Organizing the HRM function: Responses to paradoxes, variety, and dynamism

• Author: Hella Sylva,Ludwig Hoeksema,Ilja Bitterling,Anne Keegan
• DOI: http://doi.org/10.1002/hrm.21893
• Published date: 01 September 2018
• Date: 01 September 2018

ORIGINAL ARTICLE

Organizing the HRM function: Responses to paradoxes,

variety, and dynamism

Anne Keegan

1

| Ilja Bitterling

2

| Hella Sylva

3

| Ludwig Hoeksema

4

1

University College Dublin, Dublin, Ireland

2

KPMG Netherlands, Amstelveen, Netherlands

3

Berenschot Group BV, Utrecht, Netherlands

4

Faculty of Economics and Business

Administration, VU Amsterdam, Netherlands

Correspondence

Anne Keegan, College of Business, University

College Dublin, Blackrock, Co. Dublin, Ireland.

Email: anne.keegan@ucd.ie

We develop empirically based insights from five case studies and argue that how actors

respond to paradoxical tensions helps to explain variety and dynamism in how the HRM func-

tion is organized. It also helps to clarify why widely popular models with clearly prescribed

structures take on a variety of forms in practice and are dynamic. We contribute to theorizing

on the HRM function by introducing a dynamic, tension-centered perspective, based on para-

dox theory,that builds on previous research on the organization of the HRM function and the

challenges facing HRM practitioners working within any particular model to organize HRM

work. We discuss the limitations of our study, as well as offering suggestions for future

research and practical implications from paradox theory for HRM practitioners dealing with

tensions in their work.

KEYWORDS

dynamism, HRM, organization, paradox, responses, tensions, variety

1|INTRODUCTION

In this article, we introduce insights from paradox theory to under-

stand variety and dynamism in the organization of the HRM function.

Previous work, for example,from institutional and contingency theo-

ries, has explored similarities and differences in the HRM function in

different contexts (e.g.,Boglind, Hällstén,& Thilander, 2011;Farn-

dale & Paauwe, 2007). Support for one-to-one relationships between

the forms of organizing adopted and the national, cultural,or institu-

tional context has been mixed (Brandl, Ehnert,& Bos-Nehles, 2012).

Scholars addressing the uptake of HRM models, especially the Ulrich-

inspired three-legged model, have found that when adopted, they are

often adapted in various ways in practice (Boglind et al., 2011). Theo-

retical contributions explaining the variety in how HRM is organized in

similar contexts and why models, when adopted, are often in transition

from one form to another are currently lacking (Farndale et al., 2010).

Our aim in this article is to introduce insights from paradox the-

ory to understand variety and dynamism in the organizing of the

HRM function (Fairhurst et al., 2016; Lewis, 2000; Miron-Spektor,

Ingram, Keller, Smith,& Lewis, 2017; W. K. Smith & Lewis, 2011).

Paradox theory sees organizations as inherently dynamic (Putnam,

Fairhurst,& Banghart, 2016), focusing on the various tensions that

actors experience, and how they make sense of or enact these, in

order to cope with the contradictory elements in their environment

(W. K. Smith & Lewis, 2011). With few exceptions (e.g.,Kozica &

Brandl, 2015), little empirical research using paradox theory has been

conducted in the field of HRM generally or the HRM function specifi-

cally. We explore five case studies on HRM functions and their orga-

nization using paradox theory insights. We make a contribution

beyond previous work connecting paradox theory and the HRM

function,which, until now, has been mainly conceptual in nature

(Gerpott, 2015).

The article is structured as follows. We review the literature on

key models and theories associated with the HRM function and how

it is organized and describe their contributions and limitations. We

then introduce paradox theory as our main theoretical frame of refer-

ence. We describe the study we carried out in five Dutch companies

and present our findings. We discuss the theoretical and practical

implications of our empirical findings for how we understand variety

and dynamism in the HRM function and how it is configured and the

uptake of particular models. We discuss the strengths and limitations

of our study and conclude with suggestions for future research.

2|KEY MODELS OF HRM FUNCTION

ORGANIZATION

From Drucker's (1961) seminal comment that personnel work is a

“hodge-podge of incidental techniques”(p. 269), the organization of

DOI: 10.1002/hrm.21893

Hum Resour Manage. 2018;57:1111–1126. wileyonlinelibrary.com/journal/hrm © 2017 Wiley Periodicals, Inc. 1111

the HRM function is of interest to both scholars and practitioners.

The principle that HRM work is characterized by different—and at

times contradictory—elements has become central in conceptual

models of the HRM function. These elements include strategy versus

operations/tactics, managing change versus managing continuity,

intervention versus nonintervention, and people versus process.

Tyson and Fell's (1986) role-oriented model highlights the elements

of strategy, operations, and the management of labor relations as

central to the work of HRM practitioners. Storey's (1992) research-

based model of advisors, change makers, regulators, and hand-

maidens stresses the bipolar elements of strategy versus tactics as

well as a change role differentiated by an intervention/noninterven-

tion focus. Ulrich's (1997, 1998) prescriptive model identifies strate-

gic partners, change agents, employee champions, and administrative

experts. These roles are concerned with elements ranging from the

strategic to the day-to-day, and from a people focus to a process

focus. Whether and how the roles should be carried out simulta-

neously has raised concerns regarding role conflict and ambiguity for

HR practitioners working with these models (Caldwell, 2003; Pohler &

Willness, 2014).

In perhaps the most popular model of the organization of the

HRM function to emerge to date, HRM activities are structurally split

into three subunits, typically a shared service center (SSC), Centers of

Expertise/Excellence (COEs), and a business partner (BP) unit

(Boglind et al., 2011; Reilly, Tamkin, & Broughton, 2007). This

model—often referred to as the three-legged stool model and widely

associated with the original work of Ulrich (1997)—identifies subunits

that differentiate administrative execution, policymaking, and strate-

gic HRM tasks. The purpose of the stool's three legs is to enable the

HRM function to cope effectively with the requirement for both stra-

tegic and operational tasks, and to enable a more strategic role for

HRM practitioners (Reilly et al., 2007; Ulrich, 1997).

Splitting the function into three distinct subunits should allow

HRM practitioners to focus on customer intimacy toward the busi-

ness (BP unit), quality and innovation in policy development (COEs),

and operational excellence regarding administrative and operational

tasks (SSCs). According to the model, the HRM function should be

structured to ensure that a strategic role is possible by differentiating

administrative tasks from strategic tasks. Administrative tasks are

often captured in SSCs, which are in- or outsourced, as well as

devolved to line managers and employees. HRM specialists should,

according to the Ulrich (1997, 1998) model, become strategic part-

ners to the business, focusing primarily on the contribution of HRM

to organizational goals (Gerpott, 2015).

The model has been described in a recent expert review as

“almost ubiquitous”(Marchington, 2015) with empirical research sug-

gesting its widespread adoption in practice (Boglind et al., 2011;

Reilly et al., 2007; Robinson, 2006). Gerpott (2015) cites evidence

that over 90% of the companies listed on the German stock exchange

(DAX30) have implemented an Ulrich-inspired “three-legged stool”

and similar trends can be recognized in the United Kingdom (Reilly

et al., 2007) and the Netherlands (Farndale, Paauwe & Hoeksema,

2009). The Ulrich-inspired template is also frequently mentioned in

practitioner and consulting literature (Chartered Institute of Person-

nel and Development [CIPD], 2013; Hay Group, 2013).

Such models, including the Ulrich-inspired model, “see”the

organization of the HRM function in somewhat static terms

whereby adopting a particular structure, or set of roles, solves HRM

problems such as lack of strategic focus. Empirical evidence, how-

ever, suggests significant variety between organizations in the pre-

cise scope, structuring, governance, and output of the HRM

function (Boglind et al., 2011). For example, it is not clear what

activities exactly belong to the three legs of the Ulrich-inspired stool

(Farndale & Paauwe, 2007). Benchmarking by professional service

firms reveals high variance in the distribution of activities where

centers of expertise (e.g., compensation and benefits; learning and

development) are sometimes part of the shared service organization,

while in other organizations they are part of the (strategic) corpo-

rate center (Van Dam, Van der Spek, & Sylva, 2013). Teo and Rod-

well (2007) argue that splitting HRM strategy from operational

execution may weaken rather than enhance the reputation of HRM

practitioners with their stakeholders, as the strategic value of HR

practitioners (from a line manager's perspective) is built on HRM

practitioners being operationally focused. Tensions between strat-

egy/operations continue to persist despite the adoption of particular

models (Caldwell, 2003), and variety exists in how models like the

three-legged stool model are adopted, adapted, and altered in the

process of their implementation (Boglind et al., 2011; Farndale &

Paauwe, 2007). To explore why this is the case and what it means,

we turn to existing theories that have been used to explain the

organization of the HRM function.

3|KEY THEORIES OF HRM FUNCTION

ORGANIZATION

Findings from a recent comprehensive review of how the HRM func-

tion is organized in different contexts by Brandl et al. (2012) suggest

key insights. The authors find mixed empirical evidence from a wide

range of studies drawing on institutional, contingency, and cultural

theories on the organization of the HRM function. Studies in the con-

tingency tradition (e.g., Schuler & Jackson, 1987) indicate limited sup-

port for one-to-one linkages between HRM strategy type and the

form in which HRM activities are organized. Farndale et al. (2010)

mobilize contingency theory in a study of the corporate HR function

and its role in coordinating international HRM policies and practices.

Their data also reveal mixed outcomes. On the one hand, they find

“initial empirical evidence of contextually based configurations of cor-

porate HR functions,”while they also find evidence that “many of the

companies here are in transition and as such suggest considering a

more dynamic approach to classifying MNCs by IHRM structure”

(Farndale et al., 2010, p. 63). Citing evidence from empirical studies in

the institutional theory tradition, Brandl et al. (2012, p. 257) found in

some studies that “national institutional factors play a minor role for

the HRM department roles”(Wachter, Peters, Ferner, Gunnigle, &

Quintanilla, 2006), while in other studies empirical results did affirm

“the relevance of the national regulatory context for HRM depart-

ment size.”Finally, the few studies drawing on cultural theory are

also inconclusive regarding the configuration of the HRM function in

different national contexts (Brandl et al., 2012).

1112 KEEGAN ET AL.