Human resource management and Deming's continuous improvement concept Mitchell Langbert*
C.U.N.Y.-Brooklyn College, 140 Riverside Drive, # 16-K, New York, NY 10024, USA Received 1 August 1998; received in revised form 1 August 1999; accepted 1 February 2000
Abstract This article presents a loss minimization or continuous improvement model for human resource management (HRM). Minimization of losses arising from the interaction of two critical human resource (HR) quality targets, commitment and equity, requires `profound knowledge' of social processes and the development of HR systems. The history of HR can be interpreted as a social continuous improvement process that makes use of four systems approaches: trust, bureaucracy, unionization, and regulation. Variance-minimizing tools that were appropriate for earlier phases of HR history (characterized by higher levels of HR loss) may be too blunt for the level of commitment industry now demands. Enterprise or company unionism may be a preferable quality management tool, although the National Labor Relations Act inhibits its adoption. D 2000 Elsevier Science Inc. All rights reserved. Keywords: Human resource management; Continuous improvement model; Loss minimization
In this paper I show that the history of human resource management (HRM) can be interpreted as a continuous improvement or loss minimization process aimed at improving equity and commitment in the workplace. During the past 15 years, human resource (HR) scholars (Kochan et al., 1986; Schuler and Jackson, 1987; Ulrich, 1996) have emphasized that HR initiatives often play an important role in creating competitive advantage by targeting human and organizational capital at strategic goals. In contrast, I contend that throughout its history HRM has amounted to a quality improvement process aimed at minimizing social losses by integrating equity with other strategic objectives.1 * Corresponding author. Tel.: +1-212-595-2366. E-mail address: email@example.com (M. Langbert). 1 I thank an anonymous referee for pointing out that this theory depicts HR in a more risk-averse light than does the theory that HR creates strategic advantage. 1084-8568/00/$ ± see front matter D 2000 Elsevier Science Inc. All rights reserved. PII: S 1 0 8 4 - 8 5 6 8 ( 0 0 ) 0 0 0 1 4 - 6
M. Langbert / Journal of Quality Management 5 (2000) 85±101
There is no question that technological innovation and globalization have reemphasized the importance of matching HRM to strategic goals (Eaton and Voos, 1992; Huselid, 1995; Kleiner et al., 1987; Kochan et al., 1986). Firms need HRM to improve employees' selection, training, and motivation. Employees need HRM to help develop managerial and other marketable skills. Indeed, some firms now say that they intend to go even further in eliciting employees' participation in generating change and propelling continuous improvement. In effect, such firms would like to bridge two traditionally distinct roles. The first is that of the risk-taking entrepreneur, who absorbs uncertainty and so is entitled to profit, risk premiums, and rents. The second is that of the risk-averse employee, paid at a fixed rate, distinct from management and characterized by ``scarcity-consciousness'' (Knight, 1933; Perlman, 1928). Such firms have begun to bridge the two roles through a range of high-performance strategies that Heckscher (1988) has called managerialism. But to energize managerial HR strategies, firms must first instill a sense that they are worthy of employees' commitment. That is, in order to elicit commitment, firms need to convince employees that they are fair. Without providing the requisite sense of equity among employees, policies that aim at co-entrepreneurship may tend to give birth to the reverse instead: cynicism and alienation. My claim is that over the past two centuries firms have improved considerably in their ability to generate...