Tài liệu Corporate Reputations, Branding and People Management 20 docx

goals. The key problem for these people is how to build an organ- izational design and HR systems that allow managers to focus on strategic responsibilities and to attain simultaneously cost advantages, differentiation of their products and services and, increasingly, to leverage learning from one part of the organi- zation to another (see later discussion on developments in the architectural approach). In the field of strategy, the classical approach has been dominated by the military metaphor and by industrial economics. The translation of such strategic think- ing into the field of HRM, however, has been influenced by US industrial and organizational psychologists who have moved into business schools (Strauss, 2001). These psychologists have in common with their economics colleagues a belief in the power of rational choices and science to produce useful knowl- edge on HR principles. As a consequence, much of their writ- ing is heavily prescriptive rather than a description of how strategy and HRM relate to each other in practice. At its best, it can be very useful – witness the application of games theory to economics and management, which has helped two econo- mists win Nobel prizes (Economist, 2005b); at its worst it can be almost otherworldly, either because the messages are so simple as to not be worth recording, or because they are so compli- cated and written in such obscure jargon that few practitioners could be bothered reading them. The two schools of strategic HRM that best exemplify this tradition are the best practice and strategic fit schools and it is to these schools we now turn. Best practice HRM As Boxall and Purcell (2000) have argued, the ideas of best practice HRM have received most enthusiasm from American practitioners and academics. Best practice models come in three different guises (Wood, 1999). The first is high commit- ment management, developed by Walton (1985) and others to refer to a set of HR practices on job design, team working, problem solving and minimum status differentials which were associated with a managerial orientation of treating people as 174 Corporate Reputations, Branding and People Management assets rather than costs and aimed at securing commitment rather than compliance. The second, high involvement man- agement, is usually associated with the work of Lawler et al. (1998). It is broadly similar to high commitment management but with a greater emphasis on developing skills and knowledge and on paying people for performance and skills development. The third is high performance management or high performance work systems. The work of Huselid (1995) and Becker and Huselid (1998) is best known for attempting to demonstrate strong statistical links between HRM and financial outcomes. The focus of their work, which was conducted throughout the 1990s, is on the links between targeted performance manage- ment, work restructuring, skill development and contingent pay practices, and organizational performance, this time not working through attitudes and values but on how these practices directly influence behaviour. In the UK, David Guest’s writing (e.g. Guest, 1987) is best known for his beliefs in the superiority of high involvement HR and the importance of integrating HR systems into the broader business strategy of the organization. Another major study, by Patterson et al. (1997) in UK manufacturing industry linked the use of (a) the comprehensiveness of the selection, appraisal and development systems, (b) the extent of factors such as job flexibility and team working and (c) the use of quality improvement, high pay, performance-related pay and harmonized conditions of employment to positive changes in profitability and productivity over time. They also demon- strated the greater power of such HRM practices to affect these outcomes than changes in other practices, such as quality man- agement, the adoption of advanced manufacturing, R&D and strategy. Two of the most accessible and best-researched exemplars of this best practice tradition are by Jeffrey Pfeffer (1998), who wrote seven practices of successful organizations, and the UK- based, high performance work practices study (Sung and Ashton, 2005 – see Box 5.2). Turning to Pfeffer first, his second book became something of a standard introductory text on MBA courses in the US for a period of time. Rather controversially, however, Pfeffer’s work was (and remains) critical of US current practice and he frequently looked to Europe for inspiration. The Chapter 5 Four lenses on HR strategy and the employment relationship 175 recently up-dated list of best practices of high performing cultures are (Pfeffer, 2005): ■ Employment security ■ Selective recruiting for talent ■ Self-managed teams or team working ■ High pay contingent on company performance ■ Extensive training ■ Reduction of status differentials and the tall poppy syndrome ■ Shared information and the building of communities. The CIPD in the UK often sponsors such research to help practitioners learn from other companies, with one of the most recent attempts being the high performance work practices project, co-sponsored with the Department of Trade and Industry (see Box 5.2). This work has identified three sets or ‘bundles’ of practices that were related to positive outcomes, though these were found to be slightly industry-dependent (Sung and Ashton, 2005) and which is more resonant with the best fit approach discussed next. 176 Corporate Reputations, Branding and People Management Box 5.2 High performance work practices (HPWPs) in the UK This study was carried out for the CIPD and UK government’s Depart- ment of Trade and Industry on good HR practices (HPWP) employed in cases drawn from a sample of The Sunday Times 100 best companies to work for and a survey of 294 organizations facilitated by the CIPD. HPWPs were defined as a set of complementary practices covering three areas. In total, 35 HR work practices were allocated to so-called ‘bundles of practices’ on the following basis: ■ High employee involvement practices, e.g. self-directed teams, quality circles, sharing access to company information, continuous improvement teams, internal engagement surveys etc. ■ Human resource practices, e.g. sophisticated recruitment and selec- tion, competency assessment, induction, performance appraisal, coaching and mentoring, work re-design, etc. ■ Reward and commitment practices, different types of financial rewards, including performance pay for all or some, stock options, family-friendly practices, flexible hours, job rotation, etc. As we have noted, much of this literature has a good ground- ing in evidence-based practice. Furthermore, it is difficult to argue against the idea that there are some practices with near universal relevance from which most organizations would bene- fit, such as selective hiring of talent and training, and others that would be desirable under favourable conditions, such as guarantees of employment security (Boxall and Purcell, 2003). Such practices, though, deserve little more than a label of ‘prom- ising’ or good practice (the CIPD’s preferred term) rather than best practices, since context is very important in determining Chapter 5 Four lenses on HR strategy and the employment relationship 177 The key findings were: 1 The level of HPWP adoption, as measured by the crude number of practices adopted, is linked to organizational performance. This is especially true for the adoption of employee involvement in deliv- ering more effective training, motivating staff, managing change and careers, having more people earning in excess of £35 000 a year and fewer people earning less than £12 000 a year is also linked to organizational performance. 2 The cases illustrated a relationship between the objectives of the organization (its strategic goals), the industry sector it operated in, how product market strategy is used to achieve goals, and the range of HPWPs used. For example, innovative organizations used differ- ent bundles from others. 3 There was also some evidence that some bundles of practices worked better than others in generating specific outcomes, e.g. to enhance organizational competitiveness, reward and commitment practices seemed to fit better than others. 4 Different bundles of practices were associated with different sec- tors, e.g. financial services made more use of financial incentives, whereas manufacturing and business services with a more quality- oriented strategy made more use of high involvement practices. 5 Training and development was taken as a given, the ‘table stakes’, and not a differentiating factor. 6 Leadership was ‘crucial in creating, shaping and driving practices’; HPWP organizations tended to be leaders in their industry and to be consistently re-inventing practices to refresh themselves. Source: Based on Sung and Ashton, 2005 the success of practices, as the embedded systems perspective points out (Leseure et al., 2004). For example, the question has to be raised, ‘best practice in whose interests?’. Clearly, the answer to this will depend on whether you are asking employees who have experienced frequent layoffs in the past, managers whose bonuses and stock options are based on increasing share- holder value, as in the case of Enron, or on increasing employee identification with the business, as is increasingly the case in firms valuing their brands. It will also vary according to whether you value individualism, as is the case in the US and, to a lesser extent, the UK, or whether you value collectivism and high levels of employee representation in decision-making, as is currently the case in Germany and the Nordic countries. An equally damaging criticism of the best practice solution is the implied answer to the question, ‘if the medicine is so potent, why isn’t everyone taking it?’. The answer to this lies in the lack of competitive advantage in following the herd, which is the problem to which the ‘best fit’ school addresses itself. Best fit HRM Best fit approaches have tended to dominate the academic, rather than practitioner, literature on HRM, reflecting the port- folio planning/life cycle approaches in marketing during the 1970s and the competitive positioning work in the emerging field of strategy in the 1980s. Perhaps the best known of these best fit approaches was Schuler and Jackson’s (1987) attempt to locate appropriate HR strategies and their behavioural implica- tions in the competitive strategy framework developed by Porter (1985). This approach suggested that quite different bundles of HR practices would be relevant to the strategies of differentiation, focus and cost leadership. For example, encour- aging innovative behaviour in firms following a differentiation strategy would require distinctive motivational policies from those that invoked the kinds of behaviours required for cost reduction. However, best fit is not only concerned with this external fit between HR systems and strategy, but also with internal fit. 178 Corporate Reputations, Branding and People Management Internal fit comes in two varieties. The first is the degree of coher- ence among HR policies and practices themselves, to create pow- erful combinations and avoid deadly paradoxes. For example, in attempting to develop an external fit with the CSR agenda, a potentially deadly cocktail of HR practices would be team work- ing and rewards based on individualized, performance-related pay. The illustration of the bundles of practices in Box 5.2 is an attempt to map internal fit. The second kind of fit we shall exam- ine in a moment. Before doing so, let’s look at some of the criti- cisms of fit approaches. Schuler and Jackson’s work is still influential but, naturally enough, has suffered from the same criticisms levelled at Porter’s rather static, outside-in and either/or approach to strategy. Thus whilst few would claim that innovation and cost leadership require different role behaviours and HR policies, these tend to be a little more complicated than a simple reading-off exercise as implied by the Schuler and Jackson model. Using our frame- work in Figure 5.3, at least two lines of criticism can be made, which tend to apply to most strategic fit approaches. The first is that by locating HR policies and role behaviours in rather static models of competitive positioning, if followed to the letter, these are likely to become self-fulfilling prophecies. So, for example, if cost reduction HR strategies are followed, there is a possibility at least, if not the certainty, of creating a vicious circle that limits future innovation. First, vital knowledge resources may be made redundant (see the evolutionary, market perspective); second, the reputation of a firm as a good employer may be damaged, doing little for its ability to recruit in the future (Cascio, 2005). Nor are differentiation HR strategies without their negative con- sequences. For example, by increasing variance into the organi- zation through recruiting innovative people, some companies have found to their cost that it is difficult to establish control when the nature of the market changes. This was one of the prob- lems associated with Apple in the mid-1980s, though it is inter- esting to see how Stephen Jobs, the founder and originator of this policy, has had to re-invent Apple as a digital music producer to become a more creative company. It was also one of the causes of the demise of Enron: remember the approach to talent man- agement and rewards which, some would say, caused a culture of greedy individualism. Chapter 5 Four lenses on HR strategy and the employment relationship 179 As this last example shows, these kinds of models tend to neglect the changing nature of organizations, reflected in dynamic and reciprocal relationships between strategy and HR, and the dangers of confusing static ‘maps with territories’ (Weick, 2001). Devising and implementing HR strategies on the basis of crude maps, without regard for the subtleties and variations on the ground (e.g. different businesses within busi- nesses, variations among employee competences, desires, needs, etc.), can be a recipe for failure. It is for these reasons that more recent thinking on strategy and HRM has turned to ‘local’ segmentation or architectural approaches (Paauwe and Boselie, 2005), which we shall now explore in discussing the second type of internal fit. Segmentation approaches This second type of internal fit focuses on creating synergies between HR policies and practices themselves and between HR systems and other organizational systems. One of the most recent of these is the ‘architectural’ approach associated with some academics based at Cornell University’s well-known Center for Advanced Human Resource Studies (CAHRS). Though the ideas have been around for a long time in the labour economics and management literature on the flexible firm, the HR architecture approach (Lepak and Snell, 2002; Kang et al., 2003) is, perhaps, the most thorough of the best fit arguments for HR strategy and provides the intellectual basis for current practice in segmenting internal employee labour market (Huselid et al., 2005). This framework is based on the RBV discussed in Chapter 2 and on two central propositions. The first is that different kinds of human capital are more or less valuable to an organ- ization, e.g. people with specialist skills who have to be trained in an organizationally specific way of doing things versus people who may have specialist skills but these skills are not specific to the organization. The second is that managing human capital stocks (the supply to the firm) and flows (through a firm over time) is at the heart of everything an organization does. The architectural metaphor is used to connote a potential for 180 Corporate Reputations, Branding and People Management designing organizations by identifying bundles of HR practices, employment modes and employment relationships for different employee cohorts, based on the degree to which their human capital is strategically valuable to the organization. This is a bit of a mouthful, but can be summed up in three propositions: 1 The value and uniqueness of human capital to organ- izations differ, i.e. talent matters. Value refers to the ben- efits that such people can add over their costs to customers. So, for example, good HR people can cre- ate lots of added value if they can address the key stra- tegic drivers of the organization by contributing to external reputations and brands. Uniqueness refers to the idea that human capital is more or less firm- specific; organizations may have to make significant investments in recruiting, developing, engaging and retaining certain people while being able to secure the services of others on the open market, e.g. HR strat- egists and business partners who have an intimate knowledge of the business versus valuable, but general- ist HR consultants in selection, training and develop- ment, employment law, etc. 2 Cohorts of human capital can also be distinguished by their employment modes, which can be either inter- nally focused on a contract of service, or externally focused, usually on a contract for services. 3 Cohorts of human capital can also be distinguished according to the different psychological contracts with the organization. For the sake of simplicity, we can point to transactional versus relational contracts, discussed in Chapter 4. Combining these three dimensions and reworking the original model a little (see Figure 5.4), we can create a picture of seg- mented human capital in organizations fitting into at least four different modes, with different implications for reputations and branding: ■ Core knowledge/creative employees, who add high reputational value (e.g. senior managers, financial analysts and fund managers, senior design engineers, Chapter 5 Four lenses on HR strategy and the employment relationship 181 senior medical staff, etc.) have both uniqueness (high firm-specific talents) and create high added reputa- tion/brand value/celebrity status (or pose significant reputation/brand risk) to their organizations. They are also likely to be central to innovation, knowledge gener- ation and flows agenda. The typical employment rela- tionship is based on either relational or even ideological psychological contracts, high levels of organizational identification and strong individual – organizational linkages/trust relations. The mode of employment is internal, focused on a long-term career, job security and based on benefits that are likely to keep employees inside the organization and committed to its cause, such as stock options, continuous development, flexible ben- efits and working, and family-friendly policies, etc. It is mainly to such employees that organizations look to help them create (or avoid damaging) reputations and brands, and to whom they direct their employer of choice/employer branding policies and risk manage- ment efforts. ■ Compulsory, traditional human capital (e.g. mainten- ance workers, technicians, software engineers, mid- to low level managers, administrators, core operations employees, including new-style call centre sales staff, etc.). These people are similar to core employees because they are important for adding high value beyond their costs and enhancing reputation, but are not unique because the types of skills can be readily bought on the external labour market and transferred in from other organizations, nor are they central to innovation, knowledge generation and flows agenda. The employment relationship tends to be more trans- actional, with less emphasis on organizational identifi- cation, commitment and the need to invest in high trust relations, though the mode of employment is usually of a full-time contract of employment variety. The focus of rewards and relations is on short-term productivity, performance-related pay, with appraisal and development emphasizing short- and long-term results. 182 Corporate Reputations, Branding and People Management ■ Idiosyncratic human capital/alliance of business part- ners: these people have highly unique skills and, often, are important in bringing in new ideas; consequently, they are difficult to find on the open labour market. However, they are not consistently core to the reputa- tions and branding of the organization, e.g. certain kinds of HR professionals in recruitment and employment law, accountants, financial engineers, etc., though this idea may be changing as companies increasingly compete on the basis of leveraging partnerships or business ecosys- tems beyond the firm, e.g. Nike, Microsoft and Cisco. The employment relationship tends to become external- ized through high investment in building relationships with individuals in these functions across the business, but does not extend to investing in their skills/careers. Such employees are prime candidates for outsourcing, but usually as long-term strategic partners since they have unique talents. Examples, here, might include consultants, project managers, engineers and even aca- demics. Sometimes, such people are self-selecting, with careers that follow a highly idiosyncratic pattern, often in the form of portfolios of contracts, where they will work for more than one employer (Barley and Kunda, 2006). They tend to have a professional (cosmopolitan), rather than firm (local), orientation to careers. ■ Ancillary human capital/contract workers: in situations where human capital is not unique and creates less added-value, reputation capital or poses little reputa- tion risk to the core business, employees are increas- ingly employed on a contract for services basis, either through outsourcing or, if remaining on a contract of employment, on a strict basis of payment-for-work done. Work tends to be standardized, with little discre- tion and with performance management limited to ensuring that employees meet targets. There is little investment in human resource development beyond that which is essential to meet basic job and legal requirements. Such employees tend to be located in relatively low skilled, production, service or administra- tive roles, and are prime candidates for reductions in Chapter 5 Four lenses on HR strategy and the employment relationship 183 . industry-dependent (Sung and Ashton, 200 5) and which is more resonant with the best fit approach discussed next. 176 Corporate Reputations, Branding and People Management Box. managerial orientation of treating people as 174 Corporate Reputations, Branding and People Management assets rather than costs and aimed at securing commitment rather