Five possible relationships now are used in different companies. The first one is ‘the separation model’, which means no relationship at all. This model reflects the picture of the HRM twenty years ago, and can be found in the very small companies today. The second one is ‘the fit model’, which means the HR strategies should fit the organisational strategies. This model is the best structure of the relationships Phelps thinks, which can have efficiency in any organisations. It is, actually, used in many firms today. All the actions HR departments implement are in order to complete the goals of the firm. The third model is ‘the dialogue model’, which takes a further step on the relationships. A two-way communication is needed in the firm. The forth and the fifth models are ‘the holistic model’ and ‘the HR driven model’ respectively. These two models show that HR strategy is the key strategy in the company, and the other strategies are even decided on the base of them. However, it is not the normal case in today’s companies (Torrington,et. al., 2005).
From Torrington’s analysis, it can be seen that ‘the fit model’ is the usual model used in most companies. In other words, what Phelps emphasises is a common situation of most companies, which means the actions HR department takes can contribute to the achievement of the goals and have value in the companies. However, it does have problems in this case. Every company has different problems, and no HR action can be suitable for all the organisations. The following parts will discuss the two sides of this issue. (Appendix 2: Five Potential Relationships)
Do Contribute to the Achievement of Organizational Goals
Torrington has summed up all the HR actions into six parts: resourcing, performance, development, involvement, pay and organisation, (Torrington and Hall, 1998). There are three major actions concerned in the following to interpret the instances that HR actions do contribute to the achievement of goals:
Firstly, in an organization, HRM plays a vital role to select appropriate employees who are in possession of professional knowledge, abilities and skills needed by the development of organization (Bratton and Gold, 2003). In the process of selection, human resource department will be responsible for reviewing applications, interviewing candidates, checking references and background and finally, making a decision (Wright et al., 2004). Moreover, in a fair condition, this process will be carried out according to the strategy of organization. Under these circumstances, the organization can determine the most appropriate candidates since the fair and effective procedure of selection used. Put simply, these chosen candidates must have the enough capabilities to meet the special needs of organizational development.
As a successful company in developing global fast food, for example, Tricon Restaurants International Ltd. can be regarded as a prominent example to present the importance of selection to achieve organizational goals. In practice, conforming with the organizational strategy, human resource department not only focuses on selecting candidates who have the technical skills to fulfil the job, but, more significantly, they will pay more attention to whether the people having a kind of special ability to suit a changed environment. In fact, it is fundamental to survive in a new living environment so that employees having professional knowledge and skills can perform better in the process of work and avoiding some living issues, such as homesick. In this situation, employees accomplishing organization goals assigned efficiently and effectively will be available. (Bratton and Gold, 2003)
Secondly, one of the responsibilities of HRM is to train and develop employees’ abilities to enjoy the job, which include their knowledge and professional skills. Torrington et al., (2002) stated: “training course may be standard offerings by various specialist bodies.” By this process, employees can equip themselves with more special knowledge. After that, putting these theories learned from training process into practice, employees are capable of fulfilling the task assigned effectively and efficiently (Bratton and Gold, 2003). Thus, maximizing employees’ performance will help organization gain competence to achieve goals.
For example, Royal Mail Manual Data Entry Center in Plymouth, which is a part of Royal Mail Group plc, offers amounts of training courses to their employees. The role of staffs in the center is to assist Royal Mail system to dispatch a huge number of letters that cannot be recognized by mail machine. During the work shift, special time learning is set in order to enable employees to learn the organizational policy, strategic development and up to date key-related skills. Also, time learning provides a good opportunity for employees and line managers to communicate with each other. Consequently, employees can master essential keying rules and understand how to deal with special letters. Depending on such employees, weekly organizational goals to send mail timely can be achieved and profitability also can be improved.
Thirdly, human resource department is also responsible for designing and administrating reward system (Bratton and Gold, 2003). It needs to note that reasonable reward system contributes to motivating and attracting employees to implement tasks more efficiently. In other words, HRM attaches a great importance to the principle that employee’s performance in the work coincides with their reward. The better employees perform the higher reward they can get.
According to Maund (2001) stated that, in the UK, over the last 25 years, great change has taken place in the reward policies. The policy to implement reward system includes offering bonus and promotion, and so on. Obviously, because of these promoting actions, such as concerning monetary policy, employees can be encouraged to complete commitment as quickly as possible so as to accomplish individual targets. In addition, this policy also has a certain influence on the formation of competitive awareness among employees. These phenomenons naturally improve the achievement of organizational goals since human resources are used efficiently and effectively.
In addition to these functions described above, Gold and Bratton (2003) pointed out that HRM represents a variety of functions to assist an organization to reach reasonable targets, such as maintaining workplace safety to create a favourable working condition for employees, negotiating the relationship between employees and employers, and so on.
Do not Contribute to the Achievement of Organizational Goals
From the analysis above, it can be perceived that the HR actions facilitate the accomplishment of organizations’ goals in most cases. There is, however, paradox, which is inherent in HRM. Is HR generally a good thing or a bad thing? Does the HR contribute to the accomplishment of company’s goals?
To start with, some people argued various goals set by different departments lead to conflicts between them, which means ambiguity and inconsistency are the two main features of paradox in HRM. In modern business enterprises, different department set their goals varying according to their responsibilities. Even if two or more targets set have their rational reasons, yet conflict each other or contradict (Bratton, J. and Gold, J. 2003). In certain circumstances, in order to pursuit a specific organizational goal, managers from different departments are required to carry out actions separately. For instance, in a manufacturing factory, the goal of production department is to improve productivity and employee autonomy. In terms of this goal, HR may take actions of training employees in order that they can be suitable for the new positions as soon as possible and make employees have flexibility. However, the objective of finance department is to reduce administration costs and make more profits. Therefore, these two objectives conflict each other. For this argument, Torrington suggested that HRM still had its positive attributes. As a consequence of HRM, training budgets have been far better protected in the most recent recession than that has happened on previous occasions. (Storey, 1995)
Secondly, some HR actions might result in the deleterious consequences accompanied by productivity benefits, (Bratton, J. and Gold, J. 2003). Because of the huge transformation in the organization, downsizing and delaying have increasingly become a normal phenomenon in recent years. To some extent, these actions taken by HR will impact employees’ loyalty inevitably, (Farrance, 1992). Owing to the objective of HR is to make employees more efficient, downsizing and delaying are one of the HR strategies, but bringing some negative effects on their employees, who might feel their positions unstable and choose to leave the company. For this controversy, Harvey, 1999 stated that downsizing and delaying as a trait reflects the changes of structure in many industries, (Harvey, 1999). Most of industries have changed their roles and become ‘leaner’ and ‘fitter’ and consequently, they require their employees having more flexibility, (Harvey, 1999). Thus, it can be concluded that this kind of HR action still contributes to the achievement of its goals, although, in the process of implementation, it might lead to the opposite consequences.
Conclusion
With the evolution of HRM, personnel management have been changed gradually to strategic human resource management. In modern companies, human resource strategies generally fit to the missions of organisations, since many human resource actions have been proved to contribute to complete the goals of organisations. Therefore, it means the human resource actions do have great value in the organisations. However, because of the contradiction of HRM, not all the actions are helpful in achieving the goals. Human resource management, sometimes, generate the deleterious consequences to the organisation, although the purpose of these actions are based on the organisational strategies. Consequently, the view of Phelps might be unilateral from which some other situations of human resource management are ignored. In a nutshell, the human resource management has a significant position in the organisations, of which actions do have great value in the organisations.
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