Manajemen | Fakultas Ekonomi Universitas Maritim Raja Ali Haji 2002 26
AFTERWORD
EMPLOYEE REACTIONS TO HUMAN
RESOURCE MANAGEMENT:
A REVIEW AND ASSESSMENT
STEPHEN DEERY*
The reactions of employees to Human Resource Management (HRM) practices
have attracted little scholarly attention. Even less research has been conducted
into the effects of those practices on employee wellbeing. Instead, much of
the research has focused on the types of policies and practices that might be
coupled or bundled together to deliver higher organisational performance. Where
subjects like job satisfaction have been investigated, associations are invariably
made with outcomes of wider concern to management such as organisational
commitment, employee withdrawal behaviour or more recently customer satisfaction and loyalty (Spector 1997). Of course, it can be suggested that there is a
symmetry between HRM practices that deliver better performance and those that
provide an enhanced working environment and greater job satisfaction. Examples
of such practices include certain forms of participative work arrangements, open
communication systems, formal training and development schemes, and voice
mechanisms that ensure organisational justice.
Nevertheless, there are many HRM practices that are designed neither to
promote employee wellbeing nor to result in a fairer or more congenial
working environment. The greater application of performance-based pay and
individual appraisal systems is designed principally to enhance work performance.
The same objective underlies the more extensive use of direct communications
with employees – often designed to restrict union involvement in the substantive
rule making process – and the marked increase in employee attitude surveys and
the provision of customer satisfaction data. Moreover, these practices can result
in less certain and regular pay increases and erode job security. In addition, they
may lead to an intensification of work effort (Green and McIntosh 1998).
Not only may different HRM practices have variable effects on employees but
the environment in which they are nested may also affect workers’ emotional
and material wellbeing. Certain innovative practices such as teamwork, employee
involvement and gain-sharing are much more likely to deliver both quality of
work life improvements and higher productivity outcomes in a unionised rather
than non-unionised environment (Eaton and Voos 1992). Unions can provide
* Professor of Human Resource and Public Sector Management, The Management Centre, King’s
College, London SE1 9NN, UK. Email: [email protected]
THE JOURNAL OF INDUSTRIAL RELATIONS, VOL. 44, NO. 3, SEPTEMBER 2002, 458–466
A F T E RW O R D
459
employees with an effective voice in the design and implementation of such
programs, resulting in better balanced outcomes for employees.
It should also be pointed out that high performance/high commitment HRM
practices can coexist with other policies in the firm that involve harsher forms
of management control and limitations to involvement in the organisation.
Employment policies can be combined to provide certain types of (core)
employees with opportunities for participative decision-making and skill enhancement while at the same time exposing other (non-core) employees to more
rigid forms of discipline and the vagaries of the external labour market. Indeed,
there is some evidence that the presence of ‘mutual gains’ HRM policies in
organisations are positively associated with the greater use of temporary contracts,
outsourcing and subcontracting (Kalleberg 2001). Thus, even in those firms
that practise high commitment management, it is unlikely that the gains will
be distributed evenly or equitably among all employees.
The purpose of this Special Issue of the Journal of Industrial Relations is to
examine and assess HRM policies from the perspective of the employee. Which
practices, for example, are associated with higher worker satisfaction? Does
teamworking offer workers the benefits of greater autonomy and self direction
and what are the possible effects on the representative structure of the workplace? Do interrelated high commitment work practices yield more contented
and productive employees? Are high performance work practices associated
with positive or negative consequences for workers? Can greenfield sites be used
as a mechanism to diffuse high commitment management to older and more
established parts of business? How do particular organisational contexts affect
the response of employees to the introduction of new performance management
practices?
In the opening article, David Grant and John Shields offer a constructive
critique of approaches to the employee in the existing mainstream HRM literature and provide an alternative means of conceptualising the employee as the
primary subject of HRM. Taking issue with both the proponents and critics of
HRM, they contend that both camps err in viewing the employee in instrumental
terms. Whether the writer sees HRM as good or bad for workers, the latter are
represented essentially as the means to management ends. It is only in the small
but emerging employee-centred literature, they suggest, that the employee
emerges as an active and independent-minded stakeholder in organisational
processes. Following what is now a well-trodden path, Grant and Shields also
draw attention to inconsistencies and debates surrounding the scope and basis
of HRM itself. Is HRM just a generic label for all current modes of employment
practice, or does it amount to a best practice approach and, if so, what particular
constellations of practices constitute best practice? If the purpose, then, is to
explore the connection between HRM practice and employee response, it is
necessary to establish not only how and why employees respond to HRM but
also what it is that they are responding to.
Toward this end, Grant and Shields propose a discursive framework of
analysis that distinguishes between discursive concepts (HRM ideas), discursive
objects (idealised human resources) and discursive subjects (thinking and acting
employees on whom HRM is practised). Invoking two key constructs from the
460
THE JOURNAL
OF
I N D U S T R I A L R E L AT I O N S
September 2002
existing employee-focused literature, namely the notions of the ‘psychological
contract’ and ‘organisational justice’, the authors propose a series of research
questions, which they suggest, would assist in re-centering the employee as the
primary subject of HRM. While such an approach may not resonate with those
simply interested in organisational performance outcomes, it may well find favour
among those with a more phenomenological orientation. These scholars may also
be attracted to the prospect of applying discursive analysis to the concept of the
psychological contract and to the precepts of organisational justice. The central
theme of this opening piece, however, is the authors’ insistence that worker expectations and perceptions should be acknowledged and interrogated, and not
ignored or pre-judged as is so often done by both the proponents and critics of
HRM.
In the second article, David Guest also presents the argument that workers
should occupy a more central location in the analysis of HRM. Rather than
corporate performance being viewed as the principal outcome measure, Guest
suggests that ‘employee-centred outcomes’ should be embraced equally as a
subject of HRM research. Thus, worker wellbeing should join discretionary
effort as a core area of analysis. Guest believes that workers can be ‘built’
into HRM research in two ways: firstly, by specifically entering them into the
HRM-performance equation by measuring the effect of employee satisfaction
and wellbeing on organisational performance, and secondly (and perhaps more
importantly) by examining the impact of particular HR practices on employee
perceptions of their own wellbeing. In relation to the first issue, Guest presents
findings that suggest that certain HR practices can have a positive effect on worker
attitudes and behaviour and that this, in turn, can affect performance. As to the
second area of research, Guest provides data from Britain indicating that particular
HRM practices are positively associated with workers’ assessments of work and
life satisfaction. Work satisfaction is associated with more challenging and interesting jobs, a friendly (trusting, supportive) organisational climate, open
communications, practices that limit harassment and equal employment
opportunities and family-friendly policies. The results for life satisfaction are
not dissimilar.
These findings identify important HRM practices that are indeed workerorientated. These practices generally do not enter equations seeking to estimate
the impact of high commitment/high performance work systems on organisational
performance. Moreover, they do not appear to be widely utilised among the
growing number of workplaces in Australia that have developed highly individualised, non-union working arrangements (Deery & Walsh 1999). In Britain
as well, the evidence does not indicate that there is a broadening commitment
to developing more challenging jobs and friendly and trusting organisational
climates. Indeed, Gallie et al. (2001) have found that during the 1990s there was
a noticeable decline in personal initiative at work and a reduction in the discretion
that employees were allowed to exercise over their work. In addition, there
appeared to be an increase in the overall tightness of management control of work
performance.
A similar point could also be made about employee-friendly HR practices in
light of Guest’s findings. Issues relating to organisational justice and employee
A F T E RW O R D
461
voice are important to worker wellbeing. However, these were not specifically
included in Guest’s two models. This is unfortunate since it is well established
that perceptions of equity and fairness (distributive, procedural and interactional
justice) are associated with job satisfaction (Folger and Cropanzano 1998).
Furthermore, recent research in the US has found that workers want to have
a voice in workplace governance (Freeman and Rogers 1999). Not only did
employees want to participate as individuals in job-related matters but they also
perceived a need to exercise a collective voice over matters such as health and
safety, pay rate and benefits, particularly in the form of union representation. They
saw management as unwilling to share power and believed that their wellbeing
required a representational voice that was independent of the company.
Interestingly, employees felt that if they did have a greater say at the workplace
it would not only improve the quality of their working lives but it would also
make their organisation more productive.
In her contribution, Marian Baird examines the effect of High Commitment
Management (HCM) practices on the employment relationship. She is principally
concerned with the dangers of these practices for employees and unions and
the adequacy of employee voice mechanisms to protect worker interests in this
context. This research was conducted in a manufacturing organisation which had
two sites: an old established brownfield site with a multiple union presence, and
a more recently commissioned greenfield operation with a single union and a
clutch of high commitment HR practices. The case study records two interrelated
developments. The first was the fairly rapid and unimpeded diffusion of HCM
practices from the greenfield to the brownfield site. Old working arrangements
were discarded as new forms of multi-skilling and employee involvement were
installed, and fourteen unions were reduced to one. The second development
was the extension of the decision-making role of the team system and the
apparent replacement of distributive bargaining with integrative bargaining
as the union in the greenfield site was progressively marginalised.
The reasons for the loss of union influence were difficult to identify. Did
the HCM practices strengthen employee identification with the company
and weaken union loyalty? The survey data on employee attitudes does not
suggest that this was so. Organisational commitment at the greenfield site
actually fell over the period of the study. Why was the union not able to tap
into any rising discontent? Perhaps the unitarist design of the HCM practices at
both sites left little room for collective bargaining and workplace rule mediation.
Alternatively, the union may have neglected its representative activities, failing
to devote appropriate resources to servicing its members and allowing management at the workplace level to redefine its role. The loss of independent representation therefore may have had as much to do with union inattention as it did
with HCM.
Richard Dunford and Ian Palmer present us with a study of an organisation
that possesses textbook-perfect HRM practices. Not only did those practices seem
to be complementary and mutually reinforcing, they also appeared to yield
high levels of employee satisfaction and exceptional performance outcomes.
The key to the firm’s success was said to lie in its structure. The organisation – a
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large multinational – was built around small business units and teams. In turn,
individuals and teams were provided with considerable autonomy and responsibility, a pay system that reinforced teamwork but also encouraged initiative,
extensive and ongoing training, open communication systems and an emphasis
on internal promotion, egalitarianism and minimal status differentials. On the
basis of the interviews conducted with the staff – from senior management to
the most recently appointed sales consultant – there appears to be universal
support for the company’s practices and for their motivational qualities. All in
all, a remarkable congruence has been engineered between the interests of the
individual, the group and the firm. The case is resonant of South West Airlines,
with its hand-picked and happy staff, its emphasis on egalitarianism and its
excellent performance standards (Hallowell 1996).
However, the study did not pick up any discordant voices or any recalcitrant
behaviour. Why? The organisation employed sophisticated selection and recruitment techniques but how did it manage to achieve such a good person–job fit?
Interactive service work can be a source of considerable job satisfaction but it
can also be a cause of great anxiety and stress (Wharton, 1996). What undercurrents lay beneath this snap-shot of corporate happiness? Were there other
dimensions to the employee response? What were the attrition rates in the
company? Teamworking combined with performance-related pay can be associated with significant peer pressure to maximise sales and to conform to a ‘work
hard’ culture. Were there not casualties of these work and pay arrangements? In
the absence of an interviewing schedule that included past employees it may not
be possible to identify the full range of employee responses to the organisation’s
HR practices.
Self-managing teams are seen as an integral part of High Performance Work
Systems (Appelbaum et al. 2000). They are said to provide workers with greater
autonomy, influence and responsibility over task completion and with a broader
set of inter-dependent skills. Organisations benefit by eliminating supervision
that is not needed and from greater employee motivation, productivity and
commitment. More generally, self managing teams are viewed as an evolutionary development in the management of work; from a traditional bureaucratic
structure to a more decentralised, participative and democratic form of controlling
work activity (Barker, 1999). However, critics have seen this as a mirage and
pointed, instead, to a reality of peer control, work intensification and limited
autonomy. In their piece, Buchanan and Hall explore these competing claims.
They point to an ‘essential dualism’ in teamworking: on the one hand, a capacity
to promote a more varied and satisfying work experience; on the other, the
possibility of creating greater work pressures and imposing new disciplines and
controls on employees. As they observe, ‘teams are neither essentially “good”
nor “bad” for labour’.
What then does shape the effects of teams on employees? Buchanan and Hall
submit that it depends on the motivations for the introduction of teams. A body
of evidence is drawn from existing case studies conducted in the automotive and
metals and engineering industries. It suggests that teams: (i) were introduced
in a context of cost cutting; (ii) were designed to improve organisational
A F T E RW O R D
463
performance; (iii) yielded little real employee decision-making; and (iv) marginalised trade unions. Buchanan and Hall find that teams were provided with
limited operational control over day-to-day production decisions. Teamworking
was associated with the removal of managerial layers in the organisation, which
gave workers some added responsibilities, but this tended to augment stress
levels rather than pay levels. Most importantly, management’s objective for
introducing teams was more to do with meeting production targets than enriching the lives of the workers. This tends to confirm Buchanan and Hall’s initial
thesis. However, the data from the existing studies are limited. Although they
infer a relationship between motivation and effect, it is unfortunate that they could
not be interrogated further to explore related questions. For example, what effect
did teams have on employee motivation, job satisfaction, organisational commitment and performance? Did it vary according to the degree of self-management
that was extended to the different teams? Was bureaucratic control replaced by
‘concertive control’ whereupon team members imposed new norms, rules and
pressures upon each other in ways that were functional for the organisation?
Under what conditions or circumstances were unions more likely to be marginalised by teams? These are important and relevant questions that flow from
Buchanan and Hall’s useful compilation of secondary source data.
Bill Harley’s article seeks to assess the relationship between High Performance
Work System (HPWS) practices and employee outcomes using the 1995
Australian Workplace Industrial Relations Survey (AWIRS95). As noted above,
some research suggests that HPWS practices are associated with positive
attitudinal outcomes while other findings point to more negative effects on
workers. Harley’s study draws upon two sets of data. The first set is drawn
from survey responses of managers who are asked to supply information about
particular characteristics of the workplace, such as: Does teambuilding exist? Do
employees get involved in change? Are there autonomous work groups at the
site? Does management communicate with its staff about its investment plans?
The second set of data is drawn from a separate survey of individual employees
who are asked questions about their job satisfaction, job security, levels of stress
and attitudes to management among other issues. The two sets of data are linked
together in such a way that it is possible to identify which employees (and their
attitudinal responses) are attached to which workplaces with particular HPWS
practices in place. Thus, the article seeks to identify whether certain attitudes
such as job satisfaction, might be associated with certain workplace HRM
practices, like teambuilding.
The findings indicate that there is practically no relationship between the
HPWS practices identified by the management respondents and the particular
attitudinal responses recorded by the employees. Furthermore, in the two-step
regression model in Table 5 the 14 HPWS practice variables explain almost no
variance in the attitudinal variables at all. Thus, for example, the job satisfaction
of employees (a positive measure of wellbeing) is not affected by downward
communication practices, upward communication practices, equal opportunity
policies, family-friendly policies, employment security, training, involvement of
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unions or employees in change or the existence of autonomous work groups
or teambuilding. Furthermore, levels of reported stress are not affected by the
presence or absence of any one of these HR practices. Harley suggests that
the reason for this is ‘that HPWS practices make little difference to employees’.
This indeed may be the case.
There is, however, another possible explanation for the absence of any real
relationship. The analysis may be affected by measurement error. It has been
shown that measures of HR practices can suffer from severe problems of construct validity (Gerhart et al., 2000). Single respondents (e.g. a senior manager
at a workplace) can produce quite unreliable information about HR practices.
Wright et al. (2001) have found that significant disagreements can exist between
employees and HR managers about the existence of particular HR practices at
both the site and job level. They have identified very low interrater reliabilities
(congruence of responses) for many questions relating to job security, training,
career opportunities and employee participation and have urged extreme
caution when using data from single informants. Thus, we may have a situation
where a single management respondent indicates that a practice exists (e.g.
teambuilding or training), but an employee working at the same site either
disagrees with that assessment or has had no experience of that practice. Thus,
any attempt to explain variations in employee attitudes (such as job satisfaction)
through the reported existence of a particular work practice by a manager may
be rendered meaningless by problems of measurement error. These problems
can, of course, be minimised by gathering the same data (from work attitudes
to workplace HR practices) from multiple respondents, as Guest has done in
his contribution.
The final article, by Michael O’Donnell and John Shields, analyses the
responses of employees to individual performance management practices in two
separate organisations within the Australian public sector. It examines those
responses within the context of the literature on the psychological contract and
explores the possible effects of those performance management practices on
contract fulfilment violation. The article documents a fundamental shift in the
management approach to employee motivation in the Australian public sector:
from a culture of career service to a system of performance management in which
individual contributions are linked to organisational objectives and rewarded
through performance-related pay. O’Donnell and Shields evaluate the success of
this attempt to transform employment relations in the Department of Finance
and Administration and in the Australian Defence Force. They find very
different espoused cultures and management styles, which affect both the
agencies’ approach to performance management and the employees’ attitudes to
the new processes and practices. In the Army there was a greater emphasis on
performance feedback and personal and career development while in Finance and
Administration there was a stronger focus on contingent pay, individual performance and processes that were said to reward extroversion and visibility.
Greater employee satisfaction was recorded with the performance management
arrangements in the Army although that agency suffered from systemic problems
of under resourcing and poor long-term career opportunities.
A F T E RW O R D
465
The authors suggest that a move towards a more transactional psychological
contract – which is inherent in the Finance and Administration model – carries
dangers of diminishing organisational trust and perceptions of injustice and
unfairness. Certainly, the research confirms the relevance of earlier studies
that have emphasised the importance of meeting employees’ development needs,
setting clear and fair performance goals and providing regular feedback and
good management support. The piece also raises interesting questions about the
psychological contract and its possible violation. By introducing new performance
management systems as part of a programmatic change process and by raising
expectations about the potential rewards that will accompany those systems,
are organisations making it more difficult to fulfil their employees’ psychological
contracts?
In conclusion, the articles contained in this volume provide important new
insights into the effect of HRM policies and practices on employee reactions and
wellbeing. Although they utilise different methodologies and draw upon different
types of evidence and data, all attempt to record the employee’s voice and assess
their attitudes/responses/behaviour to HRM. In this sense, they complement
earlier research – often ethnographic or case study in nature – that sought to
understand how workers responded to, or fared under, other work regimes and
management control systems, whether Taylorised or bureaucratised. The similarities or differences with those research findings may warrant further exploration.
Finally, the Editors are to be congratulated on drawing together into one issue
such an interesting and challenging body of work.
REFERENCES
Appelbaum E, Bailey T, Berg P, Kalleberg A (2000) Manufacturing Advantage. Ithaca NY: Cornell
University Press.
Barker J R (1999) The Discipline of Teamwork. Thousand Oaks, California: Sage.
Buchannan J, Hall R (2002) Teams and Control on the Job: Insights from the Australian Metal
and Engineering Best Practice Case Studies Journal of Industrial Relations 44 (3), 397–417.
Deery S, Walsh J (1999) The character of individualised employment arrangements in Australia:
a model of ‘hard’ HRM. In: Deery S, Mitchell R, eds, Employment Relations: Individualisation
and Union Exclusion. Sydney: Federation Press.
Eaton A, Voos P (1992) Unions and contemporary innovations in work organization, compensation and employee participation. In: Mishel L, Voos P, eds, Unions and Economic Competitiveness.
Armonk NY: M.E. Sharpe.
Folger R, Cropanzano R (1998) Organizational Justice and Human Resource Management. Thousand
Oaks, California: Sage.
Freeman RB, Rogers J (1999) What Workers Want. Ithaca, NY: Cornell University Press.
Gallie D, Felstead A, Green F (2001) Employee policies and organizational commitment in Britain
1992–97. Journal of Management Studies 38 (8), 1081–101.
Gerhart B, Wright P, McMahan G, Snell S (2000) Measurement error in research on human
resources and firm performance: how much error is there and how does it influence effect size
estimates? Personnel Psychology 53, 803–34.
Green F, McIntosh S (1998) Union power, cost of job loss and workers effort. Industrial and Labor
Relations Review 51 (3), 363–83.
Hallowell R (1996) Southwest Airlines: a case study linking employee needs satisfaction and
organizational capabilities to competitive advantage. Human Resource Management 35 (4),
513–34.
Kalleberg AL (2001) Organizing flexibility: the flexible firm in a new century. British Journal of
Industrial Relations 39 (4), 479–504.
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Spector PE (1997) Job Satisfaction. Thousand Oaks, California: Sage.
Wharton AS (1996) Service with a smile: understanding the consequences of emotional labor. In:
Macdonald CL, Sirianni C, eds, Working in the Service Society. Philadelphia: Temple University
Press.
Wright PM, Gardner TM, Moynihan LM, Park HJ, Gerhart B, Delery JE (2001) Measurement
error in research on human resources and firm performance: additional data and suggestions
for future research. Personnel Psychology 54, 875–901.
EMPLOYEE REACTIONS TO HUMAN
RESOURCE MANAGEMENT:
A REVIEW AND ASSESSMENT
STEPHEN DEERY*
The reactions of employees to Human Resource Management (HRM) practices
have attracted little scholarly attention. Even less research has been conducted
into the effects of those practices on employee wellbeing. Instead, much of
the research has focused on the types of policies and practices that might be
coupled or bundled together to deliver higher organisational performance. Where
subjects like job satisfaction have been investigated, associations are invariably
made with outcomes of wider concern to management such as organisational
commitment, employee withdrawal behaviour or more recently customer satisfaction and loyalty (Spector 1997). Of course, it can be suggested that there is a
symmetry between HRM practices that deliver better performance and those that
provide an enhanced working environment and greater job satisfaction. Examples
of such practices include certain forms of participative work arrangements, open
communication systems, formal training and development schemes, and voice
mechanisms that ensure organisational justice.
Nevertheless, there are many HRM practices that are designed neither to
promote employee wellbeing nor to result in a fairer or more congenial
working environment. The greater application of performance-based pay and
individual appraisal systems is designed principally to enhance work performance.
The same objective underlies the more extensive use of direct communications
with employees – often designed to restrict union involvement in the substantive
rule making process – and the marked increase in employee attitude surveys and
the provision of customer satisfaction data. Moreover, these practices can result
in less certain and regular pay increases and erode job security. In addition, they
may lead to an intensification of work effort (Green and McIntosh 1998).
Not only may different HRM practices have variable effects on employees but
the environment in which they are nested may also affect workers’ emotional
and material wellbeing. Certain innovative practices such as teamwork, employee
involvement and gain-sharing are much more likely to deliver both quality of
work life improvements and higher productivity outcomes in a unionised rather
than non-unionised environment (Eaton and Voos 1992). Unions can provide
* Professor of Human Resource and Public Sector Management, The Management Centre, King’s
College, London SE1 9NN, UK. Email: [email protected]
THE JOURNAL OF INDUSTRIAL RELATIONS, VOL. 44, NO. 3, SEPTEMBER 2002, 458–466
A F T E RW O R D
459
employees with an effective voice in the design and implementation of such
programs, resulting in better balanced outcomes for employees.
It should also be pointed out that high performance/high commitment HRM
practices can coexist with other policies in the firm that involve harsher forms
of management control and limitations to involvement in the organisation.
Employment policies can be combined to provide certain types of (core)
employees with opportunities for participative decision-making and skill enhancement while at the same time exposing other (non-core) employees to more
rigid forms of discipline and the vagaries of the external labour market. Indeed,
there is some evidence that the presence of ‘mutual gains’ HRM policies in
organisations are positively associated with the greater use of temporary contracts,
outsourcing and subcontracting (Kalleberg 2001). Thus, even in those firms
that practise high commitment management, it is unlikely that the gains will
be distributed evenly or equitably among all employees.
The purpose of this Special Issue of the Journal of Industrial Relations is to
examine and assess HRM policies from the perspective of the employee. Which
practices, for example, are associated with higher worker satisfaction? Does
teamworking offer workers the benefits of greater autonomy and self direction
and what are the possible effects on the representative structure of the workplace? Do interrelated high commitment work practices yield more contented
and productive employees? Are high performance work practices associated
with positive or negative consequences for workers? Can greenfield sites be used
as a mechanism to diffuse high commitment management to older and more
established parts of business? How do particular organisational contexts affect
the response of employees to the introduction of new performance management
practices?
In the opening article, David Grant and John Shields offer a constructive
critique of approaches to the employee in the existing mainstream HRM literature and provide an alternative means of conceptualising the employee as the
primary subject of HRM. Taking issue with both the proponents and critics of
HRM, they contend that both camps err in viewing the employee in instrumental
terms. Whether the writer sees HRM as good or bad for workers, the latter are
represented essentially as the means to management ends. It is only in the small
but emerging employee-centred literature, they suggest, that the employee
emerges as an active and independent-minded stakeholder in organisational
processes. Following what is now a well-trodden path, Grant and Shields also
draw attention to inconsistencies and debates surrounding the scope and basis
of HRM itself. Is HRM just a generic label for all current modes of employment
practice, or does it amount to a best practice approach and, if so, what particular
constellations of practices constitute best practice? If the purpose, then, is to
explore the connection between HRM practice and employee response, it is
necessary to establish not only how and why employees respond to HRM but
also what it is that they are responding to.
Toward this end, Grant and Shields propose a discursive framework of
analysis that distinguishes between discursive concepts (HRM ideas), discursive
objects (idealised human resources) and discursive subjects (thinking and acting
employees on whom HRM is practised). Invoking two key constructs from the
460
THE JOURNAL
OF
I N D U S T R I A L R E L AT I O N S
September 2002
existing employee-focused literature, namely the notions of the ‘psychological
contract’ and ‘organisational justice’, the authors propose a series of research
questions, which they suggest, would assist in re-centering the employee as the
primary subject of HRM. While such an approach may not resonate with those
simply interested in organisational performance outcomes, it may well find favour
among those with a more phenomenological orientation. These scholars may also
be attracted to the prospect of applying discursive analysis to the concept of the
psychological contract and to the precepts of organisational justice. The central
theme of this opening piece, however, is the authors’ insistence that worker expectations and perceptions should be acknowledged and interrogated, and not
ignored or pre-judged as is so often done by both the proponents and critics of
HRM.
In the second article, David Guest also presents the argument that workers
should occupy a more central location in the analysis of HRM. Rather than
corporate performance being viewed as the principal outcome measure, Guest
suggests that ‘employee-centred outcomes’ should be embraced equally as a
subject of HRM research. Thus, worker wellbeing should join discretionary
effort as a core area of analysis. Guest believes that workers can be ‘built’
into HRM research in two ways: firstly, by specifically entering them into the
HRM-performance equation by measuring the effect of employee satisfaction
and wellbeing on organisational performance, and secondly (and perhaps more
importantly) by examining the impact of particular HR practices on employee
perceptions of their own wellbeing. In relation to the first issue, Guest presents
findings that suggest that certain HR practices can have a positive effect on worker
attitudes and behaviour and that this, in turn, can affect performance. As to the
second area of research, Guest provides data from Britain indicating that particular
HRM practices are positively associated with workers’ assessments of work and
life satisfaction. Work satisfaction is associated with more challenging and interesting jobs, a friendly (trusting, supportive) organisational climate, open
communications, practices that limit harassment and equal employment
opportunities and family-friendly policies. The results for life satisfaction are
not dissimilar.
These findings identify important HRM practices that are indeed workerorientated. These practices generally do not enter equations seeking to estimate
the impact of high commitment/high performance work systems on organisational
performance. Moreover, they do not appear to be widely utilised among the
growing number of workplaces in Australia that have developed highly individualised, non-union working arrangements (Deery & Walsh 1999). In Britain
as well, the evidence does not indicate that there is a broadening commitment
to developing more challenging jobs and friendly and trusting organisational
climates. Indeed, Gallie et al. (2001) have found that during the 1990s there was
a noticeable decline in personal initiative at work and a reduction in the discretion
that employees were allowed to exercise over their work. In addition, there
appeared to be an increase in the overall tightness of management control of work
performance.
A similar point could also be made about employee-friendly HR practices in
light of Guest’s findings. Issues relating to organisational justice and employee
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voice are important to worker wellbeing. However, these were not specifically
included in Guest’s two models. This is unfortunate since it is well established
that perceptions of equity and fairness (distributive, procedural and interactional
justice) are associated with job satisfaction (Folger and Cropanzano 1998).
Furthermore, recent research in the US has found that workers want to have
a voice in workplace governance (Freeman and Rogers 1999). Not only did
employees want to participate as individuals in job-related matters but they also
perceived a need to exercise a collective voice over matters such as health and
safety, pay rate and benefits, particularly in the form of union representation. They
saw management as unwilling to share power and believed that their wellbeing
required a representational voice that was independent of the company.
Interestingly, employees felt that if they did have a greater say at the workplace
it would not only improve the quality of their working lives but it would also
make their organisation more productive.
In her contribution, Marian Baird examines the effect of High Commitment
Management (HCM) practices on the employment relationship. She is principally
concerned with the dangers of these practices for employees and unions and
the adequacy of employee voice mechanisms to protect worker interests in this
context. This research was conducted in a manufacturing organisation which had
two sites: an old established brownfield site with a multiple union presence, and
a more recently commissioned greenfield operation with a single union and a
clutch of high commitment HR practices. The case study records two interrelated
developments. The first was the fairly rapid and unimpeded diffusion of HCM
practices from the greenfield to the brownfield site. Old working arrangements
were discarded as new forms of multi-skilling and employee involvement were
installed, and fourteen unions were reduced to one. The second development
was the extension of the decision-making role of the team system and the
apparent replacement of distributive bargaining with integrative bargaining
as the union in the greenfield site was progressively marginalised.
The reasons for the loss of union influence were difficult to identify. Did
the HCM practices strengthen employee identification with the company
and weaken union loyalty? The survey data on employee attitudes does not
suggest that this was so. Organisational commitment at the greenfield site
actually fell over the period of the study. Why was the union not able to tap
into any rising discontent? Perhaps the unitarist design of the HCM practices at
both sites left little room for collective bargaining and workplace rule mediation.
Alternatively, the union may have neglected its representative activities, failing
to devote appropriate resources to servicing its members and allowing management at the workplace level to redefine its role. The loss of independent representation therefore may have had as much to do with union inattention as it did
with HCM.
Richard Dunford and Ian Palmer present us with a study of an organisation
that possesses textbook-perfect HRM practices. Not only did those practices seem
to be complementary and mutually reinforcing, they also appeared to yield
high levels of employee satisfaction and exceptional performance outcomes.
The key to the firm’s success was said to lie in its structure. The organisation – a
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large multinational – was built around small business units and teams. In turn,
individuals and teams were provided with considerable autonomy and responsibility, a pay system that reinforced teamwork but also encouraged initiative,
extensive and ongoing training, open communication systems and an emphasis
on internal promotion, egalitarianism and minimal status differentials. On the
basis of the interviews conducted with the staff – from senior management to
the most recently appointed sales consultant – there appears to be universal
support for the company’s practices and for their motivational qualities. All in
all, a remarkable congruence has been engineered between the interests of the
individual, the group and the firm. The case is resonant of South West Airlines,
with its hand-picked and happy staff, its emphasis on egalitarianism and its
excellent performance standards (Hallowell 1996).
However, the study did not pick up any discordant voices or any recalcitrant
behaviour. Why? The organisation employed sophisticated selection and recruitment techniques but how did it manage to achieve such a good person–job fit?
Interactive service work can be a source of considerable job satisfaction but it
can also be a cause of great anxiety and stress (Wharton, 1996). What undercurrents lay beneath this snap-shot of corporate happiness? Were there other
dimensions to the employee response? What were the attrition rates in the
company? Teamworking combined with performance-related pay can be associated with significant peer pressure to maximise sales and to conform to a ‘work
hard’ culture. Were there not casualties of these work and pay arrangements? In
the absence of an interviewing schedule that included past employees it may not
be possible to identify the full range of employee responses to the organisation’s
HR practices.
Self-managing teams are seen as an integral part of High Performance Work
Systems (Appelbaum et al. 2000). They are said to provide workers with greater
autonomy, influence and responsibility over task completion and with a broader
set of inter-dependent skills. Organisations benefit by eliminating supervision
that is not needed and from greater employee motivation, productivity and
commitment. More generally, self managing teams are viewed as an evolutionary development in the management of work; from a traditional bureaucratic
structure to a more decentralised, participative and democratic form of controlling
work activity (Barker, 1999). However, critics have seen this as a mirage and
pointed, instead, to a reality of peer control, work intensification and limited
autonomy. In their piece, Buchanan and Hall explore these competing claims.
They point to an ‘essential dualism’ in teamworking: on the one hand, a capacity
to promote a more varied and satisfying work experience; on the other, the
possibility of creating greater work pressures and imposing new disciplines and
controls on employees. As they observe, ‘teams are neither essentially “good”
nor “bad” for labour’.
What then does shape the effects of teams on employees? Buchanan and Hall
submit that it depends on the motivations for the introduction of teams. A body
of evidence is drawn from existing case studies conducted in the automotive and
metals and engineering industries. It suggests that teams: (i) were introduced
in a context of cost cutting; (ii) were designed to improve organisational
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performance; (iii) yielded little real employee decision-making; and (iv) marginalised trade unions. Buchanan and Hall find that teams were provided with
limited operational control over day-to-day production decisions. Teamworking
was associated with the removal of managerial layers in the organisation, which
gave workers some added responsibilities, but this tended to augment stress
levels rather than pay levels. Most importantly, management’s objective for
introducing teams was more to do with meeting production targets than enriching the lives of the workers. This tends to confirm Buchanan and Hall’s initial
thesis. However, the data from the existing studies are limited. Although they
infer a relationship between motivation and effect, it is unfortunate that they could
not be interrogated further to explore related questions. For example, what effect
did teams have on employee motivation, job satisfaction, organisational commitment and performance? Did it vary according to the degree of self-management
that was extended to the different teams? Was bureaucratic control replaced by
‘concertive control’ whereupon team members imposed new norms, rules and
pressures upon each other in ways that were functional for the organisation?
Under what conditions or circumstances were unions more likely to be marginalised by teams? These are important and relevant questions that flow from
Buchanan and Hall’s useful compilation of secondary source data.
Bill Harley’s article seeks to assess the relationship between High Performance
Work System (HPWS) practices and employee outcomes using the 1995
Australian Workplace Industrial Relations Survey (AWIRS95). As noted above,
some research suggests that HPWS practices are associated with positive
attitudinal outcomes while other findings point to more negative effects on
workers. Harley’s study draws upon two sets of data. The first set is drawn
from survey responses of managers who are asked to supply information about
particular characteristics of the workplace, such as: Does teambuilding exist? Do
employees get involved in change? Are there autonomous work groups at the
site? Does management communicate with its staff about its investment plans?
The second set of data is drawn from a separate survey of individual employees
who are asked questions about their job satisfaction, job security, levels of stress
and attitudes to management among other issues. The two sets of data are linked
together in such a way that it is possible to identify which employees (and their
attitudinal responses) are attached to which workplaces with particular HPWS
practices in place. Thus, the article seeks to identify whether certain attitudes
such as job satisfaction, might be associated with certain workplace HRM
practices, like teambuilding.
The findings indicate that there is practically no relationship between the
HPWS practices identified by the management respondents and the particular
attitudinal responses recorded by the employees. Furthermore, in the two-step
regression model in Table 5 the 14 HPWS practice variables explain almost no
variance in the attitudinal variables at all. Thus, for example, the job satisfaction
of employees (a positive measure of wellbeing) is not affected by downward
communication practices, upward communication practices, equal opportunity
policies, family-friendly policies, employment security, training, involvement of
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unions or employees in change or the existence of autonomous work groups
or teambuilding. Furthermore, levels of reported stress are not affected by the
presence or absence of any one of these HR practices. Harley suggests that
the reason for this is ‘that HPWS practices make little difference to employees’.
This indeed may be the case.
There is, however, another possible explanation for the absence of any real
relationship. The analysis may be affected by measurement error. It has been
shown that measures of HR practices can suffer from severe problems of construct validity (Gerhart et al., 2000). Single respondents (e.g. a senior manager
at a workplace) can produce quite unreliable information about HR practices.
Wright et al. (2001) have found that significant disagreements can exist between
employees and HR managers about the existence of particular HR practices at
both the site and job level. They have identified very low interrater reliabilities
(congruence of responses) for many questions relating to job security, training,
career opportunities and employee participation and have urged extreme
caution when using data from single informants. Thus, we may have a situation
where a single management respondent indicates that a practice exists (e.g.
teambuilding or training), but an employee working at the same site either
disagrees with that assessment or has had no experience of that practice. Thus,
any attempt to explain variations in employee attitudes (such as job satisfaction)
through the reported existence of a particular work practice by a manager may
be rendered meaningless by problems of measurement error. These problems
can, of course, be minimised by gathering the same data (from work attitudes
to workplace HR practices) from multiple respondents, as Guest has done in
his contribution.
The final article, by Michael O’Donnell and John Shields, analyses the
responses of employees to individual performance management practices in two
separate organisations within the Australian public sector. It examines those
responses within the context of the literature on the psychological contract and
explores the possible effects of those performance management practices on
contract fulfilment violation. The article documents a fundamental shift in the
management approach to employee motivation in the Australian public sector:
from a culture of career service to a system of performance management in which
individual contributions are linked to organisational objectives and rewarded
through performance-related pay. O’Donnell and Shields evaluate the success of
this attempt to transform employment relations in the Department of Finance
and Administration and in the Australian Defence Force. They find very
different espoused cultures and management styles, which affect both the
agencies’ approach to performance management and the employees’ attitudes to
the new processes and practices. In the Army there was a greater emphasis on
performance feedback and personal and career development while in Finance and
Administration there was a stronger focus on contingent pay, individual performance and processes that were said to reward extroversion and visibility.
Greater employee satisfaction was recorded with the performance management
arrangements in the Army although that agency suffered from systemic problems
of under resourcing and poor long-term career opportunities.
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The authors suggest that a move towards a more transactional psychological
contract – which is inherent in the Finance and Administration model – carries
dangers of diminishing organisational trust and perceptions of injustice and
unfairness. Certainly, the research confirms the relevance of earlier studies
that have emphasised the importance of meeting employees’ development needs,
setting clear and fair performance goals and providing regular feedback and
good management support. The piece also raises interesting questions about the
psychological contract and its possible violation. By introducing new performance
management systems as part of a programmatic change process and by raising
expectations about the potential rewards that will accompany those systems,
are organisations making it more difficult to fulfil their employees’ psychological
contracts?
In conclusion, the articles contained in this volume provide important new
insights into the effect of HRM policies and practices on employee reactions and
wellbeing. Although they utilise different methodologies and draw upon different
types of evidence and data, all attempt to record the employee’s voice and assess
their attitudes/responses/behaviour to HRM. In this sense, they complement
earlier research – often ethnographic or case study in nature – that sought to
understand how workers responded to, or fared under, other work regimes and
management control systems, whether Taylorised or bureaucratised. The similarities or differences with those research findings may warrant further exploration.
Finally, the Editors are to be congratulated on drawing together into one issue
such an interesting and challenging body of work.
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