONS

Lastly, Uber’s hard, Tayloristic-like approach can be seen in their employee relations

practices. Uber’s relationship with their employees and their industry is another clear

illustration of their PM style. Although many drivers have voiced their opinions about

wanting to be employees rather than contractors, Uber has dismissed the drivers voice and

has continued to keep them as individual contractors to be more cost effective. Uber

has paid over $ 1 billion in court cases and settlement fees to keep drivers as

contractors (Lowe, 2017), and it appears Uber taking a PM approach to workforce

management considerations and ignoring their driver’s voices have benefited the

company; California recently ruled that Uber can keep their drivers as independent

contractors (Liedtke, 2020). On the day of Uber’s IPO, drivers who were interviewed by

the Guardian said that they felt poor and powerless and that Uber did not appreciate

them (Sainato, 2019), further

 16
emphasising the PM way Uber places minimal importance on the employees’ input, voice,

and investment in human capital.

Furthermore, Uber has completely disregarded the cries of concerns from other VFH

companies. Uber has caused unfair turmoil in the VFH market which has resulted in taxi

and limousine drivers losing jobs and being unable to earn a fair wage (Berg and Johnston,

2018). Taxi markets regulate the number of taxis that can be on the roads at one time

to avoid oversaturating the streets and ensuring drivers can earn a fair wage (Berg and

Johnston, 2018). However, not only did Uber bring more VFH options to the market upon

launch, but Uber does not limit the number of drivers they allow on the road at one

time,
FIGURE 6: UBER & LYFT DRIVERS DEMONSTRATE FOR DECENT PAY & BENEFITS |
SOURCE: (ARN STAFF, 2020)

nor do they limit the number of drivers they hire (Smith et al., 2018). Uber’s goal of

cost reduction has been met by means of disregarding their drivers' inputs and the

voice of their industry and oversaturating the market.

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FIGURE 7: UBER'S HRM-SYSTEM

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UBER’S BEST FIT – ALIGNMENT OF BUSINESS STRATEGY AND HR-

STRATEGY

When viewing Uber’s business strategy of cost leadership and seeing the HR-approaches

they have implemented to ensure that they are following a utilisation HR-strategy, one

may assume that they have found an ideal vertical fit and have aligned their business

strategy and HR-strategy. Additionally, seeing that Uber just won the court case and

are allowed to keep their drivers as independent contractors (Liedtke, 2020), it is

justifiable to assume they will keep their job design as it is. However, it is our belief

that Uber can become more aligned, more cost effective, and still follow their utilisation

HR-strategy by slightly altering their job design in the management sector of their

organisation and find “the best fit.” We propose that to find a more vertical fit for the

company, Uber should invest more in human capital and hire regional managers to help

train and develop drivers who receive poor rankings on the 5-star rating surveys. This

approach will allow Uber to keep all of their drivers as independent contractors, and will

allow drivers to have a more personal, human interaction for development that can be

customised to each individual driver. If this practice proves to be effective, Uber can then

invest further and launch district managers so that they will be able to better attend to all

drivers. Furthermore, based on the HR-policies and practices that have been

implemented in Uber’s organisation, we believe that involving HR in upstream decisions

will allow for more consistency amongst the organisation and result in better downstream

decisions such as the proposed HR-practice above as well as a more consistent work

flow amongst individuals (Schuler, 1992).

UBER’S BEST PRACTICES – RECOMMENDATIONS TOWARDS A HIGH

PERFORMING ORGANISATIONAL CULTURE

When discussing Uber’s HR-strategy, we found many examples of hard, tight, PM

approaches in their HR-practices. As we have clearly seen, Uber is determined to be a

cost-effective, utilisation, compliance-based, hard company; but we believe that if Uber

adjusts and becomes slightly softer by implementing a form of employment security, one
 19
of the most important high-performance management practices (Pfeffer, 1998), then they

can further reach their goals of excellent financial performance. Currently Uber hires mass

amounts of drivers regardless of how many they already have (Smith et al., 2018) and

they will lose access to the app and lose access to offering rides if they receive an average

grade of lower than 4.6 (Rosenblat, 2015). If Uber were to initiate the best fit practice

of training and development mentioned above, and help drivers understand that their

employment would be secured even if their rating fell below a certain percentage, then

employees would be more willing to work towards being a better driver. Furthermore,

they would learn from the experience of when they got their bad rating and how to fix it

and would ultimately see employees more committed to the company. We believe that

this can be done with Uber’s existing rating program.

In the new employment security system that we are encouraging, drivers who fall below

4.6 would meet with their regional or district manager and go through one-on-one training

and development. After the training and development, drivers would then have three

months to increase their average rating. This would show Uber drivers that Uber has

placed more investment and commitment to the drivers and will change the drivers’

perspective that Uber does not value or appreciate them (Sainato, 2019). Furthermore,

Pfeffer (1998) has shown that employment security results in lower turnover, a more

productive workforce,

FIGURE 8: UBER RECOMMENDATIONS TO HPWP

 20
and higher trust between the employee and employer which all result in lower costs

and has a substantial link with increased financial performance (Delery and Doty,

1996).

CONCLUSION UBER

In review, Uber’s upstream, first order decision of using a cost leadership business strategy

has resulted in downstream decisions of implementing a utilisation, compliance-based

HRM-system that is highly emphasised in Uber’s HR-policies and practices in job design,

performance management, and employee and industry relations. Uber’s contract job

design, app-based performance management tool, and disregard of employee and

industrial voice has resulted in a negative workforce culture that feels vulnerable,

powerless, and futile. Although Uber’s HRM-system aligns well with their business strategy,

we believe they can find a better vertical fit by introducing hired regional managers

who are not contract based and still keep their cost-effective business strategy by having

these managers help in the training and development. Furthermore, if Uber also

introduces our

suggestion of an employment security best practice into their HRM-system then they would

be able to further meet their business strategy of cost leadership while maintaining a
 21
compliance-based strategy but introducing a softer side of HRM and helping transform

their culture to be more appealing.

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CONCLUSION

During the analysis of their HRM-systems and HR-strategies, it was found that although

Amazon’s and Uber’s utilisation strategy fits with their cost leadership strategy to some

extent, there are some critical aspects that need to be changed in the future to ensure

long-term success and sustainability. Both companies were recommended several HPWP

including specific measures to achieve a high-performance organisational culture. The

analyses showed that there is need for change for both companies.

Amazon invests little in its HR, but is making great efforts to develop innovative technology,

which puts high pressure on its employees. Volini et al. (2020) wrote an article about

human capital trends in 2020 and said that it is important for companies in the future to

focus on balancing technology and humanity. Amazon's employees suffer from high

competition and high individualism. Amazon could use its technological infrastructure to

promote a sense of belonging to the company and strengthen internal relationships,

giving its employees a reason to work. The telephone directory, which is currently

used for anonymous "bad" feedback from colleagues, could be used for positive feedback

from superiors. In addition, personal feedback should be given regularly.

Uber’s employees often fear losing their jobs in the short term. There is a high turnover of

staff, which could lead to long-term performance problems in the future. By using the

current rating system, Uber does not seem to be making any real effort to maintain its

employees. According to Volini et al. (2020), it is important to create security in times

of reinvention and thus match the skills and potential of the employees with the given

technology. This could help to ensure long-term success. It is therefore recommended to

embed training measures in the rating system.

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 33

APPENDIX

HRM-System

FIGURE 9: HR-SYSTEM TEMPLATE USED FOR ANALYSIS

Above is the template of an HRM System that we used to identify and analyse Uber and

Amazon’s different blocks of their Human Resource System.

 34
Porter’s three generic strategies of competitive advantage

1. Cost Leadership

An organization looking to gain a competitive advantage by offering the lowest price

and attracting cost-conscious consumers. The organization attempts to become the lowest-

cost producer in their market (Porter, 1985).

2. Differentiation

Organizations that use the differentiation strategy look to make their products or

service more attractive by making them different from those already existing.

Organizations that partake in differentiation usually market to a larger, more

widespread consumer base (Porter, 1985).

3. Focus

An organization using the focus business strategy chooses a reduced segment within a

market and engineers their strategy to appeal to that specific market (Porter, 1985).

Hard, Soft, Loose and Tight Approaches of HRM

Hard

A hard HRM approach is used when companies consider their employees a resource that

need to be monitored and controlled

Soft

A soft approach to HRM pursues the promotion of an organizations culture and has enacts

pro-employee policies and practices

Loose

A loose HRM approach is based around versatility and flexibility to the objectives of a

company

Tight
 35
A tight approach has HRM clearly defined and articulated to workforce management and

it is based on a strong theoretical framework

HRM strategies according to Schuler

Accumulation

Organisations pursuing the HRM-strategy of accumulation establish policies and practices

to attract good candidates for employment. They select their employees very carefully

and consistently and focus more on personal fit rather than technical fit (necessary job

relevant skills). If there is a lack of skills to do their job, employees are trained

internally. This is why companies with this HRM-strategy invest large amounts in training

and further education. (Schuler, 1989).

Utilisation

The selection of employees is based only on job-related skills (technical skills). Once a

person is hired, little training is required to do a good job. This is a rather short-term

view of HRM, which shows a way of employment-at-will thinking: those employees who

have all relevant skills will survive, others will have to be dismissed. (Schuler, 1989)

Facilitation

Technical skills are required in pursuing the HRM-strategy of facilitation, but the company

also places great emphasis on interaction with employees. Staff development and

enhancement is important, but training is facilitated rather than provided by the company.

This means that the employees are responsible for their individual learning, the company

only provides financial resources. (Schuler, 1989)

 36
HR-configurations

The following table of HR-configurations is adopted from Monks et al. (2013) p. 383.

TABLE 1: HR-CONFIGURATIONS MODELS

 37
Best practices of HRM

The following figure shows the best practices for HRM according to Pfeffer (1998),

Huselid (1995), as well as Delery and Doty (1996).

FIGURE 10: BEST PRACTICES FOR HRM

 38
Four Key HRM Goals According to David Guest (1989; 1997)

Strategic Integration – Guest believed that HRM should be incorporated with an

organizations business strategy

Employee Commitment – Guest said that organizations should support the idea of

employee commitment to the company and that the employee should involved with or

apart of the company

Quality – Guest’s goal of quality meant that firms should pursue high quality standards

regarding their work, their employees, and how employees are treated (Guest, 1989)

Flexibility – Guest believed that organizations needed to be flexible in relation to

the substance of jobs as well as the company’s structure (Guest, 1989)

FIGURE 11: GUEST'S HRM FRAMEWORK MODEL | SOURCE: (GUEST, 1989; 1997)
 39
HRM vs. P
TABLE 2: TWENTY-SEVEN POINTS OF DIFFERENCE | SOURCE: (STOREY, 1992)