HUMAN RESOURCE MANAGEMENT Concepts and Theories

1. HUMAN RESOURCE MANAGEMENT Concepts and Theories This presentation has been adapted from part of a range of resources offered free to academics and/or students using Armstrong’s Essential Human Resource Management Practice as part of their course.

2. Assessment • Exam • Report

3. THE CONCEPT OF HRM: Objectives 1. Definition of HRM2. Development of the HRM concept3. The goals of HRM4. Diversity of HRM5. Philosophy of HRM6. Underpinning theories of HRM7. Reservations about HRM8. HRM today

4. Task: Find 2 (recent) definitions. At the end of this session you will need to select 1 of these and explain why you think it is the best one https://www.youtube.com/watch?v=rByDmC0SqtM

5. HUMAN RESOURCE MANAGEMENT DEFINED Human resource management (HRM) is a strategic and coherent approach to the management of an organization's most valued assets – the people working there who individually and collectively contribute to the achievement of its objectives. https://www.youtube.com/watch?v=FjfvvFg1D14

6. FEATURES OF HRM Commitment: Emphasis on gaining commitment to the organization’s mission and values Coherent: Integrated and mutually supporting HR policies and practices Strategic: Integrate business and HR strategy People treated as assets: Focus on developing human capital Unitarist approach: Management and employees share the same interests Line managers deliver HRM: Belief that HRM is essentially the responsibility of line managers

7. Task - FEATURES OF HRM in your own words

8. Mini Plenary How would your define HRM?How useful do you think the features of HRM are? And why?

9. Development The Harvard frameworkThe matching modelThe UK contributionThe Bath People And Performance Model

10. Each group will research 1 of these models and prepare an electronic presentation for the class. • Definition of model • Purpose of model • Explain model • Give real-world example of model • Link to theories and information from last week

11. THE HARVARD FRAMEWORK • Stakeholder • interests: • shareholders • management • employees • government • unions • HRM policy • choices: • employee influence • human resource • flow • reward systems • work systems • Long-term • consequences: individual well- being • Organizational • effectiveness • societal well- • being • HR outcomes: • commitment • competence • cost-effectiveness • Situational factors: • workforce • characteristics • business • strategy and • conditions • management • philosophy • labour market • unions • task technology • laws and social • values Source: M Beer et al, Managing Human Assets, The Free Press, 1984

12. This resource is part of a range offered free to academics and/or students using Armstrong’s Essential Human Resource Management Practice 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 MATCHING MODEL OF HRM The matching model of HRM as developed by Fombrun, Titchy, and Devanna (1984) is illustrated below. Rewards Selection Performance management Performance Development Adapted from Fombrun et al, Strategic Human Resource Management, Wiley, 1984

13. This resource is part of a range offered free to academics and/or students using Armstrong’s Essential Human Resource Management Practice 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 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: Guest et al, Effective People Management, CIPD, 2000

14. THE BATH PEOPLE AND PERFORMANCE MODEL Training and development Performance management Career opportunity Job security Recruitment and selection Ability and skill Motivation and incentive Opportunity to participate Pay satisfaction • Front-line • management: • Implementing • enacting • leading • controlling Organizational commitment Motivation Job satisfaction Discretionary behaviour Work–life balance Performance outcomes Job challenge/ autonomy Teamworking Involvement Source: J Purcell et al, Understanding the People and Performance Link, CIPD, 2003 Communications

15. Common features – Model Analysis Think about the four models-) do they share common features?-) do they do similar thing?-) what conclusions can we make about these models?

16. Mini Plenary Which of the four model do you think is the best? And why?Do you think that these models are suitable for model business? And why?Do you think that these models support ebusiness? And why?

17. Goals 1) Objectives2) People3) Employment relationship4) Ethics

18. GOALS OF HRM Enhance motivation, commitment and job engagement Achieve human capital advantage Achieve high performance through people Improve knowledge sharing Attract and retain the skilled, committed and motivated people required Value people according to their contribution Increase capabilities and potential Develop a co-operative and productive employee relations climate

19. Mini Plenary What does the Goal Model focus on to achieve the HRM goals?How useful do you think the Goal Model is?

20. Diversity HRM practice variesHard and soft HRM

21. This resource is part of a range offered free to academics and/or students using Armstrong’s Essential Human Resource Management Practice 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. VERSIONS OF HRM Using you knowledge of human motivation theories which we discussed last week. Suggest how these approaches view human motivation Soft Emphasis on the need to develop a high-commitment, high-trust organization – focus on ‘mutuality’, communication and involvement Hard Treating employees ‘rationally’ as as a key resource from which competitive advantage can be obtained Hard/soft Using a mix of hard and soft approaches

22. Mini Plenary What do you think about Soft and hard HRM?How useful do you think these approaches are?

23. Philosophy • The human resource gives competitive edge • The aim is to enhance employee commitment • HRdecisions are of strategic importance • HRpolicies should be integrated into the business strategy. Storey (2001)

24. In your groups research the underpinning theories and write a short paragraph about each one -) Commitment -) Organizational behaviour-) Motivation-) AMO (ability motivation opportunity)-) Resource dependence-) Resource-based-) Institutional-) Transaction costs-) Human capital-) Agency-) Contingency

25. Link the Goal Model to the underpinning Theories Enhance motivation, commitment and job engagement Achieve human capital advantage Achieve high performance through people Improve knowledge sharing Attract and retain the skilled, committed and motivated people required Value people according to their contribution Increase capabilities and potential Develop a co-operative and productive employee relations climate

26. 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 Management Development Contingent pay Communications Employee benefits Knowledge management Health and safety and welfare HR services Performance management

27. Mini Plenary Do you think HRM theory is useful?Do you have enough information to answer this question? Justify your answer

28. Guest (1991: 149) referred to the ‘optimistic but ambiguous label of human resource management’. • ‘The HRM rhetoric presents it as an all or nothing process which is ideal for any organization, despite the evidence that different business environments require different approaches’. (Armstrong, 2000: 577)

29. HRM is simplistic - as Fowler (1987:3) wrote: The HRM message to top management tends to be beguilingly simple. • Don't bother too much about the content or techniques of personnel management, it says. Just manage the context. • Get out from behind your desk, bypass the hierarchy, and go and talk to people. That way you will unlock an enormous potential for improved performance.

30. The unitarist/managerialist approach to industrial relations implicit in HRM prompted Fowler (1987:3) to write: • At the heart of the concept is the complete identification of employees with the aims and values of the business - employee involvement but on the company's terms. • Power in the HRM system, remains very firmly in the hands of the employer. Is it really possible to claim full mutuality when at the end of the day the employer can decide unilaterally to close the company or sell it to someone else?

31. HRM is 'macho-management dressed up as benevolent paternalism' (Legge, 1998: 42). • HRMis manipulative, Wilmott (1993: 534) asserted that: ‘any (corporate) practice/value is as good as any other so long as it secures the compliance of employees’. • Oxterby and Coster (1992: 31) asserted that: ‘The term ‘human resources’ reduces people to the same category of value as materials, money and technology – all resources, and resources are only valuable to the extent they can be exploited or leveraged into economic value’.

32. Mini Plenary Do you think HRMis a useful process? And why?Do you think HRM is there to support the company or the worker? And why?

33. HOW HR CAN MAKE AN IMPACT ON PERFORMANCE Source: J Purcell et al, Inside the Box: How people management impacts on organizational performance, CIPD, 2003 • Develop and successfully implement high-performance work practices, particularly those concerned with job and work design, flexible working, resourcing, employee development, reward and giving employees a voice. • Formulate a clear vision and set of values (the ‘big idea’) and ensure that it is embedded, enduring, collective, measured and managed. • Develop a positive psychological contract and means of increasing the motivation and commitment of employees.

34. HOW HR CAN MAKE AN IMPACT ON PERFORMANCE Source: J Purcell et al, Inside the Box: How people management impacts on organizational performance, CIPD, 2003 • Formulate and implement policies that meet the needs of individuals and ‘create a great place to work’. • Provide support and advice to line managers on their role in implementing HR policies. • Manage change effectively. https://www.youtube.com/watch?v=jWdovBCWTF0

35. At a meeting of trustees the chief executive of a medium-sized charity proposed that a director of human resources should be appointed. Two trustees protested that the term ‘human resources’ implied that employees would just be treated as factors of production not as people. How would you respond?

36. Mini Plenary -) Suggest which model might be best to support the employees from one of the video from last week (Amazon & China) and explain why.-) Is the company using a hard or soft HRM?-) Suggest your own definition which best reflects that workplace, using todays notes?

37. List 3 things you have learnt today • Identify 3 things you need to study in more depth • On a scale of 1-10 (10 being high) how confident are you with your understanding of today’s topics?