This video concludes the lesson on why there are different human resources practices and managerial strategies. So, why do organizations and managers have different approaches? Well in previous videos, we've looked at the importance of external influences, and also the importance of organizational strategy. But it's important to remember that these outside as well as inside influences do not completely determine the choices that organizations and managers make. Again, managers and organizations have choices. So what also determines the choices that are made. Well in this video I'm gonna outline how Ideas matter, how ideas shape choices, not only of managerial styles, but also of organizational HR strategies. So in an earlier video, I argued that the evolution of HR practices represents not only an evolution of those practices, but an evolution of ideas as well. But what about today? Well, my argument is the same for today. And that both managerial styles, as well as HR strategies, reflect ideas. And so I'm going to highlight three different sets of ideas, for shaping managerial strategies, as well as HR strategies. Organization's roles in society, the employment relationship, and workers. So first, thinking about a corporation's role in society. And there's really two views here that are critical. There's the shareholder value view which is that corporations best serve society by creating shareholder value. And how do they do that? It's by providing goods and services that are valuable to customers. On the other hand, there's an alternative view which emphasizes the corporations receive privileges to serve society. For example, owners are shielded from being personally responsible for a company's debts through limited liability. And again, it's society that is granting those limited liability. Privileges, and so therefore corporations have an obligation to serve society and stakeholders more broadly than simply by trying to maximize shareholder value. This first few points towards instrumental HR strategies that view workers as costs or inputs, and that emphasize the importance of market competition and financial returns over the importance of workers. The second view, the stakeholder view, points more towards higher road HR strategies that see workers as key stakeholders. Now we can see this applying to the public sector equally well, and we can have different views as to whether public sector organizations should simply be providing service to customers at the lowest cost possible, or whether public sector organizations should also be paying attention to how employees are treated. So now let's turn to employment relationship. I'll present four different viewpoints on the employment relationship. Two of them underlie different HR strategies. Two others are more critical of HR. To do this I'm going to present four different pieces of line art that are around 90 to 120 years old. I think these are really cool. I use them a lot in my own teaching and I think they're a great way to think about the intellectual assumptions we all make about the employment relationship. So the first one portrays labor leader Eugene Debs as a king during the Pullman strike in 1894. I use this drawing to highlight the importance of markets. The strike here is choking off commerce. If we zoom in we can see that it is choking off the highway of trade. And this is seen as very harmful, because there's a belief in this school of thought in the primacy of free markets for creating opportunities, alternatives, and values, including in the employment relationship. Some might call this a neo-liberal market ideology. People who hold this view are likely to favor HR and managerial strategies. They're rooted in the determination of wages and other things by whatever the market will bear. Now as a second school of thought, here's a drawing from 1909. In this picture a snake is portrayed as choking off workers and families. What does this snake represent? Well if we zoom in, we can see that it represents capitalism. And what is required to save workers and their families from capitalism? We'll zoom in and see that it's socialism that is portrayed here as the solution to capitalism. So this is clearly a radical or critical perspective. This assumes that employers of employees have sharply conflicting interests, and that employers have excess power, not only in the workplace, but also in society. So this view is critical of human resources. It sees human resources as a sneaky disguise way to appease worker and disguise employer's power. In other words it's seen as an iron fist in a velvet glove. Thirdly here's a piece of art from 1914 that represents a school of thought in between the free market and radical models. Think of employers and employees bargaining as captured here in the middle of this picture, trying to push a pendulum to gain a power advantage. Now what happens if labor gets too strong? Well the pendulum gets pushed over here to an extreme and the situation here is characterized as one of anarchy. And you have bombs and dynamite and other products of anarchy. What if we go the opposite direction and capital or employers get too strong. Well then you have a situation when employers are seen as despots and you have the weapons of that come with that domination. For example, colors and chains and whips. So clearly in this picture, neither extreme is being portrayed as valuable. And the valuable, desirable situation is here where there's a balance in the middle and where capital and labor have some semblance of a balance of power. And there you avoid the destruction of either extreme. And you have a bountiful harvest to split. And so, this school represents an idea of the employment relationship where stakeholders in the employment relationship have unequal bargaining power. They have some conflicting interests, and it is bad for them and bad for society for one size interest to dominate. So, those interests instead, need to be balanced. In other words, this is a pluralist employment relationship where the employment relationship consists of a plurality of interests that are all seen as legitimate. So, again, it's not good to have one side's interest dominate the other's. So, what does this school or thought think about human resources? Well, from a pluralist perspective, human resources is important, especially for those issues for which there isn't a conflict of interest. However, this school is uncomfortable relying solely on human resources because there are competing interests and you don't want to leave those competing interests to the power of the organizations. So instead you need institutional checks and balances like laws and the labor movement. So the fourth and final view of the employment relationship that I want to highlight in this video is reflected in this piece of line art from the late 1920s called bringing home the turkey. Let's zoom in on the key labels. So the father pilgrim is labeled "business", the children are labeled "stockholders and workers", and crucially, the gun that the father pilgrim is holding, representing business, is labeled "new methods". In the late 1920's, this represented a lot of business managerial developments, but let's just focus here on human resources. So what is captured by this picture? Well first, if we take it literally, all right, stakeholders are important. In fact, they're a family. But more importantly, who's creating wealth for the family? It's not a joint initiative. It's not a market based initiative. It's a business initiative. It's the gun representing new methods that is generating wealth. And so in terms of human resources, these are win win human resources policies that are serving not only the organization's interest but creating enough wealth that the stockholders and workers can share as well. So, this is really an important viewpoint to underscore, because it's the foundation of what I called, in a previous video, high road human resources strategies. And this is really essential in this view for creating win/win employment relationships. So this is called a Unitarist view of the employment relationship where workers and organizations are assumed to share a number of common interests and so it's simply a matter of managers finding the right policies to align those interests to produce win win outcomes. So this is a very important view for thinking about modern high road human resources practices. So we have four different views of human resources. We have two that yield different human resources models. And we have two that see human resources as either incomplete or as more problematic. These different views are ultimately rooted in different views about the employment relationship. So again to emphasize, approaches to human resources, both supportive as well as critical, are shaped by ideas of the employment relationship. So in conclusion, I've shown you how ideas about an organization's role in society as well as beliefs and assumptions about the employment relationship, shape the choices that managers and organizations are making. But what about workers? How do they think about work? What motivates them? What rewards are they looking for from their work? Thinking about this and the assumptions that we're making about these questions is critically important for managers, as well. In fact, this is so important that it will be the focus for modules two and three. I look forward to seeing you there.
