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Employee
Relations The name has changed but has
22,6 the game remained the same?
Michael Armstrong
576 Independent Consultant, London, UK
Keywords Human resource management, Personnel management
Received July 2000
Revised August 2000 Abstract The article argues that many of the practices associated with the concept of human
Accepted August 2000 resource management were flourishing under different names before the notion of HRM emerged
in the mid-1980s. There have been many developments in these practices but they have been
evolutionary. They have not happened because of any revolutionary new approaches derived from
HRM theory. The fact that the pace of change in personnel management is faster now than before
the 1980s is not attributable to the advent of HRM as a philosophy. It has been forced on
organisations by the rapidly changing business, political, economic and social environment. It has
also taken place as a result of the increased professionalism of personnel practitioners encouraged
by the Chartered Institute of Personnel and Development and by the burgeoning academic
institutions which have disseminated ideas about human resource management more
comprehensively through a wider range of high quality publications.
Introduction
Personnel practitioners who have been around a long time, as this one has, are
often bothered, bewildered and bemused by a feeling of deÂjaÁ vu as we
contemplate the seemingly endless and often sterile debate about HRM and
personnel management. We ask questions: Are they different? Is one better
than the other? Has anything really changed ± for better or worse? Is this
simply a case of the emperor's new clothes (Armstrong, 1987)?
HR has now become common parlance. Three quarters of the job
advertisements typically refer to human resource rather than personnel. But we
observe these HR directors and managers doing much the same things
personnel directors and managers were doing 20 years ago. Familiar concepts
and practices such as performance appraisal, skills analysis and merit pay are
re-packaged (often persuasively) without any discernible differences in their
content. Fads come and go.
This article is based largely on my experience as a personnel practitioner
extending over a period of nearly 40 years in the engineering and food
industries and in publishing, The reason for writing it is that I, like many other
practitioners I know, have become confused, even cynical, when concepts or
techniques are introduced as new ideas although we have been using them all
the time under different names. My theme is that, while the context in which
personnel people work is constantly changing, many of the approaches that
have been tried and tested over the years can work just as well today. Giving
them a new name makes no difference. Of course, ideas worked up by
academics such as Argyris, Boyatzis, Flanders, Kolb, Lawler, McGregor,
Employee Relations,
Vol. 22 No. 6, 2000, pp. 576-593.
Tyson, Vroom, Walton and Woodward have influenced personnel practices but
# MCB University Press, 0142-5455 they have not revolutionised them.
The purpose of this article is to address the question of ``what's new'' both in The name has
the overall concept of HRM and in various policy and practice areas. changed
Consideration is also given to the issues emerging from the analysis and
possible directions in the future.
The game was changing and it was useful to have a new name and a new
language to encapsulate what was taking place in the world of work. It is,
however, worth noting that the term human resources did not first appear in
the mid-1980s. It was in common use as a synonym for personnel in the 1970s;
for example, Armstrong (1977) noted that ``personnel management is concerned
with obtaining, organising and motivating the human resources required by
the corporation'', (italics added).
HRM has been described as ``a perspective on personnel management''
(Hendry and Pettigrew, 1990) and ``high-concept personnel management'
(Armstrong, 1996). Some commentators (Legge, 1989, 1995; Keenoy, 1990;
Sisson, 1990; Storey, 1993; Hope-Hailey et al., 1997) have highlighted the
revolutionary nature of HRM. The latter mention the ``rhetoric'' of HR
practitioners, but should more accurately have referred to the rhetoric of the HR
academics who have been debating what HRM means, how different it is,
whether or not it is a good thing, indeed, whether or not it exists, endlessly and
unproductively. Practitioners have pressed on regardless, in the justified belief
that what the academics were writing about had little relevance to their day to
day lives as they wrestle with the realities of organisational life. They did not
suddenly see the light in the 1980s and change their ways, for better or for
worse. The true personnel professionals just kept on doing what they had
always done but tried to do it better. They took note of the much wider range of
publications about personnel practices and the information on so-called ``best
practice'' provided by management consultants and conference organisers, and
they learned from the case studies emanating from the research conducted by
the burgeoning academic institutions. They also recognised that to succeed in
an increasingly competitive world they had to become more professional and
they were encouraged to do so by bodies such as the then Institute of Personnel
Management. They took account of new ideas and implemented new practices
because they were persuaded that they were appropriate, not because they
fitted into any sort of HRM philosophy. HRM cannot be blamed or given credit
for changes that were taking place anyway. For example, it is often alleged to
have inspired a move from a pluralism to unitarism in industrial relations. But
Employee newspaper production was moved from Fleet Street to Wapping by Murdoch,
Relations not because he had read a book about HRM but as a means of breaking the
22,6 print unions' control.
Lowry's point is significant. It is the context within which people are managed
that is changing and personnel management has had to re-position itself in the
ever-changing environment of global competition, new technology, and new
methods of working and organising work. In the private sector the mantras are
sustainable competitive advantage, added value, core competences and
strategic capability. In the public sector the driving force is ``best value''. Whilst
in the voluntary sector, charities are saying: ``we may not be businesses but we
have to be business-like''. In this situation personnel management has had to
become more strategic but this is simply building on what effective personnel
directors were already doing in the 1970s and 1980s. As Don Beattie
commented in 1998 when he was personnel director of STC plc (cited by
Armstrong, 1989): ``Personnel directors are paid to know what business they
are in, to know where it is going, and to ensure that the input to get there is
available from a human resourcing and organisational capability point of
view''.
The notion that personnel practitioners became involved in strategy
formulation and implementation after HRM was invented is a travesty of the
facts. Perhaps the word ``strategy'' was not bandied around as much then as
now but personnel specialists could not deliver effective services unless they
understood the business context within which they were operating ± where the
business was going, what its needs were. To imply that until they travelled
along the road to Damascus in the mid-1980s they were unaware of the need to
innovate and think ahead is an insult to the many able personnel practitioners
who were doing just that before the 1980s.
Another concept often associated with HRM is that of the HR director as a The name has
business partner or manager. This idea is generally attributed to Ulrich (1998) changed
but was advanced many years before by Tyson (1985) who suggested that:
Personnel specialists as business managers integrate their activities with top management
and ensure that they serve a long-term strategic purpose and have the capacity to see the
broad picture and to see how their role can help to achieve the company's business objectives.
579
In 1993 the HR director of Motorola (cited by Armstrong and Long, 1994) stated
that: ``Basically, I have agreed with my teams that we will be business partners
in each business; we will have the understanding of what is going on to
converse knowledgeably with any of the business people''.
The business-orientated approach to people management described by
Storey (1989) as ``hard HRM'' emerged as a method of responding to and
supporting the enterprise culture of the 1980s. Personnel management simply
adjusted to new demands. More recently the importance of involving and
developing people which is characteristic of current approaches to personnel
management has been emphasised by the resource-based theory of the firm
formulated by Barney (1991). This suggests that competitive advantage is
achieved if a firm can obtain and develop human resources which enable it to
learn faster and apply its learning more effectively than its rivals. An approach
based on this concept will aim to improve resource capability (Kamoche, 1996)
achieving strategic fit between resources and opportunities and obtaining
added value from the effective deployment of these resources. This can be
regarded as no more than putting a label on what any effective personnel
director as manager believed before the advent of HRM. Those who were
business partners or ``architects'' (Tyson and Fell, 1986) were fully aware of the
need to integrate personnel and business strategies, although it is true that
HRM theory places considerable emphasis on the importance of external and
internal integration or fit.
The writer would like to share with the readers three examples from his
earlier experience which illustrate strategic or business-like approaches before
the term human resource management was coined. They are by no means
unique.
Bristol Aircraft
In 1961 the writer was a personnel officer in the Britannia Assembly Hall of
what was then Bristol Aircraft Ltd. The business strategy was quite clear. The
company had to manufacture, sell and deliver Britannia aircraft (the first large
turbo-prop aircraft) faster than the competition ± Lockheed with its Electra and
De Havilland with the Comet. To meet this business need a revolutionary
manufacturing system ± stage build ± was developed. This involved teams of
workers, some of them multiskilled (although that term was not used in those
days) who concentrated on one of the twelve successive manufacturing stages.
To meet this business/operational need, recruitment and training plans had
to be drawn up. The author of this article was in charge of a national recruiting
Employee campaign for skilled fitters. It was successful in getting people from all over the
Relations country but they did not stay ± half left within three months. This was
22,6 seriously holding back production. Investigations into the cause of this
problem included exit interviews and meetings with management, supervisors,
shop stewards and rate fixers (the people who agreed on the timing of jobs or
tasks which was the basis for the payment-by-results system). The message
580 was quite clear: as a result of a stream of design modifications and shortage of
tools and equipment, it was impossible for workers to predict their earnings
from the payment-by-results scheme. These earnings in any case, fluctuated
widely. Simply, the skilled fitters recruited and trained at considerable expense
could not keep their families in funds, so they went home. As a first attempt to
produce a business solution to this problem the author of this article suggested
that a group or team bonus scheme should be introduced, tied to the stage build
system. This met with overwhelming resistance from works management
(many of them ex-rate fixers) and the rate fixers themselves. That particular
retention crisis ended but the problems of wage drift (incentive earnings
increasing at a higher rate than productivity) and dissatisfaction with the
payment system remained.
So another approach had to be adopted which could be pursued when the
author took responsibility for education and training throughout the company
in 1962. With the active support and encouragement of the personnel manager,
John Raimes (no personnel director in those days), a system of what was called
project training was developed for managers. The slogan adopted for this
approach to management development was that it must be ``problem-based and
action-orientated''. It was, in fact, action learning before Revans (1971)
popularised the concept.
The first project was centred on the payment-by-results scheme and the
project team consisted of a production manager, a senior production engineer,
the chief aerodynamicist, the financial accountant and the deputy personnel
manager. The author facilitated the project ± recommending reading such as
Wilfred Brown's Piecework Abandoned (1962), arranging visits to Glacier Metal
and other firms which had changed their piecework systems, and setting up
seminars with experts. The educational aim of the project was to develop a
wider appreciation of management issues and approaches and an
understanding of the processes of modifying and diagnosing management
problems. The operational aim was to expose top management to new ideas
about how to run the payment-by-results scheme. The team reported to the
works director (an ex-rate fixer) and was aware that, realistically, he was not
going to be persuaded to change his views about the effectiveness of the
scheme, although it had clearly been demonstrated that it resulted in
continuous wage drift. However, the team was able forcefully to impress on
him the need to review rate fixing methods and check wage drift, and action
was accordingly taken. The point of reflecting on this experience is not that it
refers to a battle against an old-fashioned payment scheme, which is not
particularly relevant today, but the fact that John Raimes and the author could
have restricted themselves to recruitment, apprentice training and industrial The name has
relations, but chose not to. What we tried to do was to put the business interest changed
above the functional interest by playing our part as part of an integrated
management team. We had to plan what we proposed to do in the context of
what the business was intending to do. Otherwise we would have failed.
Performance management
584 Performance management is generally believed to be an invention of the late
1980s and early 1990s. But the term was first used by Beer in 1974 in describing
the introduction of performance management processes in Corning Glass. In its
earlier version, performance management was entirely based on the
measurement of achievements against agreed objectives. But this was nothing
more-or-less than the discredited management by objectives system. Features
of performance management such as integrating individual and organisational
objectives were part of the concept of management by objectives as originated
by Drucker (1955) and developed by McGregor (1957, 1960). As Drucker wrote:
``Business performance requires that each job be directed towards the
objectives of the whole business''. He emphasised the importance of
measurement, which is a basic feature of performance management but
stressed that: ``These measurements need not be rigidly quantitative; nor need
they be exact. But they have to be clear, simple and rational.'' In 1960,
McGregor wrote that the purpose of management-by-objectives should be ``to
encourage integration, to create a situation in which a subordinate can achieve
his (sic) own objectives best by directing his efforts towards the objectives of
the enterprise''.
Of course there have been some changes in the game. Performance
management has moved on beyond traditional approaches to performance
appraisal. The focus is more on problem-solving dialogue leading to agreement
rather than top-down rating (although the partnership approach was advocated
by McGregor in 1960). Another development is the introduction of the ``mixed
model'' of performance in which not only are outputs (achievements against
objectives) reviewed but inputs (levels of competence displayed) are also
assessed. The latter provide the basis for the preparation of personal
development plans leading to self-managed (but supported) learning
programmes.
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Employee
Relations Abstracts from the wider
22,6 literature
``The name has changed but has the game
590 remained the same?''
The following abstracts from the wider literature have been selected for their special relevance to
the preceding article. The abstracts extend the themes and discussions of the main article and act
as a guide to further reading.
Each abstract is awarded 0-3 stars for each of four features:
(1) Depth of research
(2) Value in practice
(3) Originality of thinking
(4) Readability for non-specialists.
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