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Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

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Page 1: Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

Chapter 3

The Changing Role of HRM: Achieving Impact through Adding

Value

Page 2: Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

Objectives of Chapter

• To outline the challenges and opportunities facing HR as a specialist function

• To critically assess influences affecting HR’s strategic contribution

• To highlight the role of HR outside strategic integration

• To critically analyse the knowledge and skills required by HR specialists in a global economy

Page 3: Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

HR as a Specialist Function

• The constant worry of all personnel administrators is their inability to prove that they are making a contribution to the enterprise. Their preoccupation is with the search for a ‘gimmick’ that will impress their management associates. Their persistent complaint is that they lack status. Drucker, 1954

• It's an exciting time for people management and development professionals. We're making ever-greater contributions to our organisations, our people and to economic performance. And we have the evidence that what we do makes the winning difference. Armstong, 2007

Page 4: Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

• …. which one is right?

• Is there now more recognition for the HR function than before?

Page 5: Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

The Context….

• Change provides the backdrop for business activity today

• HR practices are linked with many measures of business performance

• Employee capability has emerged as a crucial factor• This context offers opportunities for visionary HR

specialists able to perceive where effective people management will make a difference to their organisations

• Thus a clear step forward from the situation Drucker describes in the first quote….

Page 6: Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

Yet … What Do HR Specialists Actually Do?

Best practice ideas suggest that HR specialists:• Develop and implement HR policy• Advise line managers on the interpretation of

policy and the legal framework• Develop effective job structures• Promote employee capability• Envisage the future (planning)• Enhance employee motivation• Demonstrate HR contribution to business

effectiveness

Page 7: Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

Evidence from Employing Organisations….

• Job advertisements (in the UK) show that HR professionals fall into two categories– Those performing operational roles: useful and important

activities – maybe not influencing higher-level decision-making– Those operating at a strategic level: seeking HR specialists who

are ‘passionate about achieving business aims’, ‘creative and innovative’, ‘establishing development plans to support growth strategy

Salaries in the UK are about double for the second category (no reason to imagine this would be different in other global contexts)

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Types of HR Activity

• Deviant innovator- business partner, clerk of works, handmaiden etc

• Legge (1978) suggested that personnel specialists should redefine organisational criteria of success (think of today’s focus on CSR and sustainability…)

Page 9: Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

• Categorisations of HR have highlighted strategic versus operational focus

• Also, HR’s propensity to engage with people as opposed to processes

• Ulricht offers an inspiring and sometimes disconcerting vision of the future of HR

• Each role has the potential to add value, but unless the contribution offered is substantive, HR risks being marginalised

Page 10: Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

Tensions and Challenges for the Profession

• Has the HR role expanded to encompass a stronger strategic imperative?

• What can HR specialists do to enhance their status and contribution?

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The Research Evidence

• Caldwell (2002)– In a study of 500 major UK organisations showed that

HR professionals described themselves as Advisors, with 67% of sample also highlighting the Change Agent role

• Truss et al. (2002) – in a qualitative longitudinal study of two organisations

found that both contextual factors (how the HR team was ‘expected’ to behave) and the personal attributes of HR specialists determined the extent of their contribution to strategic decision-making

Page 12: Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

• Wright et al. (2002) found that HR was seen to contribute to service delivery rather than to strategic decision-making. The function was valued for this input, however

• These findings were also reported by Buyens & De Vos (2001) who found that change management had become a major concern for top management.

Page 13: Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

• There is a range of roles available and enacted, but HR has yet to achieve its full potential

• There is a gap between normative models of strategic HR and the behavioural reality of HR practice

• BUT recognition of HR’s role does exist, and where HR plays a strategic role, it is because the HR specialists have been good at marketing their services and capitalising on success

Page 14: Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

Factors Influencing the Strategic Role

• HR is constrained by the context within which it is located (Bach & Della Rocca, 2000)

• This is especially so for public sector organisations: ‘institutional isomorphism’

• Contested ownership of the HR agenda• Capability and commitment of the senior

management team• The relationship between HR and other agents

within the organisation

Page 15: Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

Other Roles for HR?

• Such as employment law advice, welfare initiatives• This area has in some cases expanded to reflect:

– Trends in the external environment– Demands and expectations of employees

• Further, some have argued that HR needs to retain its close links with employees

• Systematising and outsourcing HR tends to remove HR specialists from the people whose needs they have represented traditionally

• Welfare initiatives are more likely to take root where a business need can be demonstrated

Page 16: Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

Knowledge

• Theory, models and techniques for managing performance, learning and development, reward and communication

• Understanding how to apply knowledge synergistically

• Knowledge of organisational structures and cultures

• Developing employees’ interest and enthusiasm for the brand: what HR offers to the business and to the people it employs

Page 17: Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

Skills

• Change management skills– Encouraging ownership and recognising differences

of opinion

• Developing future leaders– Being good coaches– Offering feedback

• Developing strategy, including ‘scenario planning’

• Marketing the HR contribution

Page 18: Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

Developing Knowledge and Skills

• Update professional and theoretical knowledge• The CIPD professional development framework• ‘Thinking performers’• Open to opportunities for learning in the

workplace• Having a mentor in a senior position• Secondments, work shadowing and placement

opportunities all allow understanding of the HR role and the challenges it faces

Page 19: Chapter 3 The Changing Role of HRM: Achieving Impact through Adding Value

• In the UK, The CIPD has developed a strong and supportive profile for both strategic and operational roles– Membership 127,000 today– Gained ‘Chartered’ status in 2000– Increased professionalism of HR (many

employers demand CIPD accreditation)– Apparently, more overseas students welcome

CIPD accreditation for their home countries– The CIPD is working to develop its international

profile

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In Conclusion

• HR has an unprecedented opportunity to influence the strategic agenda, which has not been entirely realised

• Will HR be the function to take on board this responsibility?– Needs to use its position with an overview of the

organisation– Knowledge and skill base of HR is unique

• The HR function has to go on to convince others of its ability to add value either operationally or strategically