The History and Development of Human Resource Management - Research Paper Example

? The History and Development of Human Resource Management Details: al Affiliation: Submission The History and Development of Human Resource Management Introduction Human Resource Management is but a contemporary concept that continues to remodel organizational management with best practices strategically lined up to achieve target objectives in a turbulent, competitive environment stretched in part by the ever changing and challenging trends of globalization. To be sure, management is no longer a standalone concept but a high-minded task of getting and consequently matching organizations’ most valued assets [the work force] with their most suited positions to collectively share in organizational goals. With a slowly drifting focus towards research oriented and tested managerial aspects to boost productivity, personnel high-handed control is no more. Industrial relations and organizational behavior are much the same paving the way for HRM as the ideal management model responsive to the pressures of intensive competitive forces. By definition, HRM simply refers to a system of operational management designed to ensure effective and efficient use of human talents in accomplishing organizational objectives (Mathis & Jackson, 2007). The function of HRM in the business enterprise has a long history, with roots right in the rise of modern industry in the nineteenth century. This article endeavors to put into perspective the history and development of the subject matter at hand, providing in part its progressive nature into the modern status. The Genesis and Early Development of HRM A generic thought that involves the management of labor services in production, human resource management (HRM) has its origin in the establishment of formal enterprises during the course of human history. Though recent in its use within the academic circles and/or in industrial developments [barely two decades old], the ideas engendered in "human resource management" are old and goes back to the dawn of human history. It [human resource management] has, thus, only undergone social and economic makeovers from earlier forms of administration through history, necessitating name changes a couple of times to accommodate the various productivity optimization add-ons. HRM as practiced today has two distinct antecedents: the emergence of industrial welfare in the 1800s and the creation of separate recruitment and selection offices/departments in the 1900s. The 1800s, particularly in the 1830s onwards, quite a number of companies begun the provision of various workplace and family amenities that included medical cover, housing, libraries , recreational programs, among other free services deemed important for effective and efficient production (Gospel, 1992). The inclusion of these extra services, reportedly pioneered by the German industries, frequently called for the creation of temporary departments hitherto known as welfare departments out of humanitarian concerns. From temporary positions created out of necessity to handle immediate tasks regarding employees’ wellbeing, separate employment offices, often staffed by one or a limited number of lower-level clerks, emerged to centralize and standardize functions such as recruitments and the general record-keeping of employee-related issues. The enactment of civil service legislations across Europe solidified the importance of employment departments, contributing to phasing out of the temporary nature of these departments into permanent offices. Farnham (1921) report of a German steel company Krupp having had an established Personnelburo as an independent office handling staff related functions since the late 1800s. As similar bureaus became widespread, the term ‘employment management’ quickly became the accepted description of the new management function with wide cross border managerial support. Routing employment management to HRM as ordered today was the emergence of the doctrine of scientific management (SM) authored primarily by engineers in the sunset years of the 1800s. As they sought after the efficacy principles aimed at increasing production systems, the ‘workforce’ became the primary target in turning around the huge costs of employee turnover. In his influential and strategic formulation of scientific management penned down in Principles of Scientific Management (1911), Frederick Taylor’s advocacy of "scientifically" led selection process and training in addition to an incentive reward system for performance in excess of expectation played a fundamental role in laying the ground-work for the development of HRM in its infantry stages. As Taylor’s ideas of scientific management gained momentum, other scholars, especially in the field of industrial psychology, tirelessly worked on the applicability of their principles in the entire process of recruitment, selection as well as employee training; efforts ultimately rewarded during World War I as major combatants sought to harness professionally tested skills in maximizing productivity within their economies (Kaufman, 2004). Faced with industrial fatigue that threatened to tilt war successes in favor of worthy opponents, several governments sponsored researches on how to rationalize management to achieve maximum results. The interwar period drastically led to forced economic booms as a result of higher employee turnover rates. Accompanying economic growth prospects in these countries were work discipline hiccups in the forms of labor unrests, strikes, and unions/organizations pressurizing wages upwards (Baritz, 1960). The widespread concern of the 1917 Bolshevik Revolution in Russia boiling over into a crisis of nations brought to the fore the need of industrial democracy in moderating employee demands (Lichtenstein & Harris, 1993). As a remedy, dozens of companies created expansive employment departments to manage organizational staff welfare activities, and in hundreds of cases allowing employee representation plans to smoothen relations with their employers. By the end of First World War, the democracy employed in the management of employee-organization relations had metamorphed into personnel management; a new concept that brought together the earlier functions of industrial welfare and employment management under one roof. The new term though never got a rousing reception until after Second World War, particularly in Europe where welfare work of the 1920s put more emphasis on improving employees’ morale; health and safety; discipline; and joint consultations on wage policies in addition to the improvised methods of recruitment and training (Chartered Institute of Personnel and Development, 2005). Developed almost during the same period was the term “industrial/employment relations. Like personnel management, however, industrial relations was only adopted widely in the Americas [USA and Canada] at inception in the early 1920s, and only embraced in other industrialized world after the second world war with a much narrower meaning than originally envisaged [union management] (Kaufman 2004). Early usage posits a more broad-based management policy capturing the entire employer–employee relations, including the subject of strategic governance. Dudley Kennedy (1919: 358) registered his understanding at the very beginning stating that: ‘Employment management is, and always must be, a subordinate function to the task of preparing and administering a genuine labor policy, which is properly the field of industrial relations.’ Notably, Kennedy’s conception covered all business firms [and not just unionized firms] as a long term strategic orientation of labor policy; an amalgam of personnel management with strategy in the modern day management. The sharp recession that followed the First World War sent some kind of shock waves to the development of HRM, with numerous companies folding up unnecessary departments in a cost cutting spree that left the hitherto fiery agitation for more pay and better work conditions thrown into disarray. The events of the 1920–1, however, were only temporary setbacks as more firms embraced the Taylor’s model of scientific management ingrained with high commitment and democratic governance just after the phase of dwindling growth (Commons, 1919). As Kaufman (2003a) notes, the 1920s saw the validation and modification of HRM as an element of cooperation and unity of interest serving the interests of both the firm and workers through what early scholars termed Welfare Capitalism. Nonetheless, the remodeled participative management offices was more of an employee involvement gimmick, administered by lower cadre personnel staff (Taras, 2003). As it turned out, the programming of HRM functions then was designed with explicit organizational goals in mind as opposed to serious departmental structuring in the interest of workers. In his article published in the Harvard Business Review titled ‘Industrial Relations Management,’ Hotchkiss (1923: 440) laments that: ‘Moving away from tactics to the question of strategic management, industrial relations management is essentially functional rather than departmental; it deals with a subject matter which pervades all other departments within an organization, and thus must succeed as an integrating, not as a segregating, force that gives a business venture substance [emphasis added].’ Alongside the gimmick and genuine adoption of the rudimentary concepts of HRM in the 1920s were the supporting infrastructures that included numerous written journals, consulting firms, teaching and research programs at the higher intuitions of learning as well as associations. Just to mentioned, the United States took a lead role in shaping the field of HRM to what it is today; from the Rockefeller funded HRM consulting/research organization [the first of a kind in the United States] to the pioneer textbooks in personnel management such as Personnel Administration by Tead and Metcalf, most developmental aspects of HRM from the 1920s onwards originated from the efforts in the United States (Kaufman, 2003b). Mary Fledderus, a Dutch welfare manager, echoed the forgoing statements stating that: ‘Broadly speaking, welfare work in Holland as in other countries seems to have arrived at a transition state. We chiefly look to the United States for directions on which way it will go on working’ (Purcell & Kinnie, 2007: 24). Over the same period, the development of HRM was hampered by the piecemeal and/or less strategic approach taken by the pioneer countries in the field, particularly the European counties that considered themselves superior in terms of labor legislation and representations [unionization]. Other less industrialized countries merely followed the European lines of approach; a factor that reduced the impetus to a more individualized aspects of effective production (Kaufman 2004). The only two countries that made significant progress independent of the United States’ were the Germans and the Japs. The German with their own pioneered science of work (Arbeitswissenschaft) explored a number of areas of efficiency namely fatigue, and job satisfaction via higher level industrial psychology and sociology, and subsequently made considerable adjustments (Campbell, 1989). The Japanese on their part not only adopted Taylor’s principles of scientific management but went further in acquiring and implementing a modified Americas’ Welfare Capitalism within their firms (Hazama, 1997). Development from 1930–19670s As noted earlier, the progressive developments of HRM from inception to the 1920s had some kind of favorable reception, particularly in the United States. Undeniably, the developments were not only impressively ambitious, but had surpassed expectations despite the hard hitting economic hitches given the level of technology at the time (Leiserson, 1929:164). As fate would have it, however, the strategic ‘goodwill’ associated with the internalization of Welfare Capitalism took a dramatic nose-dive with the onset of the Great Depression; almost dampening every aspect of development achieved earlier across the industrializing world. Firms had no choice but to undertake massive layoffs, offloading the hitherto initiated elements of HRM program in dire efforts to survive the scathing attack that had apparently gone viral. The tremendous developments of the previous two decades, seemingly, went under as the labor crisis turned to legislation rather than the then highly regarded personnel management for solutions (Leiserson, 1933: 114). With the new turn of events, governments virtually had a leeway of poking holes into the earlier developments in HRM. In the United States, the Roosevelt’s New Deal was readied in time to stimulate demand, which in effect raised household incomes through minimum wage laws, encouraged mass unionism and stretched numerous social insurance programs even to the very old (Kaufman, 2000). The unilateral decisions previously under the control of the employer suddenly took a new twist, guided by the law and determined by collective agreement. Fascist governments such as Germany and Japan left no space even for the hitherto moderate elements of HRM, instead opting for full political control in preparation for the Second World War. In a kind of striking contrast, only the United States had some little room for HRM development during this phase as the entire Europe and Asia changed priority to war alignments. Accordingly, companies that survived the depression the United States revived and strengthened personal departments to administer the contracts entered into between the employees and the labor unions. Though relatively active with some weight, the promises HRM during the period looked hollow, for it had lost the substance it had before. The outbreak of the much anticipated war in 1939 worsened the foregoing scenario even further, with HRM developments in Europe going into a deep slumber after a devastating combat leaving them almost equally in ruins. For the next three decades or so, America became the focus on the progress of the field discussed herein having had nothing comparably much destabilizing as was in Europe. In a number of respects, the 1970s received HRM developments as either personnel management or industrial relations, but with marginal importance. Though German and Japan picked up relatively fast, most company established personnel departments were merely payroll and/or records offices. As the dust of the Second World War begun to settle, the importance of industrial psychology and industrial sociology resurfaced with prospects of shaping employee morale, job satisfaction, and loyalty into productive efficiency [human relations]. The Hawthorne experiments led by Elton Mayo between 1927 and 1932 became the bench on which several scholars attacked this area, leading to the adoption of the new work relations by numerous rising companies at the time such IBM and General Motors (Jacoby, 2003). Even with the recognition that human relations had considerable impact on the desired ends on the production possibilities frontiers, personnel departments at the large bulk of American companies typically had little strategic aspects of business and employment policy, still overly tactical considering the their lowest rungs of hierarchy at the very bottom of administration (Drucker , 1954: 275). The Era of Flexibility and Diversity [The 1980s to date] The modern version of HRM began its earnest spread from its birthplace, North America, to the other parts of the world in the early 1980s out of scholarly efforts drawn explicitly from management and the behavioral sciences in higher intuitions of learning. Naturally, the new psychological and sociological orientation in employment injected a new approach of organizational design and control, coopting leadership styles and effective management principles in line with the rapidly changing technological advancements. From this point onwards, the field of HRM embarked on a marked cumulative trajectory, oftentimes converting the subtle intellectual substance of the academic world from mere expressions to workable realities. With the expansion of the internet right into the remote parts of the world, employers have not only integrated 24/7 flexible working society within their systems, but have also tapped the international labor through on-line recruitment and training systems, thus rendering the traditional personnel functions out of use (Kelly, 2003). Though embraced internationally, HRM remains on the construction mode with wide disagreements on its contents. Conclusion HRM evolved through a number of stages, replacing inefficient methods of production to become the most trusted method of managing labor in the 21st century. From a rudimentary application of concepts with no research in the early twentieth century, HRM is now an integral part of business, with cross-cutting support from academics and practitioners. Tactical and cost-focus issues, however, still pervade the modern practice of HRM in key business management areas such finance. References Baritz, L. (1960). The Servants of Power: A History of the Use of Social Sciences in American Industry. Middletown, Conn.: Wesleyan University Press. Campbell, J. (1989). Joy in Work, German Work. Princeton: Princeton University Press. Chartered Institute of Personnel and Development. (2005). The History of CIPD. Retrieved from http://www.cipd.co.uk/hr-resources/factsheets/history-hr-cipd.aspx Commons, J. (1919). Industrial Goodwill. New York: McGraw-Hill. Drucker, P. (1954). The Practice of Management. New York: Harper. Farnham, D. (1921). America vs. Europe in Industry. New York: Ronald Press. Gospel, H. (1992). 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