Discovering Management: Human Resource Management

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Discovering Management:

Human Resource Management

Prof. Dr. Gudela Grote D-MTEC

ETH Zürich

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Human Resource Management (HRM)

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Definition:

HRM concerns the policies, practices, and systems that influence employees' behavior, attitudes, and performance.

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Goal:

HRM aims at applying human resources within organizations such that people succeed and organizational performance improves.

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A tragic

example of

effects of work on personal well-being

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Effects of Human Resource Management

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HRM-practices (especially job design and selection/ appraisal/training) better predict

company performance than R&D, QM, strategy and technology (West, 2001)

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Empowerment better predicts company

performance than technology-based management practices in the short- and long-term

(Patterson et al., 2004; Birdi et al., 2008)

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HRM-practices as cause and effect of company performance (Guest et al., 2003)

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Characteristics of HRM in successful companies

(Pfeffer & Veiga, 1999)

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Selective hiring

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Extensive training

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Self-managed teams and decentralization

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Reduction of status differences

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High compensation contingent on organizational performance

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Sharing information

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Employment security

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Characteristics of HRM in successful companies

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Selective hiring

§ 

Extensive training

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Sharing information

§ 

Employment security

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e.g. work samples/tests;

selection of predictors

Job analysis Job requirements

Planning

Selection of success criteria

Assessment and combination of success criteria

uation

Validity testing

Prototypical procedure in personnel selection

Assessment and combination of predictors

Decision about selection/

placement

Implementation

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Validity of different selection methods

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Personality dispositions

§  Cognitive ability tests ~ .5

§  General personality tests ~ .3

§  Graphology ~ .0

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Behavioral simulation

§  Work samples ~ .5

§  Assessment center ~ .55

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Biographical focus

§  CV/references ~ .2

§  Biographical questionnaire ~ .35

§  Structured interview ~ .45

§  Unstructured interview ~ .3

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Characteristics of HRM in successful companies

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Selective hiring

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Extensive training

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Sharing information

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Employment security

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Personnel development

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Systematic furthering of personal aptitude in relation to individual expectations and

organizational requirements

§  education/training

§  counselling/coaching

§  management by objectives

§  team development

§  job design

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Basic assumptions in personnel development

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Dynamic relationship between person and work:

person and work change continuously, requiring also continuous adaptation

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Adaptation can happen from the perspective of

„fit human to task“ and/or „fit task to human“

§  Define possible career paths: e.g., management versus technical career

§  Identify individual career needs: e.g., different types of career orientations

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Career orientations in Switzerland

(Swiss HR-Barometer, Grote & Staffelbach, 2012)

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Career orientations in Switzerland

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Characteristics of HRM in successful companies

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Selective hiring

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Extensive training

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Sharing information

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Employment security

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Core concept of job design:

Self-regulating teams

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Teams: several people who work together over a period of time to reach common goals and who share a sense of belonging together

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Self-regulation: individual and collective

autonomy in order to coordinate work processes and to cope with process variances and

uncertainties locally

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Prerequisites for good team work

§  Adequate common task

§  Complexity higher than individual competencies

§  Clear performance criteria

§  Collective decision competence

§  Shared goal orientation

§  Positive goal coupling

§  Goal transparency and feedback

§  Adequate group composition

§  Different perspectives on the task

§  Shared language

§  Development of group rules

§  Adequate group size

§  Support for team development (form, storm, norm, perform)

§  Handling conflicts between individual and collective autonomy

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Characteristics of HRM in successful companies

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Selective hiring

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Extensive training

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Sharing information

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Employment security

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In the past the question was: "How do I lead a company?"

Today it is: "How do we lead a company?"

For the future it will be: "How does a company lead itself?"

"Boundaryless, flattened, flexible, project-based and team-

based organizations that employ temporary, externalized and remote workers, whose tasks are more intellectual amd less routine and cannot be controlled and coordinated by structure or direct supervision, need mechanisms of coordination

through shared meaning systems and a shared sense of purpose" (Shamir, 1999)

Changing context for leadership

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Management of uncertainty as strategic and operational leadership function

Ø  Balance between

minimizing uncertainty, which creates stability, and coping with uncertainty, which creates flexibility

Flexibility

Central planning High standardization High level of automation

Little operative freedom Feedforward control

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New issues in leadership

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Leadership portfolios

§  In order to match different situational demands with adequate leadership behaviors, leaders must develop portfolios of styles and behaviors and understand

when to use which behavior.

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Shared leadership

§  Leadership involves different tasks that can be taken on by different team members and may shift between team members.

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Sharing different leadership functions in medical teams

(Künzle et al., 2010)

High performing teams (n=6) Low performing teams (n=6)

p<.05

(n.s)

0 0.5 1 1.5 2 2.5 3 3.5 4 4.5

Nurses Residents

(n.s)

Leadership (Mean rate per Minute)

0 0.5 1 1.5 2 2.5 3 3.5 4 4.5

Nurses Residents

Leadership (Mean rate per Minute)

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Characteristics of HRM in successful companies

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Selective hiring

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Extensive training

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Sharing information

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Employment security

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Pay is ...

… 

money

… 

compensation

… 

^reward

… 

incentive

… 

recognition

Ø 

Procedural and distributive justice of pay systems at least as important as absolute amount of own pay

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Performance-related pay

§  A part of the overall pay is determined on the basis of individual/group/company performance.

§  Increasing use

§  in the US more than in Europe

§  for managers more than for non-managerial employees

§  in larger companies more than in smaller companies

§  Critical voices become louder:

§  Is the rewarded behavior the desired behavior?

§  Danger of reducing intrinsic motivation

§  Conflict between individual and team performance

§  Pay schemes related to organizational performance tend

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Characteristics of HRM in successful companies

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Selective hiring

§ 

Extensive training

§ 

Sharing information

§ 

Employment security

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Characteristics of HRM in successful companies

§ 

Selective hiring

§ 

Extensive training

§ 

Sharing information

§ 

Employment security

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Employment relationship: Social exchange defined by legal and psychological contracts

Employment relationship

Employee

t + Goal achievement

Firm

$ + Goals

e.g. goal-orientation, loyalty

e.g. employability, job security

Employee

Firm

Legal contract

Psychological contract

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Flexible working: Any time, any place,

contract work, pay for performance

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Flexible working: Change from a

traditional to a new contract?

(Raeder & Grote, 2001)

Traditional contract New contract Job security /

Life-long employment Flexibility / Accepting insecurity Internal promotion Internal development

Specialization Goal / Performance orientation

Loyalty/

Identification Employability / Focus on own

competencies

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Psychological contracts in Switzerland

Mix of old and new contract

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Using the psychological contract to handle employment uncertainties

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Communicate and match reciprocal expectations and offers

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Support employability through training, job design, and systematic career management

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Distribute risks between organization and employee according to individual coping capabilities

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Characteristics of HRM in successful companies

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Selective hiring

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Extensive training

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Sharing information

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Employment security

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Beyond "rational choice": HRM-practices as expression of organizational culture

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Organizational culture implies

§  Assumptions about human nature (e.g., motivation, trust versus control)

§  Images of organizations (e.g., brain, machine, family)

§  Assumptions about how organizations work best (e.g., centralization versus decentralization)

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These assumptions strongly influence choices of HRM practices beyond and possibly even against empirical evidence.