Internal and External Fit

In: Business and Management

Submitted By oppenheimer
Words 1202
Pages 5
[pic]For Efficient HR Management, Be Consistent!
García Ruiz, P.; Sánchez-Runde, Carlos J.
Publisher: Universitat Rovira i Virgili

[pic]During the 80's, there was a lot of talk about the need for human resource management studies to have a strong theoretical foundation, beyond case by case analysis. Various authors responded by formulating three hypotheses. The "vertical fit hypothesis" says that HR practices must be aligned with the company's strategy. The "performance hypothesis" suggests that if strategy and HR management are consistent, the organization will perform better. Lastly, the "horizontal fit hypothesis" says that neither vertical fit nor better performance will be possible unless HR practices are understood as a consistent system.
Consistency refers to a problem that occurs in many organizations. Namely, a measure may be good, but it is not sufficient merely to implement it without further ado. If a company emphasizes a particular process - say, training - but does not simultaneously reinforce its control and compensation systems, it will send contradictory signals to its employees. As a result, the effectiveness of both training and compensation will be seriously impaired.
The difficulty for HR managers is that there are so many obstacles and challenges arising from the increasing diversity of practice and the need for HR practices to meld with other corporate systems and policies. In "Teoría de sistemas y propiedades emergentes en las

organizaciones" ("Systems Theory and Emergent Properties in Organizations"), Pablo Garcia Ruiz of the University of Navarra and Carlos Sánchez-Runde of IESE point out some of the sources of complexity and propose a conceptual framework to help managers analyze the consistency of their human resource management system.
Systems theory has been applied in the field of management for decades. Thanks to the…...

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