forces’ on HR policy choices: the external environment (social, political, legal, and
economic), the workforce, the organization’s culture, its strategy, and the technol-
ogy of production and organization of work. This advice is not oVered in a simple,
deterministic fashion: managers still have choices (such as where to locate plants in
manufacturing) but once some choices are made, certain environmental conse-
quences do follow (e.g. if you locate in the USA rather than Honduras, US laws,
culture, and workforce characteristics inevitably come into play). The goal of achiev-
ing internal consistency in whatever model of HRM is adopted (often called ‘internal’
or ‘horizontal’Wt) is then strongly emphasized by Baron and Kreps ( 1999 ).
In a similar fashion to Beer et al. ( 1984 ), Dyer and Holder ( 1988 ) also identify
three broad styles of labor management but go further than the Harvard authors by
providing more detail on how their three types of HR strategy—‘inducement,’
‘investment,’ and ‘involvement’—are linked to environmental conditions. Induce-
ment, seen as having its roots in ScientiWc Management, aims for reliable, cost-
eYcient employee behavior (ibid.: 18 – 24 ). This is deemed suitable forWrms
operating in very competitive markets with simple, slowly evolving technologies.
Environmental conditions are seen as ‘largely benign, although militant unions
are not unheard of ’ (ibid.: 22 ). The investment strategy, with its roots in Welfare
Capitalism and Human Relations movements, pursues high employee competence
and commitment in a generously staVed organization. These goals stem from
paternalistic founders and are seen as consistent with a business strategy of com-
peting through diVerentiation rather than price in rapidly changing technological
environments (ibid.: 24 – 7 ). Unions are rare in these environments. Finally, the
involvement strategy, owing something to the Human Relations movement but also
to more contemporary emphases on participative management, aims for very high
employee commitment, competence, and creativity. Self and team management
loom large in this model. Firms pursuing involvement fall mainly into two types:
those in highly competitive markets (like inducers) and those pursuing innovation
or agility. SomeWrms may be pursuing the model not for any product market
reasons but as a response to ‘today’s highly educated and narcissistic labor force’
(ibid.: 28 ). The model is not seen as antithetical to unions but clearly requires a high
level of union–management cooperation in a unionized environment (ibid.: 30 ).
Like the Harvard authors, if not more emphatically, Dyer and Holder ( 1988 ) and
Baron and Kreps ( 1999 ) argue for a contingent understanding of HR strategy or the
necessity of molding HRM goals and means to theWrm’s particular context. Dyer
and Holder ( 1988 : 31 ) conclude that ‘the inescapable conclusion is that what is best,
depends.’ Baron and Kreps ( 1999 : 33 ) assert that ‘in HRM, there is no one size that
Wts every situation’ and when considering the high-commitment model of HRM
argue that it should not be adopted unless the beneWts outweigh the costs (ibid.:
ch. 9 ). None of these frameworks is inherently anti-union or takes the view that
HRM is restricted to one style. The message in terms of the goals of HRM is one of
Wt or adaptation.
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