July
2001 - Re-shaping HR
Is human resource management
undergoing one of its periodic transform ations
where the job, or job title, mutates before our
eyes and adopts a more exotic appearance? It happened
in the 1980s and 90s when the title "personnel
manager" quietly faded from business cards.
Like an improved soap powder
with a biological ingredient, HRM, equipped with
something called strategy, promised a whole new
set of tools to reward, motivate and organise
employees. Then, suddenly, there were the internet
and teleworking and concerns for "work-life
balance"; and there were difficult employees
who wanted gap years or freelance arrangements
and more interesting pay deals with the opportunity
to take equity. Why did they have to spoil everything?
Peter Drucker, the management
writer, identified employees as a "human
resource" in 1955, in his book The Practice
of Management. Drucker was a pathfinder attempting
to understand the social implications of the large
corporation. But he was not alone. In the same
year Sloan Wilson was writing in his novel, The
Man in The Gray Flannel Suit, about how executives
were ready to bury emotions and values in the
name of corporate conformity. The next year William
H. Whyte identified these individuals as "the
dominant members of our society" in The Organization
Man.
"When a young man says that
to make a living these days you must do what someone
else wants you to do, he states it not only as
a fact of life that must be accepted but as an
inherently good proposition," wrote Whyte.
His observation is recalled by Daniel H. Pink
in his new book Free Agent Nation, which, as the
title suggests, describes a quite different proposition
that he argues is beginning to transform the US
employment contract.
Based on hundreds of interviews
with US freelance workers, Mr Pink's book outlines
the way organisation men such as Walt Fitzgerald,
a former manager at General Electric, took early
retirement in the 1990s, then hired themselves
out as consultants. Mr Fitzgerald's daughter Theresa
did not wait for any reorganisation before she
gave up her own management job in a design department.
She returned to her first love - designing - as
a freelance rather than managing other designers.
Her father, too, had been a good artist, studying
under Norman Rockwell before his management work
made painting impossible.
The problem for people like Walt
Fitzgerald is that, until they were confronted
by a radical corporate re-organisation and redundancy,
they had not confronted the possibility that there
was life outside the corporation. But the 1990s
witnessed a discernible transition in the way
many people began to view their so-called permanent
jobs and the risks associated with leaving them.
Bob Milbourn, a former loan officer in a San Francisco
bank, told Mr Pink how he sensed that the risk
of one day losing his job was expanding, the longer
he stayed. "For the longest time I was terrified
of being laid off," he said. "Then I
got to the point where I hoped they would lay
me off. Then I asked to be laid off."
Mr Milbourn is one of thousands
who have made the break. Mr Pink estimates - he
says it is a conservative estimate - that about
33m Americans today are "free agents",
making up about one in four of the US workforce.
That means that the US economy now has about 15m
more freelance workers than manufacturing workers.
Freelances also outnumber the 20m US government
employees.
He is not alone in believing
that the employment relationship is undergoing
role reversal. In the European Business Forum
magazine, the academics John Kimberly, Hamid Bouchikhi
and Elizabeth Craig, founders of the Executive
Careers Institute, argue that "social and
demographic trends point to significant changes
in the traditional configuration of power".
They write: "Centuries ago,
Copernicus realised that the Earth revolves around
the Sun . . . In management we may be in the midst
of another Copernican revolution, a revolution
in which the relationship between the firm and
the employee is inverted and in which the 'customised
workplace' replaces the hierarchical, military-inspired
model that has served so long and so well."
An element of workplace democracy
or co-operation may, however, have a long history.
The late Marijas Gimbutas, an archaeologist, described
a pan-European Neolithic civilisation that flourished
in "uninterrupted peaceful living" between
6,500 and 3,500 BC. She believed she had found
evidence of a settled social order in which men
and women had equal status. If she is right, we
may need to question assumptions about the inevitability
of hierarchy.
No matter; as Daniel Pink has
pointed out, thousands of people worldwide are
promoting their own alternatives and this may
be the catalyst for yet another change to the
shape of HRM. Academics, writing in EBF magazine,
sense the emergence of something called "human
capital development". "The customised
workplace," they write, "is built on
the recognition that to be successful, companies
will increasingly have to be organised around
individuals rather than the reverse."
Human capital development, they
argue, is designed to handle the different needs
of individuals. The prospect sounds a nightmare
for existing human resource departments but, if
they are clever, they may greet the idea like
a bugle call from the Seventh Cavalry. As it is,
human resource management has had a tough time
from line managers who seem increasingly resentful
of its methods.
A Gallup poll this week blames
HR ideas such as competence frameworks and 360-degree
appraisals for growing disenchantment among workforces
in the UK. Perhaps the reason for workplace unhappiness
is the clinical atmosphere of the re-engineered,
post-merger corporation.
Michael Lewis has charted some
of these emerging attitudes in his book The Future
Has Just Happened, in which he examines how people
are finding the freedom to develop their talents
on the world wide web. Open sourcing, a phrase
that relates to free accessibility to computer
programmes, is an ideology extending into other
spheres and challenges existing concepts of intellectual
property.
If HRM fails to make sense of
such developments its future looks bleak. But
it would not be alone among the managerial disciplines
and assumptions that may founder in a radically
changing workplace. Asked about the future of
managers in a world of free agents, Daniel Pink
says: "Most managers are toast."
Free Agent Nation, How America's
New Independent Workers Are Transforming The Way
We Live, by Daniel H Pink. Warner Business Books.
$24.95. The Future Just Happened, by Michael Lewis.
Hodder & Stoughton. £16.99 European
Business Forum is a print and online publication
that gives a European perspective of management
issues.
© 2001 The Financial Times
Ltd. All rights reserved
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