This is the second time that I have posted this message; regrettably, I did not get the whole response the first time.

Would it be possible kindly read this paper and write a complete summary of this paper besides that choose one issue discussed in the paper, then analyze how the selected issue is conducted (from your working experience).

God bless you.

The authors argue that there are trends currently strategy and goals. This has been recognized as especially present in industry and management which require | important in service frrms where there is a close relationhuman resource (HR) managers to have much ship between production and consumption of the higher levels of competence and skills. Concepts service. It is thus concerned with buth quality manageand techniques from marketing can provide means ment and customer service and involves co-ordinating by which HR managers can be more effective. people and process improvement strategies. It is also pointed out that Chief Executive Officers Internal marketing relates to all functions within the have failed to recognize the importance of HR organization, but it is vitally concerned with the managemanagers in their organizations - a weakness for ment of human resources. However, the traditional which HR managers must also carry some blame. personnel department and the more advanced human resources department, have frequently been oriented Introduction towards control and administrative activities rather than g. First, there is the notion that every depart, marketing concepts and methods used by marketing ment and every person within an organization is both managers can provide the basis of a new perspective a supplier and a customer. The second aspect relates un meeting the opportunities and challenges faced by to the organization's staff and involves ensuring they : human resource managers. A market-oriented human wrork together in a manner supporting the company resource manager is more likely to make an impact on EUROPEAN MANAGEMENT JOURNAL Vol 9 No 3 September 1991 261 the success of a company, through being more effec- Increaged usage of technology in some industries has tive in both demonstrating the relevance of human led to the assumption that the quality of people perforresource movement (HRM) to all management team mance will become a less important issue as technology members, and helping other managers to increase their beromes more pervasive. However, the maintenance of productivity. reliable performance by competent employees is becoming more crucial. For example, we are now in an era Our approach is to first consider the nature of the where electronic banking means fewer face-to-face challenges and opportunities confronting human encounters between the bank and its customers. Conseresource (HR) managers. A view of what is seen to be quently, the importance of handling these interactions, a central task for the HR management professional is and the 'costs' of not making the most of opportunities then outlined. The congruence between marketing func- are greater. In a relatively homogeneous industry such tion activities and HR management activities is then as banking, a key opportunity for banks to gain a described. Finally, we consider how the HR manager competitive edge over competitors lies in the quality of can utilize the philosophy, ideas and tools of the market- its people. In an era of electronic fund transfer there is ing function to make a more effective contribution opportunity for a bank to position itself as one that has toward the organization's objectives. good people, not just good machines. 4 Many of the key challenges facing retail banking involve the employee: Challenges Facing the HR Manager the need to sell and cross-sell, unionization, electronic The managers in a company who deal with the 'people' and technology management. issues are now recognized as having an increasingly strategic role in the success of many businesses. Regard- It has been argued that HR professionals have failed in less of whether the function these managers perform the past to reach their full potential within the corporate is called personnel, human resources, industrial rela- framework because they devoted themselves to the tions, or training and development, it collectively now creation of ever more sophisticated programmes and represerits a business role similar in importance to the forgot the whole purpose of the business. 5HR manaareas of tinance, marketing andoperations management. gers have had a role in organizations dealing with This trend has been driven by a more intensely competi- outside pressures such as government, unions and tive business environment, increased use of technology safety, but their active involvement and collaboration in some industries, and the shift in corporate philosophy is also needed with the production, marketing and from asset management to operations management. | finance functions. They have been responsible for fonding off interruptions, handling the reporting requireA focus on operations management has forced Chief ments of regulatory bodies, and dealing with social Executive Oificers (CEOs) to understand the need for responsibility issues, but often are not involved in skilled HR executives if they are to successfully cope activities perceived by other managers to be fundawith change. An organization able to adapt to change mentally important to the business. is generally found to be more able to sustain competitive advantage in an environment of increasing uncertainty. Managing a corporation is complex, and CEOs find it The constant stress of corporate takeovers, new ventures, necessary to simplify their task by concentrating on what the restructuring of companies, rationalization of existing appear to be the most important strategic issues. Because operations, new technology introduction and staff lay- of resource limitations, it is necessary to focus senior offs, means that the success of basic strategic decisions management's attention and time on those aspects of increasingly depends on 'matching skills with jobs, the business process with the highest expected payoff. keeping key personnel after a merger, and solving the This means that some areas with extremely high potenhuman problems that arise from introducing new tech- tial impact, but a very low perceived probability of nology or closing a plant'. 1 The dramatic turnaround delivering significant results, must get less attention of SAS by Jan Carlzon was driven by people rather than one might really wish. Strategic HRM requires a than by an expensive investment in equipment and significant investment of organizational resources, assets. 2 which directly and immediately affects profits, and can thus make it unattractive to managers under pressure Increasing attention is being focused on the area of for short-term results. Further, any real understanding external customer retention and the enormous potential of what competent HRM could contribute to the success for improved profitability. 3 Top management should of a business has only been popularized fairly recently. 6 also seek to obtain improved organizational performance For these reasons, senior management has often failed through effective HKM strategies aimed at improving to grasp why HRM was relevant to business strategy, personnel retention. The baseline benefits are cost business performance and the cost management savings on retraining in a rapid turnover job market and function. cutting down the equally expensive knowledge drain. Companics able to manage this issue will reap the Clearly, the central task of HRM must be to gain the rewards which go with a team of committed, active support of senior management, secure the commitment \begin{tabular}{l|l} individuals at a time when under-training is sapping \\ productivity among competitors. \end{tabular} EUROPEAN MANAGEMENT JOURNAL Vol 9 No 3 September 1991 The HRM function in a company is never likely to be withholding of supply, because credit guidelines have valued unless it convinces management it can provide been exceeded at a time when Sales is trying to service significant payoffs, and is part of the key interactione a sudden increase in demand, resulting in open conbetween the organization and environment. HRM will flict. 8 Similarly, an HR manager can become involved become established as an integral part of a business in interdepartmentalconflict through a need to represent through helping other managers to increase their the interests of an employee against the needs of another productivity. Managers do not require more sophisti- manager. Like marketing. HRM is a function where cated programmes. They require someone who under- success requires close cooperation with other functions, stands their problems, can actively contribute to the but there can be significant potential for conflict. The more effective and efficient management of human coalitions of power and politics at the core of fundaresources, and who has a good understanding of the mental conflicts such as this can be used to maximize business. We will now consider how the roles of business performance, or detract from it. The task for marketing managers and HR managers are linked. the HR manager is made more difficult because the quality of management performance is difficult to The Marketing-HRM Analogy quantify - there is no bottom line responsibility. This - employees within the organization; financial reports; bottom line results. - other managers involved with the senior manage- ment tasks including the CEO; and - external groups such as prospective cmployees, utility, the capacity to satisfy needs. 9 The HR manager government, unions and regulatory bodies. is similarly concerned with the creation of utilities. The Consideration of the challenges faced by HR managers marketing philosophy or concept states that, in serving indicates that they are similar to those challenges faced marketplace needs, the entire organization should be by cther senior managers, and requirements for success guided by thinking that centres around the consumer. For our purposes, the concept has three key elements: marketing miana ges. The use of marketing ideas does not need to be - The HR manager requires a thorough knowledge narrowly confined to products and markets. Marketing of the needs, wants and problems of the CEO, has been defined as 'a social process by which indivi- other managers and employees. Ideally, the I IR duals and groups obtain what they need and want : manager should start with a knowledge of client through creating and exchanging products and value needs and work backwards to develop products with others', 7 and implies two voluntary parties with and services to satisfy them. unsatisfied needs, an expectation of mutual benefit, a - The second element requires that the cost, design. means of communication, and a medium to complete implementation and follow-up on HR projects the exchange. should be carefully planned so all features are consistent with project goals, and the process coordiPeople who buy goods and services are involved in the nated with other functions in the organization. same type of exchange process as people who seek - Finally, in our definition of marketing we recogemployment that is satisfying, interesting, and more nize that individuals or groups engaging in the than a well-lit work space. The relationship between marketing process have diverse goals and objecbuyer and seller in a labour market is such that the tives. If the organization itself does not gain utility employee must sell labour to earn an income. A com- from an exchange then this element of the pany must create goods or services and exchange them philosophy is not met. Consequently, we would in order to earn profits. Clearly, there are times when expect that if an IIR activity did not lead to one party to an exchange has much more bargaining organizational gain the activity would be power than the other party. The manager who seeks discontinued. mutual benefit through working closely with the HRM department is involved in a similar exchange process Quantification of performance plays a crucial role in the to that which takes place between consumers and success of the marketing function, and the performance companies everywhere. audit guides corrective action while providing measureA source of interdepartmental ments essential to supporting access to resources for projects. IIR managers have sometimes been characterfor a marketing manager to represent the interests of ized by a lack of willingness to work with performance a customer against the needs of other managers. We do , measures. Marketing strongly depends on techniques not iack examples of conflict between the marketing and developed in the behavioural sciences for quantification accounting functions. For example, while the Sales of the needs, wants and perceptions of consumers. department is properly concerned with maintaining a These toois can be readily adapted to requirements of good relationship and undisrupted supply to the the HR manager. While measures employed by marketcustomer, the Accounts department is concerned with ing managers are not always of high precision, they are administering credit control. Accounts may seek the essential to the building of credibility through measure- ment and performance against explicit goals. Manage- Similarly, the importance of HRM has gradually gained ment performance in functions other than markoting credibility and importance. as managers have come to and HRM are generally more amenable to performance understand how it can contribute to the achievement measurement. of business success. There exists an increasing number believed to be a key factor in their success. groups served, and develop a coordi We have seen the similarity in roles of the marketing tion goals and with the expectation of asth organiza- and HR managers. The marketing and HRM processes both involve the creation and exchange of utilities. A need to represent the interests of a client against the emphasis on narrow interests of another manager may be conducive to the weil-being of the company but a surce of open interdepartmental conflict. This conflict is difficult to s. Consider training programmes for example: the function and the organization. Both functions require difference between a product-oriented and a market- commitment and support from the CEO to succeed, and oriented manager is shown in Figure 1. This example performance measurement is seen to be an important is stereotypical in that the model represents two extreme tool for building credibility within the company: The positions. No one person would be expected to exhibit market orientation can be applied equally to either the all of the characteristics presented for a specific orienta- marketing or HR functions when it is accepted that tion, but an HR practitioner would be expected to success is achieving organizational goals through possess several if they were either market- or product- delivering customer satisfaction. We will now consider oriented and the distinction between two very different how the HR manager can harness the ideas and tools management philosophies are illustrated. of the marketing function to more effectively contribute We have found it a useful exercise, in workshops with senior managers, to discuss the role of conflicting philosophies and how they affect achievement of a marketing orientation. This can be addressed in the context of both We are concerned here with internal marketing that external customers 10 and internal customers. 17 Athough ' form of marketing where both the 'customer' and the it has been accepted for many years that a market 'supplier' are inside the organization. In this context, orientation is essential to the success of a business, it we consider employees as customers or clients. These has not been proven in all contingent situations Monn- classifications are quite broad and could be further poly or regulated markets provide examples of non- divided into such groupings as the board, managers, market orientation. As the difference between a market supervisors, foremen, clerical staff. etc. The HRMorientation and any one of many conflicting orientations marketing function can be described in terms of seeing possible is accepted as the difference between unstable managers and employees as in-house customers, viewshort-term success and stable long-term growth, it ing the tasks and activities performed by the HRM becomes of considerable importance to senior managers function as in-house products or services, and offering to push a market orientation within their company. in-house or services that satisfy the needs and wants Figure 1 Stereotypical differences between market-oriented and product-oriented HR managers with respect to training programmes 264 EUROPEAN MANAGEMENT JOURNAL Vol 9 No 3 September 1991 Marketing management is the process of increasing the This channel of communication provides an early means effertiveness andior efficiency by which marketing for pinpointing organizational breakdowns and problem activities are performed. Effectiveness refers to the areas. An important requirement before undertaking degree to which organizational objectives are attained, data collection is to adopt a commitment to face the while efficiency is concerned with the expenditure of issues uncovered, no matter how unpalatable. It is an resources to accomplish these objectives. This difference ongoing process requiring that issues be resolved in is eloquently expressed in the view that it is more impor- order to maintain credibility of the HR department at tant to do the right things (improve effectiveness) than all levels within the company. To raise the expectations to do things right (improve efficiency). 13 An organiza- of client groups without delivering can generate strongly tion that is doing the right things wrong (effective but negative effects. Finally, market research can also nitt efficient) can outperform organizations that are provide a basis for monitoring the impact of programmes domg the wrong things right. Effectiveness and effi- on employees and check whether HR programmes are ciency is also a concern of the HR manager seeking achieving what they were designed to achieve. improved performance. Marketing Activities This market research process sometimes suffers from a condition referred to as the 'no-full-disclosure disease'. 14 The marketing function in any organization is concerned I ment hierarchy who fear the things threatening them with a number of related activities which include: may become known to others and then used to their - Personal detriment. The extent of this problem depends - Understanding of the market and competitive on survey design and content. People interviewed tend environment. to speak freely when given a chance to express their - Definition of the firm's Mission. thoughts and opinions on HRM issues. However, - Determination of the Target Market Segments to undertaking not to reveal the content of an interview be emphasized. under any circumstances, without prior approval from - Developing integrated Marketing Mix strategies to : the person interviewed, is sometimes necessary in order accomplish this Mission in the selected segments. to get at the real problems and issues. Whether use is - Implement Marketing Mix strategies and Control made of questionnaires, personal interviews, informal marketing activity. meetings of managers or group discussions, market research provides a clear means of identifying client This well-known model of marketing function activities, needs and wants. It also provides the means for tracking which involves the above steps, is used as a basis for performance. a discussion on internal HRM marketing. Market and Competitive Environment The second step involves the development of a mission The starting point is for HR managers to gain a good for the HR department. The corporate mission statement knowsledge of the needs and wants of the client groups for an organization is too broad to be meaningful for a served, the significant factors influencing the HR depart- specific business function, and consequently a mission ment's operations, and identify the 'publics' which statement should be specifically developed for the HRM interact with the company. This process is market function. It involves asking the questions 'what is our To develop and promote the highest quality human resource against specific objectives. A function which provides practicos and initiatives in an ethical, cost effective and timely a service, and deals predominantly in intangibles, manner to support the current and future business objectives of the organization and to enable line managers to maximize tangible evidencc of success in order to the calibre, eftectiveness and development of their human | demonstrate competent performance and help build resources. This will be achioved through working with managers and staff to: - Develop an integrated human resource policy and impleMarket Segmentation - ment its consistent use throughout the organization. The third step is deciding which market groups should - Enhance managers' etricient use of human resources be cmphasized. Market segmentation is a process by through the provision of responsive and adaptable which we divide the total, heterogeneous group of - Be the preterred source vi core strategie HA services. clients into smallet, more homogeneous groups with - Provide high quality tailored HR consultancy. - Introduce methods to plan for the provision of required successfully satisfy. By developing specific services we - Ensure consistent line accountability throughout all areas _ can generally improve the effectiveness of our perior- - within the organization. mance in satisfying clients. It may cost more to serve - Assist the organization in becoming more customer smaller groups or handle problems requiring customized - Deline and encourage implementation of an improved solutions. Because of this, there is sometimes a need to - communications culture throughout the organization. balance the level of customization required to adequately solve a problem, against the benefits which might accrue to the organization. This is very much a cost-benefit exercise. The characterization shown in Figure 3 can be helpful for sorting problems into classes, each of which require different capabilities. be within the organization?'. Figure 2 provides an example of an HR mission statement based on one At a high degree of customization there is increased developed with a leading British service organization. demand for resources from the HR function. The HR cost to the organization increases with an increase in At the HRM level the definition of mission does not have the level of customization. Programmes or projects to be complex. It should provide a framework for undertaken by HR typically involve long-term benefits explaining the HR department's role and how it can help with short-term costs and, given limited resources, this the different levels and units of an organization to has a direct impact on the HR department's effectiveness. coordinate their efforts to achieve the overall objectives of the organization. Quadrant 1 in Figure 3 represents the situation where there is need to fit a key programme to the specialized Once the mission statement has been adopted objectives needs of a client group. A major company wishing to need to be formalized. Because objectives are not equally run an in-house strategicmanagement seminar, enabling important, a hierarchy of potential services, programmes senior management to review and discuss current and projects should be put together. If possible these management thinking and practice, is an example. The objectives should be operationalized - stated in terms, CEO would perceive this to be of high value to the that are specific and which will lead to measurable end organization, while requiring this process to fit closely results. It is important to understand what needs to be with the business context. accomplished, when the task should be completed, and how it will be decided that the task is completed. This The programme-oriented task found in quadrant 2 is process links very closely with the market research characterized by the opportunity for a high quality but function which can be used to demonstrate performance standardized approach to be taken. For example, con- Figure 3 Characterizing HR marketing problems EUROPEAN MANAGEMENT JOURNAI. Val 9 No 3 September 1991 operations from a manual to a computerized telephone way 15 betting system. There is a need to develop and implement a programme at low cost which will enable a smooth transition to the new system. Due to the large Developing and Implementing the group of operators requiring new skills there is an Marketing Mix opportunity to seek savings through standardization. Once the tasks of determining the mission of the HR The importance of this issue means effective performance department and the target market segments to be by the HR department is more critical. emphasized have been undertaken, a marketingIn quadrant 3 the degree of cutomization oriented HR function will focus on the 'marketing mix'. a task is low - for example, where factory staff are being The marketing programme is developed based upon a given first-aid training. The content of a first-aid training manager has some control: designing the product or programme will be fairly standard across a range of service, costing it, setting up a service delivery system, industries. Such a programme is not central to achieve- promotion of the product to clients, and gaining commitment of organization objectives, and represents a situa- ment for proposals from management. Figure 4 illustion where service delivery can readily be obtained from trates the four elements of the marketing mix which cutside the organization. Once the training programme need to be addressed. Whilst all elements need to be was in place, knowing who had attended the course and considered, two key variables - the design of the monitoring the training process would be the key tasks. 'product' (i.e. courses or services) and communications are especially important. These two key variables and An increase in the degree of customization required their relevance for the HR manager are now reviewed. corresponds to an increase in the level of organizationspecific content, as shown in quadrant 4 . Consider a 'Designing the 'product' retail tyre organization which needs to train shop floor it has been pointed out that the process of a marketing staft in the testing and servicing of car batteries. This department introducing a new product, and resolution more specialized course requires company-specific of a complex long-standing problem by the HR function input, and an in-house programme is the best solution. are very similar. Figure 5 illustrates this, and is based In this quadrant the need is for course development on Desatnick 16 who argues that 'as the contribution of skills, a flexible approach and the ability to manage the HRM is less tangible and more difficult to measure in development process. Other examples are custom- terms of end results, it is even more important to market designed employee retirement programmes, or surveys it effectively. This implies taking the time to reflect, to of work group satisfaction where there is a need to position, to package, to merchandise, and to sell'. Thus design and implement a project with the specific needs the HR manager must get the maximum impact from of a client group in mind. each situation through careful management of those Obviously most impact can be made by HRM elements he can control. Developing a product or service - for a client group is an activity over which the HR manager has a great deal of control, and consequently importance to the organization, but not involving signi- provides an area where management attention can be ficant short-term investment. This type of problem area, rewarded with maximum impact. identified because the issues involved are considered central to the achievement of business objectives, will Communication often be more able to attract support and adequate Communication represents promotional activity in the funding. Working in areas requiring a high level of form of advertising, indirect publicity and face-to-face customization, which are also critical to business selling which is employed by marketers to influence surcess, is the challenge facing HR. This is the direction potential or existing customers to behave in desired in which HR requirements have moved due to the increased complexity of business, changing technology and the shift from an asset management to operations management philosophy. Segmentation of employees on the basis of their needs and wants, as opposed to the segmentation of management clients, recognizes the need to accommodate individual differences. This is the basis for concepts such as negotiable remuneration packages, employment contracts, flexible working hours and job sharing. The techniques used for consumer segmentation by marketers can be applied directly here. It provides upportunity for companies to 'lessen the influence of unions by placing greater emphasis on direct employee communication, in addition to, or instead of, industrial Figure 4 The four elements of the marketing mix EUROPEAN MANAGEMENT JOURNAL Vol 9 No 3 September 1991 267 INTERNAL MARKETING: A NEW PERSPECTIVE FOR HRM Figure 5 Comparing product development to resolving a complex HR issue ways, such as to undertake the trial purchase of a product the firm has just launched onto the market. Promotion can also be used to influence employees to situations where a service or programme is either partly reconsider attitudes, to inform managers, or alter the or fully dependent on the performance of employees for way in which a particular progtamme is perceived by success, the communications and promotional activity the clients to whom it is directed. The use of 'publicity' should be concerned not only with encouraging clients through internal publications and other documentation to buy, but with encouraging employees to perform. can be used to provide feedback to employees on current Success in business requires the commitment of both issues, as well as enhance and reinforce the credibility employees and management. of the research process. A well-conceived internal promotional programme can have very positive effects The implementation and control processes represent the on employees. It can motivate, educate, or help provide final step which involves the measuring of effectiveness a sense of belonging. The famous Avis Rent-a-Car and efficiency, taking corrective action, and iteration slogan suggesting that Avis employees 'Try harder' was through the marketing planning processes. The wellas effective for their employees as it was for the public established marketing planning literature 17 provides a image of Avis. This type of corporate advertisement framework to follow in undertaking this task. primarily seeks to influence the perceptions of external publics, but management tends to forget these campaigns are also critically viewed by employees at all Conclusions levels within the organization. A campaign which lacks The 1980s saw the start of a new emphasis on the HRM credibility with employees is not consistent with function. It has been pointed out that the reality is that development of a positive organizational culture. a firm adopting 'HRM' may simply involve a retitling Management should develop corporate communications of the old personnel department with no obvious change which are consistent with the HIRM objectives of the in its functional role, or it may be 'strategic HRM' which organization. Simpler, less ambitious projects can also represents a fundamental re-conceptualization and reproduce a significant impact for the HR function. organization of personnel roles and departments. 18 The 268 EUROPEAN MANAGEMFNT JOURNAL. Vol 9 No 3 September 1991 EUROPEAN MANAGEMENT JOURNAL Vol 9 No 3 September 1991 269 INTERNAL MARKETING: A NEW PERSPECTIVE FOR HRM BRETT COLLINS, Faculty of ADRIAN PAYNE, Cranfield Management and Business, School of Management, Deakin University, Geelong. Cranfield, Bedford MK43 OAL, Victoria 3217, Australia UK Brett Collins is Director of the Adrian Payne is Professor of MBA Programme at the School of Services Marketing and Director Management, Deakin Univerof the Centre for Services sity, Australia. Prior to this. Management at Cranfield School he lectured in Marketing at the of Management. He has practical Graduate School of Manageexperience in marketing. ment, University of Melbourne. market research, corporate He has fifteen years of experience in sales, manufac-_ planning and generat management. His previous turing, marketing, corporate planning and general appointments include positions as CEO for a manufacmangement, and is active as a consultant fo com- turing company and he has also held serior appointpanies and govemment bodies. His teaching and ments in corporate planning and marketing. He teaches research centre on marketing management, financial on many intemational executive courses and consults mathematics, marketing decision analysis and business and researches world-wide. His current research strategy. He has published zwidely in academic and interests are in strategic marketing and management in professional joumals. service industries, customer service, corporate aiquisitions, global competition and developing market-oriented organizations. He has published over 30 journal articles. 270 EUROPEAN MANAGEMENT JOURNAL Vol 9 No 3 September 1991