chapter 9
....................................................................................................................................................HRM AND SOCIETAL
EMBEDDEDNESS
....................................................................................................................................jaap paauwe
paul boselie
9.1 Introduction
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Oneof the more fundamental aspects of the ongoing debate about the added
value of HRM relates to ‘best practice’ versus ‘bestWt.’ ‘Best practice’ argues for
the universal success of certain HR practices while ‘bestWt’ acknowledges the
relevance of contextual factors. We argue that diVerences in institutional settings
(for example, across countries) aVect the nature of HRM. To understand this
phenomenon, HRM needs additional theory. In this chapter, we use ‘new institu-
tionalism’ (DiMaggio and Powell 1983 ) and the theoretical notions of organiza-
tional justice (Greenberg 1990 ) and organizational legitimacy (Suchman 1995 )asa
better way to understand the shaping of HR policies and practices in diVerent
settings.
Strategic HRM has gained both credibility and popularity over the last decade,
especially with respect to the impact of HRM on organizational performance (see
Paauwe 2004 and Boselie et al. 2005 for overviews). More than 100 papers have been
published in the last decade on this topic. However, these papers have often
neglected the importance of the societal embeddedness of HRM. In contrast, in
the 1980 s, a much greater emphasis on social context in explaining HR practices
was evident.