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Madness As Usual


  • Stefan Kühl
  • Thursday, 13. June 2024

The Battle for Authority over Human Resource Decisions

For a long stretch of time, a debate has been raging over the question of whether hiring and promotion decisions should be taken by present and future managers or by specialists from the human resources department. Careers play an important role in organizations because the prospect of an attractive professional future motivates employees to do their best. In some organizations, such as political parties and NGOs, the chance to be promoted can be an even stronger incentive than financial reward, luxury travel, hampers, or wining and dining. 

Traditionally, responsibility for personnel decisions lay with the management, and this gave them a powerful way of securing the obedience of their employees that was far more direct in its effects than the threat of redundancy. However, as Niklas Luhmann has argued, while formal organization – the authority to issue official directives – plays an important role, ‘actual power’ depends far more on the influence someone has over careers. The reason for this is that it is much rarer for someone’s membership of an organization to be withdrawn than it is for decisions about how to fill posts to arise. To retain one’s membership, Luhmann says, one need only fulfil the most basic requirements and not openly rebel against one’s superiors. Making a career inside the system requires much more. 

However, the power of managers to make decisions about careers started to come in for criticism. Given the powerful position of superiors, it was argued, the professional development of their subordinates often depended more on their willingness to obey than on their actual performance. When decisions about careers are taken by an organization’s management, ‘non-organizational’ criteria, such as religion, ethnicity, political attitudes, or involvement in other organizations, can also play a role. And in public administrations, positions are often filled with protégés or depend on party political affiliation, networking, or professional fraternities, rather than being decided on the basis of performance. 

Over time, at least in the case of large public administrations and businesses, the authority to make career decisions has increasingly been transferred to human resources departments. Most large insurance companies and banks now have ‘internal assessment centres’. The general idea is that if you want to move from the first to the second stage in your career as a manager, say, you need to do well at these assessment centres. 

To the extent that decisions about personnel matters become rationalized and dependent on the input of many people, they cease to be means of exercising power. It becomes difficult for superiors to manipulate their subordinates because it is no longer open to them to choose whether to boost or block an employee’s career progression within the organization. At the same time, whether and how one’s conduct towards a boss will affect one’s career becomes increasingly unclear. Perhaps the boss still has some control over the evaluations an employee receives from personnel development managers, but it is doubtful that this influence will translate into effective power over the employee’s career. How did personnel managers gain so much in terms of influence compared to general managers? 

A chief explanation for this is the diffusion of responsibility for personnel decisions that results from the involvement of personnel managers in career planning and the use of personnel diagnostics. A decision taken at an assessment centre to elevate a rising star to an important position can no longer be attributed to a single decision-maker. The directive to make an employee redundant is easier to issue when the employee previously went through a cycle of personnel diagnostics, coaching, and evaluation, as this ‘objectifies’ the decision to fire the employee. It is no longer attributable to a specific person. 

In many organizations, the tendency towards the diffusion of responsibility plays into the hands of the managers and their strategies, because it enables them to conceal the identity of the person responsible for a specific decision for as long as possible. Should an employee fail in her new position, the responsibility for having chosen her can then be attributed to ‘the procedure’. And should she succeed, the manager can reveal that he had ‘discovered’ her, and his having taken the personnel decision can be another feather in his cap. Success, as we know, has many fathers (but failure is an orphan). 

Prof. Stefan Kühl

links in his observations the latest results from research with the current challenges of the corporate world.

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