Human Resource Management is not just a new label for old-fashioned personnel practices. While the classic personnel department of the 1970s dealt with personnel issues as a separate and purely administrative function, Human Resource Management aims at a close integration of HR policies with business strategy and other internal and external factors which affect the firm (institutional environment, production technology, etc). This is what has been often termed as the problem of external integration. On the other hand, as a coherent set of practices planned and implemented in pursuit of long-term goals, HRM is a strategy on its own. This refers to the issue of internal integration. We are not here concerned with the differences between Personnel Management and Human Resource Management. Rather, our aim will be to provide some answers to the questions 'what are these two levels of strategic integration?', 'why and in what terms are they desirable?' and 'what evidence is there for the diffusion of strategic HRM in the UK?'.
Given the vastness and the complexity of the topic treated, this essay is an attempt to throw some light on the main issues and is not to be deemed as either exhaustive or conclusive.
Let's first look at the issue of internal integration. HR policies, even though dealing with a wide range of personnel issues like selection and recruitment, training and development, communication, employee involvement, payment systems and rewards, performance management, should be planned and implemented in a way that constitute a coherent whole, whose parts fit with each other. Why is the implementation of a coherent HR strategy desirable as opposed to piecemeal introduction of HR policies?
First of all, where piecemeal introduction of HR policies is implemented without particular care to how the specific practices fit together, the single policies might not produce...