DefiningStrategicHRMAnOverviewoftheField

1、Defining Strategic HRM: An Overview of the FieldPatrick M. WrightProfessor of HR StudiesCornell University1My BiasesIdeologically, I want HR to matterPeople are valuable (Judeo-Christian ethic)Professionally, my role is gatekeeper/scientist to explore rigorously if it doesPositivist, Empiricist Pers

2、pectiveResult is a very critical approach to studying Strategic HRM2My BiasesEmphasis will be on my workNot because its truthNot because its the bestNot because its perfectNot because others work doesnt matterbutBecause its what I know and what Im passionate about3What is HRM?Is it Practices?Is it P

3、olicies?Is it Processes?Is it Philosophy?4What is HRM?HRM is all of the activities aimed at building the human potential and performance within an organizationIncludes:HR Philosophy (Values, Culture, etc.)HR Policies (What should be done)HR Practices (What actually gets done by managers implementing

4、 policies)Communications5What is Strategic HRM?The pattern of planned human resource actions and deployments intended to enable the firm to achieve its goalsWright & McMahan, 19926Defining the Landscape of HRM MultipleSingleOrganizationIndividualNumber of PracticesLevel of Analysis7Defining the Land

5、scape of HRMStrategic HRMIndustrial RelationsHPWSIsolated FunctionsTraditional/FunctionalHRMI/O PsychologyPsychological ContractEmployment Relationship MultipleSingleOrganizationIndividualNumber of PracticesLevel of Analysis8Focusing on Strategic HRMProblems with Single Practice ResearchMotivation P

6、rove it MattersIgnores simultaneity with other practicesIgnores that “systems impact peopleNeed to do More and Better Systems-Oriented Strategic HRM Research9Overview of SHRM ResearchHR Practices and PerformanceFit (Vertical and Horizontal)Classifying HR Practices (Bundles)Flexibility10HR Practices

7、and Performance: Seminal StudiesArthur (1992; 1994)Huselid (1995)MacDuffie (1995)Delery and Doty (1996)11HR Practices and Performance: Some Additional StudiesWelbourne (1996) +Youndt et al. (1996) +Delaney & Huselid (1996) +Lee & Chee (1996) ?Huselid, Jackson, & Schuler (1997) +Shaw, Delery, Jenkins

8、, & Gupta (1998) +Lee & Miller (1999) ?+Guthrie (2000) +Ostroff, (2000) +Bae & Lawler (2000) +12HR and Firm Performance: SummaryNumerous Studies Demonstrate Relationship between HR Practices and Firm Performance1 SD increase in HR practices results in 20% increase in profits per employeeWhile promis

9、ing, there are a number of problems with this stream of research that we will cover over the next few days13Fit in Strategic Human Resource Management14The Concept of Fit“The degree to which the needs, demands, goals, objectives and/or structure of one component are consistent with the needs,demands

10、, goals, objectives, and/or structure of another component.Nadler & Tushman (1980:40)15VERTICAL FIT: Align the organizations people, processes, systems, and relationships with its strategic priorities/initiatives. HORIZONTAL FIT: Ensure cohesion and coherence among elements of the HRM system (synerg

11、y). StrategyHORIZONTALFITStaffingTrainingRewardsEvaluationCoreCompetenceCompetitiveChallengesValue PropositionVERTICALFITAchieving Fit16Approaches to Conceptualizing SHRMUniversalisticContingencyConfigurationalContingency/Configurational17UniversalisticBased on the assumption that there are HR pract

12、ices that will always, if used, result in higher performanceE.g., High Performance Work SystemsExpectation of consistent positive relationships between these systems and firm performance18 StrategyStaffingCoreCompetenceCompetitiveChallengesValue PropositionAchieving Fit - UniversalisticTrainingRewar

13、dsEvaluationOrganizationPerformance19ContingencyBased on the assumption that the effectiveness of any given HR practice is contingent upon some other variable (usually strategy)Most popular way of viewing “fitTested through moderated regression20VERTICAL FIT: Align the organizations people, processe

14、s, systems, and relationships with its strategic priorities/initiatives. StrategyStaffingCoreCompetenceCompetitiveChallengesValue PropositionVERTICALFITAchieving Fit - ContingencyTrainingRewardsEvaluationOrganizationPerformance21ConfigurationalBased on the assumption that there are certain identifia

15、ble types of HR systems, each of which is equally effectiveE.g., analyzers, defenders, prospectors, reactors in strategy literatureTested by identifying profiles and looking at deviations from profiles22HORIZONTAL FIT: Ensure cohesion and coherence among elements of the HRM system (synergy). Strateg

16、yConfigurationHPWSStaffingTrainingRewardsEvaluationCoreCompetenceCompetitiveChallengesValue PropositionAchieving Fit - ConfgurationalOrganizationPerformance23Contingency/ConfigurationalBased on the assumption that the effectiveness of any particular configuration depends on some other variable (e.g.

17、, strategy, or environment)E.g., bureaucratic vs. agile organizationsTested with moderated regression24VERTICAL FIT: Align the organizations people, processes, systems, and relationships with its strategic priorities/initiatives. HORIZONTAL FIT: Ensure cohesion and coherence among elements of the HR

18、M system (synergy). StrategyHORIZONTALFITStaffingTrainingRewardsEvaluationCoreCompetenceCompetitiveChallengesValue PropositionAchieving Fit Contingency/ConfigurationOrganizationPerformanceVERTICALFIT25Goal of SHRM ModelsTo achieve a fit between the strategic needs of the business and the people reso

19、urces needed to execute against those needs, using HR policies, practices, and programs to gain that alignmentObjective is to execute todays strategy to be successful today26Conventional View of Strategy What Business are we in? How will we compete?Marketing, manufacturing, finance, HR, etc.What cri

20、tical tasks must get done to execute the strategy?Design practices and systemsMonitor alignment and complianceStrategyFunctional StrategiesKey Success FactorsOrganizational AlignmentSenior Management Role27A Fit-based Model of Strategic HRMMissionGoalsInternalstrengths/weaknessesExternalopportunitie

21、s/threatsStrategicChoiceStrategy-focusedanticipatedemployeeskills &behaviorsStrategy-focusedintendedHR practicesActualstrategy-focusedHR practicesActualstrategy-focused skillsActualstrategy-focusedemployeebehaviorsFit Firm Performance28Strategy - HR Fit EffectMany Advocate Fit.Dyer, 1985Schuler & Ja

22、ckson, 1987Baird & Meshoulam, 1988Wright & Snell, 1992But Few Find It.Lengnick-Hall & Lengnick-Hall, 1988Dyer & Reeves, 1995Gerhart, Trevor, & Graham, 1996Wright & Snell, 1997Why Not?Theoretical ProblemsEmpirical Problems29Theoretical Problems1. Lack of Good SHRM TheoryBacharach, 1989Wright & McMaha

23、n, 1992Dyer & Reeves, 199530Theoretical Problems2. Problems with Inconsistent Modelsof Fit (Venkatraman, 1989)Moderation (Huselid, 1995; Wright et al, 1995)Mediation (Snell, 1991; Schuler & Jackson, 1987)Matching (Arthur, 1992)Gestalts (Milliman et al, 1991; MacDuffie, 1995)Profile Deviation (Delery

24、 & Doty, 1996)Covariation (Huselid, 1995; Huselid & Becker, 1997)31Theoretical Problems3. Problems with Inconsistent ConstructsStrategy - HR Practices (Jackson et al, 1989;Arthur, 1992; Huselid & Rau, 1997)Strategy - EE Skills (Gupta & Govindarajan, 1984;Lengnick-Hall & Lengnick-Hall, 1988; Wright e

25、t al, 1995)Strategy - EE Behavior (Schuler & Jackson, 1987; Cappelli & Singh, 1992)32Fit Concepts/ConstructsStrategy (which aspects?)People (which aspects?)HR (which aspects)33Strategy ConceptsRegulatory ConstraintsCompetitive ActionsCorporate StrategyBusiness StrategyBusiness ProcessesCore Competen

26、ceCulture/Values?34People ConceptsCulture/Values?MoraleBehaviors/ActionsSkills/CompetenciesEmployee (Human Capital) Flows35HR ConceptsHR Practices/SystemsHR RolesHR PoliciesHR StructureHR Communication36Empirical Problems1. Inconsistency in OperationalizingStrategy (Huselid, 1995 vs. MacDuffie, 1995

27、)HR (Arthur, 1994 vs. MacDuffie, 1995)Performance (Dyer & Reeves, 1995)Individual (Arthur, 1994)Organization (Youndt et al, 1996)Financial (Delery & Doty, 1996; Huselid, 1995)37Empirical Problems2. Methodological IssuesTesting the Full ModelUnreliability, Contamination, & DeficiencyTemporal Consider

28、ationsWrong/Mixed Levels of AnalysisLatent Moderating VariablesCovariance of Independent Variables38Implications1. Give Greater Attention to Level of Analysis Issues Reliability/Validity Concerns Meaningfulness39Implications2. Develop Better Measures of HRWhich Practices?What Scale?What Level of Spe

29、cificity?40Figure 1Depiction of Hypothesized results on Fit UsingDifferent Incentive MeasuresAB% Employes Coveredby IncentiveCriterion to WhichIncentives are TiedHighFirm PerformanceLowLowHighHighLowCostReductionInnovationFirm PerformanceCost StrategyDifferentiation Strategy41HR Practice Architectur

30、ePerformance Based PayBonuses, Merit Pay Piece Rate Pay, Profit/Gain SharingPay tied to: Cost Reduction, Innovation, Revenue Growth, Market ShareAssessed by: Valid Objective Measure 360 Degree Appraisal Supported by: Selection/Training SyssGuiding PrinciplesPolicy/Practice AlternativesProductsPracti

31、ce/ ProcessAdapted from Wright, (1999)42Implications3. The Need for Greater TheoreticalDevelopmentWright & McMahan, 1992Becker & Huselid (1998)McMahan et al, 1997Specificity in Variables, Relationships, Processes, & Levels of Analysis.43Classifying HR Practices The Horizontal Fit QuestionThe goal of

32、 classifying HR practices is to identify consistent clusters or categories of practices to create “types or “strategies44Classifying HR Practices - ApproachesConceptualFactor AnalysisCluster Analysis45Classifying HR Practices The Conceptual ApproachE. Lawler (1986) information sharing, knowledge/ski

33、ll, power, rewardsMacDuffie (1995) have skills, have motivation, have opportunityDelery, Gupta & Jenkins (2000) Skills, motivation, empowermentGardner, Moynihan, Park, & Wright (2002) - Skills, motivation, empowermentBoudreau & Ramstad (1999) capability, opportunity, motivation46Classifying HR Pract

34、ices The Conceptual ApproachSome Consensus around practices aimed at:Skills/AbilitiesMotivationEmpowerment/Participation/Information Sharing47Classifying HR Practices The Factor Analytic ApproachFactor Analysis seeks to identify practices that co-vary with one another. The assumption is that when a

35、firm does one practice, it also does these others.It is trying to identify practices that hang together, and distinguish themselves from other practices that also hang together48Classifying HR Practices The Factor Analytic ApproachbcdefghijaxyHR PracticesFactors49Classifying HR Practices The Factor

36、Analytic ApproachHuselid (1995), Becker & Huselid (1998)Employee Skills and Organization StructuresEmployee MotivationGardner, Wright, & Gerhart (2000)Replicated Huselid with fictitious dataLee & Chee (1996)Information sharingKnowledge/skillPowerrewards50Classifying HR Practices The Factor Analytic

37、ApproachSummary Evidence for collapsing skill/empowermentMaybe because firms dont empower without ensuring that skills are present?Evidence for motivation51Classifying HR Practices The Cluster Analytic ApproachCluster Analysis seeks to identify cases (organizations) that are the same52Classifying HR

38、 Practices The Cluster Analytic Approach12345678910PurpleGreyGreenOrganizationsOrganization Types53Classifying HR Practices The Cluster Analytic ApproachArthur (1992)Control vs. CommitmentLee & Chee (1996)Contingent Payer, information sharer, weak trainer, low involverBecker & Huselid (1998)Personne

39、l, alignment, compensation, high performanceOstroff (2000) 5 clustersComprehensive, Involvement, Traditional, Identification, None54Classifying HR Practices The Cluster Analytic ApproachSummary Little consensus, if anyMaybe support for high (does all progressive HR) and Low (does none)In between, po

40、ssibly compensation (pay for performance, but little else) and involvement (focus on information sharing/participation) clusters55Summary of FitFit is advocated by almost all (Pfeffer, 1984 as an exception)Fit is not necessarily empirically supportedFailure to support fit effect is not surprising gi

41、ven the theoretical and empirical challengesEven if fit works, there are problems56Problems with FitVertical Fit leads to success, and success leads to inability to change (homogeneous mindsets, past success leads to pride, etc.)Horizontal fit makes it difficult to change any one part of the system

42、because that implies changes for all parts57Problem:What happens when todays environment changes?Sense the Change?Sense the Need to Change?Able to Change systems?Able to Change people?This is the issue of flexibility!58Flexibility in Strategic Human Resource Management59VERTICAL FIT: Align the organ

43、izations people, processes, systems, and relationships with its strategic priorities/initiatives. HORIZONTAL FIT: Ensure cohesion and coherence among elements of the HRM system (synergy). StrategyHORIZONTALFITStaffingTrainingRewardsEvaluationCoreCompetenceCompetitiveChallengesValue PropositionVERTIC

44、ALFITThe Question of FlexibilityFLEXIBILITY: Capacity to reconfigure assets to accomplish transformations necessary for change.60A Fit/Flexibility Model of Strategic HRMMissionGoalsInternalstrengths/weaknessesExternalopportunities/threatsStrategicChoiceStrategy-focusedanticipatedemployeeskills &beha

45、viorsStrategy-focusedintendedHR practicesActualstrategy-focusedHR practicesActualstrategy-focused skillsActualstrategy-focusedemployeebehaviorsFit Firm PerformanceDesiredflexibility-focusedemployeeskills &behaviorsIntendedflexibility-focusedpracticesActualflexibility-focusedpracticesActualflexibleem

46、ployeeskillsActualflexibleemployeebehaviorsFlexibility61Types of FlexibilityRESOURCE FLEX the extent to which a resource can be applied to a larger range of alternative uses, the difficulty of switching from one alternative use to another, and the time required to switch. COORDINATION FLEX the exten

47、t to which the firm can re-synthesize the strategy, reconfigure the chain of resources, and re-deploy the resources.-SanchezScott A. Snell, Cornell University62Broad skill sets General purpose skills Rapid learning SkillsBehaviorsPracticesResource CoordinationFlexibility FlexibilityAll-purposeBroad

48、applicabilityScaleableCustomizableDiverse skill base (specialists)Contingent workersFunctional slackBehavioral repertoireDiscretionary behaviorEmpowerment (vs SOP)Complementarity/conflict of scripts among different groups(vs GroupThink Culture)Types of HR FlexibilityDecentralizedModularized configur

49、ationCustomized/Innovative systemBest practice sharing 63 Positives Just-in-time resource deployments Access to specialized skills Minimize costs by externalizing routine tasks77-93% of U.S. firms outsource some HR activities Negatives Short-term focus (cost cutting) Reduces internal expertise Fragm

50、ents the HR functionCost is US$415 per employee (28% of total per employee HR costs)Only 1.6% of HR time spent with 3rd party vendors- Hackett GroupCoordination Flexibility:The Role of External Partnerships64SummaryEmpirical support for the HR performance RelationshipBut some serious theoretical and

51、 empirical problems with this workLittle empirical support for vertical fitLittle consensus or empirical work on horizontal fitLittle empirical work on Flexibility65Building Theory in Strategic HRM: Problems and ProspectsPatrick M. WrightProfessor of HR StudiesCornell University66Theoretical Challen

52、gesTheoretical FrameworksBlack BoxHow Many Boxes?How Many Variables in each Box?Whats the Causal Direction?67HR and Sustainable Competitive Advantage (VRIO Framework)How do we drive SCA with HR Practices?The Question of ValueThe Question of RarenessThe Question of ImitabilityThe Question of Organiza

53、tion68The Question of ValueDoes our HR system provide value, and is it greater (Revenues-Costs) than competitors. How do we drive cost reduction in HR? How do we drive revenue enhancement in HR?69 HR and Value at Fed Ex If a resource or activity is not valuable, to have it or engage in it results in

54、 a competitive disadvantage. If a resource or activity is valuable, it might only result in competitive parity.The Question of Value (contd):70The Question of RarenessHow many of our competitors already possess this resource or capability or are engaged in this value creating strategy?Common Resourc

55、es are a Source of Competitive ParityCommon Does Not Equal UnimportantValuable and Rare Resources are at Least a Source of Temporary Competitive Advantage.71The Question of ImitabilityDo firms without this resource or capability face a cost disadvantage in acquiring or developing it?Performance in t

56、he “five finger industrySources of Inimitability:History: Safety at DupontProblem: SubstitutabilityUncertainty: Value at Koch IndustriesProblem: Identifiability Social Complexity: Culture at Southwest Problem: Fragility72Value, Rareness and ImitabilitySouthwest AirlinesCompensation at mean of indust

57、ryTurnover significantly lower than industryTop ten companies to work forProductivity - 81ees/aircraft vs.1342.2 ees/1000 passengers vs. 4.273The Question of OrganizationAre we organized to take full advantage of the competitive potential of our resources and capabilities?With V, R, and I, firms can

58、 mess up O and still make money: Better Resources at MerckWith V, but no R or I, O makes all the difference:Better Alignment at Shell74The VRIO FrameworkIs a resource . . . Difficult Supported to by CompetitiveValuable? Rare? Imitate? Organization? Implications PerformanceNo - - Competitive Below Di

59、sadvantageNormalYesNo - CompetitiveNormal ParityYesYesNo Temporary Above CompetitiveNormal AdvantageYesYesYes Sustained Above CompetitiveNormal Advantage75Application of Resource-Based View - ConceptualWright et al. (1994) focus on human capitalLado and Wilson (1994) focus on practicesBoxall (1996)

60、- HRA = HCA + HPALepak & Snell (2000) HR Architecture76Application of Resource-Based View - SummaryHuman Capital PoolEmployee Relationships and BehaviorPeople Management Practices77Application of Resource-Based View - EmpiricalHuselid (1995)Koch & McGrath (1996)Boxall & Steeneveld (1999)Wright, McMa