The where and the who of HRM decision-making: HRM decentralization and devolution
| Date | 28 May 2024 |
| Pages | 76-96 |
| DOI | https://doi.org/10.1108/ER-01-2023-0026 |
| Published date | 28 May 2024 |
| Subject Matter | HR & organizational behaviour,Industrial/labour relations,Employment law |
| Author | Nadima Hassan,Jordi Trullen,Mireia Valverde |
The where and the who of HRM
decision-making: HRM
decentralization and devolution
Nadima Hassan
Department of Business Management, Faculty of Business and Economics,
Universitat Rovira i Virgili, Tarragona, Spain
Jordi Trullen
Universitat Ramon Llull, ESADE, Barcelona, Spain, and
Mireia Valverde
Department of Business Management, Faculty of Business and Economics,
Universitat Rovira i Virgili, Tarragona, Spain
Abstract
Purpose –HRM decentralization and devolution have been highlighted as key HRM processes in
organizations’quest for increased flexibility. Although they have been extensively studied in the MNC and
International HRM literature, they have mainly been examined on a separate basis, and their definition and
operationalization have often been confused. Thus, we first clarify the difference between the two concepts by
refining the definitions by Hoogendoorn and Brewster (1992), and then empirically examine how they are
related.
Design/methodology/approach –The relationship between HRM decentralization and devolution is
examined by means of a survey in a large multi-country sample of multi-unit organizations.
Findings –Regarding our clarification objective, we contend that devolution has to do with who takes
responsibilities for HRM (i.e. line managers or HRM professionals) while decentralization refers to where HRM
responsibilities are allocated (i.e. headquarters or increasingly local units). Regarding the relationship between
the two concepts, the results show that higher levels of HRM decentralization are related to higher levels of
devolution, but this association is attenuated in organizations with more powerful HRM departments.
Originality/value –The study contributes to theory and practice by disentangling, at the conceptual,
operational, empirical and practical levels, two different but related HRM decisions (how much to devolve and
how much to decentralize HRM) that organizations must make to efficiently cope with the characteristics of
their own structure and competitive environment. It highlights the role of the relative power of HRM
departments in how HRM responsibilities are ultimately distributed across the organization.
Keywords HRM function, HRM department, HRM decentralization, Devolution, Line managers, HRM power
Paper type Research paper
Introduction
To better adapt to their changing environments, organizations are gearing towards more
flexible structures and operating modes, with increased levels of shared responsibility.
Environmental disruptions such as the COVID-19 crisis or current trends in the labor market,
such as remote working, stress the relevance of agility in HRM delivery (Adekoya et al., 2022).
Within this context, decentralization of human resource management (HRM) policies and
ER
46,9
76
© Nadima Hassan, Jordi Trullen and Mireia Valverde. Published by Emerald Publishing Limited. This
article is published under the Creative Commons Attribution (CC BY 4.0) licence. Anyone may
reproduce, distribute, translate and create derivative works of this article (for both commercial and non-
commercial purposes), subject to full attribution to the original publication and authors. The full terms of
this licence may be seen at http://creativecommons.org/licences/by/4.0/legalcode
Nadima Hassan acknowledges the Mart
ıFranqu
es Research Support Programme (Universitat
Rovira i Virgili) for the funding this research (No. 2019PMF-PIPF-57).
The current issue and full text archive of this journal is available on Emerald Insight at:
https://www.emerald.com/insight/0142-5455.htm
Received 18 January 2023
Revised 28 July 2023
16 March 2024
Accepted 15 April 2024
Employee Relations: The
International Journal
Vol. 46 No. 9, 2024
pp. 76-96
Emerald Publishing Limited
0142-5455
DOI 10.1108/ER-01-2023-0026
practices (Kostova et al., 2016), as well as devolution of HRM responsibilities to the line (Kurdi-
Nakra et al., 2022), have become more relevant. For decades, studies have shown that
organizations exhibit distinctive patterns of centralized control in HRM (Ferner et al., 2004)as
well as different levels of devolution within firms (Larsen and Brewster, 2003). Both HRM
decentralization and devolution processes have received considerable attention (Gooderham
et al., 2015;Intindola et al., 2017;Lazarova et al., 2017), but they have been examined
separately. There is a lack of research specifically addressing the linkages between them,
even though both processes were connected early on in the literature by Hoogendoorn and
Brewster (1992). They noted that the transfer of HRM responsibilities to middle managers
often ran in parallel to larger processes of HRM decentralization within firms. A decade later,
Larsen and Brewster (2003) called for further research on the relationship between the two, a
call that thus-far has not been met.
A potential reason for this lack of attention to the decentralization-devolution relationship
in HRM may be a certain confusion regarding the specific meaning of each phenomenon.
Although both deal with the allocation of HRM responsibilities, the degree of HRM
decentralization is a matter of where HRM takes place (e.g. at headquarters or at local units),
while the degree of devolution indicates who is responsible for HRM within an organization
(commonly either the HRM department or line managers). While this differentiation is
embedded in the original definitions by Hoogendoorn and Brewster (1992),their
conceptualization of the difference between the two has received modest attention in the
ensuing three decades. To illustrate this confusion, Mesner-Andol
sek and
Stebe (2005) use
both concepts interchangeably, talking about “devolution or decentralization”of the HRM
function. Similarly, Davis and Luiz (2015) state that they study the devolution of the HRM
function, but in fact operationalize it as HRM decentralization, looking at what decisions are
made at the subsidiaries or at headquarters. In the field of public administration, devolution
has been considered as another type of decentralization (Lodenstein and Dao, 2011) and, in
turn, decentralization has been conceptualized as devolution, deconcentration or delegation
(Feizy et al., 2015). More recently, Intindola et al.’s (2017) attempt to separate the two concepts
by using “retention of power”to distinguish between HRM decentralization and devolution
has not helped to this clarification.
Even when authors demonstrate a completely clear conceptualization and
operationalization of these phenomena in their research, the use of the language itself
sometimes gets in the way of distinguishing them from each other. For example, when
Mayrhofer et al. (2019, p. 360) talk about “centralization of policy-making towards the HRM
department”when discussing decreasing devolution trends across organizations, or when
Nachmias et al. (2022, p. 295) refer to the “importance of decentralizing HR practices to the line”
(our italics).
The first objective of this paper is thus to clarify the difference between HRM
decentralization and devolution, and accordingly develop definitions for each term. Being
separate phenomena, HRM decentralization and devolution may not inherently occur
together. As firms decentralize HRM from the main headquarters to regional headquarters to
subsidiaries or even smaller business units (a where choice), they also need to decide who will
be taking over that decentralized HRM function, typically either their local HRM department
(in which case, devolution would not ensue) or the line managers in the subsidiaries (in which
case, both decentralization and devolution would run in parallel).
The second objective of this paper is to study the relationship between both constructs.
While Hoogendoorn and Brewster (1992) already provided some descriptive data on different
combinations of HRM decentralization and devolution, they did not carry out an empirical
test of their association. Thus, questions remain as to whether and under what circumstances
HRM decentralization is more or less likely to increase devolution. The exploration of the
possible relationship between HRM decentralization and devolution is based on conceptual
Employee
Relations: The
International
Journal
77
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