Human resource function, unions and varieties of capitalism. Exploring their impact on human resource management practices based on CRANET data
| Pages | 1072-1098 |
| Date | 01 October 2018 |
| Published date | 01 October 2018 |
| DOI | https://doi.org/10.1108/ER-10-2016-0198 |
| Author | Alvaro Cristiani,José María Peiró |
| Subject Matter | HR & organizational behaviour,Industrial/labour relations,Employment law |
Human resource function, unions
and varieties of capitalism
Exploring their impact on human resource
management practices based on CRANET data
Alvaro Cristiani
ESAI Business School, Universidad de Especialidades Espiritu Santo,
Samborondon, Ecuador and
Universidad Catolica Uruguay, Montevideo, Uruguay, and
José María Peiró
IDOCAL, Universitat de Valencia, Valencia, Spain and
Instituto Valenciano de Investigaciones Economicas, Valencia, Spain
Abstract
Purpose –The purpose of this paper is to explore varieties ofcapitalism (VoC) as a moderator of the effect of:
the strategic HR function role; and the level of union presence on the adoption of different human resource
management (HRM) practices categorized as either person-centered or performance-centered.
Design/methodology/approach –The authors use data on both multinationals and locally owned firms
from 14 OECD countries, collected through the Cranet 2009 survey. The hypotheses of the proposed model
were tested using hierarchical multiple regression analysis.
Findings –Evidence shows that the strategic HR function is positively related to the adoption of both types
of HRM practices, whereas higher levels of union presence inhibit the adoption of performance-centered
practices and promote the adoption of person-centered practices. In addition, although VoC does not show any
significant direct effects on HR practices, there is a moderating effect of VoC on the HR function role –HRM
practices and union presence –HRM practices relationships.
Research limitations/implications –The use of survey data with single respondents might produce
reliability problems. Additionally, the data used are cross-sectional, which means that causality cannot
be determined.
Practical implications –Managers in multinationals corporations and local firms must be aware of
the distinct effects of the strategic HR function and trade union presence in different market economies.
In particular, special attention must be paid when a firm expands globally, “outside the reach”of the national
market economy or type of capitalism, and operates in different VoC.
Originality/value –The present paper contributes to better understanding the influence of VoC, not only on
HRM practices, as in previous research, but also on the relationships between the HR function role and the
level of union presence and the types of practices promoted.
Keywords HRM practices, Varieties of capitalism, International HRM, HR function, Unionization
Paper type Research paper
Introduction
Two prescriptive components can be distinguished in the strategic human resource
management (HRM) literature with different perspectives on employee behavior alignment:
a predominantly economic dimension with a main focus on performance and a more
humanistic and collaborative perspective focused on the person behind the human resource
(Arthur, 1994; Cristiani and Peiró, 2015; Legge, 1995; Walton, 1985; Gooderham et al., 1999).
Performance-centered HRM practices emphasize that people are a type of instrumental
resource like any other. Person-centered HRM practices enhance human resourcefulness by
increasing worker commitment and practices that pursue the interests of employees and
employers and their participation in organizational decision-making. In addition, the
strategic role of the HR function and the union presence are possible sources of variation in
the adoption of HRM practices by firms. For the resource-based view (RBV ) perspective,
Employee Relations
Vol. 40 No. 6, 2018
pp. 1072-1098
© Emerald PublishingLimited
0142-5455
DOI 10.1108/ER-10-2016-0198
Received 24 October 2016
Revised 1 September 2017
10 February 2018
Accepted 25 February 2018
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/0142-5455.htm
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ER
40,6
the mix of resources, including human resources, gives each firm its unique character and
may lead to differences in competitive performance across an industry (Barney, 1991;
Wright et al., 2001). The emphasis on people as strategically important to a firm’s success
has contributed to the interaction and convergence of strategy and HRM issues (Barney
et al., 2001). The HR function, for the RBV theory, becomes a strategic partner in developing
coherent HRM practices. These practices directly impact the workforce’s skills and develop
employees’commitment, contributing value and competitive advantage to the firm (Barney
and Wright, 1998). However, since the 1990s more scholars have come to realize that
institutions matter (Powell and DiMaggio, 1991; Scott, 1995). Organizations are embedded in
a broad and complex institutional context and face different environmental forces. For
institutionalists, strategic choice that firms make is affected by the constraint of a given
institutional framework. Firms will adhere to embedded formal rules and unwritten norms
in the interests of efficiency and legitimacy (Paauwe, 2004; DiMaggio and Powell, 1983).
HRM and organizational practices are usually direct or indirect expressions or reactions to
the norms or structure of this macro and supra organizational context (Paauwe and Boselie,
2003). This theory differs from the e conomic and bureaucratic explanati on that
organizations are rational instruments for the achievement of clearly defined goals.
Differences in institutional settings affect the nature of HRM and the adoption of HRM
practices. Consequently, an institution-based view (IBV ) of strategic management has
emerged (Peng, 2002; Peng et al., 2009), with roots in both, the economists (North, 1990;
Williamson, 1985) and sociological (DiMaggio and Powell, 1983; Scott, 1995) institutional
literature. This IBV perspective incorporates the role of institutions in understanding why
firms differ in terms of competitive advantage.
According to Oliver (1997) both the resource capital aimed for by the RBV and the
institutional capital emphasized by the IBV are indispensable to sustainable competitive
advantage. However, their influence may vary based on the strategies to secure this capital
and also to prevent the threats that may deplete it. Later Paauwe (2004), based on previous
scholar studies combining institutional and RBV in the field of strategic management
(Lewin and Volberda, 1999; Oliver, 1997; Peng et al., 2009), explicitly incorporates both the
strategic market and the institutional context in the contextually based human resource
theory. Our study aims to contribute to this approach considering both the role of strategic
human resources management functions and the one of the unions in the enactment of
performance-centered and person centered HRM taking into account the context of the firm.
The most recent literature on comparative institutional analysis builds on comparative
capitalism, particularly the Varieties of Capitalism (VoC) literature. The study of the VoC
has been a recurrent topic for more than a decade. With the end of the Cold War and the
collapse of the socialist bloc, most of the countries in the western world have embraced open
market capitalism. These series of events and developments have led to renewed interest in
understanding the systematic differences and similarities across the economies of Western
democracies. One political economist approach is to address these differences and
similarities by looking at the way coordination among economic institutions and actors’
systems is organized (Hamann and Kelly, 2007). In the 1990s, various studies of capitalism
models in advanced democracies appeared (Dore, 2000; Stallings, 1995; Berger and Dore,
1996; Crouch and Streeck, 1997; Whitley, 1992). However, the most influential publication on
the topic was Varieties of Capitalism: The Institutional Foundations of Comparative
Advantage, edited by Peter Hall and David Soskice in 2001. Hall and Soskice (2001) found
two relevant clusters among advanced industrial democracies: liberal market economies
(LMEs) and coordinated market economies (CMEs). According to the authors, nations
converge on complementary practices across different spheres, such as industrial relations,
corporate governance, education and training, inter-firm relations, and relations with
employees. The VoC approach questions the conventional globalization view that we should
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