Human resource management, management, organization, social_media

The evolution of HRM: a novel description


HRM as a field has come at the cross-road between toward two different (and opposite) evolutionary paths.
On one side, it aims at becoming a ‘science’ (see Boudreau & Ramsted; Fitz-enz; Cascio) by adopting an evidence based approach (Davenport). This direction leads HRM toward the development of new competencies in the area commonly referred to as HR Analytics. Such competencies range over domains like statistics, research methods, quantitative analysis, finance, etc. This direction is greatly favored by advocates of business orientation who think HRM must make the case for its usefulness to managers, in pretty much the same way as other core functions, like for example finance or marketing. A great drive in this direction is commanded by talent management and in fact Boudreau & Ramsted assign the name of talentship to this ‘new science’. This path is what I call the ‘Objectification path’. HRM has a role because it has a direct, and measurable impact on business results.
On the other side, it recognizes the complexity of issues related to the alignment of external environment, organization, and people and it accepts the impossibility of any optimization approach. The complexity of decisions related to human capital originating from the different time horizons of human development and business development, the interdependence among dimensions, the external uncertainty of events, all sum up to the recognition of HRM as a function that keeps weaving a narrative that keeps everything together, accepting permanent misalignment and struggling to convey sense to people in order to maintain essential levels of engagement. HRM becomes a ‘bricoleur’, which aims at co-creating sense among the different constituencies of an organization and uses different strategies. HR competencies differ largely from those of the previous path and emphasize the ability to create ex-post, cognitive connections between events, the ability to promote dialogue and different narratives, the use of an extreme range of communication codes (qualitative and quantitative), the flexibility in defining paths for sensemaking open to very different ex-post interpretations, the detachment from absolute beliefs, and an overall disenchantment. This path is what I term the ‘Subjectification path’. HRM has a role because it helps connecting two separate and radically departed realms: the abstract world of business and technology and the world of human beings.
At the same time, HRM is moving into another dilemma relating to the key constituency that it needs to target.
On one side, HRM is recognizing the need to target individuals. In this perspective, the analysis of society and the evolution of the needs society in more detail lead to emphasizing heterogeneity among human resources within organizations. Systems aim at conveying value to every single individual, on the basis of her/his highly specific needs, and allowing for changes in time related to generational dynamics. It is the so called workforce of one approach. Common ideas behind this framework can be traced back to the introduction of total reward approaches, or individual performance appraisal and development plans. The individual is the cornerstone of any intervention, and practices evolve toward being personalized and at times practically left to the individual choice (think about coaching, self-service compensation packages, etc.)
On the other side, though, the diminishing texture of society is pushing people toward a search for novel ways of partnering up and creating that sense of community which is still a value to human beings. The extraordinary emergence of social media and their diffusion is an example of such everlasting values. Community lays at the basis of reciprocity, and is therefore needed within organization to trigger collaboration and citizenship behaviors, ever more important in an uncertain context. In this perspective HRM becomes the architect of collaboration, by fueling the creation of a sense of commonality among participants and fostering the establishment and diffusion of communities of practice, but also of intent and meaning. The organization is not considered a marketplace where individuals ‘shop’ by exchanging their performance with the goods they prefer (coach, incentives, etc.), but a place were people collectively assign sense to individual actions relating them to the collective endeavor they are at.
It might be interesting and provocative at this point to cross these two dimensions, even though they might somehow be correlated. I try to do that at a very preliminary level with this matrix:

 

2 thoughts on “The evolution of HRM: a novel description

  1. Guido Buffo

    Dear Luca,
    nice and interesting article; with highly stimulating hints to evaluate.
    Considering your statements, I wonder if some of the complexities that you mentioned should be removed, either considering the relationship between Business and Human Capital Management logics in small-medium sized companies, and – but this is just a personal belief – looking at the undergoing economics. The point of separation you highlighted, namely between: “the abstract world of business and technology and the world of human beings” is somehow, at least to some extent considering my personal experience, the
    core of a major underlying issue that seems to remain quite untouched. As I’m sure you understood, what I’m referring too is the everlasting consideration for “results” which – somehow unreasonably – does not seem to command an equivalent attention for “requirements”. I guess this is the point now: human capital mis-management is simply too expensive to last any longer (yet getting confused with company welfare and miscellaneous contentment policies); as results of HC mis-management do impact business performance regardless the size of the company, and todays, as we al know, “the smaller the weakest”. So I’d say that it could be interesting to discuss whether this detachment between business and people, and between results and requirements is not, indeed what we should be working upon… maybe considering some kind of evolution from a too short sighted and (maybe) a too greedy attitude.
    Thank you for your patience in reading Luca.
    I’d be delighted in reading your feedback.
    Thanks,
    Guido

    • admin

      Dear Guido,

      I really appreciate you taking the time to comment on this post.
      Let me elaborate on your comment. I do perceive that we followed a path out of the very nature of organizations, which according to Barnard in 1938 should have been considered the greatest accomplishment of humankind. In Barnard, profit was considered an operating condition not a goal per se. The impact of simplistic views on economy and human behavior has lead to a systematic overstatement of issues like profits, EBIT, and incentives. Ghoshal stated it clearly when he attacked the intellectual dominance of agency theory in management schools. Economists have it wrong as demonstrated by the failure of their approaches to complex socio-economical and organizational issues, but they are so powerful (because simplistic) to dominate any debates. Actually, economics far from being an empirical science is in its mainstream interpretation a strictly normative approach, which studies departures of reality from models, rather than modeling better what reality is…
      This turns into different possible ways out. One is to analyze impact of HRM policies as advocated by Boudreau and Ramstad, instead of measuring short term efficiency and effectiveness. Another is to recognize that long term value matters most, but this is harder to accomplish, given the taken-for-granted assumptions of investors and managers. I think a deep rethinking of assumptions on economics and business is much needed, but I find it hard to imagine it can happen soon.

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