HRM INTRODUCTION

Dr Kalina Grzesiuk
 HUMAN RESOURCE MANAGEMENT

• is concerned with all aspects of how people are

employed and managed in organizations
• Is a strategic, integrated and coherent approach
to the employment, development and wellbeing
of the people working in organizations
 DEFINITION

• ‘all those activities associated with the

management of employment relationships in the
firm’
(Baxall, Purcell, 2003)
A BIT OF HISTORY OF HRM

John W Budd

https://www.youtube.com/watch?v=Kxc8KceOb14&t=11s
 DEVELOPMENT OF THE HRM THEORY

I. The Harvard framework

II. The matching model
III. The UK contribution
 I. THE HARVARD FRAMEWORK
• ‘Human resource management (HRM) involves
all management decisions and actions that affect
the nature of the relationship between the
organization and employees – its human
resources’ (Beer et al., 1994)
• It is necessary to adopt ‘a longer-term
perspective in managing people and
consideration of people as a potential asset
rather than merely a variable cost’
 I. HARVARD FRAMEWORK CND
HRM had two characteristic features:
1. line managers accept more responsibility for
ensuring the alignment of competitive strategy
and HR policies,
2. HR has the mission of setting policies that
govern how HR activities are developed and
implemented in ways that make them more
mutually reinforcing.
 II. THE MATCHING MODEL

• HR systems and the organization structure

should be managed in a way which is congruent
with organizational strategy.
• ‘The critical management task is to align the
formal structure and human resource systems so
that they drive the strategic objectives of the
organization.’
• (Fombrun et al.)
 III. UK CONTRIBUTION

• HRM was ‘heavily normative from the start: it

provided a diagnosis and proposed solutions.’
• goal - to provide a label to wrap around some of
the observable changes, while providing a focus
for challenging deficiencies - in attitudes, scope,
coherence, and direction - of existing personnel
management.
• (Hendry and Pettigrew )
 THE GOALS OF HRM
• Objectives
– support the organization in achieving its objectives by developing and
implementing human resource (HR) strategies which are integrated
with the business strategy (strategic HRM)
• People
– ensure that the organization has the talented, skilled, and engaged
people it needs
• Employment relationship
– contribute to the creation of a positive employment relationship
between management and employees and a climate of mutual trust
• Ethics
– encourage the application of an ethical approach to people
management
 DIVERSITY OF HRM (1/2)
• HRM practice varies
– HRM goals vary according to competitive choices,
technologies, characteristics of employees (eg could
be different for managers) and the state of the labour
market
– covers a vast array of activities and shows a huge
range of variations across occupations, organizational
levels, business units, firms, industries and societies
 DIVERSITY OF HRM (2/2)
Hard HRM
– The focus is on the quantitative, calculative and business-
strategic aspects of managing human resources in as 'rational'
a way as for any other economic factor.
Soft HRM
– Employees treated as valued assets, a source of competitive
advantage through their commitment, adaptability and high
quality

But the distinction between hard and soft HRM is not

precise..
 THE PHILOSOPHY OF HRM
• The human resource gives competitive edge
• The aim is to enhance employee commitment
• HR decisions are of strategic importance
• HR policies should be integrated into the
business strategy
 COMMON HRM THEMES
• Relation to other management functions
– Human resource policies should be integrated with strategic
business planning and used to reinforce an appropriate (or
change an inappropriate) organizational culture
• Competitive advantage
– Human resources are valuable and a source of competitive
advantage
• Soft HR
– Human resources may be tapped most effectively by mutually
consistent policies that promote commitment and which, as a
consequence, foster a willingness in employees to act flexibly
in the interests of the ‘adaptive organization's’ pursuit of
excellence.
 UNDERPINNING THEORIES OF HRM
• Commitment
– Eliciting commitment – and providing the environment
in which it can flourish – pays tangible dividends for
the individual and for the company
• Organizational behavior
– Describes how people within their organizations act
individually or in groups and how organizations
function in terms of their structure, processes and
culture
 UNDERPINNING THEORIES OF HRM

• Motivation
– Explains the factors that affect goal-directed
behaviour.
• AMO
– Performance is a function of Ability + Motivation
+Opportunity to Participate
 UNDERPINNING THEORIES OF HRM
• Resource dependance
– Groups and organizations gain power over each other by
controlling valued resources.
• Resource-based
– Competitive advantage is achieved if a firm’s resources
are valuable, rare and costly to imitate.
• Intitutional
– Organizations conform to internal and external
environmental pressures in order to gain legitimacy and
acceptance.
 UNDERPINNING THEORIES OF HRM
• Transaction costs
– Transaction costs economics assumes that businesses
develop organizational structures and systems which
economize the costs of the transactions (interrelated
exchange activities) that take place during the course of
their operations.
• Human capital
– Concerned with how people in an organization contribute
their knowledge, skills and abilities to enhancing
organizational capability
 UNDERPINNING THEORIES OF HRM
• Agency
– The role of the managers of a business is to act on behalf of
the owners of the business as their agents. But there is a
separation between the owners (the principals) and the
agents (the managers) and the principals may not have
complete control over their agents. The latter may
therefore act in ways which are against the interests of
those principals
• Contingency
– HRM practices are dependant on the organization’s
environment and circumstances.
HR ARCHITECTURE (STRUCTURE)

Consists of:
• Systems,
• Processes
• Structure
As well as employees’ behaviors
 THE HR SYSTEM

• Contains the interrelated and jointly supportive

activities and practices which together enable
HRM goals to be achieved
 THE HRM SYSTEM BRINGS TOGETHER:

• HR philosophies which describe the overarching values and guiding

principles adopted in managing people.
• HR strategies which define the direction in which HRM intends to
go in each of its main areas of activity.
• HR policies which set out what HRM is there to do and provide
guidelines defining how specific aspects of HR should be applied
and implemented.
HR practices which consist of the HRM activities involved in
managing and developing people and in managing the
employment relationship.
 HUMAN CAPITAL
• intangible collective resources possessed by
individuals and groups within a given population.
• include all the knowledge, talents, skills, abilities,
experience, intelligence, training, judgment, and
wisdom
• possessed individually and collectively,
• the cumulative total of which represents a form of
wealth available to nations and organizations to
accomplish their goals.
 CORPORATE SOCIAL RESPONSIBILITY (CSR)

„the responsibility of enterprises for their impact on

society and, therefore, it should be company led.
Companies can become socially responsible by
• integrating social, environmental, ethical, consumer,
and human rights concerns into their business
strategy and operations
• following the law”
EU Commission