Excerpts from Chapter 1 of Human Resource Management in a Business Context
(3rd Edition, 2007) by Alan Price - published by Cengage
From personnel to human resource management
HRM-type themes, including 'human capital theory' (discussed in Part 2) and 'human asset accounting'
can be found in literature dating as far back as the 1970s. But the modern view of human resource management first
gained prominence in 1981 with its introduction on the prestigious MBA course at Harvard Business School. The Harvard
MBA provided a blueprint for many other courses throughout North America and the rest of the world, making its
interpretation of HRM particularly influential (Beer et al, 1984; Guest, 1987; Poole, 1990). Simultaneously, other
interpretations were being developed in Michigan and New York.
These ideas spread to other countries in the 1980s and 1990s, particularly Australia, New Zealand,
parts of northern Europe - especially the UK, Ireland and Scandinavia - and also South and South-East Asia and
South Africa. Today, the HRM approach is influential in many parts of the world.
Pages 20-23 provide a discussion on why HRM seemed to be different - and
preferable - to personnel management but also examine some common prejudices against the notion of HRM.
The new managerialism
Schuler (1990) emphasized that the HR function had an opportunity to shift from being an 'employee
advocate' (associated with personnel management) to a 'member of the management team'. Schuler's view was that this
required HR professionals to be concerned with the bottom line, profits, organizational effectiveness and business
survival. In other words, human resource issues should be addressed as business issues.
In fact, line and general managers have been instrumental in the adoption of HRM - often pushing
changes through despite the resistance of personnel specialists (Storey, 2001: 7). Radical changes in business
structures and supportive - largely right-wing - governments encouraged a renewed confidence in the power of managers
to manage. (...)
Encouraged by the writing of management gurus and, more recently, by the burgeoning legions of
consultants (Legge, 2004, p.2), managers eagerly adopted new management fads and fashions. (...) The stage was set for HRM, which
was presented as a coherent and integrated philosophy by its originators, covering every aspect of people management.
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Human Resource Management in a Business Context, 3rd edition
Human Resource Management in a Business Context provides an international focus on the theory and practice
of people management. A thorough and comprehensive overview of all the key aspects of HRM, including articles from HRM Guide and other sources,
key concepts, review questions and case studies for discussion and analysis.
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