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«Line managers as implementers of HRM The effect of line managers’ limitations on their HRM implementation effectiveness A.M. Terhalle Line managers ...»

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Line managers as implementers of HRM

The effect of line managers’ limitations on their HRM

implementation effectiveness

A.M. Terhalle

Line managers as implementers of HRM

The effect of line managers’ limitations on their HRM implementation

effectiveness

Student

Name: A.M. Terhalle

Student number: s0177040

Study: Master of Business Administration

Track: Human Resource Management

Telephone number: 00316 40347471

E-mail: anoukterhalle@gmail.com Supervisory committee First supervisor: Drs. A.C. Nehles E-mail: a.c.nehles@utwente.nl Second supervisor: Dr. M.J. van Riemsdijk E-mail: m.j.vanriemsdijk@utwente.nl Preface Hereby I present my master thesis which was written to complete my Maste rs degree in Business Administration at the University of Twente. It concerns an examination of the limitations that line managers experience in their HR responsibilities and the effect of these limitations on their HRM implementation effectiveness.

In the master of Business Administration I developed a deeper understanding and interest in Human Resource Management (HRM). Whereas in my bachelor education, internships and work experience the focus was on how to execute HRM practices, in the master of Busine ss Administration I learnt about HRM performance, strategic HRM and how to manage Human Resources. I did not have to hesitate long about the topic for my master thesis: line managers’ expanding HR role and the problems that go along with this was something I recognized from practice. Therefore, I contacted the expert on this topic: drs. A.C. Nehles. She offered me a concrete thesis on this topic, which I enthusiastically accepted. In the last months I learned how to perform an academic study, gained a lot of knowledge on the HR-role of line managers and can present you with surprising results.

However, I could not have achieved this without the help of a number of people.

I would like to thank my supervisors for their guidance and input. First of all, I woul d like to thank my first supervisor, drs. A.C. Nehles, for the pleasant collaboration in executing this research together and her valuable remarks and constructive feedback. I would also like to thank her for the possibility to attend a HRM conference in Spain, which was an unique experience for me. Furthermore, I would like to thank my second supervisor, dr. M.J. van Riemsdijk, for his interesting views and conviction.

I also would like to thank dr. P.A.T.M. Geurts, for his assistance with statistical data analysis.

I enjoyed writing my thesis at the university and appreciated the company of fellow graduates, PhD students and lectures. Finally, I would like to thank my family and friends, especially my boyfriend and parents, for their support and incentives.

Anouk Terhalle Enschede, July 2009 Management summary Rationale Two aspects which are critical for HRM to be successful are the presence of HRM practices and the effectiveness of HRM implementation. Line managers are responsible for HRM implementation in an organization since they have to execute the HRM practices on the work floor. Nevertheless, research has indicated that line managers find implementing HRM practices difficult because of several limitations they experience in implementing HRM. HRM practices can be developed properly, but if line managers fail to implement them successfully on the work floor they are still not effective.

Research objective and questions This research aims to measure to what extent line managers perceive the s uggested limitations as hindering and whether their employees perceive their HRM implementation as effective. Furthermore, it aims to examine to what extent line managers’ limitations influence their effectiveness in HRM (according to their employees). This research objective leads to the following research questions: 1) To what extent can line managers implement HRM practices effectively? and 2) What is the influence of the limitations that line managers experience in implementing HRM on their HRM implementation effectiveness?

Line managers’ limitations in implementing HRM Many researchers expressed concern about line managers’ performance due to a number of limitations.

First of all, line managers have a lack of desire to implement HRM. However, willingness is essential for someone to perform effectively. Furthermore, line managers do not have capacity to implement HRM, since they have other, more pressing, short term operational responsibilities. This short -range focus may result in people management that is generally less effective. Besides, line managers have limited skills and competences in HRM due to a lack of training. It is suggested that these low competences are a significant constrain on the effective devolution of HRM responsibilities to line managers. Line managers are also hindered by a lack of support from the HR department and it is argued that line managers cannot perform their HR tasks effectively without the assistance of HR professionals. Lastly, line managers rely on clear policies and procedures on what their HR responsibilities imply and on how to execute HRM practices.

Without these policies & procedures, their HRM implementation effectiveness is likely to suffer. Based on

this literature, I developed the following (positively formulated) hypotheses:





Hypotheses 1: The more desire line managers have to perform HR tasks, the more effectively they will implement them on the work floor.

2: The more capacity line managers have to execute HR tasks next to their opera tional tasks, th e more effectively they will implement them on the work floo r.

3: The more competent line managers perceive themselves to perform HR tasks, the more effectively they will implement them on the wo rk floor.

4: The more HR support line managers perceive to receive from HR professionals in perfo rming their HR ta sks, the more effectively they will implement them on the wo rk floor.

5: The more policies and pro cedures line managers have on their HR responsibilities and on how to execu te HRM practices, the mo re effectively they will implemen t HR tasks on th e wo rk floor Methodology l performed statistical data analysis to answer the research questions. Nehles (2006) developed a research instrument based on non-HRM literature to measure the limitations that li ne managers experience in HRM. Line managers’ HRM implementation effectiveness is measured by asking their subordinates’ opinion of their HR performance on five HRM practices. Nehles (2007-2008) collected data by means of questionnaires in two case organizations; an international naval defence company and a construction company. For measuring line managers’ limitations in implementing HRM, the research population was line managers at various levels of an organization responsible for the supervision of a tea m of employees.

For measuring line managers’ HRM implementation effectiveness, the research population was line managers’ subordinates.

Results & conclusions Contrary to earlier research, I found that line managers perceive themselves as effective as they do not perceive limitations in implementing HRM and they are also perceived as effective by their subordinates.

Thus, line managers have found a way to perform their HR role to their own satisfaction as well as to the satisfaction of their subordinates.

In order to investigate whether the limitations have an effect on line managers’ effectiveness in implementing HRM practices, I performed a multiple regression analysis to test the hypotheses. I performed three regression models (1) without control variables, (2) with demographic control variables, and (3) with demographic and organizational control variables. Without controlling for the organization in which the research was performed, I can conclude that the more capacity line managers have to apply HRM practices, the more HR competences they have and the better they get supported by HR professionals, the more effectively they implement HRM practices on the work floor. Therefore, I support hypotheses 2, 3 and 4. However, when controlling for the organization, only line managers HR competences are significantly positively related to their effectiveness in implementing HRM. Policies and procedures available for line managers have no relation with their HRM implementation effectiveness and therefore hypothesis 5 is rejected. Line managers’ desire to implement HRM has a negative effect on their HRM implementation effectiveness and therefore hypothesis 1 is rejected. This remarkable finding can be explained by the fact that for employees it does not matter whether their line manager believes in HRM practices, since employees themselves might not see the added value of certain HRM practices.

Employees might not value standardized procedures and depersonalized instruments but prefer a personal approach with individual decisions.

Content

1. Introduction

1.1 Line managers and effective HRM implementation

1.2 Relevance

1.3 Research strategy

1.4 Thesis structure

2. Literature review

2.1 The importance of HRM implementation

2.2 Distribution of HR roles and responsibilities in an organization

2.3 Line managers’ limitations in implementing HRM

2.4 Research model

3. Methodology

3.1 Operationalization of concepts

3.2 Reliability assessment

3.3 Research population & data collection methods

3.4 Preparation for data analysis

4. Results

4.1 Line managers’ limitations in implementing HRM

4.2 Line managers’ HRM implementation effectiveness

4.3 The effect of line managers’ limitations on their HRM implementation effectiveness....... 40

5. Discussion

5.1 Line managers’ limitations in implementing HRM

5.2 HRM implementation effectiveness of line managers

5.3 The effect of line managers’ limitations on their HRM implementation e ffectiveness....... 50

6. Conclusion

6.1 Research conclusions

6.2 Research limitations

6.3 Suggestions for further research

6.4 Recommendations

References

Appendix

–  –  –

1. Introduction

1.1 Line managers and effective HRM implementation Many researchers assume that the HRM strategy of an organization corresponds with the implementation of this strategy. However, HRM strategies are often implemented without a clear direction, or are not implemented at all. This can lead to significant differe nces between the developed HRM strategy and the actual implementation (Nehles & Boon, 2006). Two aspects which are critical for HRM to be successful are the presence of HRM practices and the success of HRM implementation (Gratton & Truss, 2003). Researchers have attempted to prove a linkage between HRM and firm performance by investigating the HRM practices while the success of HRM implementation has received little attention so far. The presence of well developed HRM practices is important for an organization’s performance but it is not enough to be competitive; equally important is the way how these HRM practices are implemented. The responsibility for the HRM implementation lies with the line managers of an organization since they have to execute the HRM practices on the work floor. Nevertheless, research has indicated that line managers find implementing HRM practices difficult because of several limitations they experience in implementing HRM. These limitations inhibit the HRM implementation effectiveness of line managers (Renwick, 2002; McGovern et al., 1997; Whittaker & Marchington, 2003; Hall & Torrington, 1998, Gennard & Kelly, 1997). HRM practices can be developed properly, but if line managers fail to implement them successfully on the work floor they are still not effective (Nehles et al, 2006). (First) line managers can be defined as (the lowest) line managers at the operational level, who manage a team of operational employees on a day-to-day basis and are responsible for performing HRM activities (Nehles et al, 2006, p. 256).

1.1.1 Research objective and question Many studies have been carried out with the intention of identifying various limitations that hinder line managers in performing their HR role. This research does not aim to identify more limitations, but to measure to what extent line managers perceive the suggested limitations as hindering and to understand which of these limitations are salient for HRM effectiveness.

Therefore, the objective of this research is twofold:

First, I aim to examine whether line managers can implement HRM effectively: to what extent are line managers hindered by HR limitations in executing HRM practices and how are they evaluated by subordinates in their HR performance.

Second, I aim to examine to what extent the limitations that line managers experience in executing HRM practices influence their effectiveness in implementing HRM.

This research objective leads to the following research questions:

1. To what extent can line managers implement HRM practices effectively?

2. What is the influence of the limitations that line managers experience in implementing HRM on their HRM implementation effectiveness?

1.1.2 The changing role of the line manager The role of the line managers has changed over the last twenty years. There is a widespread drive to give line managers more responsibility for the management of their staff and to reduce the extent to which human resource departments control or restrict line management autonomy in this area (Brewster & Larsen, 2000). HR professionals no longer have sole responsibility for the management of people, but share this responsibility with line managers. There is evidence that HR responsibilities are increasingly decentralized and devolved to line managers (Whittaker & Marchington, 2003;



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