Personnel management refers to a set of functions or activities including recruitment, training, pay and industrial relations performed effectively but often in isolation from each other or with overall organisation objectives. In 1991, Hilmer noted that the Australian tradition of many sub-specialities or functions (industrial relations, compensation, training and pay) was out of date. The early 1990s was an are of great speculation on the future of the functions in managing people. The concept Human Resource Management (HRM) began to influence the practice of integrating functions with each other and organisation objectives. Coppleston (1991) explained "the HR function within any enterprise must first of all serve the organisation… an investment area rather than a cost to the organisation." Reinforced by other writers, human resources should be viewed as 'human capital', and that HR managers should strive to use them as investment creating an environment where the appropriate strategy is likely to emerge. (Williams, 1991) Alternate perspectives of HRM emphasise either the effective management of employees through greater accountability and control, the greater involvement in decision making processes, or both of these. (Nankervis, Compton & McCarthy, 1993)In countries such as Australia, the personnel management function arrived more slowly than its USA counterparts and came from a number of avenues. The orientation of personnel management was not entirely managerial. In the UK, its origins were traced to 'welfare officers' where it became evident that there was an inherent conflict between their activities and those of line managers. There were not seen to have a philosophy compatible with the view of senior managers. The welfare officer orientation placed personnel management as a buffer between the business and the employees. In terms of organisational politics this was not a viable position for those wishing to further their careers, increase their status, earn high salaries or influence organisation performance. Industrial relations further compounded the distinction through their intermediary role between unions and line management. (Price, 2005) However, during the 1970s, many Australian organisations found themselves in turbulent business and economic climates with major competition from the USA, Europe and Asian markets. Concurrently, the Institute for Personnel Management (IPMA) and training institutions such as TAFE and universities were becoming more sophisticated in their approaches incorporating more recent approaches such as 'Excellence" and 'Total Quality Management'. During this period the IPMA held national and international conferences, initiated relationships with the Asia-Pacific region, developed an accreditation process and the now titled Asia Pacific Journal of Human Resources. (Nankervis et al, 1993)By the 1980s, personnel had become a well-defined but low status area of management. Traditional personnel managers were accused of having a narrow, functional outlook. Storey (1989) comment that personnel management "…has long been dogged by problems of credibility, marginality, ambiguity and a 'trash-can' labelling which has relegated it to a relatively disconnected set of duties - many of them tainted with a low status 'welfare' connotation." In practice, the background and training of many personnel managers left them speaking a different language from other managers and unable to comprehend wider business issues such as business strategy, market competition, labour economics and the role of other organisational functions. (Price, 2005) This set the scene to integrate personnel management with wider trends in management thinking.
In 1999 (cited in Gollan 2005), Hunt suggested, 'the key link to the success of the function lies in the struggle to acquire more influence, something that is being carried out in a climate of downsizing and outsourcing. Even the change of name from personnel to HR is...
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