ItemHRM and Performance: What’s Next?Paauwe, Jaap; Boselie, Jean Paul (2005-07-22)The last decade of empirical research on the added value of human resource management (HRM), also known as the HRM and Performance debate, demonstrates evidence that ‘HRM does matter’ (Huselid, 1995; Guest, Michie, Conway and Sheehan, 2003; Wright, Gardner and Moynihan, 2003). Unfortunately, the relationships are often (statistically) weak and the results ambiguous. This paper reviews and attempts to extend the theoretical and methodological issues in the HRM and performance debate. Our aim is to build an agenda for future research in this area. After a brief overview of achievements to date, we proceed with the theoretical and methodological issues related to what constitutes HRM, what is meant by the concept of performance and what is the nature of the link between these two. In the final section, we make a plea for research designs starting from a multidimensional concept of performance, including the perceptions of employees, and building on the premise of HRM systems as an enabling device for a whole range of strategic options. This implies a reversal of the Strategy-HRM linkage. ItemThe Role of Corporate HR Funcitons in MNCs: The Interplay Between Corporate, Regional/National and Plant LevelFarndale, Elaine; Paauwe, Jaap (2005-03-01)The HR literature has been abundant in providing typologies of the roles of HR professionals in their organisation. These typologies are largely related to the changing nature of HRM over time, and the context in which empirical work was carried out. In this paper we focus on the context of the increasing internationalisation of firms and how this has an effect upon modern-day typologies of HR roles. We explore these roles by focusing on the way in which HRM practices come about. Especially in a MNC setting of increasing internationalisation of firms the issues of coordination, shared learning and standardisation versus leeway for adapting to the local context (customisation) are prominent. These issues present themselves both at the corporate and regional level and at the national and local (plant) level. On all these levels HR practitioners are active and find themselves amidst the interplay of both (de-)centralisation and standardisation versus customisation processes. This paper thus explores the way in which HR practices come into being and how they are implemented and coordinated. These insights help us understand further the roles of international corporate HR functions that are being identified. Our data is based on 65 interviews, which were held (as part of larger study of HR-function excellence) with HR managers, line managers and senior executives of six multinational companies in eight countries from September to December 2004. This data reveals new classifications of processes by which HR activities are developed, implemented and coordinated, both in terms of who is involved and how these processes are carried out. ItemHuman Resource Function Competencies in European CompaniesBoselie, Jean Paul; Paauwe, Jaap (2005-01-01)This paper presents an overview of recent empirical research on human resource competencies in Europe. The data were collected in 2002 in the global Human Resource Competence Study, an initiative of the University of Michigan. The results suggest that personal credibility and HR delivery have a positive effect on the relative ranking of the HR function and its professionals. According to non-HRM respondents strategic contribution is the competency that will lead to financial competitiveness, while HR managers consider business knowledge to be crucial for added value of the HR function. ItemMeasurement Error in Research on Human Resources and Firm Performance: Additional Data and Suggestions for Future ResearchWright, Patrick M.; Gardner, Timothy M.; Moynihan, Lisa M.; Park, Hyeon Jeong; Gerhart, Barry A.; Delery, John (2000-11-01)Gerhart and colleagues and Huselid and Becker recently debated the presence and implications of measurement error in measures of human resource practices. This paper presents data from three more studies, one of large organizations from different industries at the corporate level, one from commercial banks, and the other of autonomous business units at the level of the job. Results of all three studies provide additional evidence that single respondent measures of HR practices contain large amounts of measurement error. Implications for future research are discussed. ItemRecognizing Risk in Human Capital Investments: A Real Options Approach to Strategic Human Resource ManagementBhattacharya, Mousumi; Wright, Patrick M. (2000-11-01)An issue that has not yet been explored in the field of strategic human resource management (SHRM) is that of managing the ‘risks’ involved in human capital management of the firm. We address this issue using the real option theory framework. We argue that certain HR practices manage risk and generate opportunities for the firm by creating 'options' for its human capital management. These HR options help ensure stability of returns from human capital and thus sustain competitive advantage. Different types of HR options and the role of certain HR practices in creation of these options are discussed. ItemNET WORKING: Work Patterns and Workforce Policies for the New Media IndustryBatt, Rosemary; Christopherson, Susan; Rightor, Ned; Van Jaarsveld, Danielle (2000-11-01)This report, based on a study of a group of highly accomplished professionals in New York City, is one of the first to take up labor market issues in the new media industry. It describes the challenges faced by professionals and employers alike in this important and dynamic sector, and identifies strategies for success in a project oriented environment with highly complex skill demands and rapidly changing technology. Our findings suggest three central issues. ItemIn the Trenches at the Talent Wars: Competitive Interaction for Scarce Human Resources - A Qualitative StudyGardner, Timothy M. (2000-11-01)The purpose of this paper is to examine how firms are competing for scarce human resources in the talent wars. First, the paper makes the distinction between responding to labor shortages with investments in recruiting and retention and directly competing against identified labor market competitors for scarce human resources. It appears firms compete with rivals in the open labor market and in initiating and defending against talent raids. The process of identifying and responding to the tactics of labor market competitors is reviewed for both types of direct competition. Firms tend to respond to rivals’ tactics either by changing the employment relationship with threatened employees or engaging in tactics to influence the behavior of the competing firm. Factors that determine the propensity and type of response to competitor’s tactics are reviewed and integrated. The greater the threat posed by the rival’s tactics the greater the likelihood affected firms will respond with externally as opposed to internally oriented tactics. The greater the skill mobility of threatened employees, the more administrative and financial resources will be invested in the counter-response. Finally, firms use a variety of preemptive tactics to reduce the threat of talent raids. These tactics are listed and explained. The paper concludes with recommendations for firms seeking to gain or protect advantage relative to rivals in the war for talent. ItemHuman Resources Strategy: The Era of Our WaysSnell, Scott A.; Shadur, Mark A.; Wright, Patrick M. (2000-11-01)The purpose of this chapter is to discuss some of the main features and trends in human resources (HR) strategy. Inasmuch as people are among the most important resources available to firms, one could argue that HR strategy should be central to any debate about how firms achieve competitive advantage. But this “people are our most important asset” argument is actually fairly hollow in light of the evidence. Far too many articles on HR start with this premise, but the reality is that organizations have historically not rested their fortunes on human resources. The HR function remains among the least influential in most organizations, and competitive strategies have not typically been based on the skills, capabilities, and behaviors of employees. In fact, as Snell, Youndt and Wright (1996:62) noted, in the past executives have typically tried to “take human resources out of the strategy equation--i.e., by substituting capital for labor where possible, and by designing hierarchical organizations that separate those who think from those who actually do the work.” ItemThe Influence of Job Satisfaction and Organizational Commitment on Executive Withdrawal and PerformanceMoynihan, Lisa M.; Boswell, Wendy R.; Boudreau, John W. (2000-11-01)This research examines the influence of job satisfaction and three dimensions of organizational commitment (i.e., affective, continuance, and normative) on the intention to leave, job search activity, performance, and leadership effectiveness of executives. Job satisfaction and the commitment dimensions were hypothesized to negatively predict the retention-related variables. Results generally supported the hypotheses. Job satisfaction had the strongest relationship, but both affective and continuance commitment showed an incremental effect even in the presence of job satisfaction. We also hypothesized that job satisfaction and affective commitment would positively and continuance commitment would negatively associate with general performance and leadership. As predicted, job satisfaction associated positively with performance, though not with leadership. Continuance commitment negatively associated with both performance and leadership. ItemThe Relationship Between Employee Perceptions of the Employment Game and Their Perceptions of Cooperative Knowledge Behavior in High Tech FirmsRogers, Edward William (2000-11-01)The relationship between knowledge sharing and organizational performance for high technology start-up companies is not well understood. Using game theory and the concept of competitive advantage through human resource management, I examine employee perceptions of the employment game relating to cooperative knowledge behavior and firm performance as an entry point into researching organizational knowledge utilization. I draw upon classical game theory to develop four measures of perceptions critical to game playing and apply these to organizational situations via a survey instrument. I propose that perceptions of the employment game held by organization members are determinants of cooperative knowledge sharing and subsequently firm performance. I analyze survey data gathered from high-tech workers using both regression and path analysis techniques. The results from this study offer new insights into methods for measuring both the connections between knowledge work and firm performance and the perceptions critical for fostering collaborative knowledge work in high tech firms. Results of the study show a significant relationship between the game theory construct of reciprocity, knowledge building behavior and firm performance. The mediation model was weakly supported but shows potential usefulness for further research in the field of strategic human resource management. ItemToward A Model of International Compensation and Rewards: Learning From how Managers Respond to Variations in Local Host ContextsBloom, Matt; Milkovich, George T.; Mitra, Atul (2000-11-01)Managers and researchers recognize that the tensions created by the interplay of globalization and national environments influence the behaviors of multinational enterprises (MNEs). In order to develop a model that is useful for understanding the effects of the global and local host environments on managerial compensation, we undertook a grounded theory building study of managers in several multinationals. We use the information gained to extend two contemporary perspectives of IHRM: national culture, and strategic alignment. We develop the idea that it is the relative degree of variation (flexibility) within the local host context that is critical to understanding managers' ICRS decisions. We present a different, pragmatic experimentation view of managers' ICRS decision making, which we believe offers insights into the effects of the interplay of the MNE pressures to create integrated global systems and the pressures generated within the local host environments. ItemTelecommunications 2000 Strategy, HR Practices & PerformanceBatt, Rosemary; Colvin, Alexander; Katz, Harry C.; Keefe, Jeffrey (2000-11-01)This report constitutes the first benchmarking survey of business and human resource practices among a nationally representative sample of workplaces in the broadly defined telecommunications industry that includes wireline, wireless, cable, and internet providers. It grows out of a multi-year study of organizational change in the industry, and is based on extensive field study, site visits, interviews, and surveys conducted by research teams at Cornell and Rutgers Universities. Managers at 577 establishments across the country gave generously of their time during a lengthy telephone survey. The study was made possible through a generous grant by the Alfred P. Sloan Foundation. While this report is based on data collected among workplaces in the U.S., it has implications for the restructuring of the global telecommunications industry. In other research, we have found that the United States has been at the forefront of market deregulation and technology change, but many other countries have followed a similar path and look to the United States as a model for organizational restructuring (Katz 1997). Thus, at least some of the patterns we find here are likely to occur in other countries undergoing similar patterns of deregulation. ItemHow High Performance Human Resource Practices and Workforce Unionization Affect Managerial PayColvin, Alexander; Batt, Rosemary; Katz, Harry C. (2000-11-01)Using data from a nationally representative sample of telecommunications establishments, this study finds that HR practices and workforce unionization influence managerial pay levels and the ratio of manager-to-worker pay. High performance HR practices, including investment in the skills of the workforce, in computer-based technologies, and in performance-based worker pay practices, are all positively related to managerial pay; but the use of workforce teams, which shift some managerial responsibilities to workers, has the opposite association. High performance HR practices also are associated with lower manager to- worker pay differentials. In addition, workforce unionization is positively associated with managerial pay levels, with worker base pay mediating the relationship between managers' pay and unionization. ItemToward a Strategic Human Resource Management Model of High Reliability Organization PerformanceEricksen, Jeff; Dyer, Lee (2004-03-01)In this article, we extend strategic human resource management (SHRM) thinking to theory and research on high reliability organizations (HROs) using a behavioral approach. After considering the viability of reliability as an organizational performance indicator, we identify a set of eight reliability-oriented employee behaviors (ROEBs) likely to foster organizational reliability and suggest that they are especially valuable to reliability seeking organizations that operate under “trying conditions”. We then develop a reliability-enhancing human resource strategy (REHRS) likely to facilitate the manifestation of these ROEBs. We conclude that the behavioral approach offers SHRM scholars an opportunity to explain how people contribute to specific organizational goals in specific contexts and, in turn, to identify human resource strategies that extend the general high performance human resource strategy (HPHRS) in new and important ways. ItemPeople in the E-Business: New Challenges, New SolutionsWright, Patrick M.; Dyer, Lee (2000-11-29)[Excerpt] Human Resource Planning Society’s (HRPS) annual State of the Art/Practice (SOTA/P) study has become an integral contributor to HRPS’s mission of providing leading edge thinking to its members. Past efforts conducted in 1995, 1996, 1997, 1998, and 1999 have focused on identifying the issues on the horizon that will have a significant impact on the field of Human Resources (HR). This year, in a divergence from past practice, the SOTA/P effort aimed at developing a deeper understanding of one critical issue having a profound impact on organizations and HR, the rise of e-business. The rise of e-business has been both rapid and dramatic. One estimate puts the rate of adoption of the internet at 4,000 new users each hour (eMarketer, 1999) resulting in the expectation of 250 million people on line by the end of 2000, and 350 million by 2005 (Nua, 1999). E-commerce is expected to reach $1.3 trillion by 2003, and of that, 87 percent will go to the business to business (B2B) and 13 percent to the business to consumer (B2C) segments, respectively (Plumely, 2000). ItemThe Role of End-of-Course Exams and Minimum Competency Exams in Standards-Based ReformsBishop, John H.; Mane, Ferran; Bishop, Michael; Moriarty, Joan (2000-07-01)[Excerpt] Educational reformers and most of the American public believe that most teachers ask too little of their pupils. These low expectations, they believe, result in watered down curricula and a tolerance of mediocre teaching and inappropriate student behavior. The result is that the prophecy of low achievement becomes self-fulfilling. Although research has shown that learning gains are substantially larger when students take more demanding courses2, only a minority of students enroll in these courses. There are several reasons for this. Guidance counselors in many schools allow only a select few into the most challenging courses. While most schools give students and parents the authority to overturn counselor recommendations, many families are unaware they have that power or are intimidated by the counselor’s prediction of failure in the tougher class. As one student put it: “African-American parents, they settle for less, not knowing they can get more for their students.” ItemCrafting A Human Resource Strategy To Foster Organizational Agility: A Case StudyShafer, Richard A.; Dyer, Lee; Kilty, Janine; Amos, Jeffrey; Ericksen, G. A. (Jeff) (2000-07-01)A decade ago, the CEO of Albert Einstein Healthcare Network (AEHN), anticipating a tumultuous and largely unpredictable period in its industry, undertook to convert this organization from one that was basically stable and complacent to one that was agile, “nimble, and change-hardy”. This case study briefly addresses AEHN’s approaches to business strategy and organization design, but focuses primarily on the human resource strategy that emerged over time to foster the successful attainment of organizational agility. Although exploratory, the study suggests a number of lessons for those who are, or will be, studying or trying to create and sustain this promising new organizational paradigm. ItemManaging Customer Services: Human Resource Practices, Turnover, and Sales GrowthBatt, Rosemary (2000-06-29)This study examines the relationship between human resource practices, employee quit rates, and organizational performance by drawing on a unique nationally representative sample of 354 customer service and sales establishments in the telecommunications industry. Multivariate analyses show that quit rates are lower and sales growth is higher in establishments that emphasize high skills, employee participation in decision-making and in teams, and HR incentives such as high relative pay and employment security. Quit rates partially mediate the relationship between human resource practices and sales growth. These relationships also are moderated by the customer segment that frontline employees serve. ItemStrategic Segmentation in Frontline Services: Matching Customers, Employees, and Human Resource SystemsBatt, Rosemary (2000-05-01)This paper examines variation in the use of high involvement work practices in service and sales operations. I argue that the relationship between the customer and frontline service provider is a central feature that distinguishes production-level service activities from manufacturing. In particular, through strategic segmentation, firms are able to segment customers by their demand characteristics and to match the complexity and potential revenue stream of the customer to the skills of employees and the human resource system that shapes the customer-employee interface. Unlike manufacturing, where high involvement systems have emerged in a wide variety of product markets, therefore, service organizations are likely to use high involvement systems only to serve higher value-added customers because of the high costs of these systems and the labor-intensive nature of services. Data from a nationally random sample of 354 call centers in U.S. telecommunications documents this pattern: from classic mass production approaches for back office workers and increasingly for front office residential service agents, to greater involvement for small business service providers, and high involvement practices for middle market service agents. ItemThe Human Capital “Impact” on E-Business: The Case of Encyclopedia BritannicaBoudreau, John W.; Dunford, Benjamin; Ramstad, Peter M. (2000-05-15)[Excerpt] The term “New Economy” has been coined to describe the remarkable economic performance of the 1990s. Stiroh, (1999) an economist at the Federal Reserve Bank of New York observes that its defining characteristic is a “focus on increasing globalization and expanding information technology” (pg. 87). Research suggests that revenues from electronic based business to business trade will double over the next five years from $43 billion in 1998 to $1.3 trillion in 2003. Revenues from business to consumer trade are predicted to rise from $8 billion to $108 billion over the same time period (Forrester Research, 1998). However, there is increasing attention to the challenges facing business in the new economy, and an increasing chorus of analysts suggesting how tenuous many of these business models really are. A recent Barron’s article showed that many dot-com companies have only days of remaining cash (Willoughby, March 20, 1999). Such a key emerging phenomenon has not escaped the attention of writers, though the existing body of writing has some important gaps. We would classify existing e-business literature into two groups. First, there is a growing body of literature that discusses the how the Internet is transforming business models and organizational strategies. A second, much smaller body of work has focused on e-HR, or more specifically, the implications of the Internet on various HR practices.