Literature Review on Human Resource Management
Table of Contents
What is human resource management?
Nowadays human resource management has become one of the vital parts of management within the organization. This practice is not very old; however, it has appeared as the efficient tool to use human resources of the enterprise in the most efficient way, resulting in productivity increase and enhancing company’s compatibility. Now, human resource management is implemented, however, it still lacks proper and precise definition, explaining its entity as a whole. So, let’s look at several approaches to HRM, used by different scholars to define Human Resource Management.
One of the most precise definitions was stated by M. Armstrong. He suggests that HRM means “a strategic and coherent approach to the management of an organization’s most valued assets – the people working there who individually and collectively contribute to the achievement of its objectives” (Armstrong, 2006, p.3). J. Storey provides a bit more narrow definition. It explains HRM as a “distinctive approach to employment management which seeks to achieve competitive advantage through the strategic deployment of a highly committed and capable workforce, using an array of cultural, structural and personnel techniques” (Storey, 1995, p.7). However, throughout the book he explains the HRM as the term, which should be viewed from two aspects, theoretical for use in academic works and practical for implementing the HR function inside the organization.
Researchers J. Bratton and J. Gold show another approach. They observe HRM as “a strategic approach to managing employment relations which emphasizes that leveraging people’s capabilities is critical to achieving competitive advantage, this being achieved through a distinctive set of integrated employment policies, programs, and practices” (Bratton, 2007, p. 7). This definition is a bit close to the first because it explains the main priority of HRM, the personnel of the organization. Moreover, like the second definition, it has a variety of methods, which are used to achieve main goals of human resource management. And finally, this definition helps us to define managing employment relations, the main goal, towards which HRM is oriented. That is why the third definition describes Human Resource Management more thoroughly and fully.
As one of the most exploited organizational management approaches, HRM has a range of different techniques and guidelines, which make the process more efficient and goal-oriented. J. Storey classifies such techniques into cultural, structural and personnel (Storey, 1995, p.7). J. Bratton and J. Gold observe methods and techniques of Human Resource Management as a range of integrated employment policies, programs, and practices (Bratton, 2007, p. 7). However, provided classifications of methods do not describe all the methods fully. Moreover, the essence of such processes is much deeper. On the other hand, scholars J. Shen and V. Edwards has provided new approaches concerning the classification of HRM techniques. This method is based not on descriptions and functional characteristics of given methods. It is more based on processes, which HRM has the intention to use. These processes include recruitment and selection, training and development, performance management and pay (Shen, 2006, p. 7). That distributes all shown activities into three main groups, answering questions: “How to find human resources?”, “How to increase the efficiency of using human resources?” and “How to maintain and reward them to motivate further successes and achievements?”. This approach is more objective because it refers more to how HRM is implemented throughout the organization.
Another major part of management approach definition is searching, who is responsible for providing Human Resource Management function. Basically, there are three possible ways, which employers can use to provide HRM function throughout the organization. The first way is to hire a qualified and experienced human resource manager, who knows what the organizational culture is and how to make it stronger. The second way is to outsource HR functions to specialized companies, which have vast experience in managerial consulting. The third way is to make line managers responsible for HR function (this works well only when these managers are properly prepared, sometimes it can even harm the organization). The one thing similar to all the approaches is that the responsibility for Human Resource Management relies on the CEO, who chooses the way to provide HR function. He makes the decision according to the current financial situation and he is the one responsible for the outcomes if a solution with low costs will have unacceptable results.
So, what is human resource management? It is a strategic and coherent approach, provided by a qualified person under control and responsibility of managerial department aiming to achieve competitive advantage using recruitment and selection, training and development, performance management and pay.
What are the functions of human resource management?
The need in human resource management is based on its ability to help achieve the main goals of an organization and to enhance personnel’s efficiency and productivity providing a competitive advantage for the company.
- Boxxal admits that such advantage has two sides:
- Human capital advantage, as the ability “to capture a stock of exceptional human talent with productive possibilities”;
- Human process advantage, consisting of complex societal and evolved historical processes of education, cooperation, and innovation (Boxall, 1996, p. 67).
The competitive advantage brought by human resource management is both inimitable and unique because every corporate system of human resource management needs the help to implement corporate goals and to fit organization’s strategy (Lado & Wilson, 1994, p. 705). Moreover, every organization needs a different approach because of complex diversity between human resources, which it involves. Hence, there is no typical solution for every organization’s HR system but all the systems have one in common: they help achieve a considerable competitive advantage for the organization; it achieves that by implementing different functions, which are vital for good personnel’s productivity.
There are several ways, where this area of management benefits the company and scholars have developed diverse approaches to classifying these functions into different groups. D. FeKenzo, S.P. Robbins and S.L. Verhulst have proposed to divide HRM into four basic functions:
- Staffing: this function is provided by building successful image of the company to employees, deciding, which qualities organization employee should have according to organization’s mission and strategy and hiring the staff, which complies underlined requirements;
- Training and development: this function is implemented in employee training, employee development, organization development and career development, helping workers to better adjust to new working environment and to grow fast to become even more valuable for the organization;
- Motivation: this function is provided by appropriate rewards system, helping workers to feel that they are valuable for the company and on the other hand, helping managers to exploit their human resources with the highest capacity;
- Maintenance: this function is essential to maintain most productive employees; it can be implemented by providing comfortable working conditions and developing effective communication programs (DeCenzo, 2015, pp. 36-39).
- Torrington and L. Hall view Human Resource Management as a set of staffing, performance, change management and administrative objectives. The first category means its goal to recruit the best employees, having needed skills and fit for the job they are applying for. Performance objective means that the approach of the HR department is to give workers proper motivation and abilities to study to enhance their productivity and the ability to do their job much better than before. The third objective addresses the need in the organization to be less vulnerable to stresses and changes in the environment, developing leadership skills in its staff and teaching them how to meet challenges and severe situations. The fourth objective addresses the need of managerial staff to control the process of their workers’ development and to provide a more smooth process of company’s functioning (Torrington, 1998, pp. 6-7).
Several approaches to functions of human resource management do not deny the fact that all these functions are needed to help achieve organization strategy and to provide considerable competitive advantage throughout the whole organization. That defines the HR function as a variety of methods and ways, which are used to implement the whole strategy of an organization and to achieve its strategy by recruitment and selection, training and development, performance and pay methods.
What are the functions of HRM in airlines?
Nowadays human resource management has become so widespread that its techniques are implemented in various industries and areas of the national economy. One of the most important areas, where human resource management techniques are crucial is the airline industry. There are several reasons, why HRM is so important for this industry:
- High labor intensiveness, creating millions of jobs throughout the world;
- High competition, especially related to developed countries and economies;
- Large amount of capital needed to enter the market and high risks, resulting from large sums, needed to recover outcomes of accidents;
- The large importance of image and strict quality management to address needs of consumers in safety and comfort throughout the flights.
Accidents and poor quality which are both negative factors, resulting in harming the corporate image of an airline are deeply rooted not in technology issues, but in socio-technical human factors. Poor quality of management, decision-making process, employee motivation and communication might result in losses for the company of its market share and losses of organizational assets. Sensitivity to safety, customer service-centric environment and the traditional product-centered industrial model prevents managers in airline industry from using product-centered approaches to management (Appelbaum, 2003, pp. 59).
There are several existing approaches to tie together functions involved in HR Management in Airlines. They include strategy, operational activities and human resource department management. The main objective, which HR function implements in such a large industry is to align its operational activities throughout the organization with the organization’s mission, strategy and culture (Appelbaum, 2003, pp. 60-61). So there is a basic number of steps which the company should make to improve the efficiency of its human resources:
- to underline the corporate strategy and mission and its main guidelines;
- to decide, how the enterprise can achieve its short-term and long-term goals;
- to decide, which elements and issues of Human Resource Management to include in this process.
HRM literature shows a wide range of benefits, which the organization can have implementing human resources strategies. They include health and dental benefits, confidential counseling services, acknowledgments for the team and individual achievements. Knowing that, airlines provide different additional facilities, which help them to maintain the life of their employees at a higher level. These facilities include giving subsidies for Home Internet connectivity, improving employee’s access to their own HR records and on-line corporate discounts (Appelbaum, 2003, pp. 63-64). Such policies enhance the attraction of job for potential employees; however, such facilities should address several guidelines to be efficient and to ensure airline stakeholders in necessity of such findings:
- Such facilities are efficient only is they are able to increase employees productivity;
- Managers should monitor hours worked by employees and their overall productivity changes to be sure that such activities are efficient;
- Employers should instruct employees about the use of hardware and key rules to prevent abuses of emails and Internet privileges;
- Employers should establish a contract with an employee to make him return obtained equipment when the contract will expire (Olson, 2001, pp. 28A).
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These requirements are objective though they make HRM activities address needs of an employee in a productive and efficient way for the company. Complex surveillance and establishing contract relations regarding these facilities are strictly needed because that will help airlines to reduce additional costs, resulting from employee’s abuses and inefficient spending of money. Of course, such facilities should be supported with different activities and establishments, concerning key guidelines of HRM, including recruitment and selection, training and development, performance management and pay. Proper recruitment system is as essential as elaborate payment and prizes policy and facilities to training and development of crew’s skills and knowledge because airline does not only properly train their employees, it also should hire people with excellent interpersonal, communication, conceptual and physiological skills because they play crucial role in providing airline services of high quality and intrinsic responsibility from the staff (Bertillo, 2013, p. 3). High access to promotion opportunities and the ability to lift up the career ladder is a must for this industry because such activity can largely contribute to the maintenance of reliable and skilled employees. However, it should not hurt the team spirit of a crew because it is quite an essential factor for flights to pass without consumers’ dissatisfaction.
Challenges faced by HRM personnel in airlines
Despite managers being highly interested in their airline’s prosperity, they still underestimate the need to build an efficient human resource strategy throughout the whole enterprise. Scholars suggest that the majority of the airlines still function according to the traditional top-down industrial model of policy structure, operations, and governance system. This model is intrinsically inappropriate in terms of the modern airline industry, which demands the vast amount of knowledge and cohesion from staff. Moreover, most of the airlines recruitment policies luck diversity of staff, which lifts up the question about inequality of employment and discrimination (Bertillo, 2013, p. 3).
According to Appelbaum, increasing diversity is crucial for implementing “strategic development and providing the customer-centered and learning-oriented workforce, able to rapidly adapt to changes addressing airline industries” (Appelbaum, 2003, p. 65). Increasing cultural diversity within the airline industries may result in a range of benefits for the organization. Organization staff may obtain more unbiased, innovative and unusual approaches to solving business tasks, using methods of brainstorming. Increasing diversity will make employees freer to express their own opinion because they will see that the organization does not want to maintain them because of their features of a character or their skin color. Staff sees that the organization needs its workers for their special skills and unique talents and no matter who the employee is, he will get the same employment terms, the same compensation as the others have and the same access to education and training facilities. The last benefit is that enhancing diversity will improve corporate image of the organization and it will show their stakeholders and clients that they are open to people of different skin color and religion, the airline will make qualified service not only to one category of people but for all, who are sitting inside the plane (Shen, 2009, pp. 54-55). Enhancing diversity is not a one-day task, it needs complex activities, involving all the processes throughout the Human Resource Management department, including recruitment and selection, training and development, performance management and pay.
Human Resource Management of modern airlines meets the large challenge, based on annual increasing competition in the market. Competition relates not only to clients’ attraction, it also concerns the aim to find the most successful employees. Pirating pilots, who have successfully ended preparation training for one company by another with better earnings, has become highly disseminated practice (Bertillo, 2013, p. 5). Moreover, recent events and accidents have shown that different accidents of past times were provoked not by terrorist attacks; they happened in the result of suicide, provoked by an internal crisis of one pilot. One of such events occurred over the Alps on March 23, 2015. That event simply underlined the lack of oversight by managerial staff, because the lack of psychological training and shortenings of medical staff due to the need to address challenges of crisis situations throughout the industry was the reason for such a terrific accident (Patton, 2015, pp. 1-8). Dr. J. Patton also suggests that the way to improve the current situation is based not only on paying attention to the state of healthcare throughout the organization, improvements should be done within the corporate culture. Scholar demands from managerial staff to encourage valued workers to use benefits of employee assisting programs as well as continuously enhance their skills to become more professional (Patton, 2015, p. 9). Proper organizational culture is vital for airlines because it is able to create the proper atmosphere for employees to grow and work with full capacity. The task to build and maintain the organizational culture according to its strategy is the direct task of the Human Resource Department. Scholars O’Donnell, and R. Boyle have developed a set of recommendations for HR managers to develop the organization culture. They include:
- Creating a climate for change, meaning HR manager should provide their services according to underlying goal, which has to fight weaknesses of the organization;
- Regarding leaders as champions: leadership is the quality which HR manager should cultivate in workers to make them more productive and enhance their responsibility to do their job as best as they can;
- Employee engagement and empowerment: employees should be involved in the process of decision making to make them feel more responsible and more allegiant to organization;
- Team-orientation: the quality, which is crucial to cultivate in crew members and pilots to make them prepared for unexpected situations during the flight;
- Tracking cultural change: changes which occurred due to these activities should be monitored and assessed to make them work efficiently and according to the organization’s strategic objectives (O’Donnell, 2008, pp. 10-12).
Proper organizational culture and enhancing diversity should be two main orientations for the airline HRM, which seeks competitive advantages of implementing human resource management functions. These issues will help airlines not only to ensure strong competition conditions but also to maintain a proper atmosphere in the organization and reduce employees’ turnover throughout the whole period of its functioning.
Proper organizational culture and enhancing diversity should be two main orientations for the airline HRM, which seeks competitive advantages of implementing human resource management functions. These issues will help airlines not only to endure strong competition conditions but also to maintain proper atmosphere in the organization and reduce employees’ turnover throughout the whole period of its functioning.
- Appelbaum, S. H., & Fewster, B. M. (2003). Global aviation human resource management: contemporary compensation and benefits practices.Management Research News, 26(7), 59-71. doi:10.1108/01409170310783592
- Armstrong, M. (2006). Strategic human resource management: A guide to action. London: Kogan Page.
- Bertillo, D. J., & Salando, D. J. (n.d.). Human Resource Management Practices in an Airline Industry: The British Airways Global Perspective. SSRN Electronic Journal. doi:10.2139/ssrn.2292797
- Boxall, P. (1996). The Strategic Hrm Debate and the Resource-Based View of the Firm. Human Res Manag J, 6(3), 59-75. doi:10.1111/j.1748-8583.1996.tb00412.x
- Bratton, J., & Gold, J. (2012). Human resource management: Theory and practice. New York: Palgrave Macmillan.
- DeCenzo, D. A., Robbins, S. P., & Verhulst, S. L.(2015). Fundamentals of human resource management.
- Lado, A. A., & Wilson, M. C. (1994). Human Resource Systems and Sustained Competitive Advantage: A Competency-Based Perspective. The Academy of Management Review, 19(4), 699-727. doi:10.2307/258742
- O’Donnell, O., Boyle, R., & Committee for Public Management Research (Ireland), Institute of Public Administration (Ireland). (2008). Understanding and managing organizational culture. Dublin: Institute of Public Administration.
- Olson, S. (2001), “Cinergy Employees Embrace PC Benefit: 80 Percent Take Perk, Receive Free Computers”, August 20, p. 28A, Lexis-Nexis, Reed Elsevier.
- Patton, J. (2015). Human Resource Management (HRM) in the Aviation Industry. SSRN Electronic Journal, 11(1), 1-12.
- Shen, J. E., Chanda, A., D’Netto, B., & Monga, M. (2009). Managing diversity through human resource management: an international perspective and conceptual framework. The International Journal of Human Resource Management, 20(2), 235-251. doi: 10.1080/09585190802670516
- Shen, J., and Edwards, V. (2006), International HRM in Chinese MNEs, London and New York: Routledge.
- Storey, J. (1995). Human resource management: A critical text. London: Routledge.
- Torrington, D., Hall, L., & Torrington, D. (1998). Human resource management. London: Prentice Hall Europe.
- Olson, S. (2001), “Cinergy Employees Embrace PC Benefit: 80 Percent.
- Take Perk, Receive Free Computers”, August 20, p.28A, Lexis-Nexis, Reed Elsevier.