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alignment, management
51
David Baker
Pro-Vice-Chancellor, Academic Infrastructure and Human Resources,
University of East Anglia, Norwich, UK
Performance, Strategy
Abstract This article looks at current trends in human resource management (HRM) and the
relatively new concept of strategic HRM (SHRM) with special reference to the United Kingdom
(UK) Higher Education (HE) community. The article reviews recent management theory in the
field and considers how it can usefully be applied in a practical context. The second part of the
article concentrates on specific issues relating to employment relations in HE with special reference
to the University of East Anglia (UEA).
structures) are more likely to work because all the knock-on effects of such a
change have been considered (e.g. recruitment, selection and induction policies).
Guest (1992) argues that such a coherent approach to human resource
management policies can also lead, via the generic HRM outcomes of strategic
integration, commitment, flexibility/adaptability of the workforce and quality
(all necessary ingredients when developing a competitive edge), to the following
benefits to the organisation which has adopted SHRM:
• high job performance;
• high problem solving, change and innovation;
• high cost-effectiveness; and
• low turnover, absence, grievances.
Storey (1992) adds to this list attitude and behaviour changes amongst the
workforce, resulting in highly desirable increases in competitive performance.
However, in the hard-headed world of the 1990s, SHRM will not be taken
seriously unless it can be demonstrated that, like any other new initiative, it is
worth the return on investment. “Traditionally, the HR director could talk
abstractly and conceptually about employee morale, turnover, and
commitment. To fulfil the business partner role of HR, concepts need to be
replaced with evidence, ideas with results, and perceptions with assessments”
(Ulrich, 1997).
Employee commitment is seen as an important way of securing SHRM. This
is a difficult challenge, given the increasing job insecurity in many countries
and industries. It requires the development of new psychological (as opposed to
employment) contracts:
The employee will be employed as long as he or she adds value to the organisation, and is
personally responsible for finding new ways to add value. In return, the employee has the
right to demand interesting and important work, has the freedom and resources to perform it
well, receives pay that reflects his or her contribution, and gets the experience and training
needed to be employable here or elsewhere (Hiltrop, 1995).
Such contracts require effective and fair performance management systems Strategic human
(Sparrow, 1996) and a flexible approach with different groups of workers resource
(Herriot, 1994). management
Developing an ethical approach is an important way of achieving positive
performance:
Treating employees ethically simply means treating them with ordinary decency and
distributive justice. The ethical business rewards contributions to the business objective, and
53
is honest and fair to its staff... crucially, since trust is so dependent upon expectations, the
ethical business is extremely careful about the expectations it engenders (Sternberg, 1995).
Performance measurement systems aimed at developing and maintaining
quality will allow for a clear articulation of the outputs which SHRM is
intended to improve. These criteria will vary depending upon the particular
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context but, provided they are organisation-wide, they will enable a link
between HR and organisational strategy to be formed and the relative priorities
within both strategies to be identified more easily. Lawson (1995) has developed
a “performance pyramid” which aims to link day-to-day operations with
internal and external foci leading all the way up to the overall goals and values
of the organisation. Such an approach allows for the identification of the “key
results areas” and business processes and their integration with SHRM.
Assessing stakeholder value can be a way of achieving SHRM. By aligning
all the different stakeholders’ expectations, the holistic approach noted above
can be achieved, whilst at the same time individual and group/organisational
objectives can be compared/reconciled. Such an approach is not new in business
management, though the emphasis placed on HR strategies is novel, as are the
efforts to attach quantifiable measurements to the effectiveness of SHRM within
the organisation. There would appear to be examples of significant
improvement in an organisation’s performance as a result (Yeung and Berman,
1997).
Difficulties
Aligning organisational and HR strategies also presents a number of
difficulties. “...strategy development may be incremental, ad hoc social, cultural
and political affairs where numerous cognitive, information limitations – allied
to cultural ways of thinking, and political loyalties, and historic relationships
and interests – play major roles in structuring how managers think and what Strategic human
they think about” (Mabey et al., 1998). SHRM assumes a stability and a resource
rationality which is simply not evident in the “real world”. The same is true of management
textbook performance management systems, with their clinical control loop
approach. Where SHRM is imposed “top-down” as a “scientific exercise”, then
the result is likely to be a cynical workforce (Mallon, 1998; Stiles et al., 1997).
Much SHRM writing presents idealised lists of the way in which SHRM (as 55
opposed to personnel and industrial) “dimensions” can be achieved. While such
lists provide a useful checklist of features and a way of placing individual
organisations in terms of their adoption of SHRM, they are over-simplistic.
“SHRM presents as inevitable and necessary organisational strategies which
may in fact be political choices aimed at displacing the costs of organisational
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collective relations.
HRM may be categorised as a subset of ER, with ER encompassing a broader
range of activities and concerns. Strategic HRM is certainly more broadly based
than such a categorisation, however. It can also be seen as evolving from ER/IR.
As Cappelli (1995, p. 595) notes: “The pressure on employers to break many [my
emphasis] different aspects of the traditional employment relationship are
intense and appear unlikely to abate in the immediate future”. This is reinforced
by the writings of Kochan et al. (1986), though it is economic pressure as much
as strategic choice which is the driver. “The critical management task is to align
the formal structure and the HR systems so that they drive the strategic
objective of the organisation” (Fombrun et al. 1984, p. 37).
The Harvard approach has as its core “the responsibility and capacity of
managers to make decisions about the relationship between the organisation
and its employees such as to maximise the organisational outcomes for key
stakeholders”. While this “undermines workforce organisation or collectivist
values...” it nevertheless encompasses a range of activity no less wide than
IR/ER, as defined above, focussing as it does on “managers’ responsibility to
manage four key SHRM policy areas: employee influence (participation);
human resource flow; reward system; and work systems (work organisation)”
(Mabey et al., 1998, p. 61). Given the definition of HRM as the “high commitment
system”, it can also encompass worker participation, not least because
employees are one of the key stakeholder groups (Kaplan and Norton, 1992).
In reality, then, there is a considerable degree of overlap between IR/ER and
HRM. Both share similar contexts: geography (global, national, regional, local);
industry (type, traditions, markets, product, technology push/pull); size (sector,
structures, globalisation workforce, organisation); politics (economics, culture,
legislation); ethics (equity, fairness). ER emphasises the interaction and, indeed,
conflict, between employer and employee, within the pluralistic and the radical
frames of reference defined by Alan Fox (Donovan, 1968), while (S)HRM leans
towards Fox’s unitary perspective where “there is essentially only space for one
source of legitimacy and there is or ought to be a single, shared, set of
objectives...” In its purest form, “there is no legitimate place for trade unions
because they represent an alternative, competing, source of legitimacy and
crystallise alternative objectives” (Mabey et al. 1998, p. 281). More realistically, Strategic human
Fox’s “pluralist frame of reference” recognises that conflict is an inevitable and resource
ongoing part of ER with trade unions “being accepted and even valued for their management
representational role” (Mabey et al., 1998, p. 282).
argue that trade unions can act as an important extension and partner of
management, including an agency function (collective rather than individual
handling of cases and issues); communication (generic and apposite articulation
of workforce concerns); legitimation (of procedure, substance and managerial
roles). Research by Kochan et al. (1986) suggests that when trades unions play
these roles with and for management, positive benefit in ER can ensue.
UK HE has traditionally adopted a hybrid approach to trades union
recognition. Constitutionally, universities are independent organisations which
can determine their own ER strategies, within overall legislative and financial
constraints. In practice, most if not all, UK higher education institutions (HEIs)
delegate pay and bargaining to a national body – currently the Universities and
Colleges Employment Association (UCEA) – with other terms and conditions
being determined locally, with or without union involvement, depending upon
HEI-level policy and practice. This approach is seen as having more advantages
than disadvantages: nationally set minimum terms and conditions can be locally
adapted; it prevents leapfrogging or individual universities being “picked off”; it
frees up local HR staff for other work; it acts as a safety valve in national
disputes; it maintains individual university involvement through the UCEA.
UEA is looking to develop a partnership approach with the trade unions (cf.
Kochan and Osterman, 1994; IPA, 1992). This is within the framework of a
number of undertakings by the management: no compulsory redundancy; equal
opportunity; joint consultation (through formal committees where necessary).
Representation (rather than recognition) has been extended to include: regular
and formal single-table consultation about major issues relating to corporate
strategy and affecting the workforce; membership of the formal body (with
delegated authority from UEA’s governing body in respect of all HRM matters).
Recognition continues for grievance resolution and single-union negotiation on
terms and conditions affecting particular groups of workers. This policy has
been adopted because UEA recognises on the one hand that it does not have the
skills or (more importantly) the resources to engage in regular collective
bargaining on pay, but that it does have local expertise and resource (in the
form of a centralised personnel office) to develop policy and practice within this
overall framework.
Experience will suggest to specific sectors and managers the extent to which Strategic human
trade union involvement and recognition is an inhibitor or a positive force. Non- resource
union environments have been regarded increasingly as having a “largely management
favourable and benign image” (McLoughlin and Gourlay, 1994, p. 3). The TUC
itself – promoting the partnership approach – recognises that “organisations
must be competitive in the global markets if they are to be successful and
provide secure employment for employees” with trade unions “working in 61
partnership with employers”; they must act “as a positive force for change – by
winning employees’ support to the introduction of new technologies and work
organisation” (TUC, 1999) (see also Daniel, 1987; Daniel and Millward, 1993).
The development of a single pay spine for all HE staff is moving national as
well as local negotiations towards a single table model, though because of the
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differing needs of, say, academic staff and technical staff, some continuance of
tiered arrangements is likely (Swain, 1999). Notwithstanding this, single table
arrangements at both national and local level are seen as being a positive move
towards harmonising not just pay and conditions for university employees, but
also from minimising the number of peripheral “ancillary” workers and
building commitment amongst all staff groups.
In a highly decentralised organisation such as UEA, corporate level
monitoring of implementation of agreements must take place. In some areas, for
example, flexi-time is practised; in others, not. Differing interpretations of pay
and grading schemes may emerge, with “rich” SBUs paying more than “poor”
ones; the trade union can play a useful monitoring role alongside corporate HR
staff in identifying misuse of agreements.
What UEA is now aiming to do is to codify its approach to ER/HRM by
developing an overarching HR strategy. In this context, the corporate approach
aims to stress high commitment and trade union recognition and involvement,
despite Guest’s (1998) comments about the possible conflicts between
commitment to trade union and the organisation. The aim is to avoid
“piecemeal HRM initiatives” and the bypassing or ignoring of the industrial
relations system (Guest, 1998, p. 245), though thus far trade unions have been
cast as the formal negotiating body rather than a real partner. What must be
avoided is a move towards Guest’s HRM blackhole. In practice, we are likely to
have a cross between his high HRM/IR priority and the high HRM/no IR model
for certain groups (e.g. professors) who have benefited from being taken out of
the traditional IR model (Millward et al., 1992).
Note
1. See, for example, the latest issue of The Times Higher Education Supplement (THES), for
articles on a university opting out of national bargaining; the collapse of the Australian
equivalent procedures; tougher terms and conditions (imposed seemingly top-down by
management) in colleges. Durham University has outsourced its MIS operations (Annual
Report, 1998); Newcastle University reports a 1 per cent increase in full-time permanent
academic staff and an 87 per cent increase in contract teachers and researchers since 1987
(presentation to National SAP Seminar, December 1998).
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7,5
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62 Daniel, W.W. (1987), Workplace Industrial Relations and Technical Change, Francis Pinter,
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