# Human Resources From an Organizational Behavior Perspective - Pfeffer.  >[!Metadata and links]- >- Author: Jeffrey Pfeffer >- Full Title: Human Resources From an Organizational Behavior Perspective >- Category: #Source/articles >- [Link](x-devonthink-item://D25A2BB4-CC66-490E-BE1A-2D9025CB3CE7) >- [DT article](x-devonthink-item://D25A2BB4-CC66-490E-BE1A-2D9025CB3CE7) ## Summary - Discussed the impact of hierarchical management techniques on the individual and the corporation. Many people are unhappy in their roles- home/life balance, job layoffs, broken promises to employees, bullying and harassment, lack of profit sharing, poor remuneration satisfaction rates. - Described his thoughts on the reasons for the persistence of bureaucracy, that ‘high-commitment work practices’ are too costly, cannot be easily measured, don’t provide shareholder returns, and that there is a psychological bias towards existing social structures. - Dispersed salary distributions mean higher turnover of staff, less co-operation/ collaboration, lower productivity. Differentiated salaries are seen as favouritism. There is a social pressure to distribute salaries fairly, especially where there is difficulty determining individual performance metrics. Larger pay gaps between senior staff and junior staff also impacts on quality. - Unionisation is correlated with positive organisational performance. ## Highlights - The Gallup organization “found that 80 percent of British workers lack commitment to their job, with a quarter of those being ‘actively disengaged’” (Deloitte Research, 2004, p. 4). “Active disengagement,” defined by Gallup as working to sabotage some aspect of the employer’s business (Page 2) - Nearly 20 percent of workers say that their companies lie to them, Towers Perrin reports. About 44 percent say that top management lacks honesty and integrity, Watson Wyatt found” (King, 2004). (Page 2) - The causes of these negative workplace attitudes are reasonably well known. One cause is job layoffs. (Page 3) - A second cause of employee disengagement and diminished productivity is the pervasive and growing conflict between work and family (Page 3) - A third cause of high and rising distrust in the workplace is that many companies have broken implicit or explicit promises made to their employees—for instance, assurances about pensions and about health insurance for both active and retired employees. (Page 3) - still a place frequently characterized by verbal bullying and psychological harassment (Page 4) - ==A truly enormous body of research from a number of countries shows that how people are managed affects quality, profitability, productivity, and total return to shareholders. ==There is no good current, complete summary of the many studies, but for partial summaries of the literature, good starting points include Becker and Huselid (1998), Pfeffer (1998), Appelbaum, Bailey, Berg, and Kalleberg (2000), Cascio (2006), and Shaw (2006). (Page 5) - ==“High commitment” work arrangements include investment in training to develop skills and knowledge; a regime of mutual commitment and employment security with long-term expectations for the employment relationship; rewards contingent on individual but also group and organizational performance; decision-making structures such as decentralization and self-managed teams that permit trained and motivated employees to actually influence decisions about work; and the sharing of information so that people can understand the business and have the data to make better inferences about what to do and how to do it (Pfeffer, 1998; Shaw, 2006). (Page 5)== - One of the current sources of dissatisfaction, as evidenced in union–management negotiations in the airline and automobile industries as well as in general public discourse, is that when employees have given up wages and benefits, in some instances company financial results have improved, but ==senior management and shareholders, rather than employees, have enjoyed virtually all of the benefits of the improved economic performance== (Page 6) - collective rewards run into the freeriding problem (Williamson, 1985, chap. 10) (Page 6) - Data from a survey of college and university faculty suggests that ==the greater the level of salary dispersion in academic departments, the lower the level of job satisfaction, the less likely faculty were to work collaboratively== on research with others from the same department, and the lower the level of research productivity (Pfeffer and Langton, 1993) (Page 7) - ==More dispersed salary distributions have also been found to be associated with more turnover among academic administrators ==(Pfeffer and Davis-Blake, 1992), with those people lower in the salary distribution particularly likely to leave. (Page 7) - layoffs frequently don’t increase stock price, productivity, profitability, innovation, quality, or other measures of company performance (Cascio, 2002). (Page 8) - Training builds skills and competence. Information sharing provides people the data necessary to make better work-related decisions. ==Decentralization permits people to use information and training to enhance the effectiveness of what they do by allowing them the necessary discretion to adapt their work processes. At the same time, each of these elements taps into similar organizational behavior processes that enhance their effectiveness==. (Page 9) - Decentralizing decision making also signals trust and a belief in employees’ competence, again engaging the norm of reciprocity (Page 9) - ==Institutional theory argues that certain ways of doing things become taken for granted and companies, to achieve social legitimacy and to conform to social expectations for appropriate behavior==, adopt these institutionalized practices (DiMaggio and Powell, 1983) (Page 12) - many investment analysts and others in the financial community do not appear particularly sympathetic to firms that adopt high-commitment work arrangements, possibly because these companies may be viewed as putting employees ahead of shareholders (Page 13) - pressures from powerful external constituencies such as investment analysts and bankers may work against the adoption of high-performance human resource management practices (Page 13) - Drago (1988), studying the survival of quality circles, found that unionization was positively related to this practice persisting. (Page 13) - establishments with programs jointly administered by management and unions achieved much greater improvement than establishments with programs that were controlled just by management (Cooke, 1992) (Page 13) - Information about the possible offsetting benefits—reduced turnover, higher levels of trust and employee engagement, reduced absenteeism, more discretionary effort—is typically either not measured at all or not measured and presented in a way that benefits and costs can be readily compared. (Page 14) - [[Social psychology has taught us that what is salient is focal.]] (Page 14) - 1) employee attitudes and related behaviors are generally poor, 2) employees and how they are managed are important sources of company success and competitive advantage, 3) and methods for achieving a culture of high-performance are known, but apparently not implemented. (Page 16) - Being open to both examining and accepting various alternative conceptions of individuals and organizations might be as productive in the domain of understanding human resource management as it has been for enriching our conceptualization and understanding of human judgment and choice. (Page 16) - If companies treat employees as if they can not be trusted, those employees will come to see themselves as untrustworthy and behave accordingly. This is true, if only for the reason that when cheating is expected, there will be more instances of entrapment (Lingle, Brock, and Cialdini, 1977). (Page 16) - Pfeffer, Jeffrey, and Alison Davis-Blake. 1992. “Salary Dispersion, Location in the Salary Distribution, and Turnover among College Administrators.” Industrial and Labor Relations Review. 45(4): 753– 63. (Page 19) ## APA reference Pfeffer, J. (2007). Human Resources from an Organizational Behavior Perspective: Some Paradoxes Explained. In _Journal of Economic Perspectives 21_(4), 115–134. [https://doi.org/10.1257/jep.21.4.115](https://doi.org/10.1257/jep.21.4.115)