The Rise of HRM in the Last Two Decades of the Twentieth Century - Essay Example

INTRODUCTION HRM or Human Resource Management is the practice of managing people in organisations. This paper looks at the evolution of HRM over the last two decades of the last century and its practice before that. The contrast between the roles of HRM earlier and now is elucidated. It is a fact that as organisations has evolved over the years in response to changes in the environment, HRM as a practice has also evolved along with them. The paper tries to discuss the statement, “the rise of HRM in the last two decades of the twentieth century represents something new and very different from the dominant personnel management approach in earlier years” (Torrington, Hall and Taylor, 2008). According to the book from which the quote has been taken, this evolution is important “For some, particularly those whose focus of interest is on the management of collective relationships at work. A particular theme in their work is the contention that personnel management is essentially workforce centered, while HRM is resource centered” (Torrington et al, 2008). What this means is that whereas earlier approaches to people management like personnel management were employee focused and concentrated on the needs of the employees, HRM, in contrast, is the practice that is solely concerned with satisfying the needs of the management. The focus of this paper would be on examining this dichotomy between traditional personnel management and the newer version of HRM as it is practiced today. Thus, the effort of this writer would be to find the differences and common ground, if any, between the two forms of people management. DEFINING AND CONTRASTING PM AND HRM According to one definition, “Personnel management is most realistically seen as a series of activities enabling working man and his employing organisation to reach agreement about the nature and objectives of the employment relationship between them, and then to fulfill those agreements” (Torrington and Chapman 1979, p. 4). This definition makes it clear that the role of a personnel manager is to mediate between the employees and the management. And it is the case that in many cases, the personnel manager takes the side of the employees in this mediation effort. Similarly, a definition of HRM would mean that “Human resource management is a series of activities which: first enables working people and the organisation which uses their skills to agree about the objectives and nature of their working relationship and, secondly, ensures that the agreement is fulfilled” (Torrington, Hall and Taylor 2002, p. 13). As with any other field in management and the science surrounding its study, there are multiple interpretations of the themes that are explored throughout this paper. To explain Torrington’s definition, it would mean that both personnel management as well as HRM must perform a mediating role and the absence of commitment on either side of the contractual relationship would jeopardize the nature and the meaning of the contract. To explain further, if the management sees the employees as another resource and is not interested in their well being, personnel management becomes yet another function with no relevance to the well being of the employees. On the other hand, if the employees distrust the management and do not come out with their grievances, the role of the HR manager is diminished as well. As the author’s point out, “It is when employer and employee – or business and supplier of skills – accept that mutuality and reciprocal dependence that human resource management is exciting, centre stage and productive of business success” (Torrington et al, 2008). The point that is being made here is that both the parties to the contract, the employee as well as the employer have to stick to their sides of the bargain and ensure commitment to the task at hand. Only then would there be an effective role for the HR manager. Further, when one side is not honoring its side of the bargain, it is then that the HR manager steps in to resolve the difference. This can be due to a difference in perception by one of the parties relating to the nature of the contract or the obligations contained in them. While the topic sentence for this paper may give the impression that the current role of the HR manager is someone who puts the interests of the management ahead of the employees, it is the contention of this author that the proper role of the HR manager would be to mitigate the differences and account for proper performance of duties by both sides. Even the authors of the textbook that is the reference for this paper seem to accept the view point that though there are differences of definition and interpretation of the terms personnel management and HRM, the common thread that runs through them should be the mediating role that the HR manager must play. It is a fact that HRM has evolved beyond its welfare beginnings and is now focused on the employer side of the equation more than the employee side. However, for the proper discharge of duties and to keep the workforce happy, HRM and its practitioners ought to remember that they have a duty to take the middle ground in disputes and not necessarily echo the stance of the management. Of course, the current practitioners appear not to be paying heed to this dictum and what is happening is that the HR managers in many new economy companies are perceived to be an extension of management. EVOLUTION OF PM AND HRM As outlined above, this paper is in response to the topic about how Personnel Management and HR management have evolved beyond their welfare origins. To explore the evolution of Personnel management, it has been argued by Torrington et al that this practice had three themes around its development. They are the themes of social justice, humane bureaucracy and negotiated consent. In contrast, the practice of HRM has evolved with a view towards staffing objectives, performance objectives, and change management objectives among other things. If we take each of these themes in turn, we get a good idea of the way in which the practice of the PM and HRM functions have changed over the years. For instance, Personnel Management was initially seen as a way to provide for social justice for the workers who were working in abysmal conditions. This was in the late 19th century and early 20th century. The early practitioners of HRM saw themselves as crusaders for the cause of the workers. Contrast this with the knowledge workers of today who view HRM as essentially a practice for pay and perks and one gets an idea of how much the world of PM and HRM have changed over the years. HRM’s origins as a welfare provider changed significantly with the second phase that dealt with the emergence of the concept of “humane bureaucracy”. This was in response to the challenge of expanding organisations that needed a bureaucratic structure as well as a humane approach towards solving the problems of the employees. Hence the Personnel Manager was seen as a person who could intervene on behalf of the workers with the management and initiate processes for redressing their grievances. If we contrast with the current practice of HR managers being policy wonks and ensuring that organisational procedures and policies are enforced, it is clear that PM and HRM have indeed evolved significantly from their origins to that of a managerial function rather than a welfare function. It must be noted that the ideal practice would be for the HR managers to facilitate rather than enforce the policies. This is the view that I have taken throughout this paper and this is something that needs to be considered for any meaningful discussion on the role of HRM in organisations. FUTURE TRENDS IN HRM The introduction of IT and computers in the workplace has added a new dimension to the role of the HR manager. It is easier for potential employees to compare and contrast the perks and emoluments that are being offered by different companies. This ensures that the information is up to date with the prospective employees as well as the employers. With the workforce in many organizations being international in nature and the profile of the workforce tending to be younger, significant challenges are posed to the function of the HR manager. First, it means that practices continually have to be developed which have the effect of enhancing an organisation’s competitive position. Ways need to be found of improving quality and of bringing to market attractive new products and services, while at the same time ensuring that the organisation remains competitive in terms of its cost base. Second, it means that a good deal of volatility is the norm and that change, often of a profound nature, is something that people working in organizations must expect and be ready for. So a capacity for organisational flexibility has become central to the achievement and maintenance of competitive advantage. Third, there are direct practical outcomes. For example, HR managers have to learn how to manage an international workforce effectively and how best to attract, retain and develop and motivate people with those relatively scarce skills that are essential if an organisation is effectively to harness and deploy evolving technologies. Flexibility has become central to the achievement and maintenance of competitive advantage. Third, there are direct practical outcomes. For example, HR managers have to learn how to manage an international workforce effectively and how best to attract, retain and develop and motivate people with those relatively scarce skills that are essential if an organisation is effectively to harness and deploy evolving technologies (Torrington et al, 2008) It is evident that HRM needs to evolve further in response to the trends that are shaping organisations. One area of further improvement would be the practice of variable pay and hiring practices. In many IT organisations, hiring is need driven and there is no comprehensive policy in place to address resource requirements. This ad hoc process leads to a situation where the fit between the resources and the requirements for the roles is often blurred that endangers the professional practice of work. Further, there are instances of variable pay being given out in an arbitrary manner leading to much heartburn in the organisation. It is often argued that with the evolution of the HRM in the late 20th and early 21st centuries, it has led to a situation where the role of the HR manager is diminished and he or she becomes an appendage of management with no real autonomy and decision making powers. It is precisely this tendency that the practitioners of HRM must guard against if they have to stay relevant and contribute their bit to the organisation. The topic sentence that expressed the statement that the HR practice has moved away from its welfare beginnings has to be seen in this context. To conclude this section, one needs to understand that we are living in a world where the nature of work itself is changing and the concept of virtual office as well as working from home have redefined the way in which work is done and carried out. Thus, one needs to have a proper perspective on the changing roles of the employees as well as the trend towards open door management that increases the role of the HR manager rather than diminishing it. CONCLUSION This paper has looked at the themes of how Personnel Management and HR management have changed over the years. The focus of this paper has been on the aspect of personnel management that has evolved from being that of a provider of social justice to the workers to a sophisticated version that takes into account the multifaceted needs of the employees as well as the employers. In discussing how personnel management has evolved, the paper has argued that even in the latest version of the HR management where the practice is perceived to be an extension of the management, there is scope for genuine articulation of the grievances of the employees and as the authors of the textbook have pointed out, the scope for meaningful participation by both the sides is contingent upon them honoring their sides of the bargain. Before concluding the essay, I would like to point out the stand of the authors of the textbook. According to them, “This remains our philosophy. Only by satisfying the needs of the individual contributor will the business obtain the commitment to organisational objectives that is needed for organisational success, and only by contributing to organisational success will individuals be able to satisfy their personal employment needs. It is when employer and employee – or business and supplier of skills – accept that mutuality and reciprocal dependence that human resource management is exciting, centre stage and productive of business success. Where the employer is concerned with employees only as factors of production, personnel management is boring and a cost that will always be trimmed. Where employees have no trust in their employer and adopt an entirely instrumental orientation to their work, they will be fed up and will make ineffectual the work of any HR function” (Torrington et al, 2008). Sources Legge, K. (1989) ‘Human resource management: a critical analysis’, in J. Storey (ed.), New Perspectives on Human Resource Management. London: Routledge. Torrington, D.P. and Chapman, J.B. (1979) Personnel Management. Hemel Hempstead: Prentice Hall. Torrington, D.P., Hall, L.A. and Taylor, S. (2002) Human Resource Management (5th edition). Harlow: Pearson Education. Torrington, D.P., Hall, L.A. and Taylor, S. (2008) Human Resource Management (8th edition). Harlow: Pearson Education. Read More