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Employment Practices and Business Strategy, Oxford University Press, New York, 1999. ISBN 0-19-512859-1: Peter Cappelli (ed.) Price $29.95 pp. 226
European Management Journal Vol. 20, No. 1, pp. 107–108, 2002 Printed in Great Britain
Pergamon
Books For Managers PII: S0263-2373(01)00119-0 Employment Practices and Business Strategy, Oxford University Press, New York, 1999. ISBN 0-19-512859-1: Peter Cappelli (ed.) Price $29.95 pp. 226
It is well known that even within a single economy or a single industrial sector, there is a wide range of workplace practice. These practices are the outcome of decisions by employers and managers — and in many cases in the field of employment, by management and trade unions through collective bargaining. They key question addressed in this book by Peter Cappelli and his colleagues is why these differences in practice exist — and persist. After all, if competition is doing the job expected of it, those firms choosing inferior practices ought either to be pushed to adopt the best practice formulation, or be driven out of business by those using the superior model. A case in point is the spread of high-performance work systems, believed by many to be a superior approach, with an emphasis on employee involvement, teamwork and supporting HR practices. But the evidence indicates that there are large swathes of even the American economy where these practices have been introduced minimally or not at all. If they really are superior — and there is much evidence that they are highly effective — why do they take so long to be adopted? Explanations couched in terms of wage differences (compensating differentials, efficiency wages, dual labour markets) do not seem to provide convincing explanations. Does the answer then lie in the fact that firms adopt different business strategies they believe are
appropriate to their position in the product market, and develop an array of employment practices to support the strategy? This is the question that Cappelli et al. examine in a series of chapters, each dealing with a different industrial sector: steel minimills, apparel, automobile assembly, telecommunications services and retail banking. A final chapter by Geoff Mason considers how the United States’ experience differs from other countries — mainly Britain and Germany, with some material on France and The Netherlands. The contrast between these sector studies makes fascinating reading. In the Minimills case (Jeffrey Arthur) there is clear evidence that different business strategies (cost minimising vs differentiation) drive the choice of HR practices. Thomas Bailey and Carola Sandy (apparel) and Frits Pil and John Paul MacDuffie (automobiles) find more complex pictures, indicating the need for a more sophisticated analysis to understand the variable diffusion of high performance work practices. In retail banking, Chip Hunter finds considerable variation in HR practices but is unable to explain these in terms of business strategies or marketing goals. Jeffrey Keefe and Rose Blatt find little variation in HR practices across companies but considerable variation within their businesses, differing between segments and influenced by the different technologies involved. Mason’s final chapter indicates that the United States, with its larger scale production potential, is less inclined than its European competitors to adopt ‘flexible’ employment systems, but shows a bigger spread of practice than in Europe. There is no obvious simple answer to the problem of variations in practice and lags in diffusion. A contingency approach with some key factors may be the best we
European Management Journal Vol. 20, No. 1, pp. 107–108, February 2002
can manage at present. But this leaves a problem for public policy, if it wants to expand the volume of ‘good’ jobs with higher performance regimes. Cappelli concludes that a ‘softly-softly’ approach may be best — helping firms to adapt their strategies and provide support for training and skill development programmes, rather than a frontal assault on the work practices themselves. There is much useful comparative material here, both for the more advanced student and for the HR specialist. The quality of the individual contributions is high and they each represent a strong feel for the industry on which they focus. Understanding the problem of variation in practice is moved along a notch but is far from being resolved. Professor Sir Laurie Hunter, University of Glasgow Business School.
PII: S0263-2373(01)00120-7 Training Management: A Multidisciplinary Approach to Human Resource Development in Southern Africa, P.S. van Dyk, P.S. Nel, P. van Z Loedolff and G.D. Haasbroek, Oxford University Press, Southern Africa, Cape Town, 2001, ISBN 0-19-571921-2, Price £26.99, pp. 476
It is now well known that developing countries need to improve productivity throughout the economy if they are to compete successfully in an era of rapid economic and technological change. Of course this requires not 107
Pergamon
Books For Managers PII: S0263-2373(01)00119-0 Employment Practices and Business Strategy, Oxford University Press, New York, 1999. ISBN 0-19-512859-1: Peter Cappelli (ed.) Price $29.95 pp. 226
It is well known that even within a single economy or a single industrial sector, there is a wide range of workplace practice. These practices are the outcome of decisions by employers and managers — and in many cases in the field of employment, by management and trade unions through collective bargaining. They key question addressed in this book by Peter Cappelli and his colleagues is why these differences in practice exist — and persist. After all, if competition is doing the job expected of it, those firms choosing inferior practices ought either to be pushed to adopt the best practice formulation, or be driven out of business by those using the superior model. A case in point is the spread of high-performance work systems, believed by many to be a superior approach, with an emphasis on employee involvement, teamwork and supporting HR practices. But the evidence indicates that there are large swathes of even the American economy where these practices have been introduced minimally or not at all. If they really are superior — and there is much evidence that they are highly effective — why do they take so long to be adopted? Explanations couched in terms of wage differences (compensating differentials, efficiency wages, dual labour markets) do not seem to provide convincing explanations. Does the answer then lie in the fact that firms adopt different business strategies they believe are
appropriate to their position in the product market, and develop an array of employment practices to support the strategy? This is the question that Cappelli et al. examine in a series of chapters, each dealing with a different industrial sector: steel minimills, apparel, automobile assembly, telecommunications services and retail banking. A final chapter by Geoff Mason considers how the United States’ experience differs from other countries — mainly Britain and Germany, with some material on France and The Netherlands. The contrast between these sector studies makes fascinating reading. In the Minimills case (Jeffrey Arthur) there is clear evidence that different business strategies (cost minimising vs differentiation) drive the choice of HR practices. Thomas Bailey and Carola Sandy (apparel) and Frits Pil and John Paul MacDuffie (automobiles) find more complex pictures, indicating the need for a more sophisticated analysis to understand the variable diffusion of high performance work practices. In retail banking, Chip Hunter finds considerable variation in HR practices but is unable to explain these in terms of business strategies or marketing goals. Jeffrey Keefe and Rose Blatt find little variation in HR practices across companies but considerable variation within their businesses, differing between segments and influenced by the different technologies involved. Mason’s final chapter indicates that the United States, with its larger scale production potential, is less inclined than its European competitors to adopt ‘flexible’ employment systems, but shows a bigger spread of practice than in Europe. There is no obvious simple answer to the problem of variations in practice and lags in diffusion. A contingency approach with some key factors may be the best we
European Management Journal Vol. 20, No. 1, pp. 107–108, February 2002
can manage at present. But this leaves a problem for public policy, if it wants to expand the volume of ‘good’ jobs with higher performance regimes. Cappelli concludes that a ‘softly-softly’ approach may be best — helping firms to adapt their strategies and provide support for training and skill development programmes, rather than a frontal assault on the work practices themselves. There is much useful comparative material here, both for the more advanced student and for the HR specialist. The quality of the individual contributions is high and they each represent a strong feel for the industry on which they focus. Understanding the problem of variation in practice is moved along a notch but is far from being resolved. Professor Sir Laurie Hunter, University of Glasgow Business School.
PII: S0263-2373(01)00120-7 Training Management: A Multidisciplinary Approach to Human Resource Development in Southern Africa, P.S. van Dyk, P.S. Nel, P. van Z Loedolff and G.D. Haasbroek, Oxford University Press, Southern Africa, Cape Town, 2001, ISBN 0-19-571921-2, Price £26.99, pp. 476
It is now well known that developing countries need to improve productivity throughout the economy if they are to compete successfully in an era of rapid economic and technological change. Of course this requires not 107