When it comes to managing people and their relationships, personal management is one of the most important functions of management. An engaged workforce can propel a corporation to new heights, so companies set up a dedicated division for personnel management. On the other hand, Human resource management (HRM) is a strategic method to successfully and efficiently manage the workforce of an organization. In order to help a firm, accomplish its strategic goals, it focuses on optimizing the output of its personnel.
For more than a decade, public sector reform has been a key component in most OECD countries. When it comes to human resource managements, instead of personnel management, a more strategic approach is taken, anticipating and responding to the business’s demands and constantly monitoring and changing all processes (Lorincová et al., 2018). According to an OECD study, cultural transformation can only be achieved through creative human resource management methods in public sector companies. Our focus in this chapter will be on public sector organizations’ efforts to shift from personnel to human resource managements management.
Personnel and HRM’s Historical Background
Throughout history, the term “human resource managements management” (or “HR”) has gone by several different names. The historical shift in social and economic activities was a major factor in the name change. The first kind of human resource managements management (HRM) was industrial welfare. The Factories Act of 1833 stipulated that male factory inspectors were required.
Personnel management, which emerged as a clearly defined field by both the early 20th century (at least in the U. S.), was essentially concerned with both the technical aspects of employee recruitment, assessment, training, and compensation, and was regarded as a “staff” function throughout many organizations. Historically, the profession did not pay attention to the role of widely disparate employee treatment on organisational success, nor to the form of transmission between such practices. Furthermore, the field completely lacks a unified paradigm.
In 1868, the first-ever Trade Union Conference was held in New York City. At this period, collective bargaining was officially launched. For the first time, Seebohm Rowntree organized a meeting on industrial welfare employees in 1913. Later, the Chartered Institute of Personnel and Development has renamed the Welfare Workers Association (Rehman & Khatoon,2022). An HR Magazine article claims that the National Cash Register Co.’s first human management department was established in the early 1900s. NCR chief John H. Patterson established a personnel department following repeated strikes and employee lockouts to deal with employee grievances, dismissals, and safety concerns. The department also provided supervisors with training on new laws and procedures.
When welfare officers first appeared at the end of the 19th century, the beginnings of human resource management’s management may be traced back to that time. They were all women, and their exclusive focus was on ensuring the safety of women and young girls (Suh & Battaglio, 2021. Because of terrible working circumstances and pressures originating from the expansion of voting rights, trade unions, labour movements, and enlightened employers, many of whom were Quakers, the development of these organizations was a response. It became increasingly difficult to balance the need to protect women and children’s morals with the increasing demands of the job.
As a result of the Very First World War, several more women were recruited to cover the holes left by men who inducted in the military, resulting in “dilution”—the acceptance of inexperienced women in and out of craftsmen’s locations and the correction of manning levels. In the 1920s, “labor supervisor” and “employment manager” leadership roles were produced in the manufacturing company and other enterprises with large plants to handle lack, recruitment, dismissal, and bonus questions (Rehman & Khatoon,2022). Employer federations negotiated national pay rates, particularly in the technology and shipbuilding industries, though there were regional offices variations that allowed for disagreements.
Companies in emergent industries began to see the potential in enhancing employee perks as a strategy to attract, retain, and motivate people during the Great Depression. Traditional sectors like textiles, mining, and shipbuilding were unaffected despite the global recession since they had little trouble finding workers.
Personnel management is the branch of management which is concerned with the recruitment and selection, having to hire, resourcing, advancement, and remuneration of employees, as well as their conversations with the business in order to achieve organizational goals. The core functions of personnel management are separated into four categories: regarding management procedures. Purchase, innovation, earn, job evaluation, utilization, presidency, and collective bargaining are examples of operational duties.
Personnel Management’s primary administrative functions are organizing, coordinating, guiding, encouraging, regulating, and blending as technology has advanced over the last two decades (Suh & Battaglio, 2021). Human resource management Planning has also overtaken this management discipline.
Human resource management
Management Of Human resource managements (HRM) is a special purpose and coordinated branch of management is concerned with the acquirement, maintenance, development, consumption, and synchronization of people at work in order for them to give their own all to the firm. It refers to a process of designing for human resource management needs and desires, variety, training, payment, but rather performance evaluation in order to meet those goals.
Management of human resource managements (HRM) ensures the accessibility of qualified or willing people or placing the right person for the right job continuously (Stone, Cox & Gavin 2020). In a nutshell, it is the discipline of maximizing effective human resource management efficiency and productivity. HRM covers employee services, salary and pay, training, jobs, and conditions for workers.
Human resource management is a branch of personnel management.
During WWII, the Department of Labour and Conscription required welfare. People worked at all institutions manufacturing war materials, just as the previous government relied on social workers at munitions factories. The government saw personnel management specialists boost efficiency, and their numbers exploded; by 1943, some 5,300 people were working in this field.
Before getting started, it’s critical to understand the difference between human resource management’s management and personnel management. The traditional concept of continuous improvement may be traced all the way back to the post-World Military conflict one “social assistance tradition” of caring for employees’ basic needs (Sakka et al., 2022). The significance, rather than institutionalization, of personnel departments developed dramatically from the 1950s through the 1970s, particularly in terms related industrial relations problems.
Human resource management (HRM) was first introduced in the early 1980s as a new strategic approach to managing people. Deregulation and globalization and influential academics in the United States and the United Kingdom all had a role in the movement’s development. However, despite some claims to the contrary, this article cites four distinct characteristics of HRM that set it apart from more traditional forms of human management.
Employees’ commitment to the company’s strategy is the goal of human resource management rather than their compliance. Complementing human resource management practices like compensation and appraisal with a holistic approach increases employee commitment (Stone, Cox & Gavin 2020). HRM, unlike personnel management, is owned by line managers as a means of integrating the workforce, unlike personnel management.
In the mid-1980s, the term “human resource managements” was popularized in the United States. Employees are an intriguing concept, and the term “human resource managements” (HR) appears to imply that they have been both an investment vehicle and a resource-like machine. . Diversity, remuneration, resourcing, employee engagement, organizational productivity and design, and development and learning are really just a few of the different applications which thus make up todays modern HR profession, which is detailed in the next paragraph of this factsheet. In creating the Profession Map, the CIPD has defined ten “key performance indicator” for the HR profession.
Theories about human resource managements
The term “human resource management theories” refers to corporate owners’ and managers’ strategies, tactics, and objectives to administer personnel policies and procedures.
- The Theory of the Organizational Lifecycle
Human resource management is one of the theories that underpin it. Historians and academicians have discovered that organizations have life cycles as with real beings. It begins when they are born (created or established), grows and develops, reaches adolescence and old age, and finally dies. Various forecasting models have been developed through research into the organizational life cycle (OLC).
Organizational growth and development are linked to these concepts, which have been the topic of much scholarly debate. Organizations are affected by external environmental events and internal influences at every step of their life cycle. Companies and entire industries have seen their rise and collapse over the years. Long before the advent of the term “product life cycle,” marketing and sales professionals were aware of this reality. Among the more logical conclusions that academics may reach was the finding that organizations have life cycles.
- The theory of general systems.
Among the theories of human resource managements management (HRM), the Systems theory is one of the most extensively used. Natural and artificial systems are both examples. A system is a unified accumulation of pieces that are interconnected and dependent. A system’s structure and purpose determine its boundaries in space and time, and its operation expresses its function. If a system demonstrates synergy or emergent behaviour, it may be greater than the sum of its parts.
It’s feasible to change one aspect of the system and impact the rest of the system. These changes in patterns of behaviour could be foreseen. Learning and adapting techniques can only be as effective as their opportunity to communicate with their environment (Stone, Cox & Gavin 2020). The other scheme is kept in proper working order so that it does not fail. The fundamental objectives of systems approach are to model dynamic nature, constraints, and situations, as well as to clarify conceptualisations (including such aim, measure, methodologies, and tools) that can be applied to other systems across the world of nesting and in a variety of fields. It was among the most frequently discussed HR theories as a result of its apparent application to HR.
Theoretical Justification of Human resource management and Personnel management
What is the Distinction Between Human resource management and Personnel Management? Management of human resource managements incorporates all top management activities and practices that have a direct impact on or influence the staff members or human resource managements of an organization. Human resource management managers, in other words, are concerned with ‘individuals’ considerations’ in management.
Some of the most important tasks in human resource managements management are determining how many staff members you require or whether to hire contract workers or in-house staff to meet needs, recruitment and retaining top performers, resolving performance issues, and ensuring your personnel and actual professional follow applicable regulations.
Managing your concept of employee benefits and remuneration, as well as employee data and personnel policies, are all part of your responsibilities. Small businesses are usually forced to perform these responsibilities because they cannot afford detail-oriented or full-time employees. They should, however, constantly make certain that employees are aware of and have access to personnel policies that are compliant with current legislation. Employee manuals are frequently used to document these policies.
A critical examination of human resource managements and personnel management shows that both focus on people management. They have a lot of differences, and here are a few examples:
- Relationships’ nature
Pluralist and Unitarist perspectives can be used to examine the nature of relationships. Personnel management places a greater emphasis on individualism, where the interests of an individual take precedence over those of a group. Only through a contractual agreement can management and employees have a working relationship. HRM, on the other hand, is more influenced by Unitarist thought, in which “uni” means “one” and “together” together. Here, HRM develops an organisational vision and mission that are linked to business targets and satisfy mutual interest, where staff members meet the needs of the business and the organization cares for employees’ needs through a common vision between staff and management.
Motorola and Seagate are two companies that believe in the Unitarian approach, which emphasizes teamwork and views employees as partners in the firm. Power and managerial staff relationships: Power is distributed centralized in people management. Personnel managers are not permitted to contribute ideas or participate in any judgment involving “workers,” and top-level management has completed decision-making authority.
As a result of this decentralization of authority, HRM sees middle and lower management groups sharing power with top management. Workers, line managers, and human resource management managers work together to make policies that impact both the organization and its employees. This is referred to as “empowerment.” HRM is all about a team-based approach to management with sharable power and authority, as well as the involvement and support of management and employees. Bottom-up approaches are becoming more popular in direction. Employees provide input to the top management, which assists employees in jointly achieving agreed-upon objectives.
- Worker’s compensation plan
Employees’ employment contracts are clearly defined in personnel management, and employees are expected to adhere to the terms of their contract. Because the agreement is so prescriptive, there is no room for alterations or amendments. Written contracts that specify rules, regulations, employment, and obligations have no room for ambiguity. On the other hand, the HRM approach does not place as much emphasis on contracts that last a lifetime and are less prescriptive about things like working hours and other aspects of employment. In this case, the relationship between the employer and the employee goes beyond the typical contractual agreement.
The new “flexible approach” allows employees to choose from various methods in which they can continue to contribute their skills and knowledge to the company. Some multinational firms such as Motorola, Siemens, and GEC have already implemented an “open contract” structure that allows employees to work from home or telecommute. Nowadays, human resource managements management allows workers the option and independence to choose the working system that best suits their needs while also benefiting the company. This strategy is referred to as a “win-win” approach by Drucker (1996).
- Managerial and supervisory position
Personnel management places a high value on a transactional style of leadership. Only a task-oriented person is considered the leader under this leadership style. Some strict rules and regulations must be followed, and penalties for non-compliance; this leader is more concerned with enforcing those standards than cultivating personal bonds, trust, understanding, tolerance, and care. HRM develops transformative leaders. Employees and management alike benefit from this leadership style’s emphasis on teamwork in pursuing common goals. Rather than relying solely on the rulebook and laws of the commercial world, executives here focus on people-oriented issues such as shared vision, corporate culture, mission, trust, and flexibility.
- Policies governing compensation and the structure of employment
Only the skills and experience required for possible vocations are paid for by people management. The employee’s worth is only determined by his or her ability to do the tasks and obligations that have been allocated to them. The payment of valuation bonuses is not encouraged. That’s also because the job design is quite operational, with each job being assigned to a single functional department. This is known simply as the division of labour based on job needs and skills (Warner,2020). On the other side, companies are encouraged to go beyond salary regarding active duties in HRM.
Earnings initiatives, group benefit planning processes, and personally tailored reward systems have been used to motivate employees to continue increasing and maintaining high levels of performance on the job. The role has been redesigned to emphasize teamwork and cyclicality rather than functionality. HRM presented a novel research method to function properly configuration, such as inter- and intra-departmental flexible work schedules expansion, in goal is to encourage one possible future and extremely competent working person to take on additional responsibilities in order to add value from his or her job but also, in return, receive additional rewards and bonuses.
Human resource management has evolved from personnel management. It’s difficult to tell the difference between management of human resource managements and people management. However, there are some differences in the following categories.
- Under personnel management, employees have fewer opportunities for training and advancement. Human resource management allows employees to receive more training and opportunity for improvement.
- Managing people, employee relations, and labor relations are all examples of personnel administration. Human resource management is acquiring, developing, motivating, and maintaining human resource managements within a business.
- The traditional method of managing employees in an organization is through personnel management. Human resource management (HRM) is a cutting-edge strategy for organizing and leading a workforce.
- Top management makes personnel management decisions following the organization’s rules and procedures. Human resource management decisions are made after considering aspects such as employee engagement, power, decentralized, the competitive climate, and so on.
- Increased productivity and a happy workforce are the goals of personnel management. Effectiveness, culture, productivity, and employee participation are the primary goals of human resource management (HRM).
- Personnel management is an issue that concerns personnel managers. From the top to the lowest, human resource management is concerned with all levels of management.
Past and present human resource management
In the last century, human resource managements management has seen a dramatic shift. HRM used to be referred to as personnel administration or management because it dealt with an organization’s employees. Administrative responsibilities such as record keeping and dealing with employee earnings, salaries, and benefits were the primary focus of this course. Human resource managements (HR) and labour relations were handled by the Personnel Officer (PO). There may be issues with trade unions, for example, or issues between companies and employees (Warner,2020). First, look at how people were managed in the past to better understand the role of HRM in today’s organizations.
Personnel Management is essentially a record-keeping function that occurs at the top management. Personnel Management’s purpose is to ensure that workers are satisfied equitably while also managing complex the focusing on the company’s many departments. Delivering justice and effectiveness in managing people operations is supposed to result in organizational success.
Practical justification for the distinction between Personal management and Human resource management
Employee-employer relations are the primary focus of a company’s human resource managements management and administrative function. It is possible to obtain, use, and sustain satisfied employees as a definition of personnel management. Managing people and their relationships with the organization is an important management component.
As a result, personnel management is largely a record-keeping role at the operational level. Efforts are made to ensure that employees are treated fairly while at the same time ensuring that each department’s personnel needs are met (Fawehinmi et al. 2020). Providing fairness and efficiency in the management of personnel operations is believed to lead to long-term success.
In the modern workplace, Human resource managements is often referred to as Personnel Management. Human resource managements are responsible for various tasks involving the organization’s workers, including recruitment, benefits, onboarding, orientation, training, and performance evaluation. Employee-friendly policies and procedures are part of personnel management, including creating and executing them. It’s a slang term becoming less common in today’s business world.
The term “people management” is still used by many governmental bodies and non-profit organizations to describe the task of managing staff. While most people associate HR management with the more commercial and administrative aspects of the job, some use the term to describe this process range of Direct responsibility and services.
Additionally, the phrase “people management” brings to mind of employee unions, inflexible job classification approaches, and predetermined pay grades, all of which limit the management alternatives available to line managers. Human resource management fails to consider the potential strategic value of HR as a function. It must involve responsibility for the training and growth of the organization. On the other hand, personnel management does not encompass these aspects of the workforce. Neither is the employee development and career advancement taken by a performance management system.
The researcher used the interview approach to collect data to analyze the behaviour of Hellenic enterprises in terms of human resource management issues versus personnel management practices. Based on the literature chapter the research and the theoretical framework developed for both human resource management and personnel management, a questionnaire was created to expose the policies and practices used by Hellenic HR departments in practice and discuss whether Performance management has been fully integrated into the Hellenic traditional economic theory (Fawehinmi et al. 2020). The questionnaire was created in English and then translated into Greek for the interviews. The questions centred on HRM procedures, with a few clues about PM regulations thrown in for good measure. The researcher selected to focus on a very restricted category of employment, HR professionals exclusively, because HRM methods often differ within occupational groupings, as mentioned in.
The qualitative approach vs. the quantitative approach debate in analysing Human resource management and Personnel Management.
Silverman (1999) claims that qualitative research can disclose further about society and the environment than quantitative research. Quantitative studies tend to be more interested in what is discovered in the study, whereas qualitative research methods appear to become more interested with “why.” Qualitative researchers feel that long interviews and observations will help them better grasp their respondents’ ideas, but quantitative studies are less interested in such descriptions.
According to Symon and Cassell, qualitative research methodologies have trouble analysing and interpreting data. Researchers may find it difficult to maintain track of the study schedule, and the reactions may lack confidence in the findings. Because a qualitative methodology entail gathering information directly from humans, these concerns are affected by the type and character of the respondents. Even though qualitative approaches are bound to hit some hurdles during the research process, rigorous evaluation and recognition of various corporate roles and surroundings can help improve the research’s quality and efficiency (Fawehinmi et al. 2020). To these limits, one could add that now the researchers must retain objectivity to avoid leading the respondents to the desired responses or interpreting the data inside the desired way.
When contrasting quantitative and qualitative research methods, one could argue that quantitative research methods are logical positivist in focus and aim to test hypotheses. Because of this emphasis on methodology and procedure, quantitative approaches are so popular. Once the sample size and questionnaire design have been determined, they can be quickly and cheaply implemented into a research project. However, there are some limitations since most of these studies are based on statistical data. As a result of the quantitative approach’s use of statistical information, it has been argued that the relationships between various sets of data can be discovered.
Analysis and discussion of data
In the first place, all interviewees stated that the human resource managements departments of their companies are primarily in charge of handling issues related to hiring and firing employees as well as payroll. Human resource managements departments play an important role in determining whether an organization needs to hire and then selecting candidates from a CV database or recommendations from current employees and partners (Boselie, Van & Veld,2021). A good example is that in BOUTARIS WINERIES S. A.’s, the HR Generalist has an important role in ensuring that the company’s employees are well-trained and well-trained enough to do their jobs well.
HR departments play an important role in creating the organization’s strategy. Still, the overall influence is restricted because other managers and supervisors (like those in the Production and Marketing departments) are much more likely to be noticed when the company experiences financial difficulties. As a result, the HR department’s key strategic tasks are selection and recruitment, as well as some degree of evaluation, as referred to do so by the HR manager in IANAS.” Performance is assessed twice per year through questionnaires and on a frequent basis in their job.
Because human resource management planning is often referred to it as the contemporary interpretation of people management, it’s easy to get confused when distinguishing the core tasks of the employee relations and people departments. These two management groups share the following important responsibilities: hiring, evaluating employee performance, employee engagement, and wage and benefits administration. Management of human resource managements and personnel management differ primarily in how they handle personnel and any situations that may arise in their presence (Warner,2020). Each department approaches employee engagement differently, with various advantages and disadvantages. Here are some concrete examples of how the practice can be justified.
It’s typical to hire from several sources for people management. This can be done by a group of people or by a single person. Candidates are graded on how well their CVs fulfil a strict checklist list, regardless of their backgrounds or personalities. Human resource management works with the business recruiter, a comparatively recent function in HRM who is familiar with the firm’s or industry’s particular requirements, to hire people. This method ensures that the employee has the necessary skills to function satisfactorily and contributes to the company’s success.
- Employee management
Personnel management strategy tends to follow a traditional, long-standing approach to promote structure and rhythm when managing staff. In this conventional framework, employees must follow the company’s code of conduct. This method is observed from the time they are employed until they are transferred, elevated, or leave the company. To learn about some of these processes and behavior norms, employees should read this same employee handbook provided about them during their first week of work.
Management of human resource managements takes a more forward-thinking approach, depending on linkages to keep a continual flow of work and high production. The group’s job is to keep channels of communication open between management and staff—human resource management aids line managers in evaluating and utilizing individual employees’ abilities to maximize staff output.
- Induction of new employees
The primary purpose of the people management team’s orientation procedure is for new employees to study and complete required paperwork on the first day on the job. This material is organized in a consistent manner and includes an employment agreement that outlines the company’s intended policies and procedures. On the other side, the human resource management team takes a more caring concept of employee orientation (Boselie, Van & Veld,2021). New employees are provided enough training upon their arrival, and opportunities, including such formal mentoring relationships and meet-and-greets with some other employees, are occasionally presented.
- Benefits and compensation
Personnel management tends to follow company policies blindly. A pay structure that bans advancements above one salary level and restricts annual increases is routinely used to limit employee benefits. This is done by adopting a scheduled, current pay spectrum, which allows an employee to progress in pay grade at a consistent rate – normally one pay grade every year of service – to assure stability and improve employee incentive. While consistency is important in human resource management, this model places a greater emphasis on employee development than on corporate policy. Employees who are rewarded for their achievements, whether from a pay raise or a comprehensive benefits package, are highly regarded by management.
The ability of a corporation to successfully manage its people is crucial. Management of human resource managements is proactive, whereas personnel management is reactive. Management of human resource managements takes a more thoughtful plan, anticipating the needs of an organization and monitoring and changing all processes on a continual basis (Hamid, Muzamil & Shah,2022). Management of human resource managements takes a more strategic approach, anticipating the needs of an organization while continuously monitoring and changing all systems, whereas human resource management focuses on the upkeep of all human and administrative procedures.
Fig 1.0 Comparison chart
|COMPARISON STANDARDS||PERSONNEL MANAGEMENT||HRM|
|Meaning||Employee engagement is the branch of management that deals with personnel and their relationships with the organization.||Human resource Department Management is a part of management concerned with making the best use of an organization’s personnel in order to achieve organizational objectives.|
|Job Planning||Workforce division||Groups|
|Focus||Most of the time is spent on boring tasks like hiring, remuneration, training, and harmony.||Treat the organization’s human resource management as valuable assets that should be respected, utilized, and protected.|
|Payment basis||Job evaluation||Performance valuation|
|Role of management||Transactional||Transformational|
|Management of labor||Contracts for Collective Bargaining (CBD)||Personal contracts|
When it comes to extending and deepening knowledge, starting with Skilled workers’ development obligations, structured work tasks, consensus networking, coaching, and mentorship staff could be a good place to start. It’s worth noting that learning through experience (on-the-job training) is easier than learning via formal education (Bratton et al.,2021). Another effective strategy is to empower employees by increasing their inclusion and commitment in managerial activities and authority. HRM approaches that promote personality, self-control, and personality, as well as the use of interdisciplinary teams, carefully planned rotation, allocation of responsibilities, and functional integration, will improve innovation performance.
In recent years, scholars and practitioners have lauded the benefits of HRM, with the function of HRM in modern businesses catching their attention. HRM encompasses more than simply administrative duties; it also considers organizational change and the skills and competencies required to achieve that aim. The difference in nomenclature stems purely from the concepts and practical implications of personnel management and human resource management.
Personnel Management is defined as an administration documentation function at the operational level that strives to retain equal terms and conditions of work while also efficiently managing people operations for specific departments in the literature review chapter (Hamid et al., Shah,2022). Personnel Management also believes that giving justice, energy, and sustainability in human management will contribute to organizational success. In contrast, Human resource management focuses on the formulation of people plans linked to business; it also broadens its scope to ensure that an organization’s culture, values, and structure, as well as its people, contribute fully to the organization’s goals. HRM encompasses human resource management planning, job evaluation, recruiting and screening, employee engagement, performance appraisal, and compensation management; nevertheless, the HRM method accomplishes these functions qualitatively differently than the personnel management approach. It is important to note that Personnel management and Human resource management are two terms that are not mutually exclusive but can be used interchangeably by some people.
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