GROUP 9

Nguyễn Thị Nhung Ngô Thị Hường

Nguyễn Trường
Dương Thúy Quỳnh
Giang

Our contact: 2104000079@ms.hanu.edu.vn

Jeffrey Pfeffer

Producing sustainable competitive

advantage through the effective
management of people

Group 9 SHRM _ Presentation of assigned reading

Table of Content
Based on reading material

The Importance of Workforce and 04 Measurement of the Practices

01 How It is Managed

Thirteen Practices for Managing 05 Overarching Philosophy

02
People

03 Taking the Long View 06 Executive Commentary

 1. The Importance of Workforce and
How It is Managed
The text discusses the idea of achieving sustainable competitive advantage through the effective
management of people. It challenges traditional understanding, which often emphasizes industry
selection and market share as key factors in predicting the success of companies.

Firms seeing the workforce as a source of strategic advantage can

outperform competitors.
1. The Importance of Workforce
and How It is Managed
Example:
A historical example from 1972 to 1992, where companies in industries
characterized by massive competition and losses achieved the greatest
returns for stockholders. These successful firms, including Wal-Mart
and Southwest Airlines => did not rely on traditional factors like
technology or market share but instead on effective workforce
management.

Southwest's success is attributed to its productive, motivated, and

unionized workforce rather than factors like economies of scale or
proprietary technology => successful management practices related to
people are often less visible and transparent but can lead to sustained
advantages that are challenging for competitors to imitate.

The overall message is that companies should recognize the strategic

importance of their employees and focus on creating a work
environment that fosters loyalty, commitment, and high performance.
1. The Importance of Workforce and
How It is Managed

*Link with theory*

The text does align with the "best fit" approach in HR

management, which is associated with the Strategic
Human Resource Management (SHRM) perspective. So,
this approach suggests that there is no one-size-fits-all
HR strategy and that the HR practices should be tailored
to support the specific needs and goals of the
organization.

Employment security, selectivity in recruiting, and the

interrelated nature of effective management practices, all
contribute to the idea that HR strategies need to be aligned
with the broader strategic goals of the organization.
2. Thirteen Practices for
Managing People

Employment Selectivity in
Security Recruiting

Incentive Pay High Wages

Employee Information
Ownership Sharing
2. Thirteen Practices for
Managing People

Participation and Self-Managed

Empowerment Teams

Training and Skill Cross-utilization

Development and Cross-Training

Symbolic Wage
Egalitarianism Compression

Promotion from
within
 2. Thirteen Practices for Managing People
Employment Security
Security of employment signifies a long-
standing commitment by organizations to
their workforce, ensuring job stability.
Job security enhances employee involvement
Incentive Pay
Enhanced performance and profitability
responsibilities often lead employees to
seek a share in the benefits.
Selectivity in Recruiting
The deliberate and careful process of
choosing individuals during the
recruitment phase to ensure the right fit
for the organization.
Employee Ownership
Employee ownership provides dual
benefits - reducing conflict between
capital and labor and aligning the interests
of employees with shareholders.
High Wages
Higher wages attract more applicants,
signaling that the organization values its
people fostering increased dedication
and diligence.
Information Sharing
Employees need access to relevant
information, fostering success; reluctance to
share information with employees often
stems from a misconception, as competitors
likely already possess the information.
2. Thirteen Practices for
Managing People
Participation and Empowerment
Nordstrom's Philosophy: promoting Autonomy in Jobs: a key dimension of
autonomy, encouraging employees to jobs, shifts from hierarchical control to
present ideas, and emphasizing the use of empowering lower-level employees.
good judgment over additional rules.

Self-Managed Teams
Organizations implementing self-managed teams often see significant
improvements in profitability, safety, and cost reduction.

Training and Skill Development

Investing in the enhancement of employees' skills can lead to
positive outcomes for both the individuals and the organization.

Cross-utilization and Cross-Training

Cross-utilization: using
employees in different roles
or departments to fill in for
absent or overburdened
colleagues.
Cross-training: training
employees in different skills or
tasks so that they can perform
multiple roles within the
organization.
 Symbolic
Egalitarianism
Symbolic egalitarianism refers to the
practice of avoiding symbols that
distinguish among employees and
employers.
Egalitarianism enhance the
opportunities to know exactly what is
going on, diminishes "us" and "them"
thinking and provides sense of
everyone working toward common
goal.
Wage
Compression
A phenomenon where newly-hired,
less-experienced employees earn
close to what current employees
make.
Addressing pay compression can
ensure that employees are fairly
compensated for their skills and
experience, promoting morale,
retention, and overall business
success.
Promotion from
within
The availability of promotion
opportunities within the firm binds
workers to employers and vice versa.
Increase interest and satisfaction in
work, decentralization, participation,
encourage training and skills
development, tend to ensure that
managers actually know about the
business.
 3. Taking the
Long View
Organizations should take a long-term
perspective in business for achieving
competitive advantage. While quick
implementation of new technology can
provide short-term profits, a long-term
perspective is needed to sustain
competitiveness.
4. Measurement
of the Practices
Provide feedback as to how well the
organisation is implementing policies.
Ensures what is measured will be
noticed.
Measures affect behavior that most
people will try to succeed on the
measures even if there are no direct
consequences. Feedback from
measurement is essential to refine
and develop ideas as well as to know
the efficiencies of the practices.
 Definition
General set of beliefs that guide an individual, group or
organization in forming specific opinions and actions

Benefits

Provides coherence to individual practices

within an organization.
Highlights that practices without a deeper
understanding and alignment with
organizational principles may be ineffective
and struggle during difficulties.

5. Overarching Philosophy
6. Executive
Commentary

Japanese Perspective
European Perspective
Changing Human Resource
Practices
Linking Human Resources
Management with Strategy
 6. Executive Commentary
Insights from Toru Hatano, offering commentary on human resource management
practices in the context of Japanese and European corporations.
Reflection on Pfeffer's thirteen practices for managing people.
Emphasis on the significance of environmental and cultural factors.

Japanese Perspective European Perspective

Historical focus on growth and market
share. Adoption of Pfeffer's framework with a
Key advantages: efficient technologies and a trend toward self-management.
highly-educated workforce. Drivers include privatization, industry
Traditional management relies on cultural restructuring, and Western
norms and non-verbal communication. management practices.
Challenges from changing values among Crucial HR development practices,
younger workers prompt HR system especially during crises.
changes.
Restructuring involves business process
engineering and new management
practices.
 6. Executive Commentary
Changing Human Resource
Practices:
Shift in administrative practices,
decreased job security emphasis in
Europe.
Decline in recruiting attention amid
restructuring, necessitating selective
dehiring strategies.
Downsizing aligned with a vision of
future growth, leading to redesigned
processes and outsourcing.
Linking Human Resources
Management with Strategy
Growing emphasis on integrating HR
practices and strategy.
Strengthening management
development as a key method for
successful integration.
Continuous attention to HR
development crucial for a competitive
advantage.
 REFERENCES

Pfeffer, Jeffrey; Hatano, Toru; Santalainen, Timo

The Academy of Management Executive; Feb 1995; 9, 1;
ABI/INFORM Global
pg. 55

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