STRATEGIC MANAGEMENT AND HUMAN RESOURCES 79but was also seen in the USA under President Reagan and in the marketization
of economies and the public services in countries like New Zealand (Boxall
and Haynes 1997). Within this broad political context, and given substantial
worker support for direct, non-union forms of participation, management in
the Anglo-American world has clearly made an impact over the last twenty
years on notions of how to structure employee voice.
Legitimacy, then, is a ‘contested arena’. Our argument is that all legitimate
firms must pay at least some regard to how their actions are perceived in
ethical terms. This is an important part of sustaining stakeholder support
and organizational effectiveness, broadly understood (Lees 1997). For most
firms, certain standards of behaviour are simply a given based on the society or
societies in which the firm operates. However, business interests, writ large, are
not just passive vessels and are capable of playing a major role in the evolution
of ethical standards over time.
Conclusions
We have defined strategy by distinguishing between ‘strategic problems’ the
firm faces in its environment, and the characteristic ways it tries to cope with
them (its ‘strategy’). As common sense tells us, the word strategic implies
something that is seriously consequential for the future of the firm.
The fundamental strategic problem is the problem of viability. To be viable,
a firm needs an appropriate set of goals and a relevant set of HR and non-
HR, a configuration or system of ends and means consistent with survival
in its competitive sector and the society (or societies) in which it operates.
This obviously means that without certain kinds of human capability, firms
are simply not viable. Firms which deal adequately with the viability problem
have the chance to play in a higher level ‘tournament’: the contest among
leaders of sound businesses to achieve some form of sustained competitive
advantage. In certain contexts, there are opportunities to pursue this goal
through (somewhat) distinctive HR and HR strategies.
Identifying strategic goals in labour management has always been difficult.
The framework we have developed argues that HRM is concerned with three
aspects of performance that are critical to the firm’s viability and that may lay a
basis for sustained advantage—labour productivity, organizational flexibility,
and social legitimacy (Boxall and Purcell 2003). While the first two aspects
of performance—productivity and flexibility—very much reflect a business-
oriented agenda, firms inevitably confront issues of legitimacy, both within
their ‘skins’ and within the wider societies in which they operate. Tensions and
trade-offs with employee goals and with broader societal expectations mean