model of HRM, in which labor was traded and used more or less like any other
commodity, and moved to what labor economist John Commons ( 1919 ) described
as a combination of a ‘machine’ (scientiWc management), ‘good will’ (high com-
mitment), and ‘industrial citizenship’ (democratic governance) model. Also note-
worthy, Commons ( 1919 : 129 ) used the term ‘human resource’ to connote the idea
that investment in human skills and education makes labor more productive and
counseled employers to take a strategic approach to labor, observing that
‘[employee] goodwill is a competitive advantage’ ( 1919 : 74 ).
If there were two themes that pervaded the 1920 s HRM literature, it was that
labor must be looked at as a distinctlyhuman factorand that the central purpose of
HRM is to fostercooperationandunity of interestbetween theWrm and workers
(Kaufman 2003 a). To achieve these goals, the leading practitioners of Welfare
Capitalism created extensive internal labor markets (ILMs), complete with what
Leiserson ( 1929 ) called the ‘crown jewel’ of the Welfare Capitalist movement—the
employee representation plan. These plans were early forerunners of modern forms
of participative management and employee involvement (Taras 2003 ; Kaufman
2000 a). Many of the speciWc employment practices in these companies were
tactical in nature and administered by lower-level personnel staV. The overall
design and mission of these new HRM programs, however, was done at the highest
executive level with clear-cut strategic goals in mind. Indeed, the need to take a
strategic approach to HRM was widely cited in the 1920 s. For example, in theWrst
article in theHarvard Business Reviewon the new practice of HRM, titled ‘Indus-
trial Relations Management,’ the author (Hotchkiss 1923 : 440 ) tells readers, ‘When,
however, we pass from tactics to the question of major strategy, industrial relations
management is essentially functional rather than departmental.... [It] deals with
a subject matter which pervades all departments.... [and] must to succeed
exercise an integrating, not a segregating, force on the business as a whole.’
Not only did the practice of HRM take root and start to develop in major
companies in the USA in the 1920 s; so too did a supporting infrastructure of
journals, associations, consulting Wrms, and university teaching and research
programs. After the Industrial Relations Association of America folded, a new
association called the National Personnel Association was founded. It later became
the American Management Association. Also founded in 1922 was the Personnel
Research Federation which promoted academic and industrial research and
published it in the Journal of Personnel Research.In 1926 industrialist John
D. Rockefeller, Jr. donated funds to start the nation’sWrst large-scale (non-proWt)
HRM consulting/research organization, Industrial Relations Counselors, Inc.
(Kaufman 2003 b). In the academic world, theWrst personnel textbook appeared
in 1920 ,Personnel Administrationby Tead and Metcalf, and was shortly followed by
several others. In 1920 the University of Wisconsin was theWrst to oVer an area of
study in industrial relations (comprised of coursework in personnel management,
labor legislation, industrial (workforce) government, and unemployment) and
the development of hrm 23