Reality of Human Resource Management

I am very sorry to about the length of this essay. Someone who had supervision with you last term told me that the essay must be about 2000 words. It was only on Monday morning that I found out it should be about 1000 words. I have already worked on more than two third of this essay by then, so I thought it is silly to stop. I will follow the word limit next time, and try to be more concise with my points.

There are many ambiguities and controversies about the meaning of Human Resource Management (HRM). HRM, in a generic term, is the process of managing employment relationship (coordinating an organization's human resources, and getting the best work from each employee by providing the right incentives and job environment, to meet organizational goal). It is also argued that HRM is a relatively distinctive approach to manage employment relationship amongst a range of different approaches.

Storey (2001) explains that HRM "is a distinctive approach to employment management which seeks to achieve competitive advantage through the strategic deployment of a highly committed and capable workforce using an array of cultural, structural and personnel techniques. " (Storey 2001, p. 6) In any case, HRM stresses the importance of human resource. While technology and capital can be attained by various organizations to achieve certain level of competitiveness, it is people that make the real difference and give the uniqueness and the competitive advantage, or edge of organisations.

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This essay will outline the key features of HRM and discuss about the gaps between the rhetoric and reality of HRM. Before moving onto the main theme of this essay, brief history of the origins of HRM in the US and the driving forces for the emergence of HRM in the UK will be covered. The origins of HRM may "lie within employment practices associated with welfare capitalist employers in the United States during the 1930's. " (Beardwell, Holden and Claydon 2004, p17) Changes in government regulations and labour relations also contributed to its origin.

It can also be seen as "the Americanized version of 'Japanese' methods" of employment management (Storey and Sisson 1994, p. 15). By the early 1980's, HRM was well established in the US business structure. It was not until the 1980's that HRM gained recognition in the UK, when the conservative party came into power. Before this time, "British industrial relations were based on extensive collective bargaining between employers and trade unions. " (Gill 2004, p. 1) Written contracts, rules and formalised procedures were the conventional ways of managing industrial relations in the UK.

There were many driving forces which moved the UK's employment management toward HRM model. The reform of the trade unions, introduced in the 1980's by the conservative party, under Margaret Thatcher, discouraged national (multi-employer) bargaining and made strike actions more difficult to do. The recession during the 1980's forced employers to rethink their employee relation policies. The UK recession of early 1990's was the longest in post-war history, and affected both the manufacturing and the service sectors.

Unemployment rose to 2. 87 million in October 1992, and the impact of job losses was felt throughout the country (Beardwell, Holden and Claydon, 2004). Both technological advancements and globalization of businesses during that period have dramatically altered the basis of competition in many industries. The increasing competition, due to economic environmental changes, forced many British managers look for new employment management models to improve their organizations' competitiveness in the market.

What are the key features of HRM that makes it different from the previous labour management relations? Both the pre-1980's labour management relation in the UK and the new model HRM identify that allocation of right people at the right jobs is very important in integrating their practices to organizational goals. In this sense, some people argue that HRM is an "old wine in new bottle" (Gill, 2004), or a restatement of existing labour management relation. However, there are number of differences between these two models.

HRM, being more 'employee friendly model' assumes that it is the human resource which gives the competitive edge. Beliefs and assumptions of HRM states that the success of an organization in its final analysis depends on its human resource capability and commitment. Therefore, it has to be handled with great care and attentions. It emphasize on the maximization of individual skills and motivation through a consultation with the workforce. One of the main elements of HRM model concerns with strategies.

The strategic emphasis of the integration of HRM with the goals of organization is often seen as the defining feature of HRM. Because human resource is regarded as a valuable asset to be invested in, and not as a cost which needs minimizing, HR decisions are of strategic importance to an organization. There are two strategic approaches. One is concerned with the general position of HRM in organization and whether HRM has influential power over core activity of the business. It needs to be considered by top management in the formulation of total business strategies.

Another approach is more concerned with the way in which HRM provide motivation and commitment from the employee, such as better recruitment, better alignment of reward systems with performance and so on. Another key feature is based around the roles of line and general managers in HRM. Line managers are regarded as the crucial element in delivering HR practice (conduction briefing groups, TQM movement, newsletters, performance related pay scheme, keeping people informed about the company's activity, and so on).

If HRM is vital for the success of business, it must not be left for the personnel specialists alone to handle. In practice, "much of the drive for HRM came in fact, not from personnel specialists, but from the line and general managers (see the evidence in Storey 1992). " (Storey 2001, p. 7) Greater attention is paid to manage the managers in order to make sure that HRM practices are being carried out. Other feature of HRM is based around the key levers used in the enforcement of HRM.

Management of cooperate culture is regarded as a key to achieving flexibility, commitment, and harmonized work force, which are all desired by employers. Flexibility of organization can be achieved by changing the culture in such a way to remove restrictions of movement between the internal labour forces. Also changes in culture may encourage people to work as one team with unified views and objectives (unitary approach). "Committed employees would 'go the extra mile' in pursuit of customer service and organizational goals. " (Storey 2001, p.

8) Greater managerial control can be achieved by controlling the culture. However, managing culture is very difficult. It may even mean altering traditional views, attitude, beliefs and values of organization. Is there any evidence of rhetoric success of HRM? The Workplace Employee Relations Survey 1998 (WERS98) is a national survey of British workplaces. It"offers some recent and representative information about the extent of use of a number of HR practices and it contains some information about the strategic location of HR. " (Storey 2001, p.

10) The information can be used to examine the impact of HRM policies and practices on organizational outcome. WERS98 has shown that 68% of all managers said that they had strategic plan that included the development of employees. The increased flow of direct communication with the workforce was observed in all organization. 48% of all work places applied for the attainment of Investor in People standard (to measure the involvement of employee relations managers in the business planning), within which 67% of these companies were accredited. Performance appraisals were reported in 79% of all workplaces.

In general, empirical studies tend to show that individual elements of HR practices are used in organizations (Storey 2001). It seems as if the idea of HRM has permeated almost all organization. However, the actual implementation of the model is extremely complex which leads to discrepancy between the model and reality. Too many British companies appear to have pursued HRM innovations without a clear strategic view or an awareness of the complexities, resulting in limited progress and criticism of HRM. Many of those claiming an HR strategy failed to describe the content of that strategy (Marginson et al 1988).

HR is not taken as seriously as it should be in many companies, and this fact is reflected on lack of HR directors at board level (Marginson et al, 1998). Bit less than 30% of companies with 1000 or more employees have a specialist HR director (Marginson et al, 1998). "Interestingly, apart from an insistence on customer orientation, most companies failed to show much in the way of an integrated approach to employment management, and still less was there evidence of strategic integration with the corporate plan. " (Storey and Sisson 1994, p. 22)

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