Competitive Human Resource Advantage Through the Strategic Management of Performance

Summary

Increased competition has obvious implications for all levels of jobs—executive, professional, technical, and entry. The 1950’s corporate structure was characterized as the traditional organization, with few at the top of the pyramid and many more below. But by 1980, corporate structures had significantly changed; they were often comprised of very few top-level executives with large middle management complements and often nearly as many professional, technical, and service workers. These organizations had become “fat” in the middle-management level. They had not rigorously assessed their workforce size and its contributions to strategic objectives, and they had not achieved a competitive human resource advantage. Competitive structures—both domestic and international—have lean, efficient organizational structures with few managers and more entry-level employees to do the organization’s “work.” The structures of these organizations may resemble a Hershey’s Kiss more than the traditional organizational pyramid—they are very tough competitors. Organizations with “fat” structures created corporate cultures that embraced a philosophy of “cradle to grave” security. They rewarded seniority, not performance. Traditional organizations have begun to respond to this new competition by becoming performance conscious, especially with respect to a very neglected system for the management of organizational resources—strategic performance management systems to plan, measure and reward human resources.

Portions of this paper were presented to the Human Resource Planning Society Research Symposium.