New Perspectives on Human Resource Management (Routledge Revivals)

John Storey

• Publisher: Routledge
• Year: 2014
• Print ISBN: 9781138824614
• eBook ISBN: 9781317580454
• Topic: Business
• Subtopic: Business General
• Index: Business

The idea of human resource management has become topical and controversial. The term suggests that people in any organization are an asset to be upgraded and fully utilized rather than merely a variable cost to be minimized. This in turn implies that the way in which people are managed is a matter of crucial strategic concern.

Increased international competition has produced various initiatives world-wide for new approaches to management, in particular human resource management. This searching set of interpretations, first published in 1983, will be of interest to serious practitioners and students alike.

Chapter one

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Introduction: from personnel management to human resource management

John Storey

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It seems hard to deny that there is a highly charged atmosphere surrounding the discussion of management at the present time. Fuelled by such best-selling books as In Search of Excellence, The Change Masters and Iacocca, the cult of the manager appears, if anything, to have been never so entrenched. At the same time, the idea of ‘the management of change’ has come to assume a place which is part and parcel of the everyday job responsibility of the manager. It is no longer a special sub-routine only brought out for special occasions such as the opening of a new facility or a corporate merger. There would appear to be a plethora of initiatives, programmes and innovations of all kinds. From the financial and management pages and from such sources as IDS and IRS, examples assail us of moves to introduce total quality, to re-differentiate organizations into strategic business units, to enhance flexibility, to install performance-related pay, to institute novel forms of employment contract, and the launch is announced of many other such initiatives. The image is of restlessness and organizational innovation. The frequently heralded displacement, or at least modification, of bureaucracy as the dominant organizational form seems belatedly to be taking place.

One cannot help but be impressed by the widespread awareness among practitioners of such experimentation; meetings with managers at all levels even in conventional, mainstream organizations soon reveal the fact that current ‘flavours’ have permeated the managerial consciousness and imagination in a way that was never the case with, for example, OD, job enrichment, QWL and other much-vaunted ‘movements’ of previous decades which some critics cite as equivalents.

There is some prima facie evidence that in response to conditions of heightened competition and a range of other environmental changes, many if not most of the organizations which survived the severe recession of the early 1980s have initiated changes of one sort or another in order to improve their viability. These have included structural changes such as a move beyond divisionalisation into strategic business units (SBUs). The underlying idea here is to promote and exploit entrepreneurial behaviour. Hence, even in single-business and single-product organizations which have lent themselves to neither divisionalization nor SBUs, the cognate tendency has manifested itself in attempts to generate the idea that separate units, departments, areas or zones could and should be treated as if they were ‘mini-businesses’.

On the face of it these sorts of changes have been associated with, and possibly underpinned by, accompanying cultural changes. Notable here has been the attention given to in-company campaigns (usually steered by management consultants) to establish a culture of ‘total quality’ and to give renewed emphasis to customer-orientation, innovation, enterprise and competitiveness. Developments of this kind have given rise to, and in turn been fuelled by, an influential literature on ‘excellence’ and ‘corporate culture’.

For those interested in the management of the employment relationship, two questions immediately arise even from such a brief sketch of recent business initiatives. First, to what extent do they mark a paradigmatic break with a previously predominating form? Second, what association do they have with the way labour is managed?

The latter issue is considered first. Clearly, the battery of changes indicated above cannot, in themselves, be thought of as necessarily coterminous with the phrase ‘human resource management’ – no matter how widely that concept is stretched. But they might suggest a set of circumstances which impel senior managers who used to take little interest in ‘industrial relations’ (see Winkler 1974) to identify the people factor as peculiarly critical in successfully managing the transformations outlined. This may in part derive simply because respected sources continually emphasize the apparently trite message that ‘people are the key’ (to success). But prescription and exhortation rarely seem to have been influential in the past with British managers (witness the subject of training). In addition therefore, one has to look also to the kind of context which seemingly generates a more receptive climate for ideas which spell a change in direction. A classic example is the case of British Airways which, in the early 1980s, faced a dire situation and where the strategy chosen to achieve competitiveness – namely an enhanced form of customer-care – clearly depended critically upon the behaviour of employees at many points across the operation.

The dramatic turnaround of BA (though by no means solely attributable to its training programme) and the publicity given to similar cases, added another ingredient to the climate of change: a highly visible group of ‘role-models’. Of greater importance, however, has probably been the infiltration of these ideas into the not inconsiderable network of personal contacts at senior echelons of corporate Britain. ‘Significant others’ were beginning to treat the people question as crucial. But in what way?

A key tendency appears to be the increased emphasis that is being placed upon ‘individual’ as opposed to ‘collective’ relations. Accordingly, there is the recent upsurge of interest in direct forms of communication and involvement – often taking the form of team briefings, quality circles and the like. Commensurate with this are the developments in integrated reward systems, and the linking of remuneration to performance. The renewed interest in harmonization can also be seen as a logical extension of such initiatives. There is also some evidenceof new patterns of working – perhaps the most notable theme here being the attention given to various forms of flexibility. In a number of organizations these kinds of development are symbolized by the change in terminology from ‘industrial relations’ to ‘employee relations’ and from ‘personnel management’ to ‘human resource management’.

This notion of ‘human resource management’ has become very topical. As a set of interrelated practices with an ideological and philosophical underpinning, it appears to align closely with prevailing ideas of enterprise, and the freeing-up of managerial initiative. There is tremendous interest in the phenomenon from both practitioners and observers alike but, as yet, the literature has by no means caught up with the demand for knowledge. Knowledge, that is, both in the sense of ‘facts’ and informed analysis. There is a lacuna in theoretical and conceptual discussion (for example, on the meaning, distinctiveness and significance of HRM) and hard empirical data (e.g. on the extent of its application across organizations and its pervasiveness and impact in those organizations which profess to practise it). This book seeks to correct for the neglect of information on both fronts. It brings together some of the country’s foremost teachers and researchers on the management of personnel and industrial relations. They bring to bear a variety of disciplines (economics, sociology and psychology to name just the most basic) and a variety of perspectives (empirical, theoretical, practical and critical).

There is another distinctive feature to this book: the contributions herein are all British. Previously, nearly all of the available material on the topic was American and in consequence it was such corporations as IBM, Hewlett Packard, and General Motors which loomed large in most case-study discussion. Moreover, American perspectives differ and the language, assumptions, and so much else are at a sufficient distance from their British counterparts that it has been very difficult to make sensible interpretations of the relevance of this literature to the British and European employment scene. Thus, for example, the figure of one Irving Bluestone, the United Auto Workers’ Vice President, who cuts such a dash in many American accounts of ‘transformations’ to labour relations in the United States, would seem to have no counterpart in Britain. Despite the diversity in the stances taken by the contributors to this volume, none adopts quite the same kind of effusiveness which is often encountered in American commentaries and which strikes such a discordant note in the British context. There are of course certain instances where British literature appears to ape the prescriptive American style (see for example, Goldsmith and Clutterbuck 1984; Lessom 1986; Martin and Nicholls 1987) but, in the main, academics and practitioners alike tend to remain sceptical. And rightly so, for, despite certain undoubted similarities in particular practices, the British work context is very different and it is only sensible to expect that any ‘take-up’ of American-style/Japanese-style ‘human resource management’ will involve, at best, some considerable adaptation. It is the precise nature of this which has so far failed adequately to be considered.

The various chapters in this book examine the phenomenon of human resource management both in toto and in its various parts. Given that the intention was to promote a searching analysis of the concept, it was inevitable that certain contrasts and disagreements would emerge between the contributors. This is to be welcomed. The reader has the opportunity to engage with, and to assess, the topic at different levels ranging from the overview – as in Legge’s chapter – to the more specific, where the implications for practice in selection, appraisal, training and involvement are addressed. It would not be appropriate in this introductory chapter to attempt to ‘resolve’ aspects of the ensuing debate. The main strands are, however, pulled together in the concluding chapter. But it may be helpful here if a backcloth to the discussion, a framework and an overview of the contributions were to be sketched out. These then will be the aims of the remainder of this introduction.

The backcloth

Within the academic as opposed to the ‘managerial’ literature, there is – despite an earlier period of caution – an increasing recognition that something significant may be happening in the management of the employment relationship. The landmark and relatively sober contribution by Kochan, Katz and McKersie (1986) has charted and interpreted the changes in the United States, but as noted, there has, as yet, been no British equivalent. Debates have raged none the less about ‘the new industrial relations’ and about a possible shift from the management of collective relations to the management of human resources.

For some readers, of course, the term ‘human resource management’ can be expected to carry no particular connotation or convey any particular distinctive meaning when placed alongside such terms as ‘personnel management’, ‘employee relations’ or indeed simply ‘the management of people’. Yet, to an astonishing degree for an increasing number of managers and students of management, the term ‘human resource management’ – usually somewhat grandiloquently abbreviated into the capitalized ‘HRM’ – has recently come to take on a quite extraordinary significance. Whether to be applauded or derided, the concept has come to represent one of the most controversial signifiers in managerial debate in the 1980s. So much so indeed that, for example, even the house journal of the Institute of Personnel Management experienced a period of dispute over the proposal to change its title from ‘Personnel Management’ to ‘Human Resource Management’. The journal now carries, as a compromise solution, the subtitle ‘The Magazine for Human Resource Professionals’. The IPM has also sponsored a Chair at Strathclyde University, notably not in personnel management but in human resource management.

The term itself is in fact not new: one can find examples of its use nearly 40 years ago, especially in North America. But for many years the term carried no special significance and it tended to be used more or less interchangeably with a whole host of alternative formulations to signal what most would understand as personnel management. In the 1980s it has, however, come to denote a radically different philosophy and approach to the management of people at work – applicable alike to manual workers, staff and managerial grades. In its reworked usage it often purports to signal the interweaving of a number of elements which, in sum, demarcate it sharply from personnel management as commonly understood.

Arguably even 20 or 30 years ago, commentators using this term were wanting to signal the possibility of a more ‘sophisticated’ alternative approach to labour management. Hence what is different about the 1980s is not so much that the message itself has changed but that it is being received more seriously.

Personnel management has long been dogged by problems of credibility, marginality, ambiguity and a ‘trash-can’ labelling which has relegated it to a relatively disconnected set of duties – many of them tainted with a low-status ‘welfare’ connotation. The classic analysis of such power and credibility issues is to be found in Legge (1978) and she updates her analysis in Chapter 2 of this book. She raises the key question concerning whether HRM and personnel management are in fact so different after all when both are compared at the normative (i.e. ‘this is how the practice should be’) level.

For a brief interlude, a new era for personnel specialists seemed to have arrived in the 1970s when trade-union power had to be accommodated and a new body of employment legislation had to be absorbed. In the 1980s, however, employers have taken a relatively more relaxed attitude to both of these forces and personnel management has accordingly been re-exposed to traditional uncertainties. Purcell (1985), for example, raised doubts about the future survival of personnel at the corporate level. (He, in fact, records a major reappraisal of his thinking on this issue in Chapter 5 of this book.)

At this juncture, HRM might appear to offer timely salvation to a specialism which has been diagnosed as highly vulnerable. To use Tyson’s terminology, the ‘contracts manager’ – the collective bargaining expert whose skills were so valued in the 1970s – has come to seem a threatened species in the 1980s. The IPM is trying to reorientate the profession so that its members become identified not so much with trade-union relations and with ‘over-bureaucratic departments isolated from the main priorities of the business’ but instead they become associated with ‘positive images’ such as imaginative pay schemes, profit-sharing arrangements, flexibility and training, and management development. To a large extent, the IPM will be pushing against an open door with this campaign, for it is remarkable to encounter so many senior personnel practitioners today who profess to have ‘always believed’ that personnel work was really about training and development and the like. HRM now seems to promise a board-level or at the very least a senior-executive-level presence for the people-management specialist (M. Armstrong 1987; Miller 1987). But there still seems to be considerable uncertainty as to whether HRM represents a threat or an opportunity to personnel management (for example, see Torrington and Hall 1987). There remains contention about the extent to which personnel specialists are in control of, or can even influence the course of the phenomenon (Storey 1987a and b).

Each of these themes will be found to figure prominently in the ensuing chapters.

Concepts and frameworks

In spite of the flurry of activity noted above, the concept at the centre of it remains problematical. In stereotyped form it appears capable of making good each of the main shortcomings of personnel management. Thus, far from being marginalized, the human resource management function becomes recognized as a central business concern; its performance and delivery are integrated into line management; the aim shifts from merely securing compliance to the more ambitious one of winning commitment. The employee resource, therefore, becomes worth investing in, and training and development thus assume a higher profile. These initiatives are associated with, and maybe are even predicated upon, a tendency to shift from a collective orientation to the management of the workforce to an individualistic one. Accordingly, management looks for ‘flexibility’ and seeks to reward differential performance in a differential way. Communication of managerial objectives and aspirations takes on a whole new importance; it is not undertaken because the EEC, the government, the trade unions, or even a section of the workforce want it to be done, or because it sounds like a laudable and ‘fair’ thing to do, but because it is regarded as necessary if the workforce is to be effectively utilized. When trying to communicate, for example, managers are increasingly unwilling to submit to the erstwhile convention of transmitting messages via the trade unions. In sum, through a range of such mutually reinforcing initiatives, management may, it is thought, be able to effect a step-change in its dealings with employees.

The attribute of HRM which perhaps excites the most intense interest is that which allegedly locates HRM policy formulation firmly at the strategic level (Beer et al. 1985). But this raises the question as to whether the strategic link is a sine qua non of HRM. There has been considerable discussion of the concept of ‘strategic human resource management’ (e.g. Fombrun, Tichy, and Devanna 1984; Hendry and Pettigrew 1986; Foulkes 1986). By implication this would seemingly a...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Original Title Page
• Original Copyright Page
• Table of Contents
• List of tables
• List of figures
• List of contributors
• Preface
• Abbreviations
• 1 Introduction: from personnel management to human resource management
• 2 Human resource management: a critical analysis
• 3 Human resource management: its implications for industrial relations and trade unions
• 4 Human resource management and the personnel function
• 5 The impact of corporate strategy on human resource management
• 6 Selection and appraisal: reconstituting 'social relations'?
• 7 Corporate training strategies: the vital component?
• 8 Financial participation
• 9 Human resource management and changes in management control systems
• 10 Limits and possibilities for HRM in an age of management accountancy
• 11 Looking to the future
• Bibliography
• Index