Lost in Translation? Critiquing the HRD Discourse in the Small Firm
Refereed Paper
Nolan, Ciara T.; Garavan, Thomas N. Associate
Introduction
In the contemporary era of discontinuous and transformational change, the innate ability to learn, generate and apply new knowledge and skills are seen as central to the achievement of competitive advantage (Harrison and Kessels, 2004). Within this context, Human Resource Development (HRD) has become a critical activity and is regarded as a key strategic partner (Mankin, 2009) in the pursuit of organisational sustainability and success. Concomitantly, small firms have become a critical focus of business, political and academic research interest in recent times (Curran and Blackburn, 2001; Marlow, Patton and Ram, 2005). No longer irrelevant relics of a bygone era (Harney, 2009) this burgeoning interest has stemmed from heightened recognition of the crucial role and contribution made by small firms to the success and competitiveness of modern economies around the globe (Barrett and Mayson, 2008; Dundon and Wilkinson, 2009; Ram and Edwards, 2010). Recently published statistics by the European Commission (2010b) reaffirm the centrality of small firms as the dominant feature of European economies, with approximately 99% of all businesses being classified asmicro or small. Moreover, the European Commission (2011) has stressed that the future of the European economy and the realisation of the Europe 2020 strategy heavily depends on small and medium-sized enterprises (SMEs) achieving their potential. Such is their importance, the European Union (EU) has developed a comprehensive SME policy framework, the Small Business Act (European Commission, 2008), aimed at strengthening SMEs so that they may grow and create employment, reclaiming their role as the “job engine of the EU’s economies” (European Commission, 2010a, p.7).
Yet, despite HRD undoubtedly being one of the key challenges facing organisations in the twenty-first century, research endeavours have rarely extended to realm of the small firm (Hill, 2004). Such neglect is not only surprising but is becoming increasingly difficult to justify, particularly when one considers that small firms have historically and continue to play a vital role in major economies around the globe (Fink and Matthias, 2009). Specifically, questions have been raised regarding the dominant paradigm of analysing HRD approaches in small firms as scaled-down versions of those adopted in larger businesses (Stewart and Beaver, 2004). Dominant theorising in HRD has thus evolved from and is oriented towards the study of atypical (large) enterprises (Iles and Yolles, 2004; Vince, 2003). As a consequence, mainstream conceptualisations of HRD are overly narrow in focus and the resultant discourse does not readily connect with models of HRD in small firms (Clarke, Thorpe, Anderson and Gold, 2006; Hill, 2004). A corollary of this is when the formal policies and practices through which HRD is articulated are not found in small firms, the resultant conclusion is that their practice is lacking or inferior (Rigg and Trehan, 2002). However, as others have argued with respect to small firm HRM (e.g. Baron, 2003; Marlow, 2006), an alternative way of thinking could actually be that the uncritical and simplistic search for HRD adopted by researchers exposes the paucity of extant HRD theory. In recent years, scholars have noted that the proliferation of small firms is likely to mark a growing location for HRD practice, which in turn may imply a repositioning of the HRD concept and an expansion of its meaning (Hill, 2002; McGoldrick, Stewart and Watson, 2002; Stewart, 2005; Vince, 2003). As such, the reality for many small firms is likely to be far removed from managerial/ theoretical idealism presented in extant frameworks of HRD (Sadler-Smith and Lean, 2004). This raises critical questions as to whether HRD theorising has taken sufficient account of the complex, dynamic and variable contexts of small firms (Gold, Holden, Iles, Stewart and Beardwell, 2010). In turn, the fundamental question of whether small firms represent an arena for HRD remains unanswered.
In the current paper we argue that the HRD literature is in need of a more balanced agenda and in seeking this, we call for a more constructive and thoughtful dialogue on small firms. We reflect on what is known about HRD in small firms, seek to correct conventional (mis) understandings and indicate future research needs and trajectories. Echoing Marlow’s (2006) analysis of the HRM concept in small firms, we advance a critique of the conceptual standing of HRD. Specifically, we question whether HRD can be adopted in an unproblematic and uncritical fashion in small firms and consider the implications of using the HRD concept to analyse developmental activities, processes and arrangements within this context. We also draw on recent developments within the mainstream and critical HRM literature and endeavour to apply similar insight and critiques to achieve a better conceptual understanding of HRD. We suggest that the HRD literature suffers from conceptual myopia and theoretical deficiency and argue for more careful theorising of HRD in context. Underpinned by a social constructionist theoretical perspective, our argument amplifies the importance of focusing on how small firms actually behave rather than contrasting practice with an idealised image of what they should do (Taylor, 2006). In doing so, the paper supports the wider ‘practice turn’ (Bourdieu, 1990; Schatzki, Knorr-Cetina and von Savigny, 2001) or ‘linguistic turn’ (Alvesson and Kärreman, 2000) in the social sciences, which has evolved in response to a general dissatisfaction with the prescriptive models and frameworks arising from representationalist thinking (Chia, 1996; Jarzabkowski, Balogun and Seidl, 2007).
The Research Context: Sustainability, the Small Firm and HRD
SMEs and entrepreneurs represent the backbone of global economic activity. They play a vital role in all economies and are regarded as the key generators of employment and income, drivers of innovation, R&D, competitiveness and economic growth. In the OECD area, SMEs employ more than half of the private sector labour force (OECD, 2009), whilst in the European Union it is estimated that some 23 million SMEs employ almost 70% of the private sector workforce, accounting for more than 99% of all businesses and employing more than 90 million people (European Commission, 2011a). Furthermore, approximately 91% of these enterprises are micro-firms with less than 10 workers (European Commission, 2010b). Similar figures are reported for economies around the globe (Mankin, 2009). As such, smaller firms play a critical role in the ongoing economic and social sustainability of modern economies worldwide.
In light of the above, it is increasingly recognised that the ability of smaller firms to survive and grow holds the key to economic recovery in the European Union in the coming years (European Commission, 2011a). By way of illustration a major component of the European Commission’s €200 billion Economic Recover Plan is its emphasis on financial and administrative support for SMEs. Key measures include providing SMEs with better access to credit and speeding up regulatory reform under the Small Business Act (European Commission, 2008). The recently published SME Performance Review (European Commission, 2010a, p.7) highlights the importance of refocusing attention on the smaller firm:
“…now is a period when well-timed and calibrated policy interventions matter more than ever so as to ensure that SMEs can as quickly as possible resume their role as the job engine of the EU’s economies.”
Due to the present economic and financial crisis, some 3.25 million jobs in SMEs have been lost in the EU alone, which further underlines the need to restore their job creating capacity (European Commission, 2011b). Indeed, it has been argued that due to greater flexibility and agility in operations (Smith and Sadler Smith, 2006; Van den Berg, Meijers and Sprengers, 2006), smaller firms may well be better positioned to survive and prosper during an economic downturn in comparison to their larger counterparts. Recent research by Kitching, Smallbone and Xheneti (2009) would appear to support this view and suggests that the impact of the current recession on small businesses in the UK has not been as damaging as might have been expected. While recognising their vulnerability to changes in the external environment, Kitching et al. (2009) report that small firms are able to exert an important influence over their long-term business performance, survival and sustainability through resilient approaches to resource acquisition and mobilisation activities.
The World Business Council for Sustainable Development (WBCSD) (2007) contend that poverty remains a major challenge to sustainable development, environmental security, global stability and a truly global market. They maintain that the key to poverty alleviation is economic growth that is inclusive and reaches the majority of people. Actions to improve the performance and sustainability of local entrepreneurs and SMEs can therefore help achieve this type of growth. In this context, HRD assumes particular importance for the successful future of SMEs. Moreover, Garavan and McGuire (2010) have recently argued that HRD has a major role to play in helping organisations achieve what they term ‘triple bottom line goals’ of corporate social responsibility (CSR), sustainability, and ethical behaviour.
In light of their prevalence, it is unequivocal that small firms represent an integral part of the HRD context, however, the study of HRD in small firms can be described as terra incognita and surprisingly remains something of a black box. Notwithstanding a few notable exceptions (e.g. Hill, 2004; Skinner, Pownall and Cross, 2003; Saru, 2007; Stewart and Beaver, 2004), small firms have failed to attract the attention of mainstream HRD researchers and the role of HRD in this context has been a neglected theme in the mainstream HRD literature (Mankin, 2009). Moreover, small business scholars have tended to avoid issues pertaining to the management and development of people (Katz, Aldrich, Welbourne and Williams, 2000). Hill (2002) maintains that there is a “demanding need” for HRD enquiry into small firms and labels their relative neglect in the HRD literature as a “serious omission” (p.122). Thus, the key problem of whether small firms represent an arena for HRD persists and, relatedly, the extent to which theorising in HRD is sufficiently robust to be functional and meaningful in this domain lies in doubt. We explore these issues in more depth below, however firstly we briefly examine the current status of the field of HRD and the evidence regarding what is known about the HRD concept in small firms.
HRD: A Field of Conceptual-Theoretic Elision
The theoretical and conceptual ambiguity of HRD is a well-recognised problem. HRD is undoubtedly a vibrant area of study (Morley and Garavan, 2006) and its strength as a field of academic enquiry continues to grow. However, it is a field typified by disunity of opinion regarding its meaning, conceptual base, philosophy and purpose (Gold et al., 2010). Its very identity continues to be the focus of robust debate and it remains a confused, controversial and contested concept (Hamlin and Stewart, 2011) that continues to defy a universal definition (Mankin, 2009). Despite the maturation of the field, Stewart and Gold (2011) note that little progress has been made in the resolution of these debates and opinion is still divided as to the merits of adopting a unified stance. The argument for clarity stems from concerns relating to the future professionalisation of the field, alongside the firm establishment of HRD as a professional practice and source of influence in organisations (see for example Gold, Rodgers and Smith, 2003; Ruona and Lynham, 2004). Others who welcome the diversity, ambiguity and debate highlight the importance of the multiplicity of perspectives from which a more complete understanding of the phenomenon of interest might emerge (see Woodall, 2001). Indeed, Stewart (2005, p.91) advocates that richness in both the focus of and approach to HRD research would be “lacking if one perspective established hegemony”. Lee (2010) notes how changes to the world of work and the progressing erosion of the traditional organisation have arisen amidst a multitude of global changes, where boundaries are shifting and becoming more uncertain. Against this backdrop, she suggests that the conceptual identity of HRD, derived as it is from studies rooted in such traditional, bureaucratic organisations with dedicated functional areas and operating within stable environments, may be in a state of erosion and decay.
HRD in Small Firms: What Do We Know?
In terms of what is known about HRD in small firms, the research base suggests that interventions, systems and processes in this context are considerably less sophisticated (Sadler-Smith, Down and Field, 1999) and insufficient (Kitching, 2007) when compared to the approaches allegedly undertaken within large businesses. However, Kuchinke (2003, p.295) maintains that the reasons for variation in HRD practices between large and small firms are “theoretically underdeveloped and empirically under researched”.Informal andidiosyncratic approaches to HRD are prevalent (Kitching, 2007), whereby interventions are predominantly embedded in everyday routines and working practices, thus rendering activity somewhat invisible (Hill, 2004). Operational and pragmatic concerns tend to drive the HRD agenda, the nature and form of activity in this setting, and thus “short, uncomplicated interventions that compliment and work with an SME’s pace, fluidity and direction seem acceptable and effective” (Hill, 2002, p. 143). The majority of the evidence suggests that small firms invest significantly less in formal training and development, and it is this omnipresence of informality has led to the emergence of the small firm HRD deficiency model (Patton, 2005) whereby “not much (HRD) is done” (Rigg and Trehan, 2002, p.390). Vickerstaff and Parker (1995, p.60) report “a high degree of unplanned, reactive and informal training activity in small firms, where there is typically unlikely to be a dedicated personnel manager or training officer”. Informality may also be a function of a lack of managerial resources and expertise to identity skill deficiencies (Cardon and Stevens, 2004; Patton, 2005). There is much support to be found for such contentions throughout the literature (see for example, Hill and Stewart, 2000; Hoque and Bacon, 2006; Kotey and Folker, 2007; Matlay, 2002; Saru, 2007; Storey, 2004). Hence, it is often assumed that small firm HRD is inferior and unorganised, if not non-existent (Hill, 2002; Rigg and Trehan, 2004).
Much of the literature is also characterised by pejorative overtones with respect to informal HRD approaches in small firms.The dominant discourse has concentrated on criticising the small firm’s lacklustre approach towards HRD, with writers extolling the virtues of adopting more formal methods of managing and developing labour as a means of improving individual and organisational performance (e.g. Bryan, 2006; Way, 2002). By way of illustration, so-called ‘best practice’ HRD frameworks such as Investors in People (IIP) are heavily concerned with documented formal procedures and systems (Fraser, 2003; Hoque, 2003, 2008). Parallel developments are evident within the field of HRM as illustrated by Kaufman’s (2010) claim that the intensive utilisation of formal HRM practices represents the key feature of a high performance work system (HPWS). As such, informality tends to be regarded as a manifestation of backwardness, while formal
approaches are viewed as representative of progression, advancement and sophistication.
On the basis of the above discussion, the prevailing belief that small firms are poor or reluctant trainers has much face validity (Joyce, McNulty and Woods, 1995) and it would appear that the field of HRD in small firms suffers from empirical elusiveness. This derives from an inability to show that HRD has a substantive presence in such firms (McGoldrick et al., 2002). This leads us to one of two possibilities. The first is that extant models and theories of HRD are broadly sound but the ability of small firms to engage with such ideals is blocked by a combination of limited resources (time and adequate finance), external uncertainty, managerial ignorance and/or market failure (Kotey and Folker, 2007; Loan-Clarke, Boocock, Smith and Whittaker, 1999; Patton, 2005; Westhead and Storey, 1997). Additional barriers relate to the perceived irrelevance of external programmes to the needs of small firms (Abbott, 1993) and a preference for poaching trained labour and moulding it to their requirements (Storey, 1994). Thus there appears to be a widespread fear that investing in HRD is a risky endeavour for the small firm, which leads Hill and Stewart (2000, p.109) to remark that there tends to be an “emphasis on the justification not to train rather than supporting a rationale for training”. The second possibility is that existing HRD theory is mis-specified and research designs have been restricted to practices and activities that are more likely to be found in larger enterprises, thereby yielding skewed and inaccurate accounts of HRD practice in smaller firms. We argue that the latter explanation is the more likely. In the discussion below we further challenge the assumptions underpinning prevailing views that small firms do not engage in HRD and maintain that the knowledge base is fundamentally flawed on a number of theoretical and methodological grounds. In doing so, we argue that the marginalisation of small firms within mainstream HRD discourse is symptomatic of a deeper problem rooted in the very identity of HRD and it is to this that we now turn our attention.
Theoretical Problems: The Identity of HRD
Questioning the identity of HRD invites a critical examination of the concept in terms of its meaning and penetration of the empirical reality of work organisations (Keenoy, 2009). Thus, Sambrook’s (2009, p.68) call for investigations about “what we actually ‘mean’ by HRD, rather than taking this for granted, perhaps by questioning those who (powerfully) decided what HRD should mean, and then exploring what this in turn might mean for those exposed to HRD” becomes crucial. The issues to be investigated here relate to the roots of the HRD ‘problem’ in small firms; specifically the way in which the dominant discourse of HRD has (mis) constructed our understanding of how training, development and learning activities actually happen within this unique context. Following Delbridge and Keenoy (2010), the key lies in surfacing and critiquing the conceptual-theoretic apparatus used to make sense of the social phenomena of HRD in the small firm setting. A number of critical flaws and deficiencies in the extant knowledge base and resultant dominant discourse can be identified and need to be addressed. Many of these are complex,multifaceted and interrelated and stem directly from the origins of HRD theory.