HRM for MBA Students

Lecture 1
People management: personnel
management and human
resource management

Learning outcomes
A good appreciation of the people management function
in contemporary organisations
Knowledge of human resource management (HRM)
and personnel management (PM)
An appreciation of the theoretical development of HRM
Understanding of the relationship between HRM and
business strategy
An appreciation of the practical application of HRM
Recognition of the themes of HRM in the early twentyfirst century.

People are the only real source of ...

continuing competitive advantage.
Prahalad and Hamel (1990)

We can define people

management as:
all the management decisions
and actions that directly affect
or influence people as
members of the organisation
rather than as job-holders.

What do people managers do?

Their role has specific objectives under four
headings:

Staffing objectives
Performance objectives
Change management objectives
Administration objectives
Torrington, Hall and Taylor (2002)

The Ulrich model of HRM

Human Resources should become:
a strategic partner with top management
an expert in administration
a champion for employees
an agent of continuous transformation
Ulrich (1998)

Building organisational capability

is HRs heartland
and
HR managers
can help make capitalism human
Linda Holbech (2007 )

Taylorism
Principles of scientific management (1911):
time and motion studies of work processes
standardisation of tools, implements and
methods
increased division of labour

Taylorism + machine-paced work = Fordism

The evolution of people

management

Personnel management
The first Industrial Revolution: welfare role
Rise of trade unionism: industrial relations
role
Scientific management: training;
sophisticated recruitment and selection
Thus by the 1970s the Personnel
management paradigm

Human resource management

Loss of faith in traditional mass-production
techniques
The example of Japanese quality
Technological development
Thus by the 1990s the (post-Taylorist)
HRM paradigm

Perspectives in management
Unitarist
Conflict is wrong

Pluralist
Conflict is not wrong but must be managed

Radical/critical
Conflict is inevitable ... and may be right

The Harvard model of HRM

Stakeholder
interests
Shareholders
Management
Employee groups
Government
Community
Unions

HRM policy choices

HR outcomes

Employee influence
Human resource flow
Reward systems
Work systems

Commitment
Competence
Congruence
Cost-effectiveness

Situational factors
Workforce characteristics
Business strategy and
conditions
Management philosophy
Labour market
Unions
Task technology
Laws and societal values

A map of the HRM territory: from Beer et al (1984, p.16)

Long-term
consequences
Individual well-being
Organisational
effectiveness
Societal well-being

Ideal types of PM and HRM

Characteristics

Personnel
management (PM)

Human resource
management (HRM)

Strategic nature
Psychological contract

Ad hoc
Based on compliance

Proactive, strategic
Based on seeking willing commitment

Job design

Typically Taylorist/Fordist

Typically team-based

Organisational structure
Remuneration
Recruitment

Training/development

Hierarchical
Collectivised
Pay by position
Sophisticated recruitment practices
for senior staff only
Limited

Employee relations
perspective

Pluralist:
Collectivist, low trust

Flexible
Individualised
Pay for contribution
Sophisticated recruitment for all employees
Strong internal labour market for core employees
A learning and development philosophy for all core
employees
Unitarist:
Individualistic, high trust

Organisation of the function

Specialist / professional
Bureaucratic and centralised

Welfare role
Criteria for success of the
function

Residual expectations
Minimising cost of human
resources

Largely integrated into line management for day-to-day

HR issues
Specialist HR group to advise and create HR policy
No explicit welfare role
Control of HR costs, but also maximum utilisation of
human resources over the long term

HRM in practice
Evidence of significant adoption of HRM
practices
(Workplace Employee Relations Surveys and
others)

But still two traditions or paradigms

Most organisations share characteristics
of both
But HRM is in the ascendant

Key themes in HRM

High-involvement employee work practices

Flexible organisation (core and periphery)
Micro-level work organisation (teamworking)
Sophisticated HR for recruitment
Unitarist employee relations
Change management
The learning organisation
Knowledge management
Leadership