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    Human Resource Management

    Posted on May 29, 2012 by admin in Articles

    Human Resource Management

    All organisations, from small firms to giant corporations, from service companies to hi-tech organisations, engage in human resource management activities. They needs to utilise their resources effectively in order to achieve their objectives and targets. Human Resource Management is an issue of vital concern to all managers, and is the most important resource which employs all other resources to produce the desired outcome of the organisation. Thus the effective deploying of employees is a key element that adds to the competitive advantage of the firm (Molander, 1989).
    However, as globalisation and growing economic interdependence among nations emerged, along with rapid socio-economic changes and intensifying of the competition between organisations, the management of people increasingly became a critical issue for businesses. Therefore Personnel Management has to ensure that personnel policies and practices are geared to the objectives and strategy of the organisation in order to cope with the turbulent environment and respond to the new business needs and the external threats from the competitors. Consequently, this resulted in perpetual development and change of personnel management. In this respect the language of Human Resource Management has emerged to translate a new term for the management of employees in this active and changing world. However, the literature demonstrates a debate about the ambiguity of differentiating personnel from human resource management. Hendry (1995:55) states that: “Human Resource Management has gained rapid and widespread acceptance as a new term for managing employment. It remains, however; an ambiguous concept. People question whether it is any different from the traditional personnel management, nor it is clear what it consists in practice”.
    Some scholars however argue that HRM is an evolution of the process of personnel management (PM) and not a new theory of management employees, for example according to Torrington and Hall (1993:3): “… personnel management is experiencing the biggest change in its history. Many commentators believed that the arrival of human resource management was to be the greatest change in emphasis, but that was no more than re-thinking the process inside the organisation..”. Similarly Guest (1987) also supports this notion by saying that label has changed whilst the content continues to be the same.
    On the other hand, other writers attempt to make a distinction between HRM and PM. Hendry and Pettigrew (1990:25) state that “HRM is then a perspective on personnel management, not personnel management itself”. Additionally, they argue that the strategic character of HRM is distinctive. Underpinning this distinction, Legge (1995) identifies three features differentiating HRM from PM where the former is concerned with managerial staff and promotes integrated line management activities, with more focus on senior management being involved in the management of culture. The developing countries are characterised by weak economic, legal and political institutions that lead to corruption, insecurity, conflict and lack of competitiveness in labour, technology and skills. The introduction of trade liberalisation and increased international competition in such conditions can have serious consequences for the infant industries in the developing countries (Stiglitz, 2000). However it is generally claimed that opening to the global markets increases the flow of foreign direct investment into the developing countries, allows them to catch up with the latest technology without need for considerable investment or research, bring capital into the country, build expertise, induce innovation, and thus contribute to the general economic growth. Francois and Schuknecht (2000) provide some empirical evidence that openness to global markets leads to GDP growth. These findings are of course challenged by others.

    The Hegemony of Global Market Structure

    Various writers define HRM focusing on different emphases. Storey (1995:5) state that HRM: “Is a distinctive approach to employment management which seeks to achieve competitive advantage through the strategic deployment of a highly committed and capable workforce, using an integrated array of cultural, structural and personnel techniques”. This definition emphasizes the vital role of employment management to attain competitive advantage through strategic employment of proficient and committed employees, along with integrating HRM practices, culture and structure of an organisation. According to Schuler (1992:18)
    “Strategic Human Resource Management is largely about integration and adaptation. Its concern is to ensure that: (1) human resources (HR) management is fully integrated with the strategy and strategic needs of the firm; (2) HR policies cohere both across policy areas and across hierarchies; and (3) HR practices are adjusted, accepted, and used by line managers and employees as part of their everyday work”. This definition stresses the strategic approach to the management of human resources. It also implies integration of HRM with the organisational strategy, where HR policies cohere across all levels in the firm, and adaptation of HR practices by workers and line managers. Many other authors as well agree that HRM is a strategic function e.g. Mackay and Torrington (1986:178):
    “Strategic HRM can be defined as the overall and coherent long-term planning and shorter ter management, control and monitoring of an organisation’s human resources so as to gain from them the maximum added value and to best position them to achieve the organisation’s corporate goals and mission”.
    Evidently, the stress here is on long and short term HRM, and utilizing the workforce to produce value to the firm and attain organisational objectives. Further and more recent work of Storey (1995), Armstrong (2000) and Boxall and Purcell (2003) is also consistent with the notion that HRM is strategic in nature.
    In view of the above, it can be noted that definitions focus on the employees as core value to the organisation that will add to its competitive advantage. However, this makes us question to what extent this emphasis is applied in real practice, taking into consideration that HRM does not pay attention to the issue of sensitivity in the context in which it exists. Apparently, this issue of awareness and appreciation to the context is tackled more by IHRM as will be demonstrated below.
    Having identified HRM, it is important to highlight how IHRM us defined in the literature. IHRM refers to activities undertaken by international organisations to utilise its human resources effectively. Those activities include procurement; allocation and utilisation (Dowling et al, 1999). A similar understanding is echoed by Harris et al (2003:129) in saying that: “International HRM examines the way in which international organisations manage their human resources in the different national contexts in which they operate”.
    Accordingly, IHRM engages in more HR activities and is involved in further complexities for operating in different countries and dealing with a diversity of workforce from various nationalities. Moreover, multination organisations face the challenges of multiculturalism which means managing people from different cultural backgrounds. Additionally, international firms are involved in operating in diverse multiple markets. Therefore the need for a broader perspective is essential as it is crucial for the success of the international mission.
    Based on these variables of diversity and involvement, it can be argued that IHRM is more sensitive to the context in which it is operating. This is an issue that contributes to the success of management while operating across borders. Nevertheless, it is significant to question the applicability of this sensitivity when IHRM in a multicultural geographical dispersion and in a very dissimilar context.

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