Human Resource Management

Module 2
Models of HRM
2.1 Defining Characteristics of HRM Models
2 Model Types
Matching - HARD - Prescriptive - Unitarist - Fombrun (1984)
Harvard - Soft - Analytical - Pluralist - Beer (1984)
1. Operational & implementation issue weighted
1. Strategic considerations
2. Prescriptive - tell mgrs "best way to do things"
2. Underlying structures and processes emphasis
3. Hard approach
3. Soft approach
4. Responsibility 4 line mgrs
4. Responsibility 4 line mgrs
5. Not far a departure from traditional PM practice
5. More departure from traditional PM practice
6. Unitarist approach-top mgmt sets strategy (only stakeholders)
6. Pluralist approach-many stakeholders
Unitarist Approach assumes only a small number of individuals or groups have a legitimate interest in the fate of the org.
Extreme Unitarist advocate only top mgmt responsible for devising strategy & its priority is to satisfy shareholders.
Pluralist Approach assumes a wide range of stakeholders who should account for the process of strategy formulation.

2.2 Matching Models

2.2.1 Fombrun, Tichy & Devanna's Model (1984) - basic proposition that HRM strategy should be driven by the
business need & business strategy.
1-way relationship = business needs determine HRM
strategy.

Political
Forces

Rewards

Cultural
Economic
Forces
Forces
Mission
&
Strategy
Org.
Structure

Selection

Performance

Appraisal
Development

Firm
Human Resource Cycle

HRM

Fombrun, Tichy & Devanna's (1984) Strategic Model

Prescriptive - tells mgrs "how to do things"
Hard Approach - contribution max & keep costs - Mechanistic Approach
Unitarist Approach -business strategy determines strategy of HRM
Market forces determine business strategy
Implementing HRM Strategy
1. Decide optimal competitive strategy
2. Employee performance goals
3. Employee training & development
4. Employee selection
5. Reward goals reached

4 Key Operational Systems

1. Selection
2. Appraisal
3. Development
4. Rewards

Advantages
1. HR activities integrated in pursuit of business strategy.
2. Links HR strategy to business strategy

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Process Stages
1. Mkt orientation determine optimal
competitive strategy.
2. Employee performance goals set
a. select new employees
b. appraise employees/performance goals
c. base rewards on performance goals
d. correct deficiencies

Disadvantages
1. account of employee needs
2. #of stakeholders
3. No trade unions or society
4. 1way relation = Business strategyHRM Strategy

Human Resource Management

Module 2
Models of HRM
2.2.2 The Schuler Group
Schuler & Jackson (1987)
Strategic Objective
Innovation

Performance Requirements
(Employee Role Behavior)
creative behavior
Long focus
level operative interdependent behavior

HRM Strategy

Jobs require close group

interaction & coordination
2. Long focus 4 performance
appraisal & group achievements
3. Employees develop other job
skills
Quality Enhancement
1. Repetitive & predictable behavior
1. Fixed, explicit job descriptions
2. quality concern
2. employee decision participation
3. Moderate cooperative interdependent
on work & conditions
behavior
3. Extensive, continuous training &
development
1. Repetitive, predictable behavior
1. Fixed, explicit job descriptions
Cost
2. Short focus
2. Short results orientated
performance appraisals
3. #
3. training & development
Best HRM Strategy (Hendry) will depend on the orgs particular circumstances.
Technology Nature
Local & National Customers
1.
2.
3.

1.

2.2.3 Evaluation of Matching Models

1.
2.
3.
4.
5.
6.

Boxall's Criticisms
No systematic research - only field studies
Unitarists assumptions "done to" not "with"
Strategy formulation not realistic as suggested
Validity assumptions misplaced since criticized
restrictive - ignores attitudes & behavior variables
2close fit of HR & Business strategiesinflexibility, inadaptability 2 change

2.3 Harvard-type Models - (Beer) has roots in OB.

Soft Approach focus on people as individuals whose talents can be nurtured & developed to the mutual benefit of society,
the org and themselves.
Pluralistic Approach - wide range of stakeholders part of strategy formulation.

2.3.1 The original Beer Model

Stakeholders Interests
1.
2.
3.
4.
5.
6.

Shareholders
Mgrs
Employee Groups
Government
Unions
Community

Situational Factors
1.
2.
3.
4.
5.
6.
7.
8.

Business strategy
Workplace nature
Labor mkt
Laws
Social values
Reward system nature
Work system type
Employee decision influence

influence

HRM Policy Choices (Strategy) HR Outcomes

Long Term Consequences

1. of employee decisions influence

2. Reward systems
3. Work systems

1.
2.
3.
4.
5.
6.
7.

Conclusion
1. Business strategy role dominant
2. Analytical not prescriptive
3. Closely related to performance mgmt
4. pluralistic - many stakeholders

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1.
2.
3.
4.
5.
6.

Cost effectiveness
Performance req. met
commitment
Adapt 2 change easy
Adapt 2 opps & threats
Self motivated employee

Mutual commitment
" goals
" respect
" responsibility
satisfaction
well being
social benefit

Human Resource Management

Module 2
Models of HRM
2.3.2 The Guest Model (1994) - consideration of strategic options & prescriptive recommendations
HRM Policies

HR Outcomes

Org Outcomes

1.
2.
3.
4.
5.

1.
2.
3.
4.

High

Org & job design

Mgmt 4 change
Recruitment, selection, socialization
Appraisal, training & dvlpmt, rewards
Communication

Strategic information
Commitment
Flexibility, adaptability
Quality of workforce,
mgmt, product, job
performance, reputation,
customer, HR policies

influenced by

Low

1. Job performance
2. Problem solving
3. Change
4. Innovation
5. Cost effectiveness
1. Turnover
2. Absences
3. Grievances

Leadership/Culture/Strategy

2.3.3 The Pettigrew Approach (1990)-Hendry & Pettigrew were more interested in understanding of the
structures and processes that influence strategy making then in "armchair
exercise of matching strategy to HR process."

Outer Context
Socio-Ecnomic
Technical
Politcal -Legal
Competition

Pluralist- many influences 2 strategy.

No prescriptive element.

Inner Context
Culture
Structure
Politics/Leadership
Task-Technology
Business Outputs

Business Strategy
Content
Objectives
Product-Mkts
Strategy, Tactics

HRM Context
2way relationship

Role
Definition
Organization
HR Outputs

HRM Content
HR Flows
Work Systems
Reward Systems
Employee Relations

2.3.4 Evaluation of Harvard-type Models

1.
2.
3.
4.

Boxall's Positive Points

Many stakeholder groups influence strategy
Other factors & business strategy shape HRM strategy
Accepts mkt forces but not driven by.
Mgmt not mkt pawn & has choices
Social influence of HRM int'l practices
Beer-USA Guest & Pettigrew - UK

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Boxall's Criticisms
1. realism of assumptions & practical application
2. Does commitmentperformance
3. commitment - how
4. Change culture - how
5. Common interests sustainable?
6. Principle/agent problem -conflict of interests

Human Resource Management

Module 2
Models of HRM
2.4 Summary
2 Model Types
Matching - HARD - Unatarist - Fombrun (1984)
Harvard - Soft - Pluralist - Beer (1984)
7. Operational & implementation issue weighted
7. Strategic considerations
8. Prescriptive - tell mgrs "best way to do things"
8. Understand structures and processes emphasis
9. Hard approach
9. Soft approach
10. Responsibility 4 line mgrs
10. Responsibility 4 line mgrs
11. Not far a departure from traditional PM practice
11. More departure from traditional PM practice
12. Unitarist approach
12. Pluralist approach
HARD HRM sees people no different from other resources, whose contributions are to be maximized while costs are minimized.
Soft HRM vies that it's possible to develop HRM polices that'll benefit both the org & the employee. Emphasizes human not resource.

Political
Forces

Rewards

Cultural
Economic
Forces
Forces
Mission
&
Strategy
Org.
Structure

Selection

Performance

Appraisal
Development

Firm
Human Resource Cycle

HRM

Fombrun, Tichy & Devanna's (1984) Strategic Model

Prescriptive - tells mgrs "how to do things"
Hard Approach - contribution max & keep costs
Unitarist Approach -business strategy determines strategy of HRM
Implementing HRM Strategy
4 Key Operational Systems
6. Decide optimal competitive strategy
1. Selection
7. Employee performance goals
2. Appraisal
8. Employee training & development
3. Development
9. Employee selection
4. Rewards
10. Reward goals reached

Advantages
1. HR activities integrated in pursuit of business strategy
2. Links HR strategy to business strategy

Disadvantages
1. account of employee needs
2. #of stakeholders
3. No trade unions or society
4. 1way relation = Business strategyHRM Strategy

Boxall's Criticisms
1. No systematic research
2. Unitarists assumptions "done to" not "with"
3. Strategy formulation not realistic as suggested
4. Validity assumptions misplaced since criticized
5. restrictive - ignores attitudes & behavior variables
6. 2close fit of HR & Business strategiesinflexibility, inadaptability 2 change

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