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Patrick Gunnigle, Thomas Turner and Michael Morley
University of Limerick, Limerick, Ireland
Introduction An emphasis on the strategic importance of employee relations considerations in achieving broad business objectives is seen as a key characteristic of contemporary developments in management approaches to employee relations (Beaumont, 1995; Kochan, 1980; Kochan et al., 1986; Walton et al., 1994). Strategic integration implies that employee relations considerations are a major factor in strategic decision making, with a strong emphasis on developing employee relations policies which are integrated with, and mutually complementary to business strategy. Thus a “strategic” employee relations approach is characterised by the integration of employee relations considerations into the business plan to facilitate the establishment and maintenance of competitive advantage. Such policies need not necessarily be employee-centred, but may be either “hard” or “soft”, depending on the chosen route to competitive advantage. In contrast, the traditional “pluralistadversarial” approach is seen as largely reactive in nature. Consequently, employee relations considerations are not a concern of strategic decision makers, but rather an operational issue only given priority when problems arise. It is plausible, therefore, to suggest that strategic integration may be associated with particular management approaches or styles in employee relations. In this paper, we explore this possibility using a survey of greenfield companies in Ireland. Strategic integration and employee relations Strategic integration, as a dimension of management approaches to employee relations, refers to the extent to which employee relations considerations impact on strategic decision making. The increased integration of employee relations considerations into strategic decision making is a recurrent theme in contemporary analyses of change in employee relations management (Beaumont, 1993; Beer et al., 1984; Brewster, 1994; Kochan et al., 1986; Schuster, 1985; Walton, 1985). However, despite its widespread prominence in the literature, there have been few attempts to empirically investigate strategic integration in employee relations. Consequently, the nature and extent of strategic integration of employee relations considerations into top-level management decision making remains unclear. This is most probably related to
Strategic integration and employee relations 115
Received December 1996 Accepted January 1998
Employee Relations, Vol. 20 No. 2, 1998, pp. 115-131, © MCB University Press, 0142-5455
preferred managerial style will act as a key determinant of the level of strategic integration of employee relations considerations. 1992. 1990). McKersie. High levels of collectivism are integral to the traditional pluralist model.. in turn. Beaumont and Townley. two generic management styles in employee relations may be identified. However. for example. To this end. 1995). 1986. 1992). Kochan et al. Brewster and Holt-Larsen. Keenoy. with the result that employee relations considerations are not a concern of strategic decision makers. it is suggested that if more strategic approaches to employee relations are being adopted. Beaumont and Townley. 1991. Alternatively.2 116 the inherent difficulties in identifying acceptable indicators of strategic integration. Gunnigle.. is questionable. findings on the levels of collectivism and individualism are important indicators of change in employee relations (Beaumont. Kochan et al. the “traditional pluralist” employee relations model is viewed as being essentially reactive. it is possible to identify a second hypothesis which states that high levels of collectivism will be positively associated with low levels of strategic integration. namely individualism and collectivism (see Purcell. Employee relations in greenfield sites A recurrent theme in the extant literature is the suggestion that firms locating at greenfield sites are likely to adopt an increasingly strategic and individualist focus in employee relations (Beaumont. the literature suggests that employee relations styles which equate to what has been termed “soft” HRM are characterised by high levels of strategic integration and high levels of individualism (Beaumont. from the fact that the imputed rationality. the evidence should be most obvious in greenfield sites. 1986). 1994). 1995. Brewster and Hegewisch. 1985. considered characteristic of Irish employee relations (Brewster. Based on this literature. 1987). McKersie. 1984. 1995. Based on the premise that greenfield sites allow managements considerable discretion when it comes to deciding on “appropriate” employee relations “styles”. Roche. 1996). 1994. 1994.. 1995. to trade unions (Beaumont. 1992. particularly. Such difficulties arise. which one needs to associate with the concept of strategy in order to observe and measure it in any concrete manner. Roche and Turner. Arguably. and. 1985. 1986. policies and practices. 1994. 1981. Kochan et al. 1985. 1984. 1986. 1985. a pervasive theme is that firms locating at greenfield sites are likely to adopt an increasingly individualist focus in employee relations (Beaumont.Employee Relations 20. Garbarino. Thus. Hillery. 1980. 1986. Foulkes. 1994. 1985. looking at the broader literature. 1985. it is possible to hypothesise that management styles in employee relations which incorporate high levels of individualism will be positively associated with high levels of strategic integration (see. This paper is based on a study of all greenfield site firms established in the manufacturing and internationally-traded services sectors in the Republic of . In particular. Beer et al. It is further argued that increased individualism presents a significant challenge to collectivism.. 1996). Drawing on such literature.
/ machinery Mechanical engineering: motor parts/vehicles other Rubber and plastics Textiles.Ireland in the period 1987-1992. Indeed. Table I outlines the principal activity and country of origin of the 53 greenfield firms studied and highlights the dominance of US-owned firms and “hightechnology” companies in the study population. The study excluded firms with less than 100 employees. Ireland is one of the most profitable foreign locations for US firms. The empirical aspect of the research was based on three inter-related and sequential components. achieving an average return on investment considerably higher than the European Union (EU) average. Its industrial structure is characterised by a heavy reliance on inward investment. Ireland is considered a particularly appropriate testing site for evaluating the impact of different explanatory factors on management approaches to employee relations. Greenfield establishments 1987-1992 by activity and country of origin . (2) statistical analysis of a questionnaire based survey completed by managerial respondents. namely: (1) qualitative interviews with senior management. The Strategic integration and employee relations 117 Irish Electrical and instrument engineering Office/data processing equip. (3) presentation and analysis of key research findings to three “expert” panels of actors in the employee relations arena. Greenfield sites were defined as “locations where an organisation establishes a new facility in a start up mode incorporating design of plant and recruitment of a new workforce”. particularly from the USA. clothing Food and drink Transport and communications Chemicals and pharmaceuticals Software Information/data processing services Paper. printing and publishing Other services Total US European Japan Other Total 1 0 0 0 0 3 2 2 0 1 0 1 1 11 6 6 1 1 1 0 0 0 1 6 5 0 0 27 2 0 2 2 1 0 0 0 1 0 0 0 0 8 1 3 0 1 1 0 0 0 0 0 0 0 0 6 0 0 0 0 1 0 0 0 0 0 0 0 0 1 10 9 3 4 4 3 2 2 2 7 5 1 1 53 Table I. This work was undertaken over a two year period from 1993-1995.
Kochan et al. However. collectivism and individualism Strategic decision-making is a notoriously difficult area for researchers to analyse accurately. • Role of personnel/employee relations function: assesses the incidence and role of a specialist personnel/employee relations function. 1994). 1994).. To achieve this goal. 1985. Kochan and Osterman. Such indicators are useful in so far as they lend themselves to empirical investigation.Employee Relations 20. This is a useful approach but requires the identification of an adequate range of robust indicators. a widespread acceptance of the legitimacy of a strong trade union role in society. measures of collectivism and individualism in employee relations are relatively well established (see. Purcell.. In contrast to strategic integration. Measures of strategic integration. Alternatively. Ireland’s employee relations system is characterised by constitutional support for the individual’s right to join associations or unions. Beaumont. . they are obviously limited in their ability to precisely measure the actual level of strategic integration in employee relations. 1994. Beaumont and Townley. Marchington. and the absence of any major political party advocating a diminished role for trade unions (Gunnigle et al.2 118 Irish socio-political context also provides a stark contrast to the USA and UK which is the source of much of the literature on contemporary developments in employee relations. for example. it is suggested that the study findings on strategic integration should be viewed as a broad guide rather than a precise measure of the extent and direction of strategic consideration afforded to employee relations issues in greenfield-site companies. 1993. Walton et al. 1985. 1994. The choice of variables and the construction of scales was heavily influenced by the theoretical literature on strategic integration in employee relations (see for example. Tyson et al. variables measuring a range of indicators regarded as indicative of strategic integration in employee relations were developed as follows: • Impact on location: assesses the impact of employee relations considerations on location decisions of greenfield-site facilities. Researchers often develop proxy indicators of strategic integration. Given these caveats. • Impact on business pol icy: measures the impact of personnel and employee relations considerations on business policy decisions at establishment level. particularly those focusing on the process of strategic decision making. A comprehensive set of measures of collectivism and individualism in employee relations is developed from the extant literature and summarised in Table II.. 1986. In particular. 1987). 1994. 1990. researchers may rely on qualitative/intuitive analyses.. • Formal strategy development: addresses the capacity to engage in business strategy and whether such capacity follows through into a capacity to formulate personnel and employee relations strategy. Roche and Turner.
65) was that measuring the impact of personnel and employee relations considerations on major business-policy decisions. nature and sophistication of management-employee communications Performance-related pay: measured through an analysis of the incidence of performancerelated pay systems and the utilisation of formal performance appraisals to aid performance-related pay decisions among manual/operative grades Employee involvement: measured through an analysis of the extent to which management utilises explicit techniques to facilitate employee involvement in decision-making Employee autonomy: measured through an analysis of the extent to which management seek to facilitate/promote employee autonomy Strategic integration and employee relations 119 • Measures of individualism • • • • • Table II. SD = 0.74. 1994).08. However. and whether such capacity facilitates a more specific capacity to engage in personnel and employee relations strategy (see Roche and Turner.69). corporate strategy and personnel/employee relations strategy.76)). SD = 0.87) was that measuring the incidence and role of the specialist personnel/employee relations function. The variable measuring the impact of employee relations on the decisions of where to locate a new . This variable measures the extent of sophistication in the development of formal mission statements. the lowest scoring variable (mean = 1. SD = 0. there is considerable variation in the four constituent measures which comprise the overall composite measure. Measures of collectivism These indicators were combined to construct overall composite measures of both collectivism and and individualism in individualism employee relations Findings The evidence from Table III suggests that levels of strategic integration in Irish greenfield sites are just below the mid point of the range with the composite indicator receiving a mean score of 1. and addresses the capacity of greenfield companies to engage in business strategy. The second highest scoring variable was that measuring the level of formal strategy development (mean = 2.Measures of collectivism • • • Trade union presence: measured through an analysis of levels of trade union recognition and trade union density Pattern of trade union organisation: measured though an examination of the nature of trade union recognition and impact of trade unions on workplace employee relations Role of trade unions and other employee representative bodies: measured though an examination of role of trade unions and other employee representative bodies in management-employee communications/interactions Employer association membership and utilisation: measured through an examination of the extent to which greenfield companies are in membership of employer associations and of the patterns of utilisation of employer association services Sophistication of the employment and socialisation system: measured through an evaluation of the degree of sophistication and relative emphasis on individualism in the management of human resource “flows” Communications: based on an analysis of the level.91 (SD = 0. The highest scoring indicator (mean = 2. In contrast.23.
SD = 0.2 120 Variables LOCAT IRINTEG IRIMPACT IRFUNC STRAT Variable description Measures impact of employee relations on location decision of greenfield site facility Measures sophistication in formal strategy development Measures impact of personnel/employee relations on business policy decision Measures role and impact of specialist personnel/employee relations function Composite measure of strategic integration based on a combination of the four variables outlined above (LOCAT + IRINTEG + IRIMPACT + IRFUNC) and minor re-coding to aggregate the scores on a low-mediumhigh scale (1-3) Mean Std./ low individ. integ.91 0. integ. Levels of strategic integration (scaled from low (1) to high (3))a 1.65 0.87.59 0. A number of important trends emerge from Table IV./ low individ.59). These summary tables address the two hypotheses outlined above concerning the relationship between strategic integration and the dimensions of individualism and collectivism. The standard deviation scores are quite high indicating considerable disparity in the levels of strategic integration in the study population. 3 (High) 6% (3) 0 Low strat. Individualism and strategic integration in employee relations 3 (High) 38% (20) 9% (5) .69 (N=4) Note: a Further details on the methods used to translate the study findings into reasonable indicators of strategic integration in employee relations management are outlined in Appendix 1 greenfield-site facility also scored below the average (mean=1.87 2./ high individ. integ.75 (N = 3) N/A 0. Alpha 1. Firstly. 2 (Medium) Table IV.74 2.88 (N = 5) Table III.Employee Relations 20. 9% (5) 9% (5) High strat. there appears to be a positive relationship between an individualist focus in employee relations Individualism 2 (Medium) 1 (Low) Strategic integration 1 (Low) 23% (12) Low strat.69 0.87 N/A 0. Dev. 6% (3) 0 High strat. The relationships between the study findings on strategic integration and levels of individualism and collectivism are outlined in Tables IV to VII below.08 1. integ.76 0./ high individ.23 0.
Measures of strategic integration locat irinteg irimpact irfunc Strat autohi 0.01.59*** prphi 0. 1986).48*** 0. 1981. All of the companies characterised by high levels of individualism in employee relations have either high or medium levels of strategic integration.47*** 0.44** 0.001.48*** 0. There was no evidence of a negative relationship between strategic integration and individualism in any of the 53 greenfield companies studied: as can be seen from Table IV there were no companies in the “high strategic integration/low individualism” or “low strategic integration-high individualism” categories. all of the companies characterised by high levels of strategic integration in employee relations have either high or medium levels of individualism.49*** 0.44* 0. This relationship is particularly strong when one considers the overall composite indicator (“strat”) and also the variable which measures the level of sophistication of the employment and socialisation system (“employhi”).36 (ns) 0.25 (ns) 0.31* Indiv.54*** 0.50*** 0.17 (ns) 0.. Kochan et al. ns = not significant Individualism axis Authohi = level of employee autonomy Briefi = level of employee briefing Employhi = sophistication of employment and socialisation system Involhi = level of employee involvement Prphi = incidence of individual performancerelated pay systems Indiv.38* 0.22 (ns) 0.63*** 0.26 (ns) 0. ***p = < 0. Similarly.32* Measures of individualism briefhi employhi involhi 0.41* 0.17 (ns) 0.58*** 0.49*** 0.26 (ns) 0. The research findings presented above strongly support this hypothesis.47*** 0.52*** 0.69*** 0. These findings clearly suggest that management styles which are . 1980. 0.67*** Strategic integration and employee relations 121 Notes: * = p < 0. Individualism and strategic integration: Bivariate correlations Strat = composite measure of level of strategic integration styles and levels of strategic integration. Table V outlines the strength of relationships between the overall (composite) and constituent indicators of individualism and strategic integration. There is a positive relationship between all measures of individualism and strategic integration.19 (ns) 0.05.57*** 0.53*** 0. Our first hypothesis suggested that management styles in employee relations which incorporate high levels of individualism will be positively associated with high levels of strategic integration (Foulkes. **p = < 0. = composite measure of individualism Strategic integration axis Locat = impact of employee relations on location Irinteg = level of formal strategy development Irimpact = impact of employee relations on business-policy decisions Irfunc = role of personnel/ER function Table V.
/ low collectivism Collectivism 2 (Medium) 3 (High) 9% (5) 13% (7) Low strat. as much of the literature suggests. The second hypothesis states that high levels of collectivism will be associated with low levels of strategic integration. Seven out of the total of ten companies characterised by high levels of strategic integration had low levels of collectivism. Similarly. there is a trend towards an increasing strategic focus in employee relations. medium and high levels of strategic integration. These findings indicate an extremely weak or a negative relationship between levels of strategic integration and collectivism.2 122 characterised by a strong strategic focus are also most likely to adopt a strong individualist focus and pay particular attention to the development of comprehensive employee relations systems and practices./ low collectivism 32% (17) 13% (7) High strat. Turning specifically to the links between collectivism and levels of strategic integration. This finding is also interesting insofar as it indicates that if. Table VI summarises the overall findings on the relationship between these two dimensions. Low. it is useful to look at the strength of the relationships between collectivism and strategic integration. This data helps to illustrate the strength and direction of the relationship between collectivism and levels of strategic integration in the greenfield-site companies studied. this is most likely to be associated with management styles characterised by low levels of collectivism and. Collectivism and strategic integration in employee relations 2 (Medium) 3 (High) 9% (5) 2% (1) . integ./ high collectivism Table VI. integ. low levels of trade union recognition and density. This finding suggests that where companies integrate employee relations considerations into strategic decisionmaking. Each company is located in the matrix in terms of both of these dimensions. As in our previous analysis. integ. The findings presented in Tables VI and VII clearly support this hypothesis. this may lead to increasingly individualist management styles in employee relations and a concomitant diminution in collectivism. only two of the 15 companies (13 per cent) characterised by high levels of collectivism in employee relations could be categorised as having high levels of strategic integration. medium and high levels of collectivism are tabulated with low.Employee Relations 20./ high collectivism 11% (6) 4% (2) High strat. integ. more particularly. Table VII outlines the relationship between the overall (composite) and constituent indicators of collectivism and strategic integration. There is a negative 1 (Low) Strategic integration 1 (Low) 6% (3) Low strat.
14 (ns) –0. McKersie and Hunter. ** = p < 0. such as workforce profile and business strategies (Beaumont. In particular.13 (ns) –0. Kochan et al.24 (ns) –0.16 (ns) –0. collectivism and individualism. There exists an extensive literature on explanatory factors impacting on variation in patterns of employee relations management.55*** –0.14 (ns) –0. Beaumont and Harris. 1986. Collectivism and strategic integration: bivariate correlations relationship between all measures of collectivism and strategic integration.9 (ns) –0.32* –0.20 (ns) –0. the greater the likelihood that this will be associated with individualist employee relations styles which exclude trade union recognition. the earlier discussion alluded to the importance of identifying the main factors explaining variations in the extent of strategic integration in employee relations.05. This finding confirms our earlier conclusions on the relationship between strategic integration and collectivism.17 (ns) –0.29 (ns) –0.38*** –0.07 (ns) –0. *** = p <0.17 (ns) Collect –0.. on the critical measure of trade union recognition and density (“presence”) we find a significant inverse relationship with almost all measures of strategic integration.Measures of strategic integration locat irinteg irimpact irfunc Strat presence –0. such as changes in product and labour markets. Explaining variations in strategic integration In addition to examining the management approaches to employee relations on the dimensions of strategic integration. 1995. ns = not significant Collectivism axis Strategic integration axis Presence = Trade union presence See Table V Unionorg = Patterns of trade union organisation Comm = Role of trade unions/other employee Emporg = Membership/utilisation of Collect = Composite measure of collectivism Table VII. 1973).46*** –0. A range of other factors have been advanced to explain .18 (ns) –0.01. and internal factors.43** –0. although the correlation coefficients are not significant in a number of cases.30* –0.41** Measures of collectivism unionorg comm emporg –0.14 (ns) –0.29* –0. Such factors included structural variables.09 (ns) –0.33* –0.001. 1985.33* Strategic integration and employee relations 123 Notes: * = p < 0. However.32* –0. it is evident that the greater the strategic consideration afforded to employee relations issues.
1993. technology. and that the actual styles chosen will closely reflect underlying managerial values associated with country of ownership (Beaumont. market share. Table VIII outlines the relationships between the independent variables and levels of strategic integration. Location in high-technology sectors has also been identified with more strategic approaches to employee relations. 1995. and vice versa. Whitaker. 1986. To evaluate the main explanatory factors impacting upon variations in levels of strategic integration in employee relations a range of independent variables was identified and constructed based on the extant literature (see. 1994. 1985. McMahon. (3) economic variables – labour costs. technology. Beaumont and Townley. and (5) ownership. activity. 1986. (2) sectoral variables – industrial sector. (4) market variables – market growth. for example. The main variables were grouped into five factors: (1) structural variables – size.2 124 variations in management styles in employee relations in greenfield sites. strategic integration was regressed on all the independent variables. level of product/service diversity.3**) on strategic integration was that measuring the location of a company’s main market(s). 1994). Roche and Turner. 1986). the greater the likelihood that it will adopt a strategic approach to employee relations. 1981a. namely: size. This finding suggests that the more international a company’s market is. labour costs. This is based on the rationale that revealed managerial preferences on management styles in employee relations will most significantly be exposed in greenfield sites.Employee Relations 20. Here we find that company size (beta = 0. even though a recent Irish study did not find any significant . In equation 1. performance. Beaumont and Harris. Kochan et al.36***). A factor considered particularly influential in explaining variations in employee relations styles is company ownership (Beaumont. level of technological complexity (beta = 0.27**) and US ownership (beta = 0. This finding is largely unsurprising and in line with the business strategy literature. 1985). 1986). The impact of size is not surprising and concurs with much of the “small-firm” literature which suggests that smaller firms afford little strategic consideration to employee relations issues (Curran. 1985. Poole. Rollinson. The only independent variable which had a significant negative impact (beta = –0. b. economic performance and ownership. Curran and Stanworth.47***) are positively related to strategic integration. 1994). A summary of the rationale for the selection of these variables and the methodology employed in their construction is presented in Appendix 2.. The objective of this analysis is to identify the factors which explain variation in levels of strategic integration in employee relations while controlling for factors such as sector. 1985. performance and sector (Beaumont. workforce profile. Turner.
09 (ns) 0.03 (ns) 0.16 (ns) –0.13 (ns) –0. ** = p < 0.30** –0.12 (ns) 0.19 (ns) –0.06 (ns) 0.06 (ns) –0.08 (ns) 0.18 (ns) 0.47** –0.00 (ns) 1.001.09 (ns) 0.16 (ns) 0.27** –0.05.04 (ns) –0.36** –0.00*** 0.10 (ns) –0.Dependent variable: strategic integration (standardised beta co-efficients reported) Independent variables Structural Size Manual Gender Temporary Sectoral Sector Activity Hi/Lo tech Economic Labcosts Perform Market Market Diverse Matrix Ownership US Irish European Constanta Collectivism Individualism R(2) F ratio N DW 0. Determinants of strategic integration in employee relations (OLS regression: stepwise method) Notes: * = p < 0.01.18 (ns) 0.02 (ns) –0.13 (ns) –0.50 14.12 (ns) 0.30 Equation 1 Equation 2 Strategic integration and employee relations 125 0.12 (ns) 0.22* (ns) 0.15 (ns) –0. The coefficient reported for the constant is the unstandardised coefficient (B) .0*** 53 2.01 (ns) 0.15 (ns) –0.67*** 0.16 (ns) 0.52 20. ns = not significant.8** 0.26** 0.14 (ns) 0. *** = p < 0.10 Table VIII. a Ownership was entered as a dummy variable with the Asian-coded companies taking the value of the constant.0*** 53 2.
However. it might be suggested that a management desire for more individualist and less collectivist styles leads to a greater strategic emphasis on developing policies and practices which help to develop and sustain this approach (Beer et al. accounting for 85 per cent of the reported variance in strategic integration. one must be somewhat circumspect in interpreting the significance of this finding. together with individualism and collectivism. namely. More in-depth qualitative research is required to investigate the precise nature of such relationships. Based on the qualitative data gathered in this study. strategic integration was regressed on all the independent variables. Walton. the most important implication of this finding is that companies adopting individualist employee relations styles are most likely to do so in a conscious and strategic vein. The only other independent variable exerting a significant impact on levels of strategic integration in equation 2 was sector. Leaving aside this important caveat. Equation 2 indicates that the most significant and positive influence on levels of strategic integration is individualism (beta = 0.2 126 relationship between market location and employee relations practices (Flood and Turner.Employee Relations 20. presence in the manufacturing sector was negatively associated with levels of strategic integration (beta = –0. In equation 2. What is perhaps more important.22*). 1987. The most common category of service-sector companies was that which comprised those in the information/data processing sector. however. . Fiorito et al. It may be that greater strategic consideration of employee relations leads to managements’ adopting more individualist employee relations styles. most particularly the use of performance-related pay systems based on individual performance appraisals among all employee grades. 1985). 1994). is the positive relationship between levels of strategic integration and individualism. 1980. While it is unclear as to the direction of causality. It is likely that the impact of the US-ownership dummy variable in equation 1 is replaced by individualism in equation 2.. this finding confirms our earlier conclusions on the positive relationship between levels of individualism and strategic integration. as only nine of the 53 greenfield companies operated in the services sector. 1984. These were typically non-union and adopted other “ideal-typical” characteristics of high individualism. Alternatively. It is also likely that the converse of this conclusion also holds. Companies in the services sector were characterised by low levels of collectivism and high or medium levels of individualism. since US companies are characterised by higher levels of individualism and strategic integration when compared with indigenous or other foreign-owned companies. It is difficult to conclude definitively on the direction of causality in the relationship between levels of individualism and strategic integration. Here.67***). Foulkes. that companies whose employee relations styles are more collectivist in character are also more likely to have developed these styles in a less strategic and more reactive fashion. it appears likely that the relationship between individualism and strategic integration as dimensions of management styles is an iterative and dynamic one..
Firstly. namely that management styles in employee relations which incorporate high levels of collectivism will be associated with low levels of strategic integration. 1981. The strongest relationship exists between strategic integration and individualism where there is a positive relationship between all measures of individualism and strategic integration.. To identify the nature of strategic integration in employee relations two specific hypotheses were tested as follows: H1: high levels of individualism will be positively associated with high levels of strategic integration.Conclusions This paper has attempted to examine the nature and extent of strategic integration in employee relations and its relationship to different managerial styles as a means of contributing to the debate on changing management approaches to employee relations. However. which suggests that management styles in employee relations which incorporate high levels of individualism will be positively associated with high levels of strategic integration (Foulkes. The major conclusions in relation to these hypotheses are as follows: (1) Levels of individualism are positively correlated with levels of strategic integration: the findings presented in this paper indicate a strong positive relationship between individualism and the integration of employee relations considerations into strategic decision-making. on the critical issue of trade union Strategic integration and employee relations 127 . a number of conclusions may be presented. it appears that levels of strategic integration in greenfield companies tend towards the middle of the range. and H2: high levels of collectivism will be associated with low levels of strategic integration. The strength of the inverse relationship between collectivism and strategic integration is not as pronounced. and vice versa. it is also clear that there are variations in the strength of relationships between strategic integration and levels of individualism and collectivism respectively. This evidence suggests that we can accept the first hypothesis outlined above. Kochan et al. These findings indicate that while there is some support for the second hypothesis outlined above. 1980. In addition to these conclusions. Based on the research evidence.05 level. the evidence is less convincing. These findings clearly indicate that management styles which incorporate a strong strategic focus are most likely to be associated with a distinct individualist employee relations orientation. although the relationship is weaker than in the previous hypothesis and is only significant at the 0. (2) Levels of collectivism are negatively correlated with levels of strategic integration: the study findings indicate that high levels of integration of employee relations considerations into strategic decisions are likely to be associated with low levels of collectivism in employee relations. 1986).
pp. New York. the preceding analysis indicates that company ownership and specifically US ownership is the most significant variable. (1993).B. Bolton Fifteen Years On: A Review and Analysis of Small Business Research in Britain. and Holt-Larsen. (1991). London. 31-8. This approach is based on the expectation that the actual employee relations styles chosen in greenfield sites reflect underlying managerial values associated with country of ownership (Beaumont. Beaumont. P. London. M. A. The Future of Employment Relations. in Salaman. B.B. 3. . Strategic integration was also positively associated with size.. P.B. P. 18 No. 1971–1986. In this study. “Trade Unions and HRM”.. International Journal of Human Resource Management. Industrial Relations Journal.B. Frances Pinter. P. Lawrence. NY. Beaumont. Curran.D. (1985). G.E. (1981a). 1986. H. P. 1985. and Townley. Brewster. Vol 8 No. pp. Beaumont. “Union recognition and declining union density in Britain” Industrial and Labor Relations Review. Curran. Beaumont. 14 No. Beer. (1995). pp. company ownership was used as a proxy variable to analyse the impact of managerial values on variations in management styles in employee relations.B. Whitaker. 15-9.). and Harris. Small Business Research Trust. Sage. C. Spector. C. “The US Human Resource Management Literature: A Review”. Routledge. “Management opposition to union organisation: researching the indicators”. 2.. 300–8. “Greenfield sites. (1986). London. Ed. “New plant work practices”. pp. new plants and work practices”. Beaumont. R. Beaumont and Townley. “HRM: The European dimension”. London. Beaumont. “The social dynamics of the small manufacturing enterprise”. P. Sage. Policy and Practice in European Human Resource Management: The Price Waterhouse Cranfield Survey. 1986). 1993.2 128 recognition and density there is a clear and significant inverse relationship with almost all measures of strategic integration. V. (1994). P. The only factor which impacted negatively on levels of strategic integration was market location in predominantly indigenous/local markets. London. In relation to explanatory factors. and Walton. Vol. References Beaumont. Brewster.R. Vol. D. 22 No. Human Resource Management: A Critical Text. positively impacting on levels of strategic integration. Ed. 5. Human Resource Management: Key Concepts and Skills. “Human resource management in Europe: evidence from ten countries”. 3 No. 1986. Vol. P. Personnel Review.. Human Resource Strategies. J. J.. The Free Press. 5.B.I. Managing Human Assets: The Groundbreaking Harvard Business School Program. 1985. (1985). pp. in Storey. 409-34. Brewster. and location in advanced industrial sectors. 141–58. 389-402. and Stanworth. 48 (April). (1992). In particular. (1984). London. J.. (Ed. B. P. (1994). R. and Hegewisch. Beaumont. (1992).B. C. (1986). Poole. The findings presented in this study clearly point to the significance of US ownership. (1995). Vol. Current Research in Management. Journal of Management Studies..Employee Relations 20. Open University/Sage. Routledge. it is apparent that US companies are most likely to avoid trade union recognition and also to adopt a more strategic and individualist approach to employee relations management. London. pp. 4. Vol.B. Employee Relations. J. in Hammond. Quinn-Mills.
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. Different Routes to Excellence. and McKersie. Alan. R. “Managerial strategy and employee relations: a case study of plant relocation”. Results were scored 0 and 1 and an overall measure of strategy integration was constructed by aggregating results on each indicator and scoring them on a 1-3 scale as follows: 1 (low: no formal strategy). Boston. Variable 3: Strategic impact: measures impact of personnel/employee relations (P/IR) considerations on business-policy decisions scored on a 1-3 scale as follows: 1 (low: P/IR considerations have little/no impact on business-policy decisions). and (v) translation of P/IR strategy into work programmes and deadlines for P/IR function. (iii) participation of senior P/IR specialist in top management team. pp. (1985). M. (iv) involvement of P/IR function in corporate strategy. March–April. Appendix 2.E.2 130 Schuster. M. Cutcher-Gershenfeld. 2 (medium: formal corporate strategy and mission statement but no written P/IR strategy). no/little involvement in strategy) and 3 (high: significant P/IR function. R. corporate strategy and P/IR strategy). Journal of Management Studies. 23 No. Vol.. 294-382. Human Resource Research Centre. Based on incidence of (i) formal mission statement. It was based on five key indicators: (i) incidence of specialist P/IR function. and 3 (high: employee relations considerations among the most significant factors impacting upon the location decision). pp. and 3 (high: formal mission statement. Tyson. pp. (ii) scale of P/IR function. J. 2 (medium: employee relations considerations one of number of factors significantly impacting on location decision).E. Variable 2: Formal strategy development: measures sophistication of formal strategy development. 77-84. 1986. (1994). Findings were coded on a 1–3 scale as follows: 1 (low: employee relations considerations not a significant factor impacting on location decision). “Models of co-operation and change in union settings”. N.B. • Manual: proportion of manual employee to total. Employee Relations (US) (Fall).E.Employee Relations 20. Variables used to construct measures of strategic integration Variable 1: Impact on location decision: measures impact of employee relations considerations on location and was constructed on basis of study findings on the critical factors impacting on location decision of greenfield facility. MA. S. 6. major role in top team and strategy development). “From control to commitment in the workplace”. and Doherty. Harvard Business School Press. Composite indicator of strategic integration: a composite measure of strategic integration was then developed based on a combination of the four variables outlined above and minor re-coding to aggregate the scores on a low-medium-high scale (1-3). Strategic Negotiations: A Theory and Change in Labor-Management Relations. R. • Gender: proportion of male employees to total. Walton.. • Temporary: proportion of employees in temporary employment relative to total. 2 (medium: P/IR considerations have considerable impact on business-policy decisions) and 3 (high: P/IR considerations have a significant impact on business-policy decisions). Each indicator was scored 0 and 1 and results aggregated to provide an overall measure on a 1-3 scale as follows: (low: no specialist P/IR function). 2 (medium: P/IR function but small scale. (1994). Appendix 1. Whitaker. Constructs of independent variables Structural variables: • Size: small (≤100 employees) versus “medium/large” (100 employees). Witcher. Cranfield University School of Management. and (iii) formal personnel/employee relations (P/IR) strategy. Harvard Business Review. (ii) formal corporate strategy. Walton. Variable 4: Personnel/employee relations (P/IR) function: measures the role of specialist P/IR function. 657-78. (1985).
• Labour costs: this variable was based on relative labour costs as a percentage of total costs. Textiles/Clothing. Ownership variables: Ownership was entered as a dummy variable in all equations with the Asian coded companies taking the value of the constant (the coefficient reported for the constant is the unstandardised coefficient β). Software. • Matrix: this variable is based on the portfolio analysis “matrix” model developed by the Boston Consulting Group which classifies establishment performance on two criteria. Market variables: • Market: this variable was based on whether the major market for the establishment’s products/services was either national/“local” or international. “medium technological complexity” or “high technological complexity”. • Activity: companies were divided into two industry groups: “Advanced” (Office/Data processing machinery. Economic variables: • Performance: this variable was based on an assessment of the establishment’s financial performance. namely market share and market growth. Strategic integration and employee relations 131 . • Technology: this variable was based on technological complexity of production or service process with companies classified as either “low technological complexity”. • Diverse: here companies were divided into two categories as follows: “core” (producing one main product or service) and “Diverse” (producing diverse range of products or services). Professional/Information services) and “Traditional” (Food/drink. electrical and instrument engineering. Chemical and Pharmaceuticals. Paper/Printing.Sectoral variables: • Sector: manufacturing versus service sector. Mechanical. Transport/other services).
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