HARVARD MODEL OF HRM

Management experts as Michael Beer, Quinn Mills et.al of HarvardBusiness School propounded Harvard model of HRM. It is one of the most influential models of HRM. The Harvard interpretation visualizes employees as resources fundamentally different from other resources cannot be managed in a single stereotype way. The stress is on people as human resources. The Harvard approach identifies an element of mutuality in all businesses.   Employees are crucial stakeholders in an organization who have their own needs and concerns as shareholders and customers

 The type of HRM policies and practices an organization prefers should be dependent upon its vision, mission, strategy, organizational goals and objectives. In quite a few cases, HR practices shall be devised and adopted in tune with external environment.  In fact, internal and external environment of organizations influence HR policies and practices. Harvard model of HRM underlined this influence of environment on HRM. This model, also known as Soft Model of HRM/Harvard Map of HRM,  argues that two significant considerations mainly influence human resource policies.

1.     Situational factors: The internal and external environment factors of organizations including:

Labour market conditions,

Societal values

Business strategies,

Technologies,

Management philosophies, and

Market conditions will restrict the formation of HRM policies.

2.     Stakeholders’ interests: The stakeholders influence the short-term HRM policies including:

Management employees

Unions, and

Government agencies

Further, the model classifies HRM policies and practices into four themes as follows:

1.     HR flow. Recruitment and selection, placement, promotion, performance appraisal, transfer and the like.

2.     Reward systems.  Pay systems, outstanding performance recognition schemes and so on.

3.     Employee influence. Clarity of authority and responsibility, delegation of powers and organizational hierarchy.

4.     Work systems. Definition of work and alignment of people.

These HR practices revolve around four C’s:

1.     Commitment. HRM policies must contribute to infusing commitment among employees that will enhance the employee performance, increase loyalty to work enhance the individual self-respect and worth.

2.     Congruence. There must be congruence between and among various HRM policies as well as practices in operation.

3.     Competence. HRM policies and practices function in such a way as to attract, develop and retain employees with skills and knowledge valuable to organization.

4.     Cost Effectiveness.  The level of Wages, benefits, turnover, absenteeism, strikes etc. must evaluate HRM policies.

The model assists HR manager in working out HR strategy for their organization. This model offers three significant insights for practice. HRM policies should be defined keeping in view the environmental factors and stakeholder’s concerns. There must be a good fit between organizational environment and HR policies. HRM policies and practices must have a clear goal to achieve employee commitment, competence, competence development, and embrace cost effective methods.

HRM that stems from environmental factors based on four C’s will result in employee and organizational effectiveness. This is a soft model as it is based on stakeholder’s concerns and their commitment to organizational goals.