114241 Topic 1 From Personnel to SHRM Role of HRM in NZ

7/29/2019 114241 Topic 1 From Personnel to SHRM Role of HRM in NZ

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S E M E S T E R O N E 2 0 1 3

M A N A W A T U C A M P U S

T H U R S D A Y 2 8 F E B R U A R Y 2 0 1 3

Topic 1: Personnel to SHRM.The role of HRM in NZ

114.241Managing Human Resources

Presented by Paul Toulson


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Overview of Presentation

What is HRM?

Historical development: Welfare Officer to SHRM Theories & Principles

Strategic HRM Horizontal and vertical fit

Best Fit vs Best Practice

The role of the HR manager

Challenges for HRM / HR managers


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What is HRM?

A management discipline: managing people

The effective and efficient management andproductive use of people through plans, processes &

policies in achieving the: organisations strategic business objectives, and

satisfaction of individual employee needs

Draws on a wide knowledge base

e.g. psychology, management, sociology& economics


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HRM System

HRM activities / practices Activities: Key functions of HRM Practices: Actions aimed at achieving a specific HRM purpose or

goal

HRM processes sequences of HRM practices combined to achieve more complex

outcomes e.g. the process for recruiting job applicants

HRM policies formal written statements outlining an organisations stance on

various HR activities, practices or processes e.g. the policy for managing a personal grievance

HRM procedures detail precisely what action is to be taken in a particular situation

e.g. the procedure for applying for annual leave


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Staffing the firmManaging / MaintainingEmployees

Human resource

planning Job analysis

Recruitment

Selection

Human resourcedevelopment

Managing performance

Employee motivation

Remuneration / reward

Health and safety (H&S) HR information systems

(HRIS)

Evaluating HRM

HRM Activities


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Contemporary Issues in HRM

International HRM Differences between domestic and Intl HRM strategies & activities Expatriate management; repatriation

Employee diversity Population demographics, labour supply, customer requirements

Workforce demographics Affects all areas of HRM planning, R&S, T&D, motivation, WLB etc Human Rights Act 1993

Health & Safety incl employee well-being, work-life balance

Workplace relations Prev. known as industrial relations / employee / employment relations Focuses on relationships within the workplace, but mainly between the

organisation and its employees Unions: represent collective employee voice


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A Brief History

Early influences Mid 1700s to late 1800s Industrial Revolution people as a resource; separation between

managers and employees

Welfare & Administration Late 1890s to mid 1900s Scientific Mgmt focus on job design, productivity, training Industrial Welfare early focus on employee welfare Then a movement from welfare to Personnel Administration

Contemporary HR Personnel Management (1960-1980) Human resource management (1980-1990)

Explosion of HRM and related theories

Strategic HRM (1990+)

(Armstrong, 1996; Torrington & Hall, 1995)


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Personnel Mgmt vs HRM

Personnel Management

1960-1980s

Human Resource Management

1980s-today

Tactical / Operational Strategic

Short Term Focus Long Term Focus

Piecemeal Approach

(no integration)

Integrated Approach

(horizontal and vertical fit)

Maintain status quo Encourages change and flexibility

Pluralist model (stakeholders) Unitarist (managerial prerogative)

Institutionalised Conflict

(refer conflict theories)

Teamwork and problem solving


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Main Theories

Open system model (pre 1980s) Functional view of HRM

Porters Model (Porter, 1985) HRM as a support activity for key areas of business CA resides in activities of the firm; people viewed as a cost

Matching (Michigan) Model (Fombrun et al, 1984) Acknowledged impact of external factors on internal context Advocated best fit approach to HRM

Harvard Model (Beer, 1984) Pluralistic - recognised different stakeholder interests

More sophisticated than earlier unitarist models Resource Based View (RBV; Penrose 1959 & Barney 1991) Gained prominence in late 1980s/early 1990s Employees seen as valuable, inimitable resources Central theory in the shift from HRM to SHRM

PersonnelMgmt

HRM

SHRM


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Figure 3: Porters Model of Competitive Advantage and Activities


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The Resource-Based View (RBV) ofHRM


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HRM underlying principles

Unitarist Employees interests are aligned with the organisations

Managerial prerogative can act in everybodys best interests

Neo-Unitarist Focuses on EE integration, engagement commitment

productivity

High Involvement / High Performance work systems (HI/HPWS)

Performance-related pay, profit sharing etc

Managers should create a common purpose and corporateculture

Promotes employee-employer relationship

ECA 1991 accelerated acceptance of this perspective; removedpower of unions (characterised by conflict-based approaches)


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Conflict Theories

Radical Pluralism Pluralism Unitarism

Conflict Inevitable under the

capitalism system of class

inequities

Unavoidable but can be

mediated through structures

and procedures.

Unwarranted and

pathological to the well-being

of the organisation

The state Protects the interests of

management

Provides the mechanisms to

resolve conflict in the interestof public good and stability

Resists interfering unduly in

the relationship between theemployer and employee

Management Exploits employees in the

interest of profit

Co-ordinates different and

divergent interest groups

Controls employees through

strong leadership

Employees Powerless and vulnerable

to exploitation

Stakeholders in the

organisation with the right tochallenge management

A resource unified to achieve

the organisations goals

Trade unions Inevitable as result of

exploited workers

protecting their own

interests

The legitimate representative

of the employees collective

interests

Unnecessary intrusion in the

individual employment

relationship.

Neo-unitarism


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Strategic HRM

Strategy

The direction in which an organisation intends to move

Drives operations

SHRM focuses on the linking of all HRM activities with the

organisation s strategic business objectives

provides a strategic framework to support long-term businessgoals and outcomes

HRM seen as critical to organisational effectiveness


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Strategic HRM

To achieve this, HRM needs to be... A strategic partner

Be involved at board / senior management level

Be involved in strategic decision making

Be able to demonstrate its contribution to organisation goals

HRM activities must... Be vertically aligned & clearly linked with organisations

strategic objectives

Support culture, climate, and organisational processes Be designed to attract, motivate, deploy and retain the right

people with the right skills at the right time to achieveorganisations goals and, ultimately, competitive advantage


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Horizontal & Vertical Fit

Horizontal (internal) fit HRM functions / activities are aligned with each other

Vertical fit HRM goals & activities are aligned with business goals

Challenge for contemporary HRM: to integrate afirms HRM practices and strategies into a coherentintegrated system (Macky 2008)

Both kinds of fit are necessary for firm performance,but require the capability of senior mgrs, HRmanagers, & employees

See Wei (2006)


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Best Fit vs Best Practice

Best Practice

Universal set of best practices that can ensure optimumperformance for all organisations (Delery & Doty, 1996)

However, no universal definition

Related concepts: high involvement, high commitment, orhigh performance work practices (Pfeffer, 1998)

Best Fit

Argues there is no one best set of practices

Superior performance depends on a number of factors (e.g.organisation strategy, environment, labour supply etc)


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Best Practice HRM?

HR planning... job analysis... recruitment & selection... Training & development Needs assessment for training; evaluation of training; planned career

development; management development

Performance management Use of 360` appraisals; links to employment decisions (e.g.

promotion, training needs; reward)

Employee motivation & retention Employee engagement; skills training;

use of work teams

HRM evaluation Use of quantitative and qualitative measures to

assess processes and outcomes


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Best Practice: Rhetoric or Reality?

Tends to vary by organisation size Large organisations are more likely to follow BP principles; SMEs

less so. Why?

Why dont organisations follow best practice principles? Uninformed - Employers may be unaware of the practices

Dont appear practical for SMEs Costly to implement, especially initially HR staff lack the clout to sell their ideas to the orgn Too busy focusing on short term objectives (profits) and managing

constant change to think and be strategic

Takes time requires employer & emplyee commitment & retention Some BPs are more appropriate to SMEs than others HR practices must be aligned with organisation context

sustainable fit

See Johnson (2000) & Klein (2004) NZ studies; Purcell (1999)


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Role of HR Manager

Primary role To help the organisation achieve its strategic goals/objectives

Storey, 1992; Caldwell2003)

Ulrich (1997) Ulrich (2005)

- Strategic partner Strategic partner

- Employee champion Employee advocate

Change Agent Change agent -

Regulator Administrative expert Functional expert

- - Human capital developer

- - Human resources leader

Advisor - -

Service Provider - -


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Ulrich (1997): 4 Roles of HR Professionals


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HR Managers view of their roles(Study by Caldwell, 2003 HR Mgrs in major UK companies)

Main roleModerately

impt role Minor role

Advisor 82% 13% 5%

Change Agent 68% 17% 14%

Service Provider 49% 26% 26%

Regulator 32% 38% 31%


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How HRM in NZ spends its time

Delivering HRservices, 29%

Administration,27%

StrategicActivities, 15%

ProcessImprovement,15%

Compliance/Auditing, 14%

Source: Mercer HR Consulting (NZ) (2007), cited in Rudman, R. (2010) p.43


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Challenges for HRM

Strategic focus vs functional/operational activities HR managers spend 60-80% admin vs 20% strategic activities

(Ulrich)

Achieving horizontal and vertical fit

Achieving recognition at board level Attracting, motivating and developing workers with

critical and scarce knowledge, skills & abilities

Creating a fair and just workplace

Managing people respectfully and creatively

Restoring trust lost through restructuring,downsizing and work pressures


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Challenges for HRM

Ethical issues Defining acceptable behaviour

Influencing employees personal lives

Monitoring / surveillance

Whose interests take precedence?

Evaluating HRs contribution Processes & outcomes

Has HR helped the org achieve its goals? Demonstrate how HRM activities contribute to sustainable CA

Some outcomes easier to measure than others examples?


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Challenges for HR Managers

Recognition and involvement in top managementteam & corporate planning

Gain and maintain credibility & professionalism Understand the business

Adopt a strategic approach

Become bottom-line oriented

Develop career as a professional training & development,networks, industry associations

Balance roles / competing demands and interests


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QUESTIONS

114241 Topic 1 From Personnel to SHRM Role of HRM in NZ

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