This paper examines the emerging trend of HR devolution — the transfer of human resource responsibilities from specialist HR departments to line managers — and its implications for organizational performance and employee well-being. Drawing on a broad review of academic literature, the paper traces the rise of Strategic Human Resource Management (SHRM) as a response to globalization, technological automation, and intensifying competition. It evaluates both the potential benefits of devolution, including increased flexibility and improved decision-making, and its limitations, such as line manager knowledge gaps and short-term performance gains at the expense of longer-term outcomes. The paper concludes that more comprehensive models are needed as the field continues to develop.
In the last few decades, the globalization trend has fostered extensive changes in how organizations operate. The rapid pace of the business world has created a scenario in which organizations are constantly evolving and organizational change is nearly a perpetual process. The role of technology has also been a contributing factor with profound implications for organizations and how their human resources interact, collaborate, and perform tasks. The level of competition has steadily risen as firms continually streamline processes and business functions. Organizations must now maintain a close eye on the external environment and adapt as needed to continue satisfying consumer demands.
It is in this environment that a trend of devolution in the HR business function is predicted to drive the evolution of the industry. The field has had to practically reinvent itself to stay relevant in the new organizational environment, a process heavily driven by technological change. Whereas the role of human resources was once heavily based on administrative duties, many of these processes have become almost completely automated by sophisticated information systems. The term devolution therefore refers to the workload that has been transferred away from top-tier human resource managers and can now be implemented effectively by line managers using new systems, controls, and advanced business processes.
In the wake of this emerging trend, human resource management has considerably more time to devote to new areas of organizational development. HR has moved away from the administrative management of human issues toward a role that actively seeks to create a competitive advantage for organizations. Given that much of the economy is now led by knowledge management and knowledge workers, maintaining high-quality human resources has reached new salience in organizational development. From this position, a whole field has emerged known as Strategic Human Resource Management (SHRM). This paper examines the emerging trends within the realm of human resources and speculates as to where the field may head in the future.
The notion of line managers being granted an increased role in HRM has gained a significant amount of attention in the literature in recent years (Power, Milner and Garavan 2007). Strategic Human Resource Management focuses on decentralizing the role of HR within an organization and empowering line management to handle more of the functionality of human resources. This strategy can intuitively provide organizations with greater flexibility in meeting the challenges of a modern environment. Many teams are spread out geographically, making it difficult for a centralized HR department to engage with diverse teams. Furthermore, devolution gives the person who generally has the most contact with employees the power to make decisions regarding HR issues — an arrangement thought to improve decision quality since these individuals are more acquainted with the specifics of any given employee's situation.
Since the emergence of SHRM, there has been an ongoing debate about whether it can actually add value to organizations or whether it serves more as a rhetorical device (Anderson, Cooper and Zhu 2007). Recent studies have indicated that financial performance can be correlated with the degree of alignment of HRM with certain business objectives. However, even where short-term financial advantages from devolution strategies exist, they may come at the cost of other variables such as employee well-being (Renwick 2003). The results produced in the literature appear widely mixed on many fronts.
The field of study itself is still emerging, and it is difficult to identify a consensus as to what the specific term devolution even encompasses (Cascon-Pereira, Valverde and Ryan 2006). It has been suggested that the term should be further delineated into distinct dimensions in order to provide a better understanding of the levels involved in such a strategy. Greater clarity and comprehensiveness in models may be needed to generate deeper insights and more comparable data. Early research seemed to indicate that, despite the ambiguity surrounding the concept, investigation of different hierarchies and responsibilities among line managers in the U.S. Government found no significant statistical difference between different levels of centralization or decentralization (Mesch, Perry and Wise 1995). However, this research was conducted at a relatively broad level and made no provisions for nuances between competing HR strategies.
Several studies have provided evidence that line management devolution, innovative recruitment and selection systems, regular training and development of personnel, equity-based compensation systems, performance appraisal systems, effective career planning systems, and robust employee participation in organizational decisions are among the key strategic HR practices that influence organizational performance (Jimoh and Danlami 2011). Human resource development strategies can also arise from broader business strategies and may depend on this alignment for their success (Horwitz 1999). However, it has also been shown that domestic culture can play a significant role in determining the level of decentralization of HR functions — more so, in some cases, than internal policies or organizational goals (Andolsek and Stebe 2007).
"Causal links weak; line managers may lack HR knowledge"
"Employee attitudes and commitment shaped by devolution quality"
A literature review was conducted regarding the devolution of HR tasks to line managers and found that this trend is heavily contested with respect to its performance effects at many different levels. On one hand, there is evidence to suggest that transferring HR empowerment to line managers can improve organizational efficiency and increase employee satisfaction if properly implemented. On the other hand, research suggests that many of the performance gains may be only short-lived and may come at the expense of longer-term organizational development factors. Much of the research being conducted appears to make broad generalizations that are highly dependent on individual organizational situations. It is likely that more comprehensive models for studying the devolution trend will emerge as the body of literature continues to build.
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