Underpinning Theories and Models of HRM

Underpinning Theories of HRM
Human resource management appears to lean heavily on theories

of commitment and motivation, and other ideas derived from the
field of organizational behavior’.
Several other theories, especially the resource-based view, have
contributed to the understanding of purpose and meaning of
HRM. These theories are as follows:
1. Motivation
This theory explains the factors that affect goal-directed behavior
and therefore influences the approaches used in HRM to enhance
engagement (the situation in which people are committed to their
work and the organization and are motivated to achieve high
levels of performance).
2. The Resource-based View
Resource-based theory expressed as ‘the resource - based view’
states that competitive advantage is achieved if a firm’s resources
are valuable, rare and costly to imitate. In a nutshell this view
sees resources as key to superior organizational performance.
3. Organizational Behavior Theory
This describes how people within their organizations act
individually or in groups, and how organizations function in
terms of their structure, processes and culture. This theory
therefore will influence how HRM approaches organizational
design and development in order to enhance their productivity.
4. Contingency Theory
States that HRM practices are dependent on the organization’s
environment and circumstances. This means that HR policies,
procedures etc. will be dependent on the size of the organization,
technology, number of employees etc.
There are several types of HRM models being used within different
organizations. Basically, HRM models could fall into one of two
categories:
Strategic and Traditional (hard and soft models)
The Strategic model is often referred to as the hard HRM which

manages the operational function between the organization and the
employees.
The Traditional model often referred to as the soft HRM, deals with
the strategic relational function between companies and
employees.
Generally, the HRM models connect the HRM strategy with the
implementation of human resource functions. These functions
include:
1.Staffing,
2.Training and development and
3.Motivation.
The staffing function typically identifies with the hard, strategic

HRM models.
Training and development and motivation are linked to soft,

traditional HRM model.
1. The Matching Model of HRM
The ‘matching model’, or the best fit model indicates that HR systems and
the organization structure should be managed in a way that is
compatible/fitting with the organizational strategy. In essence, it requires
that human resource strategies have a tight fit to the overall strategies of the
business.
The Matching Model identifies four (4) common HR processes performed in

every organization:
1. Selection: matching people to jobs
2. Appraisal of performance
3. Rewards: emphasizing the real importance of pay and other forms of
compensation in achieving results
4. Development of skilled individuals
These processes are linked in a human resource cycle.

MODELS OF HRM
HR CYCLE
2. The Harvard Model
The Harvard model sees employees as resources.
The stress is on people as human resources.
Employees are significant stakeholders in an organization.
They have their own needs and concerns along with other groups such
as shareholders and customers.
3.The Warwick Model of HRM
This model was developed by two researchers, Hendry and

Pettigrew of University of Warwick. It centers around five elements:
1.Outer context (macro environmental forces
2.Inner context (organizational or micro environmental forces)
3.Business strategy content
4.HRM context
5.HRM content
Warwick Model of HRM
3.The Warwick Model of HRM
The strength of the Warwick model is that it identifies and

classifies important environmental influences on HRM.
It maps the connection between the external and environmental

factors and explores how human resource management adapts to
changes in the context. Obviously, those organizations achieving
an alignment between the external and internal contexts will
achieve performance and growth.
4. Contextual model of HRM
The contextual model of HRM emphasizes the importance of

environmental factors by including variables such as the
influence of social, institutional and political forces. The
contextual approach is broader, integrating the human resource
management system in the environment in which it is developed.
A broader set of stakeholders are involved in the formulation and

implementation of human resource strategies. This is referred to
as the multiple stakeholder framework. These stakeholders may
be external as well as internal
Contextual Model of HRM
5. European model of HRM
The characteristics of the European model are:
1.Dialogue between social partners
2.Emphasis on social responsibility;
3.Multicultural organizations
4.Participation in decision-making
5.Continuous learning
6. The 5-p’s m model of HRM (a new model)
Philosophy: Expressed in statements defining business values and

culture. It expresses how to treat and value people.
Policies: Expressed as shared values and guidelines. Policies establish

guidelines for action on people related business issues and HR programs.
Programs: Articulated as human resource strategy. These coordinate

efforts to facilitate change to address major people related business
issues.
Practices: For leadership managerial and operational role practices

motivate needed role behaviors.
Processes: For the formulation and implementation of other activities

these define how activities are carried out.
Strategic HRM
The strategic approach to human resource management
recognizes three key elements.
1. All managers are involved in human resource management.
2. Employees are viewed as assets. Employees, not buildings and

machinery, give a company its competitive edge.
3. Human resource management is a matching process,

integrating the organization’s strategy and goals with the correct
approach to managing human capital.
In companies that take a strategic approach, HR managers are key

players on the executive team and play a pivotal role in driving
performance.
Example:
At retailer Target, for example, the formal
mission of the human resources
department is to “drive company
performance by building a fast, fun, and
friendly team committed to excellence.”
Strategic HRM To fulfill the mission, HR managers are

directly involved in building a culture that
distinguishes Target from other retailers,
finding the right people to fit the culture,
then creating training programs,
compensation, and other mechanisms to
develop and retain quality employees.
MODELS OF HRM
Strategic HRM
The central idea behind strategic HRM is that all initiatives involving how
people are managed must be aligned with, and in support of the
organization’s overall strategy.
Strategic HRM is the process of attracting, developing, rewarding and

retaining employees for the benefit of both the employees as individuals and
the organization as a whole.
Strategic HRM can be viewed as the link between the organizations’ goals
and objectives and its human resources in order to improve business
performance and develop a culture that fosters innovation, flexibility and
competitive advantages.
Strategic HRM is concerned with the
following:
1. Analyzing opportunities and threats
existing in the external environment
2. Formulating strategies that would
match the organization’s (internal)
Strategic HRM strengths and weakness with the
(external) threats and opportunities.
SWOT analysis of the organization.
3. Implement the strategies formulated
4. Evaluate and control activities to
ensure organization’s objectives are
duly achieved.

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Underpinning Theories of HRM

Human resource management appears to lean heavily on theories

Strategic and Traditional (hard and soft models)

The Strategic model is often referred to as the hard HRM which

The staffing function typically identifies with the hard, strategic

Training and development and motivation are linked to soft,

The Matching Model identifies four (4) common HR processes performed in

These processes are linked in a human resource cycle.

The Harvard model sees employees as resources.

The stress is on people as human resources.

Employees are significant stakeholders in an organization.

This model was developed by two researchers, Hendry and

1.Outer context (macro environmental forces

2.Inner context (organizational or micro environmental forces)

3.Business strategy content

The strength of the Warwick model is that it identifies and

It maps the connection between the external and environmental

The contextual model of HRM emphasizes the importance of

A broader set of stakeholders are involved in the formulation and

Philosophy: Expressed in statements defining business values and

Policies: Expressed as shared values and guidelines. Policies establish

Programs: Articulated as human resource strategy. These coordinate

Practices: For leadership managerial and operational role practices

Processes: For the formulation and implementation of other activities

1. All managers are involved in human resource management.

2. Employees are viewed as assets. Employees, not buildings and

3. Human resource management is a matching process,

In companies that take a strategic approach, HR managers are key

Strategic HRM To fulfill the mission, HR managers are

Strategic HRM is the process of attracting, developing, rewarding and

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