Understanding HR reputation: a study to identify and measure the factors that determine perceptions and judgements of HR.

Abstract

HR suffers from an on-going negative reputation supported by a variety of criticisms of their support for line managers, lack of business knowledge and failure to adapt to a new business model. Much of the research on HR has been focused on establishing a link between HR practice and business performance. Although arguments for such a link are compelling, HR’s competence to deliver a strategic plan, which balances both the interests of individuals and those of business, is in question. The aim of this study is to identify the components of HR reputation and develop a scale of measurement for HR reputation. There has been little research carried out to date on either HR reputation or its constructs. That which exists suggests that HR reputation is formed by shared perceptions and judgements across the organisation but offers no suggestions as to its constructs or causes. A scale of measurement will enable the HR profession to better understand those perceptions and the expectations of the key stakeholders to identify how their role needs to develop, not only to meet these expectations but also to give them a robust tool to respond to their reputation more effectively. A review of the literature identified a number of factors which potentially impact on HR reputation. These are perceptions of HR service, positioning and leadership of the HR function, skills and abilities of HR professionals, the context in which HR operates, and trust in HR and HR outcomes. These factors were further explored in an exploratory study using a qualitative methodology to gather the views of HR and line managers. The exploratory study confirmed that three factors – perceptions of service, skills and abilities, and trust – are indeed factors that contribute to HR reputation, but found little support for positioning and leadership. The exploratory study also generated a number of questionnaire items within each of these factors, which were combined with items generated from literature and validated scales to develop items for the pilot questionnaire, which refined the factors contributing to HR reputation. The final study consisted of a large-scale survey of UK employees and concludes there are four sub-scales that contribute to HR reputation: expectations of HR, skills, trust, and HR performance. All sub-scales are perception-based and together explain the latent variable of HR reputation, which is multifaceted and needs to be viewed on all four dimensions. Within these sub-scales differences could be found between perceptions made by individuals of the direct impact HR has on them and perceptions of the impact of HR on the business. Finally, the work concludes that different stakeholders may hold different perceptions about HR, and hence HR reputation, which has implications for practice, and that the way in which HR performance is viewed can explain differences in HR reputation.