18 The conceptual framework of strategic HRM hypotheses are not made explicit.It is too comprehensive.If HRM is labelled a"theory"it raises expectations about its ability to describe and predict.' Guest (1991)believes that HRM is an 'optimistic but ambiguous concept';it is all hype and hope.Mabey et(19)follow this up by asserting that 'the heralded outcomes [of HRM]are almost without exception unrealistically high'.To put the concept of HRM into practice involves strategic integration,developing a ohe nt and consiste set of employment policies,and gaining commitment.This requires high levels of determination and competence at all levels of management and a strong and effective HR function staffed by business-orientated people.It may be difficult to meet these criteria,especially when the proposed HRM culture conflicts with the established corporate culture and traditional managerial attitudes and behaviour. Gratton et al(1999)are convinced on the basis of their re arch that there is 'a disjunction between rhetoric and reality in the area of human resource management between HRM theory and HRM practice,between what the HR function says it is doing and that practice as perceived by employers,and between what senior management believes to be the role of the HR function, and the role it actually plays'.In their conclusions they refer to the'hyperbole and rhetoric of human resource management'. Caldw ell(2004)believes that HRM'is an unfinished project informed by a self-fulfilling vision of what it should be' The above comments are based on the assumption that there is a single monolithic form of HRM.This is not the case.HRM comes in all sorts shapes and sizes.Sometimes it is just new wine in old bottles-personnel management under another name.Often it is aspirational,for example,in Walton's(1985)phrase,aiming to move'from control to commitment'.It has to be conceded that many organizations that think they are practising HRM as described earlier are not doing so,at least to the full extent.It is difficult, that hurriedly adopted would act as a lever for change have been sorely disappointed. However.the research conducted by Guest and Conway (1997)covering a stratified random sample of 1,000 workerse established that a notably high level of HRM was found to be in place.This contradicts the view that management has tended to 'talk up'the adoption of HRM practices.The HRM characteristics covered by the survey included the opportunity to express grievances and raise personal concerns on such matters as opportu nities for training and development,communications about business issues, single status,effective systems for dealing with bullying and harassment at work,making jobs interesting and varied,promotion from within
hypotheses are not made explicit. It is too comprehensive. If HRM is labelled a “theory” it raises expectations about its ability to describe and predict.’ Guest (1991) believes that HRM is an ‘optimistic but ambiguous concept’; it is all hype and hope. Mabey et al (1998) follow this up by asserting that ‘the heralded outcomes [of HRM] are almost without exception unrealistically high’. To put the concept of HRM into practice involves strategic integration, developing a coherent and consistent set of employment policies, and gaining commitment. This requires high levels of determination and competence at all levels of management and a strong and effective HR function staffed by business-orientated people. It may be difficult to meet these criteria, especially when the proposed HRM culture conflicts with the established corporate culture and traditional managerial attitudes and behaviour. Gratton et al (1999) are convinced on the basis of their research that there is ‘a disjunction between rhetoric and reality in the area of human resource management between HRM theory and HRM practice, between what the HR function says it is doing and that practice as perceived by employers, and between what senior management believes to be the role of the HR function, and the role it actually plays’. In their conclusions they refer to the ‘hyperbole and rhetoric of human resource management’. Caldwell (2004) believes that HRM ‘is an unfinished project informed by a self-fulfilling vision of what it should be’. The above comments are based on the assumption that there is a single monolithic form of HRM. This is not the case. HRM comes in all sorts of shapes and sizes. Sometimes it is just new wine in old bottles – personnel management under another name. Often it is aspirational, for example, in Walton’s (1985) phrase, aiming to move ‘from control to commitment’. It has to be conceded that many organizations that think they are practising HRM as described earlier are not doing so, at least to the full extent. It is difficult, and it is best not to expect too much. For example, most of the managements that hurriedly adopted performance-related pay as an HRM device that would act as a lever for change have been sorely disappointed. However, the research conducted by Guest and Conway (1997) covering a stratified random sample of 1,000 workers established that a notably high level of HRM was found to be in place. This contradicts the view that management has tended to ‘talk up’ the adoption of HRM practices. The HRM characteristics covered by the survey included the opportunity to express grievances and raise personal concerns on such matters as opportunities for training and development, communications about business issues, single status, effective systems for dealing with bullying and harassment at work, making jobs interesting and varied, promotion from within, 18 l The conceptual framework of strategic HRM
The concept of human resource management19 involvement programmes,no compulsory redundancies,performance- related pay,profit sharing and the use of attitude surveys. The morality of HRM HRM is accused by many academics of being manipulative if not positively immoral.Willmott(1993)remarks that HRM operates as a form of insidious 'control by compliance'when it emphasizes the need for employees to be committed to do what the organization wants them to do.It preaches mutu- ality but the reality is that behind the rhetoric it exploits workers.It is,they say,a wolf in sheep's clothing(Keenoy,1990a).As Legge(1998)pointed out 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.The may even be in the majority.For these people,the soft version of HRM may be an irrelevancy,while the hard version isl kely to be an uncomfortable experience. The accusation that HRM treats employees as means to an end is often made However,it could be argued that,if organizations ex kist to achieve ends which they obviously do,and if those ends can only be achieved through people,which is clearly the case,the concern of managements for commitment and performance from those e people is not unnatural and is not attributable to the concept of HRM-it existed in the good old days of personnel management before HRM was invented.What matters is how managements treat people as ends and what managements provide in return Much of the ho ity to HRM expre essed by a number of acade mics is based on the belief that it is against the interests of workers,ie that it is managerialist.However,the Guest and Conway (1997)research established that the reports of workers on outcomes showed that a higher number of HR practices were associated with higher ratings of fairness,trust and management's delivery of their promises.Those experiencing more HR activities also felt more secure in and more satisfied with their jobs. Motivation was significantly higher for those working in organizations where more HR practices were in place.In summary,as commented by Guest(1999),it appears that workers like their experience of HRM.Thes findings appear to contradict the radical critiqueview produced by academics such as Mabey et al(1998)that HRM has been ineffectual,perni- cious (ie managerialist)or both.Some of those who adopt this stance tend to dismiss favourable reports from workers about HRM on the grounds that they have been brainwashed by management.But there is no evidence to support this view. Moreover,as Armstrong(2000)points out:
involvement programmes, no compulsory redundancies, performancerelated pay, profit sharing and the use of attitude surveys. The morality of HRM HRM is accused by many academics of being manipulative if not positively immoral. Willmott (1993) remarks that HRM operates as a form of insidious ‘control by compliance’ when it emphasizes the need for employees to be committed to do what the organization wants them to do. It preaches mutuality but the reality is that behind the rhetoric it exploits workers. It is, they say, a wolf in sheep’s clothing (Keenoy, 1990a). As Legge (1998) pointed out: 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. The accusation that HRM treats employees as means to an end is often made. However, it could be argued that, if organizations exist to achieve ends, which they obviously do, and if those ends can only be achieved through people, which is clearly the case, the concern of managements for commitment and performance from those people is not unnatural and is not attributable to the concept of HRM – it existed in the good old days of personnel management before HRM was invented. What matters is how managements treat people as ends and what managements provide in return. Much of the hostility to HRM expressed by a number of academics is based on the belief that it is against the interests of workers, ie that it is managerialist. However, the Guest and Conway (1997) research established that the reports of workers on outcomes showed that a higher number of HR practices were associated with higher ratings of fairness, trust and management’s delivery of their promises. Those experiencing more HR activities also felt more secure in and more satisfied with their jobs. Motivation was significantly higher for those working in organizations where more HR practices were in place. In summary, as commented by Guest (1999), it appears that workers like their experience of HRM. These findings appear to contradict the ‘radical critique’ view produced by academics such as Mabey et al (1998) that HRM has been ineffectual, pernicious (ie managerialist) or both. Some of those who adopt this stance tend to dismiss favourable reports from workers about HRM on the grounds that they have been brainwashed by management. But there is no evidence to support this view. Moreover, as Armstrong (2000) points out: The concept of human resource management l 19
20 The conceptual framework of strategic HRM HRM cannot be blamed or given credit for changes that were taking place ed a move from pluralism wapne城h no bee he paper pro on wa ed from d read a book abou HRM but as a means of breaking the print unions'control. Contradictions in the reservations about HRM Guest(1999)has suggested that there are two contradictory concerns about HRM.The first as formulated by Legge (1995,1998)is that,while management rhetoric may express concern for workers,the reality is harsher. And Keenoy(1997)complains that 'The real puzzle about HRMism is how,in the face of such apparently overwhelming critical"secured such influence and institutional presence. Other writers,however,simply claim that HRM does not work.Scott (1994),for example,finds that both management and workers are captives of their history and find it very difficult to let go of their traditional adversarial orientations. But these contentions are contradictory.Guest(1999)remarks that 'It is difficult to treat HRM as a major threat(though what it is a threat to is no always made explicit)deserving of serious critical analysis while at the same time claiming that it is not practiced or is ineffective
HRM cannot be blamed or given credit for changes that were taking place anyway. For example, it is often alleged to have inspired a move from pluralism to unitarism in industrial relations. But newspaper production was moved from Fleet Street to Wapping by Murdoch, not because he had read a book about HRM but as a means of breaking the print unions’ control. Contradictions in the reservations about HRM Guest (1999) has suggested that there are two contradictory concerns about HRM. The first as formulated by Legge (1995, 1998) is that, while management rhetoric may express concern for workers, the reality is harsher. And Keenoy (1997) complains that ‘The real puzzle about HRMism is how, in the face of such apparently overwhelming critical “refutation”, it has secured such influence and institutional presence.’ Other writers, however, simply claim that HRM does not work. Scott (1994), for example, finds that both management and workers are captives of their history and find it very difficult to let go of their traditional adversarial orientations. But these contentions are contradictory. Guest (1999) remarks that ‘It is difficult to treat HRM as a major threat (though what it is a threat to is not always made explicit) deserving of serious critical analysis while at the same time claiming that it is not practiced or is ineffective.’ 20 l The conceptual framework of strategic HRM
2 2 The concept of strategy me o en directing the larger military movements and operations of a campaign. Commanders-in-chief and military campaigns do not exist in business,the public sector or voluntary organizations,but at least this definition conveys the messages that strategy is the ultimate responsibility of the head of the organization,is an art and is concerned with projecting and directing large movements It was Peter Drucker who long ago(1955)pointed out in The Practice of However,the concept of business strategy was not fully developed until three outstanding pioneers,Kenneth Andrews(1987),Igor Ansoff(1987)and Alfred Chandler(1962)made their mark.They were followed by Michael Porter(1985),Henry Mintzberg (1987),Hamel and Prahalad(1989)and many more who further developed the concepts and adapted them to contemporary conditions. This chapter focuses on business strategy.It provides a bridge between the basic concept of human resource management as covered in Chapter 1 and strategic huiman resource management as described in Chapter 3.One of the purp nter the belief that business strategy is a highly rational affair that provides a firm basis for HR strategy.Business strategy is in fact a far more intuitive,evolutionary and reactive process than
2 The concept of strategy Strategy was originally a military term, defined in the Oxford English Dictionary as: ‘The art of a commander-in-chief; the art of projecting and directing the larger military movements and operations of a campaign.’ Commanders-in-chief and military campaigns do not exist in business, the public sector or voluntary organizations, but at least this definition conveys the messages that strategy is the ultimate responsibility of the head of the organization, is an art and is concerned with projecting and directing large movements. It was Peter Drucker who long ago (1955) pointed out in The Practice of Management the importance of strategic decisions, which he defined as ‘all decisions on business objectives and on the means to reach them’. However, the concept of business strategy was not fully developed until three outstanding pioneers, Kenneth Andrews (1987), Igor Ansoff (1987) and Alfred Chandler (1962) made their mark. They were followed by Michael Porter (1985), Henry Mintzberg (1987), Hamel and Prahalad (1989) and many more who further developed the concepts and adapted them to contemporary conditions. This chapter focuses on business strategy. It provides a bridge between the basic concept of human resource management as covered in Chapter 1 and strategic human resource management as described in Chapter 3. One of the purposes of the chapter is to counter the belief that business strategy is a highly rational affair that provides a firm basis for HR strategy. Business strategy is in fact a far more intuitive, evolutionary and reactive process than 21
22 The conceptual framework of strategic HRM most people believe.This is the reality of strategic HRM that must be bore in mind when dealing with this compelling but often elusive concept. The chapter starts with definitions of strategy and goes on to describe the fundamentals of strategy in more detail.It concludes with a review of the process of strategy formulation STRATEGY DEFINED Strategy has two fundamental meanings.First,it is forward looking.It is about deciding where you want to go and how you mean to get there.It is concerned with both ends and means.In this sense a strategy is a declaration of intent:This is what we want to do and this is how we intend to do it. Strategies define longer-term goals,but they also cover how those goals will be attained.They guide purposeful action to deliver the required result.A good strategy is on e that works,one that in Abell's (1993)phrase enables organizations to adapt by 'mastering the present and pre-empting the future'. The second meaning of strategy is conv veyed by the concept of The focus is upon the organization and the world around it.To maximize competitive advantage a firm must match its capabilities and resources to the opportunities available in the external environment.As Hofer and Schendel (1986)conclude,'A critical aspect of top management's work today involves matching organizational competences(internal resources and skills)with the opportunities and risks created by environmental change in ways that will beboth effective and efficient over the time such resources will be deployed. Strategy has been defined in other ways by the many writers on this subject.For example: Strategy is the determination of the basic ng-termgoalsand objectivesofan enterprise,and the adoption of coures of of resources necessary for carrying out these goals. (Chandler.1962) Strategy is a set of fundamental or critical choices about the ends and means of a business (Child,1972) [Strategy involves]the constant search for ways in which the firm's unique resources can be redeployed in changing circumstances. (Rumelt,1984)
most people believe. This is the reality of strategic HRM that must be borne in mind when dealing with this compelling but often elusive concept. The chapter starts with definitions of strategy and goes on to describe the fundamentals of strategy in more detail. It concludes with a review of the process of strategy formulation. STRATEGY DEFINED Strategy has two fundamental meanings. First, it is forward looking. It is about deciding where you want to go and how you mean to get there. It is concerned with both ends and means. In this sense a strategy is a declaration of intent: ‘This is what we want to do and this is how we intend to do it.’ Strategies define longer-term goals, but they also cover how those goals will be attained. They guide purposeful action to deliver the required result. A good strategy is one that works, one that in Abell’s (1993) phrase enables organizations to adapt by ‘mastering the present and pre-empting the future’. The second meaning of strategy is conveyed by the concept of strategic fit. The focus is upon the organization and the world around it. To maximize competitive advantage a firm must match its capabilities and resources to the opportunities available in the external environment. As Hofer and Schendel (1986) conclude, ‘A critical aspect of top management’s work today involves matching organizational competences (internal resources and skills) with the opportunities and risks created by environmental change in ways that will be both effective and efficient over the time such resources will be deployed.’ Strategy has been defined in other ways by the many writers on this subject. For example: Strategy is the determination of the basic long-term goals and objectives of an enterprise, and the adoption of courses of action and the allocation of resources necessary for carrying out these goals. (Chandler, 1962) Strategy is a set of fundamental or critical choices about the ends and means of a business. (Child, 1972) [Strategy involves] the constant search for ways in which the firm’s unique resources can be redeployed in changing circumstances. (Rumelt, 1984) 22 l The conceptual framework of strategic HRM