Human Resource Management
in the Service Sector
Review of the course
Overview
Course examines the HRM challenges in the knowledgeintensive service sector
1. Introduction: characteristics of the service sector and
identifying the knowledge-intensive section of this
sector (1 week)
2. Develop theoretical frameworks and perspectives for
analysing the HR challenges (2 weeks)
3. Investigation of HR challenges in four types of
organisations in this sector: call centres, management
consulting, law and creative (8 weeks)
Summary and review (second half of final week)
2
HRM
Call
challenges centres
theory
Theory
Management Law
consultancies Firms:
theory
Theory
and case
Creative
Firms:
Theory and
case
Managing Call
knowledge centres
workers
Case
Management Law
consultancies Firms:
theory
Case
and case
Creative
Firms:
Theory and
case
Summary and revision
Characteristics of the service sector
Course design
3
Literature focus for the course
HRM & knowledgeintensive services
Services sector
Professional
Services
4
Week 1: Introduction to the service
sector: objectives
• Outline the importance of the service sector in
modern economies
• Identify the key characteristics of service work
and the areas of the sector for detailed study:
knowledge intensive work
• Outline the research in the area
• Introduce the HRM challenges posed by
knowledge based service sector working
5
Converting Human Capital into
Intellectual Capital
Human
HumanCapital
Capital
Conversion
Process
Employee
Knowledge
Skills
Experience
Intellectual Capital
Products
and
services
which have
market value
Role of HR
practices in this
conversion process
6
Implications for HRM
Nature of Work
Intangible
Managerial problem
Measurement
HRM issue
Performance
management/reward
Knowledge
based
Renewal
Training and
Development
Customised
Standardisation
Staff
allocation
Professional
Organisational
commitment
Recruit and retain
(Drawn from Suddaby and Greenwood (2006) Maister (2003) and Batt (2006))
7
Week 2: HR practices in knowledge
intensive firms: objectives
• To understand the distinctive characteristics of
knowledge intensive service firms
• To identify the key resources (forms of capital)
that knowledge intensive firms draw on for their
success
• To identify the challenges for managing people
and managing knowledge faced by knowledge
intensive firms
• To explore the ways in which HR strategy,
structure, delivery and practices can be used to
create valuable products and services
8
Pressures on knowledge intensive firms
Product market Customers and clients
KIF
Financial success –
short and long term
(Maister, 2003)
Employment market –
needs of employees
9
Knowledge skills
and experience of
staff
Forms of Capital
Knowledge of
and
relationships
with network
members
Human
capital
Social
capital
Network
Capital
Intellectual
Capital
Knowledge of
and
relationships
with clients
Client
Capital
Knowledge
embedded in
values, culture
and
relationships
Structural
capital
Organizational
Capital
Procedures, policies
and processes
Ways of
structuring
work
10
The HR
Wheel
Resourcing
Human
capital
Social
capital
Network
Capital
Intellectual
Capital
Client
Structural
Capital
capital
Organizational
Capital
Pay and Reward
Kinnie et al 2006
11
Delivery
Week 3: Managing knowledge
workers: objectives
•
•
•
•
•
Define a knowledge worker
Identify the characteristics of knowledge workers and
understand the human resource management
challenges presented by them
Explain how knowledge workers are managed
Identify and discuss the dilemmas associate with the
management of knowledge workers
Understand how social identity can resolve some of the
tensions involved in the management of knowledge
workers
12
Managerial challenges
Retention
Organisation specific
Value capture
Multiple Identity perspective
• How can organisations retain and develop their
professionals?
• Presents three dilemmas that sit between the
employee and the organisation
Employability
Transferable
Ownership of value
13
Multiple sources of identity
Organisation
Professional
EE
Team
Client
14
Weeks 4 and 5: Call Centres:
objectives
• Define call centres and understand the reasons for their
growth
• Identify the key characteristics of the nature and
management of call centres
• Analyse their forms of human capital and consider the
implications for HR especially recruitment, selection and
retention
• Examine recent changes in call centres especially the
moves towards outsourcing and off-shoring
• Apply the 4 ID model to gain insights into the nature of
work in call centres – with reference to the Norwich
Union case
(Refs: Deery and Kinnie, 2004; Korczynski, 2002, Frenkel et al, 1999, Homan, 2004)
15
Weeks 6 and 7: Management
Consulting: objectives
• To understand the characteristics of the management
consulting industry
– History
– Types of organisations
– Types of consultancy activities
• Typology of human capital
– According to the client interface process
– Career structures within management consultancy
– The role of consultants as knowledge brokers
• Typology of client capital
– The consulting firm – client relationships
• The HRM practice focus:
– Recruiting human capital
– Managing across boundaries
Human
capital
Network
Capital
Social
capital
Client
Structural
Capital
capital
Organizational
Capital
16
Using external facilitators poses a challenge to many
forms of intellectual capital flows
Clients
Facilitators
17
Facilitator network: HC viewpoint
HC
boundary
Clients
Facilitators
within
clients
External pool of
facilitators
External
Externalskill
skillexperts
experts
Clients
Focal Regions
Practice
Group
Other
Practice
Groups
Clients
External skill experts
Clients
18
Weeks 8 and 9: Law Firms:
objectives
• Understand the basic characteristics of the
sector
• Identify the traditional model of organising
and management of HR
• Consider some of the key changes in the
sector and the responses of law firms
• Identify the challenges this presents for HRM
and for knowledge management
• Focus on the key issue of remuneration and
reward, especially variable reward
• Analyse a practical case drawing on our
knowledge of theory
19
High reward for
equity partners
Traditional HR practices
‘Up or Out’
Partner in 6 years
– or leave the firm
Apprenticeship
model
Elite
recruitment
20
‘High Trust’
• Local law firm - medium sized and growing fast
• Strong emphasis on culture and values inclusive
and mutual respect – building social capital –
sharing work and knowledge
• Issue of how to reward their staff who contribute
to the success of the firm while reinforcing their
values
21
Weeks 10 and 11: Creative
Firms: objectives
• Understand the basic characteristics of the
sector and establish our focus on
advertising/marketing agencies
• Identify the key forms of capital present in
these firms
• Identify the challenges this presents for HRM
especially the development and retention of
staff
• Draw contrasts between two practical cases
on the way they manage these HR
challenges
22
Building network capital
Client
Agency
Marketing
manager
23
Key challenges and tensions facing
HRM in marketing agencies
•
External Resourcing
–
–
•
Internal Resourcing
–
–
•
Developing human capital - developing client capital
Importance of coaching, feedback and development – importance of serving client needs
Reward
–
–
•
Promotion and career building – efficient allocation of staff
Rotation of staff - building and maintaining client and network relationships
Training and Development
–
–
•
Attraction and retention of staff valuable to the firm and to existing and potential clients
Recruiting for internal development – recruiting experienced staff
Intrinsic rewards linked to development – extrinsic rewards linked to client success
Longer term rewards through promotion – shorter term linked to targets
Our focus: the interaction between the need to develop employees, serve the
needs of clients and achieve financial success
24
Revision
• Essential to understand the basic
theoretical frameworks underlying the
course (weeks 2 and 3 especially)
• Need to be able to apply these to the four
sectors studied (eg how does the reactor
model apply to creative firms)
• Facility to move between theory and
practice (to understand the theory in
practice and the practice in theory)
25
Revision continued
• Cases studied in class are important along
with other cases and your own experience
• Key is to build up your understanding of
the issues – at a sector level and at a
macro/cross sector level
• Use the frameworks and models to guide
your analysis – to help you understand the
issues/problems/cases
26
Examination structure and rubric
• Unseen paper in 2 hours no additional
materials
• 6 questions – one from each sector
studied plus two others
• Answer three questions
27
Sample questions
• What are the most important external pressures
on the managers of knowledge intensive firms?
How might HR strategy and practice help to
manage these pressures?
• How might the concept of multiple identities help
managers of HR contribute to the creation of
organisational value in professional service
firms?
• With reference to the ‘High Trust’ case study
discuss the problems associated with designing
a variable reward system in law firms. How
might these problems be resolved?
28
Expectations
• Demonstrate your learning and your understanding of
the theory and the practice
• Answers which directly focus on the question (basic
descriptive answers will get a low pass)
• Explicit references to previous research (you will get
credit for this)
• Good use of practical examples to illustrate points
(credited)
• Highlight conflicts and tensions where they exist
• Develop an argument which is supported by theory and
evidence (illustrates higher level understanding)
29
Advice
• All the basics apply: plan your answer/focus on
the question/refer to relevant theory and
examples/pull it together
• Thorough revision – understanding not rote
learning – test yourself out – use the models to
analyse cases; use the cases to ask: what is this
an example of?
• See links between the models and sectors
• Use contemporary examples if you can – shows
engagement with the material
30