Models of HRM

Models of HRM

'Storey (1989) has distinguished between hard and soft forms of HRM, typified by the Michigan and Harvard models respectively.

'Hard' HRM focuses on the resource side of human resources. It emphasizes costs in the form of 'headcounts' and places control firmly in the hands of management. Their role is to manage numbers effectively, keeping the workforce closely matched with requirements in terms of both bodies and behavior.

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'Soft' HRM, on the other hand, stresses the 'human' aspects of HRM. Its concerns are with communication and motivation. People are led rather than managed. They are involved in determining and realizing strategic objectives.

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The modern view of human resource management first gained prominence in 1981 with its introduction on the prestigious MBA course at Harvard Business School. Simultaneously, other interpretations were being developed in Michigan and New York.

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Sparrow and Hiltrop (1994) picked out four main approaches from this period:

• The Michigan and New York Schools: strategic matching theories

• The Harvard school: a multiple stakeholders theory • The Warwick School: a political and change process

theory • The Schuler School: a behavioural transformation

theory

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As some scholars argue, many companies employ both soft and hard models either at different times or for different groups of employees.

For instance, managers, core employees and skilled workers may be treated according to the soft model, and casual or unskilled workers according to the hard model.

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Budhwar and Debrah for instance identify five main models and analyze them. These are

i. The Matching modelii. The Harvard modeliii. The contextual modeliv. The 5-P modelv. The European model

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Matching model: This model highlights the resource aspect of HRM and emphasizes the efficient utilization of human resources to meet organizational objectives. It also emphasizes a ‘right fit’ between organizational strategy, organizational structure, and HRM systems.

Hard HRMA harder approach - people as human resources

A different view of HRM is associated with the Michigan Business School (Fombrun, Tichy and Devanna, 1984).

There are many similarities with the Harvard 'map' but the Michigan model has a harder, less humanistic edge, holding that employees are resources in the same way as any other business resource. People have to be managed in a similar manner to equipment and raw materials. They must be obtained as cheaply as possible, used sparingly, and developed and exploited as much as possible.

Contd..The Michigan model is also known as the 'matching

model' or 'best-fit' approach to human resource management. In essence, it requires that human resource strategies have a tight fit to the overall strategies of the business. As such, it limits the role of HR to a reactive, organizational function and under-emphasizes the importance of societal and other external factors.

For example, it is difficult to see how the current concern for work life balance could be integrated into this model.

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Fombrun et al identified four common HR processes performed in every organization:

Selection: matching people to jobsAppraisal of performance Rewards: emphasizing the real importance of

pay and other forms of compensation in achieving results

Development of skilled individuals

Contd..The matching model has attracted criticism. At a

conceptual level, it is seen to depend on a rational, mechanical form of organizational decision-making. In reality, strategies are often determined and operationalized on a more intuitive (sensitive, spontaneous) , political( biased, supportive) and subjective ( one sided, personal, individual) level. Certainly, the decision-making is more complex than the model allows. It is also both prescriptive and normative, implying that the fit to business strategy should determine HR strategy.

Harvard model

This model stresses the ‘ human’, soft aspect of HRM and is more concerned about with the employer-employee relationship. It highlights the following

• Situational factors• Stakeholder interests• HRM policy choices• HR outcomes• Long-term consequences

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Classifies inputs and outcomes at both organizational and societal level.

Absence of a coherent theoretical basis for measuring the relationship between HR inputs, outcomes and performance.

Contextual model

This model is based on the premise that organizations may follow a number of different pathways in order to achieve the same results. This is so mainly because of the existence of a number of linkages between external environmental context (socio-economic, technological, political-legal and competitive) contd….

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And internal organizational context (culture,. Structure, leadership, task technology and business output). These linkages contribute directly to forming the content of an organization’s HRM.

5-P model

This model (Schuler, 1992) consists five human resource activities

PhilosophiesPoliciesProgramsPractices andProcesses

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This model shows the inter-relatedness of these activities and explains their significance in achieving the organization’s needs.

European model

This model is based on the argument that European organizations are constrained at both international (European union) and national level by national culture and legislation. They are also constrained at the organizational level by patterns of ownership and at the HRM level by trade union involvement and consultative arrangements. These constraints need to be accommodated while forming a model of HRM

Internationalization of HRMThe management of human resources of a company

does not take place in vacuum and various factors inside and outside the company influence its shape and content.

One of the major external factors is the socio-cultural environment within which the company operates.

For a multinational company with business interest and activities in diffident parts of the world, this environment is all the more complex because of the sheer variety of it.

National culture

What is national culture and how does it affect employee management in general and HRM in particular?

Culture is a unclear concept as to its precise meaning and definition.

Culture has at at least two broad meanings, depending upon the context in which it is discussed.

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In anthropological and sociological terms culture refers to values and attitudes that people belonging to a given society hold.

Outside the academic world and in day-to-day life, culture is usually identified with the arts and literature, for example poetry, theatre, music, opera, painting and so on.

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Within its broader scope, management scholars have offered their own definition of national culture.

Hofstede, for instance, defined it as the collective programming of the mind based on a broad tendency to prefer certain state of affairs over others.

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Tayeb defined culture as historically evolved values, attitudes and meanings which are learned and shared by the members of a given community, and which influence their material and non-material way of life. From the definitions above it is clear that culture is different between nations.

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A nation’s culture or national character is shaped by historical geographical and philosophical factors. As each country has a different history, geography and philosophy so they have different cultures.

In management studies and any other aspects of human relations the recognition of cultural differences between different people is essential and helps to understand the motives and behavior of those with whom we interact.

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Culture is more often a source of conflict than of synergy. Cultural differences are a nuisance at best and often a disaster.“

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Why culture is important in international business

Doing business on a global basis requires a good understanding of different cultures.  What works in your country might not work well in another, and could even be interpreted as an insult!  And in your role as an international human resources professional, it’s important to raise the awareness of cultural issues within your organization to ensure effectiveness