Discussion on Contingent and Integrated Approach to Human Resources Management

Abstract

Human Resource Management is a constantly changing and evolving field and it has seen a series of significant changes in approaches in relatively recent times. Organizations today recognize the importance of treating their employees as diverse individuals who each bring their own value to the organization. An integrated and contingent approach to HRM is recognition of the fact that the environment in which we work is changing and that being flexible and responsive to change is an important part of dealing with the new environment. The important factor here is to understand that the optimal solution will realize in understanding a variety of factors these perspectives and integrating them to form a solution which is suitable for the situation that you are in.

A variety of factors will change the situation your environment in and your HR policy will change accordingly. It is therefore that Human Resources Management be flexible and change accordingly with these factors. It is very beneficial to have an integrated and contingent approach to Human Resource Management because such a solution provides the possibility of a large number of solutions and ones which are more complete and deal with the problem in a more effective manner. It also allows a better approach then traditional methods to dealing with problems being faced by organization’s today. Some issues that need to be noted are that senior management needs to closely involved at all stages and that the Human Resource policy should always keep in mind the individuals it has been designed to cater.

Introduction

Human Resource Management is a constantly evolving and developing field. The concept of human resource development has come a long way from when it was believed that human resource management was nothing more then hiring and firing the organization’s personnel. Organizations today realize the importance of recognizing the individuality and diversity of employees and creating an environment which attracts qualified and motivated individuals to the organization which are so essential for its success.9Lorenz, Wilkinson 2003) An integrated and contingent approach is extremely important to find solutions in the diverse and constantly changing environment in which organization’s today function.

An integrated and contingent approach would be one covering a variety of concepts in human resources theory and not only linking them together but developing a closer connection between theory and practice. It would also involve being more sensitivity to the changing environment and to be more proactive rather than reactive in the organization’s policy towards human resources. Infact in the words of David Bishop senior adviser at KPMG pointed out:

‘The examples of good practice show that there is no single right answer. Each organization will work out what is material to its own circumstances, and will be stronger for doing so’.

An Integrated and Contingent Approach to Human Resource Management

Human Resource Management today involves a variety of activities from hiring the right employees, to creating an environment in which they gave their best to the organization and training and developing their potential. In addition to this there is a significant amount of research which provides various theories and approaches to handling each of these activities. An integrated and contingent approach would be one which would keep all these and activities in mind and not simply have one solution

Integrated Approach

The importance of integration can be explained in detail with the discussion of two contrasting theories analyzing employee behavior, namely Theory X and Theory Y.(McGregor 1960)

Theory X reflects a harder and more authoritarian style of work. It assumes that employees will not have any personal motivation to work and therefore if they are not closely watched they will perform poorly, that employees have little to contribute other then what is required of them and their jobs must be extremely structured for optimal utilization of the employees. There are many situations in today’s work environment where such a philosophy would be extremely unpopular and would result in a wastage of the employees potential.

Theory Y on the other hand is in total contrast. This theory assumes that a certain amount of work comes naturally to the human brain. Therefore work is not a forced exercise that humans will always run away from. So keeping this in mind theory Y claims that unlike what theory X claims coercion is not necessary to get the most from your employees. It also suggests that employees are unique and full of potential and therefore employers should pay attention to the ideas that employees and allow employees to think beyond the narrow confines of their job description.

Even though these theories are in such sharp contrast it is clear that possibly with their integration (such as taking assumptions from each) can an organization be successfully run. It is also very important to remember here that what theory is more relevant and their level of integration is more applicable depends on the specific circumstances. For example Theory X might be more applicable to less skilled workers while Theory Y is more applicable for highly trained ones. However an employer might decide that even though he keeps employees under strict supervision because of an assumption of Theory X he might at the same time allow his employees to have a more flexible job description. The Theory Z (Ouchi 81) which is today more recognized then Y or X was in fact an integration of the earlier two theories.

Contingent Approach

This is also an example of a contingent approach to HRM. All managers should always be aware that each situation is unique and requires different solutions and that there is hardly ever one best fit solution for all the problems. If demand slows down for example an employer might consider keeping more employees on a part time basis to deal with the situation.

An employer will base his HR policy and strategy based on his overall business strategy he is implementing for the next few years. If a company wants to slow its growth and stabilize its position it might look for standardization in all its practices and will encourage HR policies which promote this kind of performance from employees. We can analyze this in greater detail if we analyze this issue from the perspective of contingency¹ management models. One such contingency model is Michael Porter’s business-strategy model (Wikipedia).

The model is not an HRM model but it has direct implication for HRM and any company’s HR Policy. Porter defines three distinctive strategies that can be followed by a company. These are the cost reduction strategy, differentiation strategy and the focus strategy. The focus strategy is one in which the company identifies a particular market segment and designs and markets the product specifically to that segment. The differentiation strategy is one in which the producer provides one unique value addition to his product which makes it more desirable for the customer. The cost leadership strategy is one which the producer attempts to standardize procedure and processes in order to cut costs wherever possible. It is clear that each of these strategies would require different HR policies by companies.

For example a company following the cost leadership strategy will be more biased towards the Theory X of management. This is because they are unlikely to encourage innovation since at the moment all they are planning to do is cut costs. Standardization of jobs might make them less appealing and therefore require more supervision and control to ensure its completion. The same logic can be applied if we consider the business life cycle model. This model simply categorizes the company according to the maturity of the product in the market, meaning when was it introduced and what is its demand in the market. For example a company selling the Mp4 player is more likely to have a different approach to running business then a company selling the radio. These different approaches therefore result in different HR policies.

Benefits of an integrated and contingent approach to Human Resource Management

An important benefit of integration in human resources management with the variety of principles in itself, with the practical work environment and with other disciplines, is simply that human resources provides a more complete and also a broader ranger of solutions. (Gautam Davis 2007)

A recent study in the University of Minnesota identified a variety of factors that are important in identifying which employees are more likely to stay in a company. His model integrates a variety of features that are important. The approach to integrate various factors into a model has resulted in the creation of a more whole and complete model which is more accurate in its conclusions. Another research suggests that making sure the smooth working or the integration of HR and operational policies will contribute more greatly to the success of the organization rather then implement positive elements of each ( for eg: teamwork, lean production supply chain management) separately.(Birdi Clegg 2008)

An integrated and contingent approach takes into mind the complex nature of humans and the work environment in which they function, and is therefore a more appropriate and realistic approach to the problems faced.

The contingent and integrated approach is far more appropriate to the changing work environment then a traditional more stagnant approach.(Konchaff Chalykoff) This approach allows for more flexibility to the changing environment and is suitable to the demands of today’s work force. New theories of human resource management call for more performance based rewards, involvement of senior management in setting HR policies and greater involvement from the workforce in policy formulation then before.

A research(Snell, Youdnt 1995) indicates the important of accounting for contingent factors in firm success. The study measured firm success as against the use of input and out control in setting HR practices. The study clearly indicated that the use of input control had a more positive impact on the firm’s performance. This indicated that manager and executives are aware of all or most of the factors that could affect the firm and set the policy accordingly. The study also indicated that the greater executive knowledge regarding contingent factors the better the performance of the firm.

Important issues

One extremely important concern that is important for the successful implementation of any HR policy any where is the commitment of the senior executives to the policy. If the policy does not have their backing its success probability will be hurt no matter how potentially successful it could have been.

Another important is cohesiveness in all elements and all levels of the policy and practice. This is an essential part, of a well integrated policy which works smoothly and enhances the productivity of other organizational organization. This again emphasizes the importance of senior officials at the time of Human Resource policy formulating and in overseeing that it is implemented and updated properly.

Finally Human Resources Management policy should keep in mind all those who actually on whom the policy will be implemented. An important concern here is to ensure that in integration Human Resources Management with other fields and while taking contingent approach that the interest of the human factor are not made subordinate to any other goal.

References

Chris C, Kamal B, Malcolm P, Andrew R (2008) The Impact of human resources and operational management practices on company productivity: A longtitudinal study., et al. Personnel Psychology. Durham:. Vol. 61, Iss. 3; pg. 467, 35 pgs.

Dhruba K. Gautam, Ann J. D. (2007). Integration and devolvement of human resource practices in Nepal Vol. 29, Iss. 6; pg. 711.

Hemmerlingly J. Building on Objectives Integrated human resources management’ opdev Management Solutions. Web.

Kochan T Chalykoff J HUMAN RESOURCE MANAGEMENT AND BUSINESS LIFE CYCLES:SOME PRELIMINARY PROPOSITION.

Lorenz E. Wilkinson F Organizational change, human resource management and innovative performance: Comparative perspectives. (2003) Cambridge Journal of Economics. pg. 239.

Mesut A. (2006) Quality Management through Human Resources: An Integrated Approach to Performance Improvement. The Business Review, Cambridge.

Scott A. Snell, Mark A. Youndt (1995) Human resource management and firm performance: testing a contingency model of executive controls Journal of Management.

An integrated Model for Strategic Hr Four Groups. Web.

Human resource management. Web.

Porter Generic Strategies Wikepedia. Web.

Theory X Theory Y Theory Z 12Manage. Web.

Footnotes

See All Experts Human Resources for reference.(explanation by Professor Rs Mani)

Contingency theories are a class of behavioral theory that contend that there is no one best way of organizing / leading and that an organizational / leadership style that is effective in some situations may not be successful in others. In other words: The optimal organization / leadership style is contingent upon various internal and external constraints.

These constraints may include: the size of the organization, how it adapts to its environment, differences among resources and operations activities, managerial assumptions about employees, strategies, technologies used, etc.

Four important ideas of Contingency Theory are:

1. There is no universal or one best way to manage.
2. The design of an organizations and its subsystems must ‘fit’ with the environment.
3. Effective organizations not only have a proper ‘fit’ with the environment but also between its subsystems.
4. The needs of an organization are better satisfied when it is properly designed and the management style is appropriate both to the tasks undertaken and the nature of the work group.