The Equal Opportunities Revolution

by James Heartfield

  Beatrix Campbell

  — SIX —

  Human Resource Management

  With the propagation of firm-based equal opportunities codes, the day-to-day work of making them happen passed from the two government Commissions, the CRE and the EOC, into the hands of managers in firms. In particular, it was the personnel department, or, as it came to be called, the Human Resource Department, that carried through the policies. The change of name to Human Resource, or just HR, was itself a marker of a new agenda, of which equal opportunities would be an intimate part.

  In the later twentieth century, business theory set out two main strands. The first was the need for restructuring. In the 1980s management gurus Peter Drucker, Tom Peters, and Charles Handy all made the case that managers must be constantly changing. They had to become change agents, restructuring their organisations. Their slogan was from the Greek philosopher, Heraclitus, for whom there was ‘nothing permanent but change’. In his book Thriving on Chaos, Peters wrote that you ‘have to learn to love change’, and argued against those who could not see the point of reform, that ‘if it ain’t broke you just haven’t looked hard enough’: ‘fix it anyway’.1 With the new business gurus ‘outsourcing’ took off. First it was a matter of shedding non-essential functions, like the canteen, plant security, or deliveries, by contracting them out to business service companies. The goal was a lean firm, agile enough to adapt to changing market conditions. But later on it was not just the non-essential functions that were outsourced. Increasingly managerial and strategic decision making were bought in, in the form of consultancy firms that specialised in re-engineering companies, like McKinsey and Accenture.

  The second major innovation in business theory in the Eighties was called Human Resource Management, and it was a reaction to the problems created by the craze for downsizing, contracting out, and delayering. All told, this was a bruising time for employers and for managers. Downsizing, delayering, restructuring, and repurposing came to feel like unending misery. According to business professors Ronald J. Burke and Cary Cooper, firms suffer a ‘downward performance spiral as organisations address real performance problems such as low profits, high costs, poor customer service, and low stock prices’. Faced with these ‘typical organizational responses include staff layoffs, greater use of part-time and contract staff, a restriction on hiring and promotions, freezes or cutbacks, and reduced investment in training and employee development’. The trouble, explain Burke and Cooper, is that ‘employees respond, in turn, by reducing their job involvement, exhibiting lower job satisfaction, decreasing their effort, increased accidents, and greater turnover’. On top of that, ‘these individual behaviours have the effect of increasing the performance problems that led to the organizational responses in the first place’: ‘Thus the downward spiral continues.’

  The point of Burke and Cooper’s telling of the story is that there is a different way that will break the vicious circle. They are arguing for the new Human Resource Management, the next major innovation in business theory, in their book The Human Resources Revolution. There is, they claim, ‘considerable empirical evidence that the use of effective human resource management practices increase firm performance’. ‘Performance increases because employees work both harder and smarter’, he says:

  Employees work harder because of greater job involvement, greater peer pressure for results, and the economic gains based on high performance. Employees work smarter because they can use their knowledge and skill acquired through training and development.2

  Burke and Cooper are not on their own. ‘Human Resource Management is a growing field with an increasing influence on organizational strategy and practice’, the Catholic University of America assures prospective students: ‘In its Occupational Outlook Handbook, the U.S. Bureau of Labor Statistics projects a robust 17% job growth in human resource management between 2006 and 2016.’3 ‘In recent years human resource management (HRM) has firmly become embedded within a business mindset’, writes Tom Short of the University of South Australia, who notes ‘two decades of rapid growth in human resource management practices’.4 Tom Keenoy says that ‘over the last twenty years “HRM” has emerged as a global discourse’. He explains that HRM ‘developed slowly in the US where it was seamlessly incorporated into management thought’. However, it ‘appeared in British universities almost overnight in the mid-1980s and, by the early 1990s, its introduction had effectively transformed the language deployed to analyse employment relations’.5

  HRM is put forward as an alternative to aggressive management, and also an alternative to workers pushing their interests collectively, through unions. The Workplace Industrial Relations Survey that has been running since 1980 over time has recorded first the decline of unions, and of union recognition, to the point that just 26% of the workforce were in unions by 2011. Even where there was high membership, this was so ‘in workplaces where managers are in favour of membership’ — meaning that those workplaces that are unionised are so because management wants it that way.6 Second, the Survey has identified the growth in specialist Employment Relations managers. This was identified in the 1998 Survey, and there was ‘increasing specialisation in personnel… in workplace level in the late 1990s and early 2000s’.7 There were doubts about how to understand the changes that were taking place: ‘Some argued that a new style of management was emerging which, in some cases, amounted to a more integrated, strategic, people-centred version of personnel management, labelled “human resource management” or HRM’; but ‘Others said that, in practice, developments were more in keeping with the cost-reduction or “macho-management” approach of the early 1980s’.8 The ambiguity was understandable. On the one hand managers remained as dominant in regard to organised labour as before; on the other, the mood music had changed, with employers addressing workers’ presumed needs and interests more solicitously. Some of the changes that took place, the shift away from national pay awards, and further, towards individual contracts and rates, towards individual performance reviews, and towards flexible working hours, could be represented either way: as the domination of labour by disaggregating collectivities, or as liberating individuals with a more personalised approach. To achieve these ends, personnel departments did indeed grow, and often changed their names to ‘Human Resources’. The Standard Chartered Bank, for example, has 6000 people in its Human Resources department serving a workforce of 88,000.9

  Stephen Machin and Stephen Wood at the London School of Economics argued that HRM departments were not replacing unions. They marshalled some good statistics to show that, in fact, larger HRM departments tended to correlate positively, rather than negatively, with recognised unions.10 Still, the influence of unions is clearly declining, and also the HRM function clearly increased up to the mid-Noughties. More to the point, the style of personnel management plainly had changed, in ways that were better summed up by the ‘Human Resources’ model than the Industrial Relations one.

  What was the idea behind Human Resources?

  The rhetoric of Human Resource Management is very much drawn from motivational seminars and therapeutic ideas of self-growth.

  The core proposition in Human Resource Management is not so remarkable. It is that ‘people are our most valuable resource’. Human Resource Management is ‘people-centric’. The phrase ‘human resources’ was probably coined by Peter Drucker in 1954, but it was not really developed to mean what it means today until the Eighties, by Mike Beer and his colleagues at the Harvard Business School. David Guest summarised that ‘HRM comprises a set of policies designed to maximise organisational integration, employee commitment, flexibility and quality of work’. Tom Keenoy highlights that in the account of HRM there is not ‘any space for trade unions or joint decision-making’. Keenoy picks through the HRM literature to show how it is preoccupied with ‘high commitment’, ‘high performance’, added value, and ‘sustained competitive advantage for the organisation’, and he paraphrases it as ‘what is the best way to
more effectively exploit the labour resource?’11

  According to Bogdan Costea and his colleagues at Lancaster University’s Department of Organization, Work, and Technology:

  Put simply, human subjects are exhorted to expand and intensify their contribution as selves (as ‘human resources’) in order to enhance production, maximize value, thus leading the organization to success.

  They go on to explain how with the slogan ‘people are our most important asset’, ‘subjectivity is broken down in multiple aspects, and how it is reassembled around an idealized “better self” created by a variety of “therapeutic” techniques and tactics’.12 In all of this, according to academics Graham Hollinshead and Mike Leat, ‘the position of the individual employee is in fact quite precarious, with a high degree of dependency on the benevolence of employers’.13

  Looking at HRM as ideology as well as organisation, we can go further, and say that it is an assertion of a community of interest between employer and employee. Coming at the end of many years of workplace strife, it is easy to see why managers might be thinking about workers’ commitment. Many of the campaigns of cost reduction and ‘macho management’ left managers anxious that they had undermined their employees’ loyalty to the company, so they were willing to invest in new personnel managers to cope with the fall-out. The growth of HR departments suggested some differences between the ways that companies related to their employees. The enhanced HR side was in some ways at odds with the more day-today discipline of line managers. Human Resource managers were more likely to be at specific sites, got greater independence, and were more likely to be represented on the board.14 These HR departments were needed to oversee some of the new ways that companies were relating to workers. Performance review, performance-related pay, and job assessments are all things that might be difficult for line managers to do without losing objectivity. The separation of the two aspects of line manager/Human Resource manager opened up some conflicts in management function. Commanding workers in a given task has its own order and logic, which can shade into bullying and personal domination. The Human Resources department on the other hand is generally aloof from the immediate work process, dealing for the most part with routine tasks of payroll and staffing levels.But in managing the workforce as Human Resources, rather than technical command, the personnel department can pull in different directions, dictating caution and consideration to line managers, and handling employees’ concerns. So, while Human Resources have only an occasional and even tangential relation to most employees and most workplaces most of the time, they still can set the parameters of what is and what is not acceptable at work. HR departments that intervene into day-to-day organisational questions, such as workplace discipline, recruitment, or workload, may have a large impact, and do a great deal to set down the boundaries of acceptability. Though it might seem that Human Resources departments are on the side of the employers, that is not really the case. While line managers can be bullies, Human Resources departments drop their own kind of misery on employees. Performance reviews and disciplinary hearings are often relentlessly oppressive experiences which are marked by an inhuman and unreflective process, unchecked by common sense.

  Considering the drive to innovate work processes it is always worth bearing in mind just how conservative UK managers really are. Michael Porter looked at the British economy for the DTI. He found that British business was good at setting people to work hard, but invested much less in capital stock than America, Germany, or France. Corresponding to the low levels of investment in new technology, Britain’s investment in R&D was lower too, and would be much lower were it not for the exceptional amounts of research done by the bio-technology sector, in which Britain enjoys a world-leading position. Another DTI investigation blamed the UK’s ‘risk-averse approach’ for low levels of entrepreneurial activity and for frustrating the early adoption of new technology and new products.15 According to the Design Council’s National Survey of Firms, 58% ‘neither developed nor introduced any new products or services in three years’.16 For the most part employers plan to do next year what they did last year. Still, the language of innovation was important for motivating the case for industry.

  Human Resource Management and equal opportunities

  It should be clear from the outline of the Human Resources Management paradigm that HR and equal opportunities policies are fairly close — or that a Venn diagram of both would show mostly overlap.17 The Human Resources revolution (Burke and Cooper) is the equal opportunities revolution (Hakim) — largely two accounts of the same process. Where the equal opportunities revolution is more profound than HR, is that equal opportunities yokes a remotivation and reordering of workplace discipline to two (and more) substantial movements for social justice, the Women’s Movement and the Anti-Racist Movement (and more latterly those for lesbian and gay rights, and more). Many newer and younger additions to the workforce identified with the greater opportunities that the policies represented. Millions of women and black people were being recruited, many of whom saw the equal opportunities policies as working in their favour. By contrast, the Human Resources revolution always lacked a strong sense of purpose, and was easily parodied, as for example in The LEGO Movie’s parody of a company song, ‘Everything is Awesome’. In industry, these methods were readily mocked by employees when they were associated with Japanese management methods, as an alien imposition. But equal opportunities policies had a much stronger moral call on workforces, substantial numbers of whom identified with the advances that they represented.

  Equal opportunities policies help employers in several ways. The first, and most important, is that opening up the employment market to more potential workers reinforces the authority of the employers. Second, equal opportunities policies serve as a motivation for restructuring workplace relations and reconstituting the workforce. Fourth, they serve to motivate workplace discipline and as an important framework within which employees are socialised into a set of values that are enshrined in company policy. Third, an equal opportunities policy enhances the authority of employers over employees, by disaggregating working collectivities.

  Restructuring the workforce

  To open the workforce up to greater competition was the point of labour market liberalisation. More market entrants meant more competition. More barriers to employment meant less competition. The point of labour market liberalisation was to keep wages competitive — which is to say lower.

  This is an argument that understandably makes a lot of people uncomfortable. It seems to say that it is women and migrants who are pushing down wages. Employees have at different times taken on a strategy of limiting access to their trade to keep wages high. At times they have tried to exclude women and immigrants. These are self-defeating strategies. A class of employees divided against each other is not really in a strong position to defend its jobs, wages, or conditions. On the other hand, it would be naïve to imagine that employers would open up their employees to greater competition out of a sense of justice for women or minorities alone. Employers want to be able to recruit from a large pool so that they can find the talents they need without paying too much for them.

  That early champion of equal opportunities for women, Baroness Seear, made her case for their recruitment in contrast to labour market rigidities in 1976: ‘monopolistic and protectionist devices have grown up at every level to render rigid an economy whose only hope of survival lies in flexibility’. As she explained,

  the ‘right to work’ has been interpreted as ‘my right to continue in the particular job in which I find myself at a given moment of time’. This belief has been strengthened by such notions as the ‘property of the job’ which, by a subtle abuse of language reinforced the idea that a man has an entrenched right to a particular job.18

  Seear hoped to undermine workers’ security and open them up to more competition.

  Later on, Human Resource Management theory was saying that the workforce was much more diverse than managers
were used to, and employment practices had to change to take advantage of that. Under the heading ‘Adapting to Change in the Work Force’, Dennis Kravetz says that the US workforce ‘has changed greatly’ since it was ‘dominated for many years by white male employees’ — but that now they are the minority. ‘Women now make up 45 per cent of the workforce’, and more, ‘members of minority groups now make up 15 per cent of the workforce’. Soon a fifth of all workers will be immigrants, says Kravetz, and ‘Human resources and line managers need to plan for this event now’. Of those more established workers, Kravetz has a different message. He says that the workforce is getting older, a change which has a ‘negative side’: ‘Employees entering the work force now will find a large group of baby boomers ahead of them’, and ‘Younger employers will find it difficult to advance into management’.19

  Human Resource managers are committed to the idea of diversity in the workforce because they have greater authority over a divided workforce. Divide and rule, said the Romans. But just as managers talk up diversity in the workforce, they also want to believe, and want their employees to believe, that workers and managers alike are all in it together. An equal opportunities policy is an assertion of a common interest between employer and employee. When organisations say that they are ‘an equal opportunities employer’, they are saying that they have the interests of the workforce at heart. ‘Equality’, that slogan of the nineteenth-century labour movement, had been taken over by employers at the end of the twentieth century. But just as the policy foregrounds the value of ‘equality’, it also emphasises difference — indeed later versions of the policy often use the title ‘managing diversity’ over ‘equal opportunities’, with the implication that diversity is a fact of life to be managed, rather than an inequality to be overcome. Nick Jewson and his colleagues at Leicester University found that ‘it was not uncommon for [ethnic] monitoring to be opposed on the grounds that it both encouraged and facilitated discrimination rather than eliminating it’. They were surprised to find that ‘this view was expressed by both ethnic minority and white respondents’.20 It is not often noticed that ‘managing difference’ is the Roman policy of divide et impera, divide and rule. The authority of the Human Resource manager stems from the need to manage difference in the workforce.