The Muddled Role of Human Resources
According to Aamodt (2007, p. 217), training and feedback are the most important use of performance evaluation. Unfortunately, not much is said about why training and feedback is so important.
I think this illustrates a huge problem with human resources. To put it bluntly, HR has a hard time disengaging from a focus on repetitive process and concentrating on contributions to the bottom line. Unlike marketing, HR is vested in repeating processes, observing rules and following convention. Unlike accounting and finance, HR has little insight on how process and procedures impacts competitive advantage and profitability. Working in that kind of an environment is not good practice for assessing and adjusting to the constantly changing threats and opportunities presented to a business. Consequently, HR sits quietly in a corner repeating process and procedure while others are articulating their contribution to the business mission, and use objective measures to calculate their share of Return on Investment (ROI) for the organization.
This is not a new problem, or something esoteric or little known. A number of books have been published addressing the problem and offering solutions (Ulrich 1998; Ulrigh & Brockbank 2005; Fitz-enz & Phillips 1998). Of course, human resources is in a very difficult position. It is very difficult to measure value based on a repetitive process that has no outcome. It is similar the challenge security organizations face in claiming credit for lack of a terrorist attack. Did a bad outcome not occur because of organizational efforts, or because nothing bad was going to happen anyway? Human resource faces the same challenge – is profitability up because HR has been doing a stellar job of recruiting and training, or because a competitor went out of business? Or because a competitor went out of business and its ex-employees came to this company?
This line of thinking brings up the question of the role of HR. Is HR a dynamic part of the company that actively contributes to business success, or is it a clerical pool processing paperwork to insulate the company from litigation? Interestingly, the trend of research seems to suggest that person-organization fit, (P-O fit), is a significant predictor of tenure, and possibly performance (McCulloch Turban 2007; Arthur et al 2006; Autry & Wheeler 2005). These researchers are closing in on a provocative question – will better measures of P-O fit, such as personality traits and organizational values, be more predictive of performance and tenure than skills and training? Almost one third of the population of the United States has earned a Bachelor’s degree or higher, and more than one fourth have at least some college (US Census Bureau 2009). Education and training is not a problem – if applicants do not have skills when they walk in the door they can probably learn them easily. Far more important is whether their personalities, traits and values match those of the people already working.
The central problem – the one that goes to the heart of the of the question about the role of HR – is finding better ways to predict future performance from P-O fit. That is the performance goal of HR. It is objective, measurable and valid.
The question presented here reflects this problem. Performance appraisals might “have many potential uses in organizations”, but only one is of any consequence – the one that increases profitability. All the rest of only of ancillary value.
Arthur, W., Jr., Bell, S. T., Villado, A. J., & Doverspike, D. (2006). The Use of Person-Organization Fit in Employment Decision Making: An Assessment of Its Criterion-Related Validity. Journal of Applied Psychology, 91(4), 786-801. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=21711351&site=bsi-live
Autry, C. W., & Wheeler, A. R. (2005). Post-hire Human Resource Management Practices and Person-organization Fit: A Study of Blue-collar Employees. Journal of Managerial Issues, 17(1), 58-75. Retrieved from http://ezp.waldenulibrary.org/login?url=http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=16862022&site=ehost-live&scope=site
Fitz-enz, J., & Phillips, J. J. (1998). A new vision for human resources : defining the human resources function by its results. [Menlo Park, Calif.]: Crisp Publications.
McCulloch, M. C., & Turban, D. B. (2007). Using Person-Organization Fit to Select Employees for High-Turnover Jobs. International Journal of Selection & Assessment, 15(1), 63-71. Retrieved from 10.1111/j.1468-2389.2007.00368.x
Ulrich, D. (1998). Delivering results : a new mandate for human resource professionals. Boston: Harvard Business School Press.
Ulrich, D., & Brockbank, W. (2005). The HR value proposition. Boston, Mass.: Harvard Business School Press.
US Census Bureau (2009). 2005-2007 American Community Survey 3-Year Estimates. Table S1501. Educational Attainment. Retrieved from: http://factfinder.census.gov/servlet/STTable?_bm=y&-geo_id=01000US&-qr_name=ACS_2007_3YR_G00_S1501&-ds_name=ACS_2007_3YR_G00_