What Is The Harvard Model of Human Resources Management (HRM)?

The Harvard Model of Human Resources Management (HRM) is a HR management approach developed by Harvard Business School. The influential model first emerged in 1984 and is considered a soft HRM approach, as it focuses on creating a context in which all staff can thrive.

What is a HRM model?

A HRM model is an essential tool for HR function and human capital management within an organization. The model outlines how HR is organized, including all activities and responsibilities, to ensure that the HR department delivers its outcomes and meets its strategic goals. It encompasses HR practices, outcomes, capabilities and standards. Simply put, it's a visualization of how HR strategy will be implemented.

A soft approach to HRM focuses upon employees as individual people, with unique ambitions and emotions. It looks to empower to improve employee engagement, workflow and output - ultimately growing revenue.

In contrast, a hard approach to HRM focuses on deliverables over people - with emphasis on objectives, results and KPIs. At the extreme, it can view employees as commodities to be used to meet company goals.

Understanding the Harvard Model

The Harvard HRM model provides a framework for managing employees, ensuring that the different areas of HR strategy are collaborative and integrated. Its five clear components (explored in greater detail in the Key elements of the Harvard model section) make it a logical and effective approach to identifying organizational HR needs.

Why is the Harvard Model important?

The Harvard HRM model is important because it places emphasis on communication and understanding across departments and levels. It sets out to engender trust between employees and management, to create a supportive environment that encourages staff to meet their potential. The model takes a holistic view, proposing that HR consider all stakeholders within HR policies and long-term planning. It suggests that these policies must be designed by assessing both stakeholder interests and situational factors to have effective outcomes.

Key elements of the Harvard Model

The Harvard HRM model is divided into five key elements: situational factors, stakeholder interests, HRM policies, HRM outcomes and long-term consequences. We'll explore these interconnected concepts in greater detail now.

Situational factors

Situational factors are internal and external factors that influence how the workforce operates. The Harvard model of HRM suggests considering external factors such as the economic situation, employment market, technological advancements, the legal environment, public policy and governmental choices and business competition.

Internal factors to consider include organizational culture, corporate structure and business strategy. Both sets of factors should be duly considered and should feed into the creation of HR policies.

Stakeholder interests

The Harvard model recommends also considering the needs of a wide range of stakeholders when developing HRM policies. Stakeholders in the HR management process include internal management, employees, government and the community.

Liaising properly with the stakeholder base helps to ensure that the HR strategy is equitable and inclusive across all those it impacts and influences. Their input must be sought and their values and perspectives taken meaningfully into account.

HRM policy choices

Human Resource Management policies are the strategies developed to ensure organizational success across areas such as recruitment, compensation, training & development. They ensure legal compliance as well as creating clear structure and process for the organization. To be future-proofed and allow for change, they must also be adaptable to meet shifting organizational needs.

The Harvard model outlines that the HRM policy areas of work systems, rewards and human resource flow are interconnected and all impacted by employee influence. Policies determine the high-level approach, but reward systems influence how HR functions within the organization.

HRM outcomes

These are the outcomes of a company's HRM policies. The Harvard model refers to a list of four HR outcomes (the 4Cs) that can be achieved through effective HR policies:

• Commitment - e.g. commitment to organizational goals.
• Congruence - e.g. effective management styles and collaboration.
• Competence - e.g. development of employee competencies, as well as the attraction and retention of competent staff.
• Cost-effectiveness - e.g. staying within budgets whilst ensuring a satisfied and motivated workforce.

Long-term consequences

The Harvard model believes effective Human Resource Management can have long-term and wide-reaching benefits for an organization that can lead to a lasting transformation. Having balanced HR policies can lead to increased employee engagement, satisfaction, wellbeing and, ultimately, productivity and profit. It can also create a harmonious organizational culture, with shared values and a context of respect and trust. All of these factors lead to more effective recruitment and retention of staff, who find the company environment a good place to work and advance their careers.

Strengths of the Harvard Model

The Harvard model of HRM is well-respected and is considered to be effective when understood and implemented correctly. Its strengths include:

• Encouragement of a holistic approach, considering the wider context - across employees, operations and management.
• Acknowledgment of the value of employees and the key role they play in organisational success or failure.
• Consideration of multiple stakeholders and intention to find the balance of their needs.
• The involvement of management in the system - placing responsibility on general and line managers rather than having siloed HR.
• Being a useful model to help visualize what can be controlled and to connect seemingly unrelated decisions to see how they interplay and impact one another.

Limitations of the Harvard Model

As with any model, there will be limitations which depend upon the context in which it is used. Some of these limitations include:

• Its academic nature - the model was constructed with careful thought by professors at Harvard Business School. It is an ideal model, but reality is often difficult to translate into the sections and separate elements of a theoretical model.
• Its breadth and scope - due to this it can be confusing to put into practice. Its comprehensiveness is a strength but also a weakness in this regard.

Is the Harvard Model right for your organization?

A HRM model is useful as a starting point for HR managers and departments when developing policies and managing HR processes. A well-considered HRM strategy will ensure effective HR management, whether the company is working in business as usual, navigating project work or adapting to changing circumstances.

When determining if the Harvard model is suitable for your organization, consider if its features are compatible with your company culture and whether you are seeking a predominantly hard or soft approach to HR. Also be aware of its breath and scope, and consider whether it is a model that you could comfortably commit or strive to operationalise.

HR management that is fit for purpose must consider the balance between the organisational goals, stakeholder interests and the internal/external situational factors that influence the environment in which HR policies are executed. The Harvard HRM model is a great way to achieve a holistic and balanced approach to HR, leading to an optimized work environment and improved performance.