Module 10: Management of the Human Resource (HRM) FD in Business: Semester 2: 2012 E Woods 20 February 2012

Today’s Agenda 9.30 Welcome & overview of module 10 9.45 Review of Module 4 – People in Organisations 10:00 What is HRM ? 10.45 Break 11.00 How HRM developed as a concept 11.45 The context in which HRM operates 12.30 Phew – end of session!

Aims & Objective of the Module Build on the knowledge gained in Module 4 – People in Organisations and provide an understanding of the HRM role and functions You will be able to: Recognise the traditional and new view of personnel/HRM Describe the procedures and practices used for recruitment and selection Discuss the effectiveness of monitoring and reward Identify rights and procedures on exit from an organisation

You should also be able to… Evaluate the role and responsibilities of line managers in human resources practice Evaluate the interview as a selection technique and discuss a range of alternative selection methods available Consider the link between motivational theory and reward Evaluate exit procedures used by your chosen organisation

Management vs Leadership Review of Module 4 Management vs Leadership Motivation Theories Teams & Group Dynamics Successful Change

The Meaning of HRM – some definitions A strategic, integrated and coherent approach to the employment, development and well-being of the people working in organisations “All management decisions and action that affect the nature of the relationship between the organisation and its employees – its human resources” (Beer et al 1984) “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” (Storey, 1995) “The management of work and people towards desired ends” (Boxall et al 2007)

Human resource management: philosophy, strategy, policies, processes THE HRM SYSTEM Human resource management: philosophy, strategy, policies, processes and practices Corporate social responsibility Human capital management Organization People resourcing Learning and development Reward management Employee relations Design Human resource planning Organizational learning Job evaluation and market surveys Industrial relations Development Recruitment & selection Individual learning Grade and pay structures Employee voice Job design Talent management Contingent pay Communications Management development Employee benefits Health and safety and welfare HR services Performance management Knowledge This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

Objectives of HRM To ensure that an organisation is able to achieve success through people To increase organisational effectiveness and capability To be concerned with the rights and needs of people in organisations through exercise of social responsibility

Policy Goals of HRM (David Guest) Strategic Integration High Commitment High Quality Flexibility

Characteristics of HRM ‘Human resource management covers a vast array of activities and shows a huge range of variations across occupations, organizational levels, business units, firms, industries and societies’ (Boxall et al, 2007). It can: ● be diverse (hard or soft); ● be strategic; ● be business-oriented; ● focus on mutuality – a state that exists when management and employees are interdependent and both benefit from this interdependency; ● take a unitary view – the belief that management and employees share the same concerns and it is therefore in both their interests to work together; ● treat people as assets or human capital.

How HRM developed as a concept Emerged in the 1980s in the form of: ● the matching model – HR systems and the organization structure should be managed in a way which is congruent with organizational strategy (Fombrun et al, 1984); ● the Harvard framework – based on their belief that the problems of historical personnel management can only be solved ‘when general managers develop a viewpoint of how they wish to see employees involved in and developed by the enterprise, and of what HRM policies and practices may achieve those goals’ (Beer et al, 1984).

THE MATCHING MODEL OF HRM Rewards Selection Performance management Performance Development Adapted from C J Fombrun et al, Strategic Human Resource Management, Wiley, 1984 This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources. 12

THE HARVARD HRM FRAMEWORK Stakeholder interests: shareholders management employees government unions Situational factors: workforce characteristics business strategy and conditions philosophy labour market task technology laws and social values HRM policy choices: employee influence human resource flow reward systems work systems Long-term consequences: individual well- being organizational effectiveness societal well- HR outcomes: commitment congruence cost effectiveness Source: M Beer et al, Managing Human Assets, The Free Press, 1984 This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

IMPACT OF HRM ON ORGANIZATIONAL PERFORMANCE Business strategy HR HRM practices resourcing performance management learning & development reward employee relations outcomes engagement commitment motivation skill productivity quality customer satisfaction Financial results profit sales market share market value Contingency variables: Internal context – size, sector, technology, employees, culture External context – competition, economic, social, legal reversed causality This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

Operational Context HRM practices are contingent on the circumstances in which the organization operates, ie the internal and external environment. ● Contingency theory tells us that definitions of HR aims, policies and strategies, lists of activities and analyses of the role of the HR department are valid only if they are related to the situation of the organization.

Reservations Promises more than it can deliver – HRM is an 'optimistic but ambiguous concept'; it is all hype and hope (David Guest, 1991). Manipulative – ‘control by compliance’ (Hugh Willmott, 1993). Hostile to interests of employees – ‘Sadly, in a world of intensified competition and scarce resources, it seems inevitable that, as employees are used as means to an end, there will be some who will lose out. They may even be in the majority. For these people, the soft version of HRM may be an irrelevancy, while the hard version is likely to be an uncomfortable experience’ (Karen Legge, 1998).

Ethical Dimensions of HRM The application of HRM requires the exercise of social responsibility – it must be concerned with the interests (well-being) of employees and act ethically with regard to the needs of people in the organization and the community.  

THE DAVID GUEST MODEL OF THE LINK BETWEEN HRM AND PERFORMANCE HR effectiveness Business strategy HR outcomes: Employee competence, commitment and flexibility Quality of goods and services HR practices Financial performance Productivity HR strategy Source: D Guest et al, Effective People Management, CIPD, 2000 This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

HRM MODEL: STOREY Strategic CHANGE MAKERS ADVISERS Non-interventionary REGULATORS HANDMAIDENS Tactical Source: J Storey, New Developments in the Management of Human Resources, Blackwell, 1992 This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.

The changing role of the HR practitioner HRM MODEL: REILLY Strategic STRATEGIST/INNOVATOR CONTRIBUTION ADVISER/CONSULTANT ADMINISTRATOR/CONTROLLER Tactical Short Long TIME ORIENTATION The changing role of the HR practitioner Source: P Reilly, HR Services and the Re-alignment of HRM, Institute for Employment Studies, 2000 This resource is part of a range offered free to academics and/or students using Armstrong’s Handbook of Human Resource Management Practice, 11th edition, as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources.