On the Interface between Operations and Human Resources Management

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Commissioned Paper
On the Interface Between Operations and
Human Resources Management
John Boudreau • Wallace Hopp • John O. McClain • L. Joseph Thomas ILR Human Resource Studies, Cornell University, Ithaca, New York 14853 IEMS Department, Northwestern University, Evanston, Illinois 60208 Johnson School of Management, Cornell University, Ithaca, New York 14853 Johnson School of Management, Cornell University, Ithaca, New York 14853 jwb6@cornell.edu • hopp@northwestern.edu • jom1@cornell.edu • ljt3@cornell.edu

O

perations management (OM) and human resources management (HRM) historically have been very separate fields. In practice, operations managers and human resource managers interact primarily on administrative issues regarding payroll and other matters. In academia, the two subjects are studied by separate communities of scholars publishing in disjoint sets of journals, drawing on mostly separate disciplinary foundations. Yet, operations and human resources are intimately related at a fundamental level. Operations are the context that often explains or moderates the effects of human resource activities such as pay, training, communications, and staffing. Human responses to OM systems often explain variations or anomalies that would otherwise be treated as randomness or error variance in traditional operations research models. In this paper, we probe the interface between operations and human resources by examining how human considerations affect classical OM results and how operational considerations affect classical HRM results. We then propose a unifying framework for identifying new research opportunities at the intersection of the two fields.

( Multidisciplinary; Cross-Training; Work Design; Scheduling; Low Inventory; Behavioral Science; Motivation; Turnover; Worker Performance; Worker Attitude )

1.

Introduction

The fields of operations management (OM) and
human resources management (HRM) have a long
history of separateness. In industry, it has been
rare for an operations manager to become a human
resources manager, or vice versa. In academia, the
two subjects have been studied by essentially separate communities of scholars who publish in nearly disjoint sets of journals. Despite this, operations and
human resources are intimately tied to one another
in virtually all business environments. Recognizing
this fact opens many opportunities for major improvements in both research and practice. 1523-4614/03/0503/0179$05.00
1526-5498 electronic ISSN

For example, consider the case of a Big Three auto
company power-train facility with a history of poor
budget performance and low efficiency. In spite of a
high-profile corporate emphasis on lean manufacturing and the best efforts of the company’s lean engineers and six-sigma black belts, the plant continued to underperform until 2001, when a new plant manager

took over. Immediately recognizing that the primary
cost driver was throughput (failure to make production quota during regular time required expensive overtime), he zeroed in on the largest source of output loss, blocking and starving in the line (traditional OM topics). But, because he knew that the majority

Manufacturing & Service Operations Management © 2003 INFORMS Vol. 5, No. 3, Summer 2003, pp. 179–202

BOUDREAU, HOPP, MCCLAIN, AND THOMAS
Operations and Human Resources Management

of stoppages were due to people-induced disruptions,
the new manager eschewed the traditional OM focus
on equipment-induced causes and worked instead
to involve operators in the problem solving process
(a traditional HRM topic).
Several months were spent educating the workforce
on the drivers of performance (e.g., the importance of
bottlenecks) and setting up mechanisms for formally
recognizing people for their successes (in nonmonetary ways, because this was a union facility). In less than a year, the plant was transformed into one of
the best performers in the company, despite a down...
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