Human resource management and business strategy links: an empirical study

Over recent years there has been an increasing interest in the field of human resource management. Currently, the literature encourages the consideration of human resources as strategic factors, not only because they play important role in strategy implementation, also because they are beginning to be reckoned as sources of sustainable competitive advantage. Relationships between human resource management and strategy have been studied from different perspectives. This article focuses on one of them. It examines matches between human resource practices and types of business strategy. The question addressed is: do human resource management practices vary with business strategy? To answer this question, empirical research was developed. Using data collected from 200 Spanish companies, this paper demonstrates significant associations between some human resource practices and business strategy in companies. Reported results support some of the previously established relationships. Implications for future research are discussed.     

Coping with an emerging market competition through strategy-human resource alignment: case study evidence from five leading Japanese manufacturers in the People's Republic of China

This paper documents how PRC-based Japanese affiliates can align their human resource management (HRM) policies and practices with their business strategies based on in-depth interview surveys of the five leading Japanese manufacturers in China. In particular, using a multiple-informant research design to interview both top and human resource managers in each site, the study has attempted to clarify the strategic fit between the business strategies pursued and HRM practices adopted in China. Our interviews with top management for each affiliate revealed three types of business strategies that the PRC-based affiliates adopt to gain competitiveness in the Chinese market. Separate interviews with HR managers further clarified that affiliates' HRM efforts are aligned with the strategy each affiliate is pursuing. The findings are used to suggest several hypothesized relationships between the particular strategies pursued and the HRM practices adopted in China. Furthermore, this study has provided some important insights as to how the choice of affiliate-level business strategies in China affects the ‘hybridization’ processes of the HRM policies and practices used in the cross-national business environment.     

International human resource policies and practices in japanese,european, and united states multinationals

This article presents the results of a survey comparing international human resource policies and practices in Japanese, European, and United States multinational companies. The survey focused on the use of expatriates over local nationals in overseas management positions, adoption of nonethnocentric policies, and incidence of international human resource management problems. Regression analysis using the entire sample indicated that ethnocentric staffing and policies are associated with higher incidence of international human resource management problems. Also, Japanese companies as a group are shown to have more ethnocentric staffing practices and policies, and they experience more international human resource management problems than do American and European firms.     

Aligning strategic human resource management and person–environment fit

Strategic human resource management addresses the need to create vertical linkages of human resource management (HRM) attributes with corporate strategy as well as horizontal linkages that integrate practices among HRM functions. Most models commonly focus on either vertical or horizontal linkages. This paper utilizes three categories of person–environment fit to create both vertical and horizontal linkages. Based on a strategic contingency framework, it demonstrates how person–environment fit relates to organizational competencies that supports corporate strategy. Furthermore, it demonstrates how person–environment fit can be used to promote internal alignment of HRM practices. Implications of this approach to strategic human resource management are then discussed.     

Antecedents and Outcomes of Diversity and Equality Management Systems: An Integrated Institutional Agency and Strategic Human Resource Management Approach

This study examines the development and impact of diversity and equality management systems (DEMS). A national sample of human resource managers from 155 Canadian firms responded to surveys about their firm's diversity and equality management (DEM) practices. Cluster analysis and latent class modeling identified three distinct approaches to DEM: classical disparity DEMS showing limited development of DEM‐related practices, institutional DEMS involving complex selection mechanisms and monitoring of employment statistics, and configurational DEMS linking diversity to business strategy. Hypothesis‐testing analyses indicated that both institutional and configurational DEMS were predicted by coverage by the Canadian employment equity program, federal contractor status, and the presence of a diversity expert on staff. Only configurational DEMS was predicted by inclusion of HRM in developing business strategy. Configurational DEMS positively predicted the employment of workers with disabilities and members of visible minority groups as well as ROA. These findings support the proposition based on strategic human resource management (SHRM) theory that DEM practices should be considered as bundles and that vertical linkage to strategy is important for DEM effectiveness. As such, SHRM theory explains how managers can structure strategic responses to institutional pressures that go beyond requirements to achieve strategic goals. © 2015 Wiley Periodicals, Inc.     

Strategy, human resource management and performance: Sharpening line of sight

This paper builds on previous theory and research on strategy and human resource management to identify important linkages between the firm's strategy, its human resources, and performance outcomes. First, we review the relevant literature focusing in particular on the role of human resources in creating competitive advantage. We then present a multi-level model illustrating how human resource management practices can effectively align organizational, group and individual factors with the organization's strategy. We redefine line of sight as the alignment of organizational capabilities and culture, group competencies and norms, and individual KSAs, motivation and opportunity with one another and with the organization's strategy. Further, we propose that such alignment contributes to the creation of human capital and social capital, both of which are necessary to achieve and sustain superior performance. We conclude the paper with some implications for future research and practice.     

Gaining competitive advantage through human resource management practices

Critical to a corporation's growth and prosperity is gaining and retaining competitive advantage. Although corporations may pursue many paths to this end, one that is frequently not recognized is capitalizing on superior human resource management. Currently, many companies recognize the growing importance of their human resources, but few are conceptualizing them in strategic terms—in ways to gain a competitive advantage. As a result, many companies forego the opportunity to seize competitive advantage through human resource practice initiatives. However, there are a few companies that do not forego the opportunity. We use them as examples to show how to systematically develop such advantages via a “target/thrust matrix.” The end results of this matrix have significant implications for both corporate strategy and personnel and human resource management.     

Dynamic and customer-oriented workplaces: implications for HRM practice and research

Changes in competitive environments are resulting in changes to the nature of work. We present job structure changes and a heightened customer orientation as two primary examples of changes that necessitate adaptation of human resource management (HRM) practices. The level of success in light of these organizational changes will largely be determined by how effectively people are managed in the new organizational environments. HRM practices that adapt to the new organizational conditions can add tremendously to the business and be a key to long-term competitiveness. We examine the implications of these changes for HRM practice and research, with particular attention to psychological contracts, job analysis, selection, and performance appraisal. The thrust of the article is to identify and describe research directions that have the potential for contributing to the future relevance and success of HRM.     

Uncovering competitive and institutional drivers of HRM practices in multinational corporations

Current international human resource management (IHRM) literature focusing on multinational corporations (MNCs) presents evidence of both similarities and differences in the HR practices adopted in different global locations. However, the drivers behind this duality require more detailed investigation. This article focuses on exploring why MNCs position themselves within global markets as they do, exploring how extant theory can help explain the drivers behind both global and national HR practices. Based on a worldwide sample of in‐depth interview‐based case studies of well‐known MNCs, we explore the ways in which different firms react to both institutional and competitive pressures in selecting their approach to HRM. The findings uncover a differentiation between external global competitive isomorphic pressures, external national institutional isomorphic pressures, and internal processes of strategic choice and competitive differentiation. It is suggested that MNCs face all three drivers of HRM simultaneously, leading to different patterns of practice adoption, adaptation and innovation.     

A study of HRM and recruitment and selection policies and practices in Taiwan

In this paper, the authors present and discuss the findings of a survey of human resource management (HRM) and recruitment and selection policies and practices in a sample of manufacturing industry in Taiwan. The results indicate that there is a general desire among HR professionals in participant companies that HRM policies are integrated with corporate strategy and that HRM should be involved in decision making at board level. Evidence was also obtained that some HRM decisions are shared between line management and HR specialists and that line managers had a particularly influential role in decisions regarding recruitment and selection, training and development, and workforce expansion/reduction. There was also some evidence supporting an assertion that certain recruitment and selection practices were culturally sensitive and this was supported by evidence of association between recruitment and selection practices and country of ownership.     

HR's strategic role within MNCs: helping build social capital in Latin America

In this article, we adopt a holistic perspective in considering the impact of the country's environment as well as the multinational corporations (MNCs) strategy on human resource (HR) practices. More importantly, we argue that within MNCs human resource management (HRM) is playing a central role in the process of balancing local and global forces. HR can be critical in helping MNCs' deal with local differences while also helping the company implement practices that are critical for its global strategy. Specifically, we argue that HR plays a key role in developing social capital, which may provide the necessary ‘substitutes’ for formal control that would otherwise be neglected. Our contribution lies primarily in outlining how this new role of creating human capital confers on HR the task of filtering mission-critical practices through a ‘localization mesh’ that ensures success. In addition, given the importance of social capital as an informal mechanism that allows MNCs to coordinate and integrate activities, we suggest ways in which an MNC can build social capital within the context of the Latin American pan-regional cultural values.     

The content of manufacturing strategy: An empirical study

While there has been an extensive literature written on manufacturing strategy since the 1960s, little empirical research has been done. This article reports on a study of manufacturing strategy in thirty-nine companies based on questionnaire responses received from manufacturing managers.The study indicates that things are not as bleak as the literature might suggest. About one-third of the companies appear to have a well-developed manufacturing strategy. In those cases where the manufacturing strategy exists it is consistent with the business strategy and internally consistent among mission, objectives, policies, and distinctive competence.The term “manufacturing strategy” is not well understood by the managers surveyed. When asked to state their manufacturing strategy, they gave statements about what manufacturing should be, what it should do, how it should do it, and why it should do it. Apparently, the terminology itself is confusing. Frameworks for stating both business strategies and the elements of manufacturing strategy need to be strengthened and some specific suggestions are given in the article for doing so.Even though two-thirds of the companies did not have well-developed manufacturing strategies, 80% of the managers felt that manufacturing had lent competitive strength to the business. This was being done through the development of a distinctive competence in manufacturing that provided competitive advantage.Manufacturing strategies seemed to follow from business strategy. This is contrary to the literature, which indicates that manufacturing strategy is missing, or, at the very least inconsistent with business strategy and marketing strategy. Perhaps a stronger relationship exists than was previously thought. This article provides some evidence for establishing this premise and also provides data on the general status of strategy in manufacturing today.     

Status inconsistency: an antecedent to bullying behaviour in groups

This paper draws on frameworks developed by the strategic international human resource management (HRM) literature to analyse human resource practices in foreign-invested enterprises in China and their affiliates. It argues that such strategies can be best understood in the context of global commodity chains. Drawing on data from a study of 27 China-based enterprises in two industries, garments and consumer electronics, it contests that strategy is a good determinant of HRM policies. Moreover, most of the enterprises are following cost reduction strategies but with certain quality levels, based on standardized mature products and production processes. Industry sector is also important, as is the institutional milieu of China.     

The interaction of human resource policies and practices with the implementation of teamworking: evidence from the UK public sector

Our study examines the interaction of human resource policies and practices with the implementation of teamworking. Put simply, do certain human resource policies and practices support the implementation of teamworking? Do certain human resource policies and practices work against the implementation of teamworking? It utilizes an illustrative case from the UK public sector – the Inland Revenue, the UK tax assessment and collection agency – to address the research question. The case of the Inland Revenue gives support to the argument that it is necessary to identify and understand the differences between a variety of forms of teamworking. With the variation in forms of teamworking that are implemented, there may be variations in the human resource management context. In short, a contingency approach to the interaction of the implementation of teamworking with human resource policies and practices may be appropriate. In the case, teamworking was implemented to facilitate the introduction of a new tax regime in the face of reduced numbers of middle managers and clerical employees, and certain human resource policies and practices had an effect upon its implementation. These were front line manager selection and development in particular, while team member selection and development and employee relations appeared less important.     

HR and IT capabilities and complementarities in knowledge-intensive services

The main premise of this article is that human resources (HR) and information technologies (IT) are central rather than support functions in knowledge-intensive services. By building management capabilities in both HR and IT, knowledge-intensive services can transform their business processes that, in turn, enable them to provide exemplary services to the customers. Our arguments are grounded in the three related theoretical frameworks of the resource-based view, organizational capabilities, and the theory of complementarities. We suggest that the research and practice in HR and IT fields may have to focus on HR and IT capabilities rather than HR practices or IT investments as the sources of sustainable competitive advantage since capabilities better fit the definition of a ‘resource’ than HR practices or IT investments. Further, organizational capabilities in both HR and IT may enable knowledge-intensive services to transcend the inherent tradeoff between cost and responsiveness. We also discuss the role of HR and IT in knowledge management.     

Quality and cost? The evolution of Walmart's business strategy and human resource policies and practices in China and their impact (1996–2017)

This study responds to calls for more in‐depth and qualitative studies, the return to a focus on external factors, and the inclusion of business strategy and industrial relations in human resource management (HRM) research, as well as more research in the retail sector in the Chinese context. We examine the coevolution of the business strategy and HR strategy of Walmart (China) in the last two decades and identify tensions in the context of intensifying competition in the Chinese retail market. We highlight the interactive effect of business and HR strategies through a historical lens. Our study reveals a shift from the original employee‐oriented win–win strategy through rent sharing between the firm and the employees to a win–lose strategy through the introduction of more cost conscious HR policies and practices. Findings of our study challenge the conventional wisdom that firms adopt either the cost or quality strategy and, along with it, the suggestion of matching the quality strategy with employee‐oriented HR policies and practices, and cost leadership with a transactional approach to HRM. We argue a cost and quality business strategy may be adopted, which requires the support of employee‐oriented, rather than cost‐oriented, HR policies and practices.     

The ‘old’ and ‘new’ competition and Malaysian manufacturing firms: a case study

The majority of empirical studies dealing with production processes, work organization and industrial relations practices have been conducted in advanced industrial nations. This article reports on a study of the changing nature of work organization and industrial relations policies in the developing economy of Malaysia. It explores the broad patterns of change in human resource management, technology and work organization among Malaysian manufacturing firms in the context of Best's ‘old’ and ‘new’ competition. The question that arises is: does the evidence reveal that Malaysia is embracing elements of the ‘new competition’, or is it still locked into a regime of mass production, or both? The article argues that the ‘old’ and the ‘new’ competition should not be treated as a simple, straightforward duality model of development. The distinction between the two approaches is sometimes blurred and not so clear-cut. The case study observes that both systems could be operating side by side at the same time within an organization. Since the Malaysian manufacturing sector is expected to shift from simple assembly and process-type operations using labour-intensive techniques to the more advanced and higher value-added industries, greater investment in HRD to upgrade the skills of the work-force and the adoption of appropriate industrial relations policies that emphasize decentralization, greater employee involvement and continuous innovation will become crucial. To be able to compete successfully in the global economy would require a change in focus in the adoption of industrial relations and human resource development policies. For Malaysia to realize its aspiration to become an industrialized and developed nation by the year 2020 would require radical changes in those policies within the context of an integrated approach to economic and industrial planning.     

The complexity of managing human resources in Peru

This article describes how the politics of human resources have changed in Peru, and how this change played an important role in the reforms that occurred throughout the 1990s. Throughout the article, we examine how the size and the type of organization influence the generation of human resource management. For example, some medium-sized businesses have successfully integrated their human resource management with its central competencies, experiencing positive economic and financial business results. Other companies chose to circumvent human resource management issues by outsourcing or using contract workers, relegating the role of human resources to a peripheral role. Transnational organizations bring many methods and selection processes, promotions, evaluations, training and salary determination. The article ends with a comparative analysis between the formal and informal sector of the national economy with respect to human resources practices.     

Managing Human Resources in South Africa: A Guide for Internationals

ABSTRACT

With the political changes that took place during 1994 within South Africa, the country again, after many years of economic isolation, became a full member of the international community. Since then, many South African companies have attempted to become more competitive, and many international companies have shown a keen interest in doing business in the country. As a result of the important role that human resource management practices can play to help companies prosper and become successful, an investigation was undertaken within companies to establish to what extent HR practices were being applied. The results of the study are reported in this article.