Sample Essay
This is also an example of a contingent approach to HRM. All managers should always be aware that each situation is unique and requires different solutions and that there is hardly ever one best fit solution for all the problems. If demand slows down for example an employer might consider keeping more employees on a part time basis to deal with the situation.
An employer will base his HR policy and strategy based on his overall business strategy he is implementing for the next few years. If a company wants to slow its growth and stabilize its position it might look for standardization in all its practices and will encourage HR policies which promote this kind of performance from employees. We can analyze this in greater detail if we analyze this issue from the perspective of contingency[1] management models. One such contingency model is Michael Porter’s business-strategy model (Wikipedia). The model is not an HRM model but it has direct implication for HRM and any company’s HR Policy. Porter defines three distinctive strategies that can be followed by a company. These are the cost reduction strategy, differentiation strategy and the focus strategy.
[1]See All Experts Human Resources for reference.(explanation by Professor Rs Mani)
Contingency theories are a class of behavioral theory that contend that there is no one best way of organizing / leading and that an organizational / leadership style that is effective in some situations may not be successful in others. In other words: The optimal organization / leadership style is contingent upon various internal and external constraints.
These constraints may include: the size of the organization, how it adapts to its environment, differences among resources and operations activities, managerial assumptions about employees, strategies, technologies used, etc.
Four important ideas of Contingency Theory are:
1. There is no universal or one best way to manage
2. The design of an organizations and its subsystems must ‘fit’ with the environment
3. Effective organizations not only have a proper ‘fit’ with the environment but also between its subsystems and
4. The needs of an organization are better satisfied when it is properly designed and the management style is appropriate both to the tasks undertaken and the nature of the work group.
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