BOOK REVIEW

MICHAEL C. STURMAN
J. W. Boudreau and P. M. Ramstad. (2007). Beyond HR: The New Science of
Human Capital. Boston: Harvard Business School Press. 258 pages.

o much has changed, and yet so

much has stayed the same. Beyond HR: The New Science of Human
Capital by John Boudreau and Peter
Ramstad points out a number of
such contradictions for the field of human
resources (HR). In many ways, HR professionals and academics know about the strategic importance of HR, the significance of
having a seat at the table, and the need for
better HR management in the war for talent,
yet the way many HR professionals actually
behave seems to change little. At the same
time, the book is replete with examples of
sophisticated HR decision making. Beyond
HR describes a way of thinking about HR
decision making that is very different from
many takes on the strategic HR management perspective. The key thesis is not that
HR management needs to change; indeed,
the authors argue that in its current form,
it is an essential function in organization.
Rather, decision making about HR, at least
for many organizations, needs to change,
and this change represents a new decision
science that the authors label talentship.
The key metaphor in Beyond HR is the
shift from professional practice to decision
science, and the metaphor is quite compelling. For example, accounting is a severalhundred-year-old professional practice that
tracks an organizations financial assets. The

field of finance emerged in the early 1900s to

show how accounting measures could support decisions about financial assets to improve business decisions. Similarly, sales is a
practice as ancient as business itself, but sales
practices were well established long before
the decision science of marketing emerged
to use sales information to develop strategies
for the products and brands an organization
sold. Beyond HR argues that the same sort of
transformation is needed in HR, and in fact
the best companies are already doing so. Boudreau and Ramstad are not saying that the
HR function necessarily needs to change; instead, a new function must emerge that will
serve as a decision science, allowing organizations to make better decisions about their
human assets.
The shift to considering a decision science
for HR requires a change in thinking that at
first may seem deceptively simple. This is illustrated with a typical mission statement:
The mission of the HR function is to be a
respected business partner, helping the company achieve its goals by providing outstanding services to help manage the companys
most important asset, its people (p. 9). This
mission focuses on the idea of service delivery, and it is premised on the notion that the
client actually knows what is needed. The authors propose a new mission statement: The
mission of the HR function is to increase the

Human Resource Management, MayJune 2009, Vol. 48, No. 3, Pp. 469472
2009 Wiley Periodicals, Inc.
Published online in Wiley InterScience (www.interscience.wiley.com).
DOI: 10.1002/hrm.20291

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success of the organization by improving

decisions that depend on or impact people
(p. 9). This change does not mean a paradigm
shift in how we think about HR; rather, it
requires a paradigm extension. We still need
to perform all the necessary functions essential to HRstaffing, training, compensation, performance appraisal, labor relations,
etc.just as we still need to know the status
of the financial assets within an organization
through the accounting function. We must
add to these functions a science for making
decisions about HR so that organizations can
use their HR information and assets to be
more competitive.
Implementing talentship requires looking at the way an organization uses its HR
to achieve its goals. A key issue is to discover
pivot points. Instead of trying to determine
what jobs within an organization are the
most important, decision makers should
consider where changes in talent can have
the greatest impact on the organizations
success. While the former approach yields
a list of jobs that is often highly correlated
with compensation, the latter approach can
yield surprisingly different conclusions. The
authors illustrate this point by comparing
the performance of Mickey Mouse to the performance of street sweepers at Disneyland.
While the Mickey Mouse character is clearly
central to the Disneyland experience, once a
certain threshold in performance is reached,
the nature of the job does not yield much additional value for increases in performance.
The position is so well understood and engineered that there is little payoff to additional
investments in improving the Mickey Mouse
characters performance. On the other hand,
variations in street sweeper performance can
be substantial. Street sweepers have the opportunity to change the customer service
experience on the fly, potentially addressing customer needs, engaging in immediate
service recovery, or simply delivering needed
information. The conclusion from this is that
pivotal and important functions are not the
same. While a traditional HR function like
job evaluation will capture importance and
appropriately set pay based on this importance and other factors, understanding what

functions are pivotal will guide where investments in HR can have the greatest payoff.
Beyond HR describes in detail the HC
bridge model, which provides a framework
for approaching this decision science of talentship. The model focuses on three key
anchor pointsefficiency, effectiveness,
and impactto help link organizational elements from investments, through policy and
culture, to sustainable strategic success. Each
link in the model (there are seven in all) is
complemented with various cues, questions,
and suggestions to help move the reader to a
new way of thinking about HR. Each of the
seven links is the focus of a chapter. An interesting aspect of the book, though, is that it
starts with the topmost link (achieving sustainable strategic success) and works its way
down to policies and investment. Indeed,
this is a key point of the book. Rather than,
for example, asking why ones company invests more in training than its competitors
do (a question that could easily result in an
impulse to cut expenses), the book suggests
that one should begin with the question
Where does your strategy require talent that
is better than your competitors? In other
words, HR decision making does not begin
with a consideration of what is being spent
on HR or what functions HR performs (which
results in an adherence to benchmarking and
mimicking the best practices of other organizations); rather, it must determine where
talent needs to be developed and deployed to
achieve the organizations mission. With this
question answered, the HR decision maker
can then begin to consider the organizations
talent pool and how best to leverage this asset to achieve success.
Of course, the idea of talentship is not
purely top-level esoteric strategic thinking.
Implementation of better HR decision making requires specific actions and must ultimately influence the quality, quantity, and
deployment of an organizations human assets. This involves understanding an organizations human assets at both the individual
level (called capacity) and the organizational
level (called culture). Capacity is composed
of individual capability, opportunity, and
motivation; culture is defined as the patHuman Resource Management DOI: 10.1002/hrm

BOOK REVIEW

tern of values, beliefs, and norms shared by

a group and thus is conceptualized as the
organizational counterpart to individual capabilities. Clear identification of individual
capacities and organizational culture helps
determine how to achieve the employee behaviors needed to fulfill a companys mission. Thinking about employee performance
and potential in this way helps move HR decision making away from the constraints of
traditional job descriptions to understanding
where employee performance can be most effectively leveraged.
The result of understanding what talent needs to be developed and deployed to
achieve the organizations mission then leads
to the need to develop HR policies and practices. Yet, a critical emphasis of the book is
not the individual practices but rather the
portfolio of HR programs needed to support
the organizational strategy. Furthermore, articulation of the support should be proactive,
not retrospective. Beyond HR stresses the use
of HR information as a decision science to
determine policy and not an exercise in rationalizing why existing policies fit to broad
and general existing strategic statements.
The idea that HR policies should be internally aligned (i.e., they should work with each
other) and organizationally aligned (i.e., they
should be linked to the organizations strategy) is certainly not a new idea; nor do the
authors claim it is new. But framing this idea
as part of a decision science of talentship provides a clear rationalization of types of information gathering and decision making that
must occur to make these choices so that an
organizations human assets contribute most
effectively to business success.
The last step in the HC bridge model is
to examine HR efficiency. It is no accident
that this point is the last step in the model.
Making HR policies and practices more efficient is the most common way that HR leaders show they can add value. The problem is
that evaluations of efficiency are dominated
by discussions of cost; often missed is an assessment of the broader opportunity costs
of HR investment and the returns from such
investments. Again, the metaphor of other
decision sciences helps make this point:
Human Resource Management DOI: 10.1002/hrm

Finance decisions are not solely driven by an

attempt to reduce the denominator of various
financial indicators; marketing departments
are not evaluated solely on the amount of
money spent on advertising. Investment in
organizations takes resources, and decisions
made in marketing and finance implicitly
acknowledge this. The difficulty is that the
costs of HR investments are easily captured
by accounting systems, whereas the benefits
are typically more elusive. Efficiency is clearly
important and should not be ignored. But it
should not be overly emphasized either. Efficiency should be considered within the entire
framework of the HR decision science so that
the desired HR outcomes needed to achieve
the organizations mission are achieved most
efficiently.
Therefore, the critical issue for talentship to be a successful decision science is its
capacity to make good decisions about HR.
This inevitably leads to the need for metrics
with which to make these decisions. The key
to good metrics, though, is that they need to
support the decisions that need to be made
rather than simply evaluate an HR department. A parallel example makes this point
clearly: If a department is behind budget, the
accounting department is rarely responsible
for fixing the problem. The accounting measures help indicate where a problem is, but it
is up to other decision makers to determine
how best to get the department back on
track. In contrast, most HR metrics evaluate
the efficiency of the HR department. If turnover is up, however, is this really a critique of
the HR function, or should it indicate where
there is a business concern? The need for an
effective decision science of HR therefore
requires a substantial change in how HR issues are typically measured, and the authors
propose what they call the LAMP (logic, analytics, measures, and process) model. The
development of HR measures should be driven by the sort of questions that need to be
answered, not by what is easily measurable.
This often requires that precision be reduced
and measured in the context of decision
support. The development of measures
should be driven by the types of decisions
needed within the framework of the HC

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bridge model and not by what the current HR

information system can produce in a report.
With measures based on good logic, the need
then exists for using them well (i.e., good analytics). This step draws upon statistics and
research design, since ultimately the causal
relationship between metrics needs to be established. As better measures from improved
decision logic are designed, and as data is collected on the effects of these measures, the
precision of the analytics will become better
understood. Ultimately, this should lead to
improved process. The talentship decision
should allow decision makers to understand
the sort of investment that can be made to
help the organization achieve its mission. HR
thus becomes not about responding to client
needs but a contributor necessary to be more
competitive.
In conclusion, talentship is not just another new HR program. It is really a different
way to think about HR decision making. The
HR function as it is currently most commonly perceived and designed is not something
to be eliminated. It serves a critical role akin
to the key roles of accounting and sales. But
the need exists for making better decisions
regarding HR and for truly thinking about
how human capital issues are inherent in the
achievement of organizational strategy.
The ideas in Beyond HR are very interesting, even compelling, and many business
leaders and academics alike would benefit
from its logic. This is not to say, though, that
some organizations are not already moving
in this direction. Indeed, the book is full of
examples of good HR decision making in
such companies as Boeing, Corning, Disney, General Electric, SAS, and Williams-Sonoma. Beyond HR could be a valuable guide in
changing how decisions about HR are made,
but it is clearly a challenging process. Any
company that wants to adhere fully to the

approach Boudreau and Ramstad propose has

a substantial amount of work in front of it,
even assuming that there is full acceptance of
the idea of talentship emerging as a decision
science. More likely, there will be many obstacles along the way, because in all probability
it will be HR professionals who will have to
take a hard look at their own decision-making
processes and organizational constraints to
see whether they can convince a world that is
often highly skeptical of HR departments that
the need exists for a profound change in how
business decisions regarding employees are
considered and made.
All in all, I think this interesting and
compelling book can change the perspective
of many readers, and it likely could provide
useful insights regarding the management of
an organizations employees to those both
inside and outside the HR function. But will
this drive the existence of a new field? Will
schools and business have both an HR department and a separate talentship department? This outcome, at least in the near to
moderate future, seems quite unlikely. But
can this book change the way some people
think about HR? I believe so.
Michael C. Sturman (Ph.D., Cornell University;
SPHR) is an Associate Professor of Cornell Universitys School of Hotel Administration, where
he is also the Kenneth and Marjorie Blanchard
Professor of Human Resources. He has consulted
with numerous businesses in the areas of compensation and human resources information systems and has published in journals such as the
Journal of Applied Psychology, Academy of
Management Journal, Personnel Psychology,
and Journal of Management. His research examines the prediction of individual job performance over time, the consequences of compensation
decisions, cost-benefit analysis, and research
methods.

Human Resource Management DOI: 10.1002/hrm