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Investigating the use of Strategic Human Resource Management In French Small and Medium-sized Enterprises
Submitted To: Submitted By: Dr. Nilanjan Sengupta Yadav(69)
the data collected cannot reflect their complex reality. • Vertical fit was defended by several important strategic models : by Porter’s Model and by Miles and Snow’s Model. • Moreover. The study starts with describing how Traditional HRM function was in charge of primarily administrative management of human resources. . and the relationship between HRM and strategy as the combination of vertical fit and horizontal fit . Their interest to study French SMEs can be also justified by the French’s capacity for adapting and creating wealth. in order to increase firm’s economic and social performance. Thus. biases related to the collected data are weak compared to those of large companies. in SMEs the change of firms’ owners is less frequent than that of managers.S. SMEs had frequently one site of production and they are often very specialized. The main question to be addressed was: What is the place of SHRM practices in Small and Medium-sized Enterprises (SMEs) in France? France was chosen for the study because The French context could have been an interesting Counter example because it is marked by the legal constraints and the institutions. The author then talks about the Strategic paradigm change which defines how SHRM emerged through the change of strategic vision . controlling them to minimize their costs and how Partisans of SHRM disagreed with this vision. SHRM in small and medium-sized enterprises: SHRM supposes the construction of a coherent system of mobilizing HR practices which ensures the co-operation of employees through a higher implication level (in opposition to employees ‘control). However. Consequently. most often studied. the type of management applied is in general unified. The interest aroused in studying SMEs because: • Large companies can implement various HRM practices in the multiple units they control. • In addition. which facilitates and increases longitudinal research objectivity. Summary: The study attempted to understand the position of strategic human resources management in the small and medium-sized enterprises (SME) in France. in particular Unions and also because the authors considered that other countries could be a source of information to fill their gaps in knowledge in the U. The aim of the research was to respond to the calls of several authors to multiply HRM studies in SME and to enrich the knowledge about SHRM in another context than North America and large companies.B-13 KIAMS.
Five factorial axes were identified and three SMEs groups were distinguished. The expenditure devoted to training is too weak . This group is compounded of mixed strategic and administrative practices. which was conducted by DARE and BVA Institute by face to face talks with the leaders of the firms and a part of the employees and trade unions’ officials. in opposition to traditional HRM. training. These practices were strategic or administrative. Group 1 adopts Administrative HRM. However. SHRM practices like links with training or promotion. In this group. information and communication. In REPONSE the respondent was typically asked to identify whether a particular practice was in use. on a representative sample of 2978 French business-units of more than 20 employees in 1998. links with training. . wages (collective increases) and collective bonus. individual wage increases. • Administrative HRM practices contain a set of HR practices qualified as traditional by the theorists in SHRM: job description. like control and description of the tasks. practices like autonomy. control. participation as well as communication are very little developed in this group. Business units of this class make very little efforts for the development of their employees. annual talks. individual wage increases. The study attempted to improve the methodological weaknesses emerged during the process and provide us complementary elements necessary to the comprehension of the HRM in the small and medium-sized firms Methodology Adopted: The data were obtained from the REPONSE survey. These practices are also described as control practices or technical practices. Group 2 is Hybrid HRM. Group 3 is SHRM. and 2930 French business-units of the same size in 2005. A longitudinal sample was obtained by combining the data of both RESPONSE surveys of 1998 and 2005. profitsharing. On the other hand. Business units of this group use on one hand relevant practices of administrative HRM. • SHRM practices primarily composed of HRM activities qualified in literature as commitment practices or Human-Capital-Enhancing: autonomy. profit-sharing and information are more developed. links with promotion. HRM practices seem very little developed. collective wage increases and collective bonus. Business units of this group grant less individual increases and more collective ones. Now based on the Factor Analysis Method And Ward Method .The author chose the following definition of SHRM which he felt will try to analyze in the French context. participation. Several studies and works were carried out in order to analyse the SHRM practices and its impact on the organisation’s performance.
Two series of forces exist: those pushing in favour of change and those acting in favour of status quo because of their resistance to change. • • It was deduced that the SMEs companies need qualified and motivated employees to produce value and to have a competitive advantage. It was also observed that the organization’s choice of HRM practices depends on the coercive power exerted by its external actors and that choosing a flexible model as the SHRM is rather hesitant in France and raises an incremental change rather than radical. Individual discussion is a current practice in order to evaluate requirements in training and careers development.e. This can well be explained by the Kurt Lewin’s change interpretation model: Force Field Analysis: The change is no longer considerate as an event but as dynamic forces that balances acting in opposite directions. rather in an individualizing way. since it appears like a transitory cluster between administrative HRM and strategic HRM. SHRM is better established in the USA because the culture of American people is based on the notion of merit as vector of individual responsibility. • . Conversely.HRM practices of this group are particularly developed. administrative HRM practices recorded a clear decline). when companies would not have other choice. The most favourable periods to changes are those of weak growth and recession. because of contradiction between SHRM principals with cultural values of the French. Individual wage increases and profitsharing are also include. The result signifies that the hybrid HRM model is particularly important in the analysis of HRM practices in the French case. It implied that SME can also adopt flexible HRM practices. • • • Individualization of the wage and performance carried by SHRM model make it not easily applicable in some European companies. Work organization is very active and innovating and training activities are often committed. Another explanation concerns the hybridization of HRM practices which could also be resulting from a compromise between the various firm’s stakeholders. SHRM practices are more important to succeed in the case of SMEs subjected to strong environmental constraints. Finally based on the Descriptive analysis and the Explanatory factors the following results were deduced: • The result depicts a progression of strategic HRM practices and a regression of administrative HRM practices (i. It is perceived by employees like a threat to gains in terms of equity and justice which are symbolic for collective responsibility.
• Earlier Defender strategy was adopted and the research showed that the French are gradually moving towards or rather adapting the SHRM practices now. as per the analysis of HRM practices in the French case. some stable. Especially as HRM is often considered as informal in SMEs. others changing Successful imitation through extensive marketing surveillance Avid follower of change Growth normally occurs through market penetration Growth may also occur through product and market development Characteristics & behaviour: • • • • • Dual technology core. top managers watch their competitors closely for new ideas. 3. Which operate in two types of product-market domains. administrative HRM practices recorded a clear decline). these organizations operate routinely and efficiently through use of formalized structures and processes. • Another point that came up was that a Hybrid Model is universally being adopted by most of the French SME s . applied research. one relatively stable. and production Planning is both intensive and comprehensive Structure is matrix. must be able to trade off efficiency and effectiveness . the others changing. Analyzers are organizations 1. In their stable areas. and then rapidly adopt those which appear to be the most promising. functional and product Control difficult. In their more turbulent areas. the model signifies that the French are more keen towards being Analysers. Basic strategy set: • • • • • A mixture of products and markets. Miles and Snow’s Typology Based on Miles and Snow’s Model Analyzers tends to fit in the best.e. The result goes in the same direction as the research showed incidence of SHRM practices on firms’ performances. implementation of SHRM practices in some SMEs is a considerable contribution to the comprehension of HRM in SMEs. It implied that SME can also adopt flexible HRM practices.• Finally. moderate efficiency Dominant coalition is marketing. Justification: The result depicts a progression of strategic HRM practices and a regression of administrative HRM practices (i. 2.
strategies of differentiation.Coordination is both simple and complex Managerial is dual efficiency versus past. because of contradiction between SHRM principals with cultural values of the French. Another explanation concerns the hybridization of HRM practices which could also be resulting from a compromise between the various firm’s stakeholders.e. of costs and of focus. the French can be best related to the Strategy of Focus. Hybrid HRM Model is a system of “hybrid” HRM which draws from both HRM systems carried by companies whose strategy is based on differentiation or lowers costs. effectiveness versus similar organizations • • Justification: • The result signified that the Hybrid HRM Model is particularly important in the analysis of HRM practices in the French case. a system of “hybrid” HRM which draws from both HRM systems carried by companies whose strategy is based on differentiation or lowers costs. • **Based on Porters Model out of the 3 strategies i. since it appears like a transitory cluster between administrative HRM and strategic HRM. This type of company will be inclined to favour. . • It was also observed that the organization’s choice of HRM practices depends on the coercive power exerted by its external actors and that choosing a flexible model as the SHRM is rather hesitant in France and raises an incremental change rather than radical. The company which pursues a strategy of focus will adopt an intermediate model which mixes the assets of the two preceding strategies.