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Restoring
Trust in the Human Resource Management Profession
Thomas A. Kochan
Prepared
for presentation at Sydney University’s celebration of 50 years
of Industrial Relations teaching and research, November, 2003.
Abstract
The human resource management profession faces a crisis of trust and a
loss of legitimacy in the eyes of its major stakeholders. The two decade
effort to develop a new “strategic human resource management”
role in organizations has failed to realize its promised potential of
greater status, influence, and achievement. I argue that to meet contemporary
and future workplace challenges, HRM professionals will need to redefine
their role and professional identity to advocate and support a better
balance between employer and employee interests at work. Specifically,
the next generation of HR professionals will need to be more externally
focused and skilled at building networks and productive alliances with
other groups and institutions, become more analytical and able to document
the benefits associated with effective HR policies and practices, and
be skilled at managing in an increasingly transparent society and information
savvy workforce. Finally, I speculate about how the changing the gender
composition of the HR profession may affect its success in making these
changes and meeting these challenges.
Last year, like you, the Sloan School of Management celebrated its 50th anniversary with convocation not unlike the one we are engaged in here. The dominant theme that came out of the discussions and papers presented by alumni, faculty, and students was that the challenge facing the current generation of business leaders is to restore trust and confidence in management by addressing the challenges facing the multiple stakeholders which business leaders and the organizations they build must serve. Carly Fiorina, the CEO of Hewlett Packard, put it best when she said:
“We have to remember that corporate executives serve at the pleasure and for the interests of shareholders, employees, and their communities, not the other way around.”
She went on to then redefine the role and responsibilities of CEOs and their corporations as follows:
“Managing a company, not a share price, means balancing the requirements of shareowners, customers, employees, and communities. And managing a company for the long-term, not just the short-term, requires building sustainable value for shareowners and customers and employees and communities. And these relationships of sustainable value require real trust and real candor.” (Fiorina, 2003).
I believe the HRM
profession faces the same crisis of trust, in part because it is (or should
be) part of senior management in corporations and even more so because
it always has had a special professional responsibility to balance the
needs of the firm with the needs, aspirations, and interests of the workforce
and the values and standards society expects to be upheld at work.
As Russell Lansbury (2003) noted in his Kingsley Laffer Lecture, our profession
is the steward of the social contract at work. This responsibility weighs
heavily at the moment since, as most of us would agree, the “old
social contract” that promised long term job and financial security
to those who were loyal and productive employees has broken down and may
no longer be viable, given the nature of the modern economy and workforce.
So the central challenge facing our profession is to ask what needs to
be done to rebuild a viable social contract at work, how do we do it,
and who needs to be involved and engaged with us to rebuild the trust
essential to the success of this effort? How we respond to these issues,
I believe, will shape the future of the human resource management profession.
So what I hope to do here is to sketch out a view of what the “next
generation” HRM profession might look like. Specifically, I’d
like to explore how and why the crisis of trust developed in our profession,
what might be done to restore trust and build a viable social contract
for the future, and how the HR profession needs to change to get this
done. I will end with some thoughts about who will be doing this work.
This is a fitting occasion to take up this challenge. The rich and successful
history of industrial relations and human resource management research
and teaching in Australia in general, and at Sydney University in particular
provides, a solid heritage on which to build. And the transition to the
newly named Department of Work and Organization Studies signals your intent
to adapt to the changing nature of our field and profession.
I must caution that I am not an expert on Australian HR or industrial
relations. Most of my examples reflect experiences in the U.S. And as
an American, I know all too well that the US model of HRM, like many of
our institutions, is often looked to as either a model for others either
to imitate or to avoid at all costs. I believe both tendencies are ill-advised.
Instead, serious comparative and international relations scholars and
professionals have learned that a better perspective for learning from
each other is to take what has been called an adaptive learning perspective
(Westney, 1987; Cole, 1989). This approach calls for experts in a local
culture to examine carefully practices or institutions from other settings,
debate and experiment to determine whether or how they might be adapted
to fit their local setting. The result of this adaptive learning process
is not imitation but innovation, i.e., new patterns and practices emerge
that learn from but do not replicate those from abroad.
How we got here: From Personnel to Strategic
HRM
The last two decades of HRM scholarship and professional activity in the
U.S. were dominated by efforts to shift from a functional, personnel administration
approach to a strategic human resource management approach. The largest
professional association in the country changed its name and focus accordingly
from the American Society for Personnel Administration (ASPA) to the Society
for Human Resource Management (SHRM). This change symbolized a deeper
shift in the professional identity and role of HR from one that challenged
and provided the support needed for their organizations to balance employee
and firm interests to one that sought to “partner” with line
managers and senior executives in developing and delivering human resource
policies that supported the firm’s competitive strategies. The dominant
effect of this shift was to more closely align HR professionals with the
interests and goals of the firm, at least the goals as articulated by
the top executives with whom HR professionals sought to align. Indeed,
one of the most respected of America’s HR professionals (Doyle, 1993)
once described this development as HR professionals becoming what he called
“perfect agents” of top management (a not too complementary
analogy to the Peter Sellers character who sought to be the alter ego
of his boss).
By the end of the 20th century the transformation in the American HR role
was largely complete. As a result, HR professionals lost any semblance
of credibility as a steward of the social contract because most HR professionals
had lost their ability to seriously challenge or offer an independent
perspective on the policies and practices of the firm. Perhaps the clearest
indicator of the inability of HR professionals to challenge their CEOs
or other top executives is the fact that in the U.S. CEO pay relative
to the average worker exploded over this time period, moving from a ratio
of 40:1 in the 1960s and 70s to over 400: 1 today. Another indicator comes
from surveys of HR professionals themselves. Table 1 reports data from
a survey of HR professionals taken in the late 1990s which asked them
to rank the profession’s most important goals and priorities (Eichinger
and Ulrich, 1996). Six of the seven most important priorities reported
reflect the needs of their organizations or their HR unit. The first workforce
concern to make it on this list (promoting diversity) comes in seventh
on their list!
Meanwhile, as (and in no small order perhaps because) the HR profession
was turning inward, pressures on the workforce slowly began to mount,
one by one. Over the past decade workers and families have endured longer
working hours in the face of stagnant or declining wages, lost or dramatically
diminished pensions, rising health insurance costs, and spreading job
insecurity. Even in 1999, at the peak of the dot.com boom, a national
survey conducted by Business Week found that three fourths of Americans
believed the benefits of the “new economy were unequally distributed,
only a third saw it as increasing their own incomes, and only about half
saw the boom as making their own lives better (Business Week, 1999). By
2003, another business organization, the Conference Board, reported its
national surveys showed that fewer than half of workers were satisfied
with their jobs. Less than forty percent were satisfied with their wages,
health insurance, or pensions (Boston Globe, 2003). Add to this the breakdown
in trust and confidence in corporations and their leaders noted above,
continued declines in union coverage and power, and with the arrival of
the current Bush Administration, a federal government busily reducing
overtime coverage, quashing rules that would allow states to fund paid
family leave, opposing (unsuccessfully) affirmative action in a pivotal
Supreme Court case, and unilaterally canceling thousands of federal workers’
rights to join a union under the Orwellian guise that collective bargaining
would be a “threat to national security.”
The net result of these diverging HR priorities and workforce pressures
is that we now have perhaps a wider gulf between the perceived needs and
interests of American firms and their employees than at any time since
the Great Depression of the 1930s. Indeed, the cumulative effects of these
pressures and the breakdown in trust in corporations has led me to describe
the American workplace as a pressure cooker that may be about to blow.
Richard Sennett captures the implications of this state of affairs for
the HR profession precisely in the first sentence of his sociological
critique of contemporary workplace relations:
“A regime which provides human beings no deep reason to care about one another cannot long preserve its legitimacy.” (Sennett, 1998; p.1).
Put back in the language
of the social contract introduced by Russell in his lecture: A profession
that fails to attend to and find a workable balance among the expectations
and aspirations of the different stakeholders at work—employees,
firms, and the communities and societies in which they are embedded—cannot
long preserve its status or legitimacy.
I believe that if the HR profession is to lead the effort to rebuild trust
and achieve a new and more equitable balance among the different stakeholders
at work, it will need to break out of its internal focus and rebuild relationships
and alliances with the workforce and other external stakeholders. But
at the same time, we should not throw the baby out with the bathwater.
The major benefit of the two decades of effort to build a strategic approach
to HR is that we have learned some important things about how HR practices
can contribute to bottom line organizational performance. It is important
to build on this understanding in shaping the future of our profession.
Meeting the Challenge: What can be Done?
Starting Point: Building Knowledge Based Organizations.
A good starting point for rebuilding trust and closing the gap between
firm and employee interests would be to focus on generating value for
all organizational stakeholders from the one unique asset that employees
bring to their organizations, namely, their knowledge and skills. A defining
task for contemporary and future HR professionals lies in translating
the rhetoric regarding the “knowledge economy” into tangible
benefits for the economy and society, for individual firms, and for the
workforce. This will not be as easy as some thought it would be.
The 21st century burst upon us in an era of seemingly unbounded optimism
about the future of what some called the “knowledge economy.”
This was expected to be the century in which knowledge and skills, or
more technically, human capital, finally found its place as the most critical
resource and strategic asset to organizations. Yet three years into the
new century, a new worry has arisen. Even knowledge work is now at risk
of being outsourced to independent contractors or “off-shored”
to lower cost employees in developing countries. Indeed, companies as
respected as IBM are worried about this trend. Their HR executives were
recently overheard commenting in a conference call that they would be
forced to offshore more knowledge intensive IT work in the future because
“everybody else is doing it.” This example reminds us that human
resources are both an asset and a cost to business. It falls on the shoulders
of HR to ensure that those most concerned about labor as a cost do not
drown out investments and organizational policies needed to ensure the
asset side of labor is fully developed and utilized.
How is the need to invest in and treat knowledge workers as valuable assets
to be reconciled with cost pressures that put them at risk of being outsourced?
Clearly some of the more routine knowledge intensive work will move to
lower cost environments. Blanket opposition is likely to fail. Instead,
the key lies in staying on and pushing out the frontiers of knowledge,
invention, and innovation in products and processes. But what can we do
to help our IBM colleagues overcome their legitimate concern that if they
follow a strategy of investing in while others are off shoring their work,
IBM will be at a competitive disadvantage?
The only viable answer to this question is for the HR profession to reach
out to external parties and build the collective efforts needed
to develop the necessary skill base. HR professionals need to work together
to help schools and universities to graduate people with the capabilities
to both invent the next generation of products and services and
to move quickly and effectively from invention through the innovation
process to the market.
To be sure this requires support for basic education at the primary and
high school levels and strong science, math, engineering, and related
technical subjects and curricula at the college and technical school level.
America has seen a decline in the proportion of students entering these
fields. While reversing the trend should be a priority, so should broadening
out the knowledge base and skills of future science and technical graduates
of universities and specialized trade or technical schools. Everyone in
the next generation workforce should have both a solid grounding in science,
math, and technology and be skilled in communicating their ideas, working
effectively in and leading diverse, cross disciplinary teams, and negotiating
differences and resolving conflicts at work and in society.
Science and technology based universities such at my own are just now
beginning to recognize the need to provide a better balance of technical,
social, and behavioral skills needed in the modern workforce. MIT, for
example, is tired of hearing the familiar refrain from industry leaders
like the one I heard recently.
“When I recruited MIT students they had great technical grounding but not a good notion of how the real world works, how to get things done, and how to deal with people.”
Changing the curriculum
to provide this mix of skills will not happen overnight nor will it happen
automatically. The HR profession can speak with authority to colleges
and universities about the skills needed and serve as the voice of industry
but to do so it needs to become a more visible ally of those leading the
fight for adequately investing in education and then work in concert with
educational institutions to modernize their curriculum to fit changing
workplace requirements.
While support for schools is important, firms will remain important sources
of “life long” education, training, and human capital development.
It is well known, however, individual firms will under-invest in education
and training if their competitors are not contributing their fair share
to the workforce development process. This is another reason that the
profession must look outward at rebuilding linkages with others and generating
collective support for these investments.
Another reason why HR professionals need to become more externally focused
to as knowledge becomes more important is that managing knowledge work
and workers may increasingly involve multiple organizations, contracting
relationships, and informal networks. For example, in the U.S. a wide
variety of ethnic, university, community, and technology specific networks
have been formed to provide educational services in different technical
fields. Temporary help agencies have arisen to match independent contractors
and consultants with specialized technical expertise with project needs
within companies. Much of what used to be the work of HR departments (selecting,
training, and monitoring employment conditions) within firms is now being
carried out in conjunction with these labor market intermediaries and
the project managers who supervise this work. As movement of work to off-shore
contractors increases, so too does the complexity of monitoring and managing
these relationships and ensuring that the core knowledge and skills needed
to remain competitive are maintained within the organization or available
from a network of trusted, proven suppliers. Managing these mixed types
of employment arrangements and multi-party networks in which they are
embedded will likely be an increasingly important and challenging aspect
of HR work.
From Knowledge Workers to Knowledge Based Work Systems
Too often the terms “knowledge worker” or “the knowledge
economy” are equated with the elite professional, managerial, and
technical workforce. Yet we know that front line workers likewise can,
indeed must, be mobilized to contribute their knowledge and skills to
the modern workplace. As former President of South Korea Kim Dae Jung
once said:
“In the age of the knowledge-based economy, every citizen must become a new intellectual. Everyone should acquire the skill to make the most of their minds to create new value for society and generate income for themselves.”
A great deal of effort,
experience, and evidence has been amassed in the past two decades over
how to build knowledge based work systems that allow front line workers
to develop and utilize their skills at work. Indeed, I believe this to
be the signal achievement of HR scholars and practitioners of the strategic
HR era. And the way it was achieved illustrates a second feature of what
is needed in the next HR paradigm—a deeper analytical focus.
Let me offer an illustration from the automobile industry. In 1982 a graduate
student of ours discovered that GM had the data in their possession to
relate employee attitudes, grievance rates, and participation initiatives
to productivity and quality (Katz, Kochan, and Gobeille, 1983). The strong
relationships between these work and labor relations practices and processes
and plant performance not only surprised us but opened our eyes to the
need and the potential for more research relating these practices to performance
outcomes. Then, a few years later, a major breakthrough in communicating
this potential to executives came when another MIT student who had previously
worked at the Toyota-GM joint venture known as the New United Motors Manufacturing
Inc. (NUMMI) developed a methodology for comparing work hours per car
and defects per car at that plant with others in the industry. The differences
reported were startling, showing a 2 to 1 differential in performance
in productivity and quality between NUMMI and sister plants with old and
new technology but traditional labor relations, human resource, and production
systems (Krafcik, 1988). These data laid the foundation for the best selling
book The Machine that Changed the World (Womack, Jones, and Roos,
1990). Later would come the international comparisons of assembly plants
(MacDuffie, 1995; MacDuffie and Pil, 1997) that both documented the generalizability
of these findings and outlined the features of the integration set of
production, human resource, work organization and labor relations practices
that produced these high levels of performance. By the late 1990s, this
new paradigm was generally accepted in the industry. Organizations around
the world were engaged in efforts to adapt its features to fit their different
cultural and institutional settings (Kochan, Lansbury, and MacDuffie,
1995).
Over the course of the 1990s similar analyses were also carried out in
a wide variety of industries including apparel, computers, telecommunications,
steel, office equipment, and airlines. In most cases these were projects
supported by the Alfred P. Sloan Foundation in conjunction with university
and industry partners. While the diffusion of these new practices and
knowledge based systems is not universal, Huselid and Becker (2001) extended
this analysis across industries and produced estimates that moving from
the mean to one standard deviation in development of HPWO was associated
with an average of 23 percent higher rate of return and 8 percent higher
market value. These types of numbers, even if off by a significant fraction,
get managers’ attention.
The lessons I take from this experience are that the effects of positive
human resource and related workplace practices on performance can be measured
and knowledge based work systems can contribute to bottom line performance
in a variety of settings. Since the evidence is that on balance workers
respond well and report high levels of satisfaction with these systems
(Appelbaum Berg, and Kalleberg, 2000), they hold considerable potential
for narrowing the gap between the needs and interests of firms and employees.
Looking Beyond Workplace Performance: The Dual Agenda
As much as I believe that significant progress has been made in understanding
and implementing knowledge based work systems, the singular focus on workplace
outcomes (productivity, quality, etc.) needs to expand to take into account
the changing labor force and the increasingly close interdependences between
work and personal/family life. As Lotte Bailyn and Joyce Fletcher (2003)
argue, today’s work systems and processes have to be held accountable
for achieving a dual agenda: high levels of performance at the workplace
and the ability to meet personal and family needs. To do so will once
again require HR professionals to engage a wider set of stakeholders.
The growing need to better balance or integrate work and family needs
has not gone unnoticed in American firms. Indeed, over the past decade
or so many firms have implemented “family friendly” policies.
Experience shows, however, that these policies suffer from a fundamental
problem: they are seldom used. One clear example of this was documented
in a survey of Boston law firms. The study found that over 90 percent
of law firms had policies on the books that allowed associates (young
lawyers not yet promoted to be partners) to work reduced hour or part
time schedules. Yet only 4 percent of those eligible in fact took up this
option Women’s Bar Association of Massachusetts, 2000). The same
survey explained why so few took the option: One third of the lawyers
surveyed believed that taking this option would seriously damage their
careers because they would be stigmatized as less than “fully committed”
professionals. Thus the culture of the profession and the culture of the
organization need to change along with the formal policies. This can only
be accomplished by involving employees and supervisors in discussion of
how to design or redesign work systems and processes.
Engaging the workforce and their professional societies in rethinking
how work and careers are structured is only the first, necessary step
in engaging the broader set of stakeholders that will need to be engaged
if the challenge of integrating work and family responsibilities is to
be met. Australia and the U.S. share the dubious honor of being the only
two industrialized countries that lack a paid family leave policy (Baird,
Brennan, and Cutcher, 2002). This is not likely to continue indefinitely.
I fully expect the pressures for some form(s) of paid leave to continue
to build in the U.S. Unfortunately, to date, the knee-jerk reaction of
the HR profession, led by its national association SHRM, has been to oppose
passage of any forms of paid leave. Staying in this oppositional posture
will ultimately not only be self-defeating, it will miss an opportunity
to shape whatever public policies are enacted in a fashion that dovetails
and complements leave policies already offered by progressive employers.
The question in my mind, therefore, is whether HR professionals will engage
in constructive dialogue, analysis, and negotiations with women and family
advocates and policy experts to design a sensible approach to this and
other aspects of work-family policy, or hunker down, continue to oppose
new policies, and then have to live with whatever policies if and when
new policies are enacted.
The above political stance is typical of the approach the HR profession
in the U.S. to nearly all employment and labor policy issues. As a result,
the political impasse between employer and labor groups that has blocked
all efforts to update our employment policies to catch up with the changing
labor force and economy continues with no end in sight. This also is not
likely to continue indefinitely, however. The question is whether this
generation of HR leaders will begin to engage in a productive dialogue
with other stakeholders over how to update our policies or leave this
task to the next generation.
Labor-management
relations: Partnerships with a Focus
One consequence of the inward turn of HR in recent decades has been an
increase in anti-union or union-avoidance ideologies and strategies. In
the U.S., HR professionals may have been too successful for their own
good (not to mention its detrimental effects on workers and society).
Because only 8.5 percent of the private sector workforce is now unionized,
the vast majority of American HR professionals have little no experience
in working or negotiating with employee representatives. Yet history suggests
that the void in worker representation now present in American society
is not likely to remain unfilled in perpetuity. The evidence is clear
that a simple return to traditional arms-length labor management relations
would not well serve the workforce, employers, or the larger economy and
society. Thus, the question is whether HR professionals will have the
skills and experience base to help build the types of constructive and
modern labor-management relationships and partnerships that required in
settings where employees are represented.
A great deal of experimentation with new forms of labor management relations
from the workplace to societal levels has taken place in both of our countries
in the past two decades from which HR professionals can learn. The 1980s
witnessed a surge in creation of labor management partnerships in the
U.S. The most visible of these was the Saturn Corporation (Rubinstein
and Kochan, 2001). Its current equivalent in scale and scope is the partnership
at Kaiser Permanente Health Care and its eight different international
and 26 local unions (Eaton, Kochan, and McKersie, 2003).
Many of these have proved difficult to sustain through changes in management
and/or union leadership, market conditions, or shifts in business or labor
strategies. Two that standout as the most durable were indeed more limited
partnerships that blended the old and new industrial relations with a
clear focus on what is needed from the employee and labor relations system
to meet its objectives. NUMMI is a good example of this. By constructively
engaging its workforce and union leaders in the process of transforming
their production, human resource, and labor relations systems to support
the Toyota Production System, NUMMI was able to become a world class manufacturer.
Southwest Airlines is another good example of a service sector firm that
engages its workforce and union leaders in the process of serving customers
efficiently, flexibly and with high quality. It does by ensuring all of
its employment practices and processes support the effort to turnaround
planes quickly (it takes Southwest 20 minutes to turnaround a flight (land
deplane passengers and take off again with new passengers) compared to
over 30 minutes for other carriers (Hoffer-Gittell, 2002).
A common feature of these two examples is that management does not give
up its role as the initiator of partnership activities. Another is their
focus on achieving bottom line results rather than worrying about whether
they have all the joint consultative structures and processes in place.
That is, they are strategic in understanding what is needed from the employment
relations system and design everything they do to achieve and reinforce
the behaviors needed. This can only be achieved in settings where HR professionals
are skilled in working with employees, union leaders, and line managers
and executives. They must have credibility with all these stakeholders
to make their organization’s strategies work and to maintain high
levels of employee commitment and trust.
Rebuilding Trust with an Information Hungry and Savvy Workforce
Carly Fiorina’s quote at the beginning of this paper lays out the
scope of the problem facing management today. The scandals of American
companies came after a decade of boom and bust economy in which the old
social contract that promised loyalty and good performance would be returned
with increased employment and long term financial security had already
broken down. A generation of young people watched as their parents put
in long hours of work only to be rewarded with increased insecurity or
actual loss of jobs and/or pension savings. This generation, the ones
now in our universities, appear to have made a solemn vow to themselves:
It will never happen to me because I will never commit my total loyalty
to a single firm. Instead, I’ll build the networks I need to know
where the next job opportunity might lie and keep one foot in the labor
market at all times. Whether young people can deliver on this personal
pledge remains to be seen. What is clear to most HRM professionals in
the U.S. already, however, is that they are inheriting a more skeptical
workforce that is not ready to simply bestow its trust in top management.
How can trust at work be rebuilt? It will start with a new openness and
transparency. One thing all employees want from their organizations is
good, honest, and open communication and information needed to assess
the risks and potential rewards associated with continuing to invest their
human capital in the firm. Employees will be expecting the same rights
and access to information as do financial investors. As any parent can
attest, most young people today are highly skilled in using the internet
to satisfy their information needs. This implies that HR professionals
will have to become as skilled as the people employed by their organizations.
The need to modernize HR processes to fit the internet age will affect
all functional areas of HR, including collective bargaining negotiations.
Recent experiences in the U.S. airline industry illustrate how the workforce
can be out in front of developments in this area. Labor and management
negotiators in the airline industry in the US have experienced a great
deal of difficulty in ratifying collective bargaining agreements in recent
years with approximately 18 percent of agreements having been rejected
by rank and file employees (von Nordenflycht and Kochan, 2003). In a number
of these cases, rank and file groups have built their own websites to
comment on negotiations and critique tentative agreements, sometimes by
sending out information even before the officially designated negotiating
teams could describe the terms of the agreement. In conversations about
this development a number of labor and management professionals lamented
this development, almost in hopes that somehow they could return to the
old days where they controlled all communications with the media and to
constituents. Instead of lamenting the new phenomena, HR and labor relations
professionals will need to figure out ways to use the new technologies
in negotiations to keep members informed with accurate and current information.
Some organizations have done so. Boeing, American Airlines, and the Association
of Flight Attendants have all set up interactive websites where employees
can log on, input their personal data (job title, seniority, age, etc.),
and instantly get a personalized report on how changes in a proposed contract
will affect their earnings, benefit calculations, and other features of
their employment relationship. The race is on between a workforce with
a great thirst for information and sophisticated ability to get it (accurate
or not) instantly and HR professionals. On whom would you put your bets?
Changing Demographics of HR Professionals
In the 20th century, when labor relations was the dominant functional
specialty in employment relations departments, the field was largely the
province of men. Today, the top level HR executives remain largely but
not exclusively a male domain. Yet, currently, women constitute an increasing
proportion of professionals entering and working in our field. For example,
in the U.S. from 1987 to 2002, the number of women in the HR profession
increased from 64 to 76 percent. The same trend is visible in the number
moving up into higher managerial positions in the HR and labor relations
profession; 53% in 1987 to 65% in 2002 (Keefe, 2003). The same trends
can be seen in our best university programs that are producing the people
most likely to become the next generation HR leaders. Women account for
56 percent of the 2003 entering Masters’ class at Cornell’s
School of Labor and Industrial Relations, for example. My sense is the
trend is similar in HR programs here at Sydney and other Australian universities.
This several interesting questions. How long will it take for women to
break the glass ceiling and reach the top leadership positions in the
HR profession? Will they experience or break the “glass ceiling”
that seems to continue to exist in other areas of top management? And
if or when they do, what effects will the feminization of the HR function
have on the profession? One unfortunate effect, if the American data are
an indication, is that the feminization of the profession may lead to
a decline in salaries. As more women were entering the profession between
1983 and 2002 in the U.S. real wages of HR professionals declined by eight
percent. On a more positive note, another possible effect could be a greater
sensitivity to the need for flexible policies that support efforts to
integrate work and family responsibilities. And, if or when more women
also move into positions of power in unions, working hours, paid family
leave, and flexible work systems and careers may surface as higher priority
issues in bargaining.
Perhaps it will take this demographic shift for the HR profession to strike
a better balance between the interests of firms and the workforce. There
is no need to wait for this transition, but, if indeed that is what it
will take, I say, for one say, bring on the women!
Summing Up
The key lessons that I hope Australian HR professionals will take away
from this brief and selective overview of the recent history of the profession
in America can be summarized quite simply:
1. The quest for greater acceptance and influence with top management
has gone too far and accounts for some of the inability of the HR profession
to discipline top management excesses that produced the corporate scandals,
runaway CEO compensation, and the overall breakdown in trust in corporations
that now prevails in America.
2. The building pressures in the American workplace call for leadership
from the HR profession to help better balance worker and firm needs and
interests, rebuild trust, and help shape a new social contract at work.
3. The substantive areas with the most potential for contributing to a
new social contract that fits the needs and realities of today’s
economy and workforce include:
a. Making knowledge work and work systems pay off for firms and employees;
b. Integrating work and family/personal concerns by evaluating all HR policies and practices against the “dual agenda” of workplace and family outcomes, and;c. Supporting efforts to restore voice and transform labor-management relations to serve as an innovative force in society and help improve the performance of organizations, industries, and the overall economy.
4. To address these substantive challenges, the next generation of HR
professionals will need to be:
a. More externally focused and skilled in building and maintaining alliances and productive relationships not only with line managers and senior executives but also with each other, educational institutions, professional associations and networks, labor market intermediaries, unions, and government policy makers;
b. More analytical and able to justify support for progressive HR policies based on their demonstrated and documented bottom line results, and:
c. More skilled in using information and principles of transparency to deliver and communicate HR polices and the range of information that employees want and need.
These changes can
only be achieved if the HR profession redefines its values and professional
identity and holds itself accountable for building an employment system
that is judged to be fair and equitable by all the stakeholders involved.
Whether this shift in professional norms will evolve gradually or will
have to await the passing of the torch to a new generation remains to
be seen.
|
Table
1 1. Helping
their organization reinvent/redesign itself to compete more effectively Source: Bob Eichinger and Dave Ulrich, Human Resource Challenges, The Human Resource Planning Society, 1996. |
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