‘HRM IS A STRATEGIC AND COHERENT APPROACH TO THE MANAGEMENT OF AN ORGANISATION’S MOST VALUED ASSETS’. DISCUSS.
OVERVIEW OF THE TOPIC
The discussion on the topic begins with definition/explanation of HRM and two useful models. Discussion proceeds with explanation of the aims of HRM, characteristics of HRM and concludes with the views of the group on HRM as a strategic and coherent approach to the management of the organizations’ most valuable asset.
Meaning of HRM
Human Resource Management (HRM) is the strategic and coherent approach to the management of organisation’s most valued assets - the people working there who individually and collectively contribute to the achievement of the objectives of the business. It could be described as employing people, developing their resources, utilizing, maintaining and compensating their services in tune with the job and organizational requirements. (Ahrm.org.uk) According to John Storey (1989) HRM can be regarded as a ‘set of interrelated policies with an ideological and philosophical underpinning’. He suggests four aspects that constitute the meaningful version of HRM:
A particular constellation of beliefs and assumptions;
A strategic thrust informing decisions about people management;
The central involvement of line managers;
Reliance upon a set of ‘levers’ to shape the employment relationship.
MODELS OF HRM
The Matching Model of HRM
One of the first explicit statements of the HRM concept was made by the Michigan School (Fombrun et al, 1984). They held that HR systems and the organization structure should be managed in a way that is congruent with organizational strategy; they further explained that there is a human resource cycle which consists of four generic processes or functions that are performed in all organizations. These are: 1. SELECTION – matching available human resources to jobs
2. APPRAISAL– performance management
3.REWARDS – ‘the reward system is one of the most under-utilized and mishandled managerial tools for driving organizational performance’; it must reward short- as well as long-term achievements, bearing in mind that ‘business must perform in the present to succeed in the future’;
4. DEVELOPMENT – developing high-quality employees.
b) The Harvard Model of HRM (from Beer et al, 1984)
This framework is based on the belief that the problems of historical personnel management can only be solved:
When general managers develop a viewpoint of how they wish to see employees involved in and developed by the enterprise, and of what HRM policies and practices may achieve those goals. Without either a central philosophy or a strategic vision – which can be provided only by general managers – HRM is likely to remain a set of independent activities, each guided by its own practice tradition.
Beer and his colleagues believed that ‘today, many pressures are demanding a broader, more comprehensive and more strategic perspective with regard to the organization’s human resources’. These pressures have created a need for: ‘A longer-term perspective in managing people and consideration of people as potential assets rather than merely a variable cost’. They were the first to underline the HRM tenet that it belongs to line managers. They also stated that: ‘human resource management involves all management decisions and action that affect the nature of the relationship between the organization and its employees – its human resources’.
The Harvard school suggested that HRM had two characteristic features: 1)
LINE MANAGERS- Accept more responsibility for ensuring the alignment of competitive strategy and personnel policies 2)
PERSONNEL MANAGERS/SPECIALISTS-Have the mission of setting policies that govern how personnel activities are developed and implemented in ways that make them more mutually reinforcing. The Harvard framework as modeled by Beer et al is shown in...
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