HRM IN PROJECT BASED ORGANISATIONS

CHALLENGES AND CHANGES

A Project Submitted to
University of Mumbai for partial completion of the degree of
Bachelor of management studies
Under the Faculty of Commerce

BY

GOWDA PRIYANKA SHEKAR

Under the Guidance of

PROF . PRANAV N. PANCHAL

SMT.KAMALA MEHATA V.W.A COLLEGE OF COMMERCE

SEVEN BUNGALOWS , ANDHERI ( WEST )
MUMBAI – 400061

1
 Certificate

This is to certify that Ms. GOWDA PRIYANKA SHEKAR has worked and duly

completed her/his Project Work for the degree of Bachelor of management studies

under the Faculty of Commerce in the subject of her project is entitled “HRM IN

PROJECT BASED ORGANISATIONS :CHALLENGES AND CHANGES ” undermy

supervision.
I further certify that the entire work has been done by the learner under my guidance
and that no part of it has been submitted previously for any Degree or Diploma of any
University.
It is her/ his own work and facts reported by her/his personal findings and investigations

Seal of the College

Signature of Guidance Teacher

(PROF . PRANAV N. PANCHAL)

DATE OF SUBMISSION
 DECLERATION

I The undersigned Miss. GOWDA PRIYANKA SHEKAR here by ,

declare that the work embodied in this Project work titled “HRM IN
PROJECT BASED ORGANISATIONS CHALLENGES AND
CHANGES”, forms my own contribution to the research work carried out
under the guidance of PRANAV N. PANCHAL is a result of my own
research work and has not been previously submitted to any other University
for any other Degree/ Diploma to this or any other University.
Wherever reference has been made to previous works of others, it
has been clearly indicated as such and included in the bibliography
I, here by further declare that all information of this document has been
obtained and presented in accordance with academic rules and ethical
conduct

Name and
Signature of
the learner

Certified by

Name and signature of the Guiding Teacher

3
 ACKNOWLEDGEMENTS

To list who all have helped me is difficult because they are so

numerous and the depth is so enormous.

I would like to acknowledge the following as being idealistic channels

and fresh dimensions in the completion of this project.

I take this opportunity to thank the University of Mumbai for giving

me chance to do this project.

I would like to thank my Principal, PROF.SANTOSH TIWARI for

providing the necessary facilities required for completion of this
project.

I take this opportunity to thank our Coordinator PROF. PRANAV

N. PANCHAL, for her moral support and guidance.

I would also like to express my sincere gratitude towards my project guide

PROF. PRANAV N. PANCHAL whose guidance and care made the project
successful.

I would like to thank my College Library, for having provided

various reference books and magazines related to my project.
Lastly, I would like to thank each and every person who directly or
indirectly helped me in the completion of the project especially my
Parents and Peers who supported me throughout my project.
 ABSTRACT

This is about human resource management (HRM) in project-based

organizations. Firms have over the last decades tended to re increasingly
on project-based structures. This process of projectivization implies a
changed work situation for individuals in modern organizations.
Researchers from the project field of research as well as from the HRM
field of research have pointed to possible implications that
projectivization might have for HRM. This thesis explores this area
through a combination of multiple, comparative, and single case studies of
project-based organizations. The studies aim at identifying and analyzing
the changes and challenges for HRM in this particular context.

The studies are presented in four separate papers. The findings suggest
a number of important and empirically nested challenges related to
Competence, Trust, Change, and Individuals. Moreover, the changing
roles of HR departments and line managers in the overall HR
organization are discussed and analyzed. The thesis proposes
alternative roles for line managers, depending on the organizational
context, and it also proposes two ’ideal types’ of HR-departmental
structures.

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 CONTENTS
Chapter 1
INTRODUCTION........................................................1
PROJECTIFICATION AND PROJECT-BASED ORGANISATIONS
CHALLENGES FOR HRM: IMPRESSIONS FROM THE PROJECT FIELD
CHALLENGES FOR HRM: IMPRESSIONS FROM THE HRM FIELD
THE AIM OF THE THESIS

Chapter 2

Research process and methodology 15

QUALITATIVE CASE STUDIES
MULTIPLE CASE STUDY AS AN ‘UMBRELLA’ STRATEGY
THE CASES
INTERVIEWS
RESEARCH PROCESS
FROM CASE STUDIES TO CONSTRUCTS

Chapter 3……………………………….. 32
Literature Review

Applying the HRM field to understand project-based

organisations
FROM MANAGING PERSONNEL TO MANAGING HUMAN RESOURCES
THE CONCEPT OF HRM
HRM: CONTENT AND STRUCTURE
LINE MANAGERS: FROM SPECIALISTS TO HR MANAGERS
THE DESIGN OF MODERN HR DEPARTMENTS
FROM THEORY TO FINDINGS
Chapter 4 …………………………………….. 53
DATA ANALYSIS, INTERPRETATION AND
PRESENTATION
Challenges and changes for HRM in project-based organisations.
FOUR PERSPECTIVES TO ILLUMINATE THE CHALLENGES FACING HRM IN
PBOS
HANGES IN CONTENT AND STRUCTURE OF HRM IN PBOS
FROM LINE MANAGERS TO HUMAN RESOURCE AGENTS
DESIGN OF HR ORGANISATION AND HR-DEPARTMENTAL STRUCTURES
Chapter 5
CONCULSIONS& SUGGESTIONS
BIBLOGRAPHY

7
 INTRODUCTION
One of the most important trends in modern organisations is that
of temporary, project-based structures becoming the every-day
work environment for an increasing amount of individuals. For
example, Manuel Castells states that “…the actual operating unit
becomes the project, enacted by a network, rather than individual
companies or formal groupings of companies
In other words, many firms are going through something
that could be referred to as “projectification’; a general
development process in
which firms to a greater extent focus their operations on projects, project
management and various types of project-like structures (see Engwall,
Steinthórsson, & Söderholm, 2003; Midler, 1995). This trend has several
implications for traditional ways of thinking when it comes to for
example management, organisation, employee relations and contracts.
James March expresses some of his concerns in the following way:
“In such a throw-away world, organizations lose important
elements of permanence Throw-away personnel policies, where
emphasis is placed on selection and turnover rather than on
training and learning, have become common in modern business,
politics and marriage.” (March, 1995:434)
According to James March, the new organisational ideal causes
organisations to lose “important elements of permanence”, which
should imply significant challenges for project-based organisations
compared to more traditional functional structures (Galbraith, 1973). In
this thesis I will argue that one such important challenge has to do with
the management of human resources (HRM), since projectification
considerably changes the relation between the organisation and the
people working in it. Despite March’s concern over throw-away
personnel policies, modern firms seem to rely more than ever on the
competence and knowledge of their employees. A common motto
among today’s companies is “Our employees are our most valuable
asset!” Hence, studies which focus on the management of the relation
between the organisation and these “valuable assets” in project-based
1
organisations appear as highly relevant, both theoretically in order to
contribute to the knowledge of management of project-based
organisations, and practically for projectified companies that strive to
manage their individual- organisation relationships efficiently. I will let
the quotation from Engwall, et al. (2003:130) guide you into the core
of my research:
“As organizations move into project-based structures, human
resource management, hiring of staff, and competence
development all seem to be affected. This is, however, a
virtually unexplored area of empirical research. Furthermore,
issues concerning working life must be readdressed in this new
corporate context design. From the perspective of the
individual employee, factors like motivation, commitment,
empowerment job satisfaction, time pressure, and medical
stress seem to be reconceptualized in the projectified context.
Working life issues also include accounts of project work as a
new career path and as ways of linking project organizations to
individual goals.”

In the following sections, I will further introduce the projectification

trend and develop the argument for the need to focus on HRM in order
to increase the understanding of project-based organisations

2
PROJECTIFICATION AND PROJECT-BASED
ORGANISATIONS
The interest for the growing importance of flexible
organisational structures is not new. Researchers paid attention
to this development already in the 1970s and 1980s. This
research did not study the nature of project-based structures per
se, but rather identified the emergence of more flexible
organisational forms in terms of, for instance, matrix structures
(Galbraith & Nathanson, 1978) and ad hoc structures
(Mintzberg, 1983).
Many of the researchers who analyse the general
organisational development in modern industry refer to a need
to face the challenges of a higher degree of globalisation,
uncertainty and complexity, and a fast technological
advancement. The historical overview by Mary Jo Hatch
(1997) of organisational change and of the literature that deals
with this field of research points to these changes. It also
indicates the organisational responses; increased
organisational flexibility and increased employee
commitment and responsibility. According to Hatch, this
development leads to the creation of ‘postindustrial
organisations’ where the organisational borders are indistinct,
or have disappeared, and where employees to an increasing
degree work in temporary teams where they represent a
certain area of expertise.
The development described by Hatch has also been
documented by the sociologist and organisational theorist Wolf
Heydebrand (1989). Heydebrand puts projects at the centre for
the analysis of modern firms and societal structures and argues
that project-based structures are a prominent feature of many
modern organisational forms. He states that modern
organisations “are staffed by specialists, professionals, and
experts who work in an organic, decentralised structure of
project teams, task forces, and relatively autonomous groups” (p.
3
 337).
Apparently, highly educated and competent employees are
an important feature of the emerging project-based structures
(see also Fombrun, 1984).
More recently, a number of broader empirical studies have illustrated
the projectification trend. The survey by Whittington, et al. (1999)
shows that a wider use of project-based structures was one of the most
evident changes in large European firms during the 1990s. It is
therefore not surprising that a significant number of researchers have
focused on studies of projectification (although not always using this
terminology to describe it), in order to expand the knowledge within
the field.
This field of research can be divided in two streams; one analysing the
projectification process on a macro-level and the other one on a micro-
level (see Figure 1). The stream that analyses projectification on a
macro- level deals with the general trend in modern industry to
increasingly use various forms of project-based structures (e.g. Ekstedt,
et al., 1999; Söderlund, 2005; Whittington, et al., 1999). This trend
holds various dimensions, but focusing on the organisational structure
of modern firms, the increased occurrence of project-based
organisations should logically consist of two change patterns; (1) that
new firms increasingly start off as project-based organisations and (2)
that traditional, functional organisations change into relying more on
project-based structures.
The stream of research that analyses projectification on a micro-level
focuses on this second change pattern and deals with the
projectification process in focal firms that are moving, or have moved,
from functional to project-based structures (e.g. Lindkvist, 2004;
Midler, 1995). The studies of the micro level of projectification
provide valuable examples of specific projectification processes and
they contribute to the general knowledge of the management of
project-based organisations. However, they typically do not pay
particular attention to the dimension of management that focuses the
relation between the employees and the organisation; HRM.
Midler’s (1995) study of the French car manufacturer Renault – one of

4
the most famous examples of studies that focus on the micro-level of
projectification – stresses the need for studies on “the relation between
the development of temporary organizations (as project teams) and
the
permanent structures and processes within the firms” (p.373). HRM
can be considered as part of the permanent structures and processes of
the firm, maintaining some “elements of permanence” as earlier
advertised for by March (1995). The problem with Midler’s study is
that he includes the transformation of the permanent processes of the
firm as a step in the very projectification process, which makes it
impossible study the relation between the two processes. This relation
is central for my research and I have therefore chosen to separate
analytically the transformation of the permanent processes, such as
HRM, from the projectification process. In order to fully understand
the meaning of this separation, I need to clarify my view of what
characterises project-based organisations.

Defining project-based organisations

The existing definitions of the term project-based organisations
(PBOs) are numerous, but a common denominator is that they
usually take the matrix structure as a starting point; projects on
one side and a hierarchical structure organised along functions
on the other side. They then identify various organisational
forms depending on the balance of the matrix (e.g. Clark &
Wheelwright, 1992; Hobday, 2000; Lindkvist, 2004). The term
PBO is normally used to describe the organisational form at one
extreme of the scales, where the project structure dominates and
the functional structure is non-existing or downplayed. For
example, Hobday (2000) defines PBO as “one in which the
project is the primary unit for production, innovation, and
competition” (p. 874), and where “there is no formal functional
coordination across project lines” (p. 878).
There is a problem with this definition. On the one hand it is
delimited to the organisation of core activities, i.e. the activities
that are primarily directed towards the creation of core products

5
or services, which form the base for the organisation’s revenues
(c.f. Prahalad & Hamel, 1990). On the other hand it rules out the
possibilities for other activities, for example those related to
what Midler (1995) refers to as “permanent structures and
processes within the firm” to be organised through functional
coordination. The study by Lindkvist (2004), however, suggests
that functional coordination might exist also in project-based
organisations, for example in terms of competence layers. For
researchers who focus on production, innovation or competition,
the definition of Hobday is probably well suitable. However, for
researchers as myself, who focus on the HRM dimension for the
understanding of the PBO, it seems to miss out on important
aspects. Separating the projectification process from the
development of permanent structures and processes opens up for
alternative views of PBOs. Projectification does not necessarily
lead to a total dominance of the project structure over the
functional structure. In this thesis, I will argue that when it
comes to for example HRM it is rather a question of
redistribution of responsibilities. It is also a matter of variations
in the balance of HRM- and task responsibilities for the different
players in the organisation. Therefore, I do not agree with
Hobday in the sense that a PBO cannot have any form of formal
functional coordination across the projects. The definition by
Lindkvist (2004:5) opens up for other forms of PBOs and might
therefore be more suitable for this context: “Firms that privilege
strongly the project dimension and carry out most of their
activities in projects may generally be referred to as project-
based firms.” However, this definition is vague concerning the
nature of the activities that are carried out in projects. Drawing
on the definition of Lindkvist, my working definition of PBOs is
organisations that privilege strongly the project dimension
concerning their core activities and carry out most of these
activities in projects. I choose to use the term project-based
organisation, instead of project- based firm, as a firm can consist
of both project-based departments as well as functional

6
departments. With the definition subscribed to above, I want to
clarify that not all activities in a project-based organisation
necessarily are organised in projects, but that the project is the
primary unit for core activities. The question is what
consequences and challenges the PBO poses to ‘permanent’
activities and processes that are not primarily related to the core
activities, for example competence development, assessment,
waging, etc., when an organisation becomes increasingly
project-based? Original PBOs and Projectified organisations
Earlier, I described two change patterns in the macro level of
projectification. These two change patterns give rise to two
different types of project-based organisations, depending on their
origins (see Figure 1). The first type is original PBOs, which I
use to denominate organisations created as project-based from
the start and that hence have no history of organising their core
activities in functional structures. The second type of project-
based organisations is projectified organisations, which implies
that the organisations have gone through (or are still going
through) a development from functional to project-based
structures. In this thesis, I will pay particular attention to
projectified organisations. My argument is that since
projectified organisations have a history of

functional structures, such organisations should be an interesting

context for studying the challenges project-based organisations
face as opposed to functional organisations. Hence, my main
empirical focus for this study is not the projectification process
per se, but rather organisations that have an experience of the
projectification process.

7
 Macro level of projectification
Original PBOs

Creation of new organisations

Project-based
Functional Project-based
organisat Micro level of organisations
ions projectification Projectified organisations

Change of exisiting
organisations
FunctionalProject-
based

8
CHALLENGES FOR HRM: IMPRESSIONS FROM
THE PROJECT FIELD
So, why is HRM in project-based organisations so important to
pay attention to? The answer is partly to be found in the vast
literature on project-based organisations. Although there is a lack
of studies focusing on HRM, there are many arguments in recent
project research that stress the need of such studies. The
arguments can be classified according to their point of departure;
a top-down perspective, i.e. the need for the company to manage
the strategic resources effectively in order to stay competitive, or
a bottom-up perspective, i.e. the concern for the individual
project worker in a projectified environment.
Mike Hobday’s (2000) study of the effectiveness of project-
based organisations in managing complex products and systems
gives example of arguments from a top-down-perspective.
Hobday reports that the project-based organisation he studied
had created a “high pressured work environment [that] had left
little space for formal training or staff development”, and a “lack
of incentives for human resource development” (p. 885). He also
argues that project-based organisations can breed insecurity over
career development because of the dispersion of technical
leadership across projects. Hobday is not alone in this concern;
also the study of “the project-oriented engineer” by Allen &
Katz (1995) and the famous study of the Danish project-based
company Oticon (Eskerod, 1995; Larsen, 2002) point to changes
in career structures
in project-based organisations. Other researchers identify problems
with staffing and resource allocation (e.g. Clark & Wheelwright, 1992;
Engwall & Jerbrant, 2003). One of Midler’s (1995) main concerns in
his case study of the projectification process of Renault discussed
above is the difficulty to maintain the long-term technical learning
process when the organisational structure promotes short-term
objectives. Midler also points to the need for changes in people
9
assessment and career management.
Researchers with arguments from a bottom-up perspective typically
put the individual at the centre (e.g. Huemann, Turner, & Keegan,
2004; Packendorff, 2002). Packendorff (2002), argues that projects
influence individuals in the modern society, not only at work, but also
in their every-day life. According to Packendorff, work in projects
expose individuals to time limits and requirements of “self-marketing”.
The work situation depends on the individuals’ own priorities, which
usually ends up affecting their personal life outside work. As pointed
out earlier, a common feature of modern organisations is the
importance of the individual employees, their knowledge and their
creativity. At the same time, projectification tends to increase the
requirements on the individuals. Some researchers argue that the
increasing ill-health in work life can be explained by the increased
demands and responsibilities placed on employees and the lack of
management and support systems to aid the employees in handling this
development (Strannegård & Rappe, 2003).
As it seems, many of the problems identified by project researchers are
closely related to the management of the relation between the
individuals and the organisations; the management of human resources.
Some of them take the organisations’ point of view, while others focus
on the individuals’ situation. Nevertheless, the researchers from the
project field of research do not link their studies to the HRM field of
research in order to analyse the problems Furthermore, the HRM field
of research should be a useful base for the analysis of such a
dimension.
Of course, when focusing on the management of the relation
between individuals and their organisational context, both the
bottom-up perspective and the top-down perspective are central in
order to grasp

10
the challenges of PBOs. However, as a first step, I will in this
licentiate thesis delimit the analysis to a top-down perspective.
In other words, the analysis takes its starting point in the need
for companies to manage their strategic resources effectively in
order to stay competitive

CHALLENGES FOR HRM: IMPRESSIONS FROM

THE HRM FIELD
Turning to the HRM field of research then, what do
researchers have to say about project-based organisations?
And what is HRM? I will discuss the concept of Human
Resource Management (HRM) further in later chapters.
Shortly, one might say that the idea of HRM developed from
traditional personnel management, or personnel
administration, which was typically used to describe the work
of the traditional personnel department (Redman &
Wilkinson, 2001). This development implied an increased
importance of strategic management of human resources as a
way to success. The transition from personnel administration
to HRM also implied integrating managers at all levels,
especially line managers, in this process (Guest, 1991).
However, there is no consensus concerning the definition of
HRM and in this thesis, I do not aim at exploring in depth
“the concept” of HRM, or at establishing a new, all-
embracing definition. The approach to HRM that I rely on is
that it essentially concerns the management of the relation
between individuals and their organisational context. As
Brewster & Larson (2000:2) put it, HRM has become “an
institutionalised way of handling the central issues of
selecting, appraising, rewarding and developing people” and
it focuses “the interplay between people, tasks and
organization”. In this thesis, HRM is accordingly defined as
the structures, processes and activities related to the
management of the relation between individuals and their
organisational context.
11
 HR departments and HR specialists have been subject to
vast
changes during the last ten years. Browsing through professional
magazines for Swedish HR specialists, many articles refer to “a
dramatic upheaval of the personnel work”, changes in HR
departments, the changing roles of HR specialists, outsourcing
HR services, etc (e.g. Alsrup Badner, 2004; Hedlund & Åberg
Aas, 2004). Moreover, numerous studies have reported on and
analysed these changes. One of the most referred researchers in
this context is the American management researcher Dave
Ulrich. He argues that HR specialists need to become “strategic
players” and his typology of the HR department as
“strategic partner”,
There are some researchers referring to new organisational forms as
one important driving force for changes in HRM (e.g. Redman &
Wilkinson, 2001; Sparrow & Marchington, 1998). Their argument is
that the development of new, flexible organisational forms puts a new
focus on co-workers and on competence issues, instead of on task and
work, as was the case earlier. This can be explained on the one hand by
the notion
of Guest (1991), that the development towards flexible organisations
requires high-quality, flexible workforce, which places higher demands
for the HRM practice. On the other hand, the PBO and its temporary
features per se demands new ways of dealing with traditional HRM
issues. As Guest (1991) argues, HRM needs to respond with the speed
and flexibility that the environment requires, and the move towards
organisational flexibility challenges traditional personnel management.
As was the case with the project-oriented research, which identified
issues important for HRM, there are some studies within the HRM field
that touch upon issues related to project-based structures. However, these
studies typically do not explicitly see the projectified organisation as the
basic context for their studies. For instance, in their study of changes in
line management in Europe, Larsen & Brewster (2003) identify the
increasing use of matrix or project-based structures in high-tech,
knowledge-intensive organisations. According to the authors, this
affects the possibilities to handle long-term development of individuals
12
or deal with other people issues. Other studies present case studies of
projectified organisations, but their focus is to examine relatively
delimited parts of HRM-related areas, such as the development of core
competencies and career development (DeFillippi & Arthur, 1998;
Larsen, 2002). Although many of the problems and challenges
identified as central for HRM in modern organisations seem to have be
strongly related to the organisational structure, the impact of the
continuously increasing use of project-based structures is not the centre
of attention.
To summarise my argument there is an area, identified both from
the project field of research and from the HRM field of research, that
needs further attention. Literature on projectification and project-
based
structures analyses an organisational context that is becoming
increasingly common and adds to the general knowledge on
management in such organisations. However, this field of research
typically misses out on the dimension of management that focuses
on the relation between the individuals and the organisation, even
if some researchers point to important challenges for this
dimension. The HRM literature, on the other hand, reflects the
changing role of HRM and of HR specialists. Several studies also
identify flexible organisational forms as a driving force for change
and as a complicating circumstance for specific HRM-related
issues. Nevertheless, this field of research in general does not
explore projectification and project-based organisations as a basic
context for these changes.

13
 THE AIM OF THE THESIS
Apparently, there exists a rather unexplored area in the research
of projectification and project-based organisations; HRM. As
discussed above, researchers from both fields have pointed to
possible implications that projectification might have for HRM.
However, there is a need for empirical studies with an
explorative approach in order to start building up to a deeper
understanding for HRM in project-based organisations.
Moreover, the context of projectified organisations is
particularly interesting, since these organisations have a history
of functional structures. Thereby, the challenges due to
projectification might be easier to identify in projectified
organisations than in original PBOs.
The overall aim of the research reported in this thesis accordingly is
to
explore HRM in project-based organisations. More specifically, I
will identify and analyse the challenges and changes for HRM in
this particular organisational context.
The basis for this research is in total eight case studies of which
five are core cases: AstraZeneca, Posten, Volvo Car
Corporations, Saab Aerospace and Tetra Pak. The additional
three cases are regarded as peripheral and they were added to
one of the papers for a broader cross- case analysis. The studies
are reported in four separate papers, each zeroing in on different
themes. In a way, the papers also reflect the chronological
process of the research. Since the study has a rather explorative
character, the overall aim is broad, but critical in order to set and
keep the direction of the research, and to serve as a guiding star
in the initial phase of the research process (see e.g. Eisenhardt,
1989). During the research process, different themes, such as
the changing role of line
managers and the design of the HR organisation and HR departments,
have emerged as important for the understanding of HRM in project-
based organisations

14
 2. RESEARCH PROCESS AND METHODOLOGY

* QUALITATIVE CASE STUDIES

First of all, I cannot deny that qualitative research simply appeals
to me. I get much more intrigued by processes and experiences,
than by numbers and statistical analysis. My curiosity is driven
by trying to discover concepts and relationships in rich
descriptions in order to develop existing theories or create new
theories, rather than by testing existing theories. Moreover, the
work process of qualitative research is challenging, interesting
and stimulating since it usually involves social interaction with
people within the area of study (Merriam, 1994). My aspiration
is that this research process not only has generated useful
contributions to the field of research, but that it also has provided
time for reflection and learning for other persons involved in the
process.
One common feature of qualitative researchers, according to
Strauss & Corbin (1998), is that they appreciate the learning
process, interaction, discussions and play of ideas that comes
with working in a research team. This is very true in my case, the
tight teamwork with my co-author on the papers has not only
been fruitful for my own creativity and learning process, it can
also be seen as a strength of the research reported in this thesis.
As Eisenhardt (1989:538) suggests, multiple investigators
“enhances the creative potential of the study” and “the
convergence of observations from multiple investigators
enhances confidence in the findings”.
Obviously, my personal interest and preferences have influenced my
choice of focus and aim for this thesis; it is not surprising that the aim is
of a character that rather suggests a qualitative approach. First of all, it
seeks to shed some light over an unexplored dimension of management
in PBOs: HRM. According to Strauss & Corbin (1998) a qualitative
approach can with advantage be used for explorative aims. Secondly, the
study is about organisational functioning and processes (what happens

15
when organisations move towards project-based structures?), which also
implies that a qualitative approach might be favourable (e.g. Merriam,
1994; Strauss & Corbin, 1998). And finally, in order to identify the
changes and challenges facing HRM in PBOs, the experiences and
opinions of the people in the organisations is of great value. According
to among others Merriam (1994), this also calls for qualitative studies.
In this type of explorative and qualitative studies, the case study
strategy is often considered to be particularly appropriate
(Eisenhardt, 1989; Merriam, 1994; Yin, 1994). For example,
Eisenhardt (1989:534) states that “the case study is a research
strategy which focuses on understanding the dynamics within
single settings”, and that it is “most appropriate in the early stages
of research on a topic or to provide freshness in perspective to an
already researched topic” (p. 548). Also, as Yin (1994:13) points
out, the case study strategy is particularly convenient when you
“deliberately want[ed] to cover contextual conditions – believing
that they might be highly pertinent to your phenomenon of study”.
This fits quite well with what this study is all about; exploring
HRM in a particular context – the PBO. My basic assumption,
based on literature studies, is that the project-based context is
highly “pertinent”, as Yin puts it, to HRM. Accordingly, this
dimension of management is critical to explore in this particular
context in order to expand the knowledge of PBOs.

16
 MULTIPLE CASE STUDY AS AN ‘UMBRELLA’
STRATEGY
My case studies have to a great extent been guided by the
multiple case study logic as suggested by Eisenhardt (1989;
1991). Eisenhardt’s main argument for multiple case studies as a
powerful means to create theory is that “they permit replication
and extension among individual cases” (Eisenhardt, 1991:620).
With replication, Eisenhardt means that individual cases can be
used for independent corroboration of specific propositions,
while extension refers to the use of multiple cases to develop
more elaborate theory. The research reported in this thesis is
based on in total
eight case studies, of which five are core cases. Some of the eight cases
are used for replication and some of them are used for extension.
Actually, the best way to describe my research strategy is the multiple
case study as an ‘umbrella’ strategy, aimed at achieving the global
aim of the thesis. This umbrella strategy however, embraces a
combination of various multiple and single case study methodologies
aimed at achieving the aim of each of the four papers. Figure 2 gives
an overview of the different case study methodologies used in the four
papers. As described in the introduction chapter, the papers also mirror
the chronology of the research process, a process that will be
described in detail in later sections

Thesis: Paper III:

Multiple case study strategy Single case study
In total 8 cases

Paper I:
Paper II:
Multiple case study
Comparative case study
4 cases Paper IV:
2 cases
Multiple case study
8 cases

17
Research design and strategy
What I do want to describe here are the various forms of multiple
and single case study methodologies used and the basic logic
behind my choices. The four case studies in the initial study (Paper
I) are examples of cases used to allow the findings to be replicated
among various cases, as suggested by Eisenhardt (1989) and Yin
(1994). We1 did not want to limit the empirical foundation to a
single case study in this initial phase, since that might cause the
findings to be too dependent on the particularities of the specific
organisation, reducing the possibilities for generalisation among
similar PBOs. On the other hand, these initial case descriptions
needed to be rich and deep, since they would provide the patterns
and propositions that would form the basis for the following
studies. This called for a limited number of cases. We chose to
conduct four case studies in the initial phase, which gave us the
possibility to find a balance between rich descriptions and
opportunities for replication. The first study created a broad
empirical foundation concerning the changes and challenges of
PBOs and analysed HRM from various perspectives. This study
revealed some relatively clear patterns about which we decided to
extend the knowledge by revisiting and enriching two of the case
studies. In their quite severe critique against Eisenhardt’s
approach, Dyer & Wilkins (1991) argue that multiple case studies
do not allow deep contextual insights and that this is the essence of
case study research: “The central issue is whether the researcher is
able to understand and describe the context of the social dynamics
of the scene in question to such a degree as to make the context
intelligible to the reader and to generate theory in relationship to
that context” (Dyer & Wilkins, 1991:616). In order to balance the
multiple case logic as suggested by Eisenhardt and gain more
depth and “rich story-telling” as argued for by Dyer & Wilkins
(1991), the cases in the second study (Paper II) are fewer, but
richer. These studies focus particularly on the HRM practice, as
suggested from the initial study. The last two studies (Papers III
and IV) follow up interesting trails that emerged in the second

18
In Paper III, a single case study of the new line management role at a
Tetra Pak company contributed to a deeper understanding of the
demands for new HR roles in PBOs. In Paper IV, on the other
hand, three additional cases were added to the existing five in
order to accomplish what I would call ‘internal replication’. The
study aimed at extension in relation to Paper I and II, but within
the study there was a need for replication among a large number
of cases in order to identify a well- founded empirical pattern of
HR-departmental structures, rather than for rich and detailed
case studies.
Combining different forms of multiple and single case study
methodologies in a thesis based on a compilation of papers might
be advantageous for the findings of the thesis since it resembles a
form of methodological triangulation (see e.g. Merriam, 1994).
Even though the different papers have separate aims, these aims
are founded in the overall aim for the thesis; they all seek to
explore HRM in project-based organisations. Through the various
papers and their divergent case methodologies, the area of focus is
highlighted in various ways. The multiple case study strategy is
weak where the single case study is strong
and the other way around. By combining the methodologies, providing
multiple case studies as well as comparative and single case studies, I
can take advantage of the positive aspects of each methodology and
balance the negative aspects.
The overall aim is explored not only through various case study
methodologies, the area is also highlighted from various perspectives
and with various foci, such as the structure and content of the HR
practice, the HR-departmental structure, and the transformation of the
line management role

19
 THE CASES
As described, the research reported in this thesis is based on five
core cases studies and three additional case studies used to
broaden the empirical foundation in Paper IV. Table 1 displays
the companies where the case studies were conducted, the parts
of the companies that are in focus for the case studies, and some
general information about number of employees and basic type
of project operations. The table also displays in which of the four
papers the cases have served as the empirical base (a shaded area
indicates that the case contributes to the study reported in that
paper).
The cases all illustrate organisations that are dependent on
their project operations when it concerns their core activities,
some to a greater extent than others. However, the focus on
projects has not always been as strong as today, the five core
cases have traditionally carried out more of the core activities in
the functional organisation. In other words, they are projectified
rather than original PBOs. They all emphasise the need to
develop their project dimension. For instance, in strategy
documents and business plans, the companies state that projects
are a key component of their daily operations and further that
they need to develop their capability to carry out projects –
successful project operations are considered to be key in gaining
competitive advantage. They have spent much time on
elaborating on various types of support systems such as project
management models and project management training
programmes.
The case studies do not cover the entire companies, but
rather focus departments or units that are highly dependent on
projects in their operations, such as developments sites and
R&D units (see Table 1).

20
Case companies Focus for case Project focus Papers
study I II III IV
Swedish Product Product
Posten development development
Postal and and /
Logistics organisational organisation
company development development
operations
35,700 2,000
employees employees
Saab Main site for Customer
Aerospace development projects/
Developer of of aviation Product
defence, technology development
aviation, and
space
technology
12,000 4,000
employees employees
Volvo Car R&D site Product
Corporation development
Car
manufacturer
4,000
employees
27,500
employees
AstraZeneca R&D site Product
Pharmaceutical development
company
64,000 2,000
employees employees
Tetra Pak Unit for Customer
Developer of advanced projects/
food processing plant design product
technology and development
21
 automation
solutions for
customer
projects

20,000 155 employees

employees
Developer of Unit for Product
medical product development
systems developme /
nt and implementati
sales. on
370 employees 90 employees
Provider of Development Product/syst
enterprise site em
solutions development
projects
2,200 employees 300 employees
Telecom Development Customer
company site project
/Product
50,500 1,000 development
employees employees

Table 1 Case companies and focus for case studies

22
I treat the cases of Posten (the Swedish Post), Saab, Volvo,
AstraZeneca and Tetra Pak as core cases in this thesis for
three reasons: Firstly because these case studies are
substantially more deep and rich in detail. Secondly, because
they have all contributed to the empirical foundation in two or
more of the research studies and hence they make up a large
part of the total empirical foundation for the thesis. Thirdly,
because those are the cases where I myself have been overall
responsible. In order to get an own image of the core cases
and not only rely on my interpretations, my co-author
participated to some extent in the gathering of material,
mostly by sitting in on some of the interviews. However, I
have been responsible for gathering the empirical material, for
processing, structuring and interpreting the material, as well
as for case study write-ups (Eisenhardt, 1989).
In the three cases added for Paper IV, on the other hand, the
material was gathered and structured mainly by others than
myself. One of these case studies (Provider of Enterprise
Solutions) was conducted mainly by my co-author and a research
assistant in a related research project. The chief aim of this
project concerned ‘Project competence’ rather than HRM in
project-based organisations. However, information specifically
concerning the latter was also gathered, and the general material
from the case study was overall informative and useful also for
this project. The basic studies of the other two cases were carried
out by research assistants within the same research project as
this thesis. The chief aim of these case studies was to contribute
to the knowledge of how project- oriented companies choose to
organise their HRM-practice, which makes them highly relevant
for the study presented in Paper IV in this thesis. This means that
the case studies per se are not superficial. However, as to my
involvement in the case studies and to their total contribution to
the study is concerned, they are not among the core cases.
The fact that I have not been fully responsible from the
start in these three case studies can obviously be seen as a

23
 weakness in confidence for the material. However, the
material needed for that particular study was more of a
descriptive character and the case studies had been carried out
with similar methods as the five core case studies. The main
reason for including them was that in order to distinguish a
clear pattern of different HR-departmental structures, which
was the aim in this study, five cases were too few. There was
a need for additional cases in order to replicate the findings
among a larger number of cases that could provide a broad
base concerning HR-departmental structures rather than rich
and
detailed examples of only a few. Hence, I decided to add these
three cases, two of them which already gave good descriptions
of the general organisation, the HR department, the structure of
the HR organisation, and the division of responsibilities
between line managers, HR department and project managers.
In the third case, I conducted an additional interview with an
employee in order to fill some of the gaps needed for the study.
As you can see in Table 1, the three additional cases are
treated anonymously; the company names are not displayed.
There are two main reasons for this. Firstly, in one of the case
studies, the company had been promised anonymity.
Secondly, these three cases are only used in Paper IV, where
the empirical foundation is broad rather than deep. In this
study it is not of any high relevance to know which specific
companies that are involved. It rather aims at giving a broad
view of a number of organisational dimensions central for the
HR-departmental structure in project based organisations.
Hence, I have chosen not to display any of the company
names in Paper IV. Also the five core companies are in this
paper treated anonymously.

24
 INTERVIEWS
The main source of information for the empirical studies of the
cases is interviews with senior managers, project managers, line
managers, and HR staff. The interview process is described more
in detail in the next section, which describes the research
process. Here, I want to clarify 1) why I chose interviews as the
main source of information and the logic behind the choice of
interviewees, and 2) the choice of conducting open interviews
with conversation character.

Interviews with managers as main source of information

As to the first point, the decision to use interviews as main source

for data gathering is of course related to the kind of information
needed. One of the main challenges for this research is that it is
hard to isolate the relation between the project-based
organisational context and HRM. The challenges that face HRM in
the cases are most probably not only due to the project-based
context. There is a large amount of both internal and external
factors that influence and serve as driving forces for changes in
HRM. By talking to people who work in the organisations, I could
get to know about their experiences of, and perspectives on, the
challenges brought about by the projectification. I could also get to
know about their perceptions of the organisational context. My
purpose is of a kind that, as Alvesson (2003:28) states, “call[s] for
getting the voices of those targeted for understanding”.
However, the information from the interviews have been completed
with additional sources, such as newspaper articles, books written
about the companies, company home pages and internal information
material. These sources have been valuable for building up a
contextual understanding of the companies, their history and their
current developments.
As to the choice of interviewees, I made the decision to focus on
people on a management level. Not because the experiences and
perspective of other employees are not relevant for the purposes of this
25
thesis. On the contrary, the individual perspective is highly interesting
and relevant and is therefore worthy of particular attention in future
studies. On this stage, however, I mainly focus on the organisation’s
part in the relation between the individuals and their organisational
context. The studies included here are therefore based on the
experiences and opinions of people in the organisation that have
responsibilities for this relation. Of course, these persons are not only
‘managers’; they are also ‘employees’, each with their own individual
relation with the organisation. Furthermore, I was particularly
interested in conversations with persons that have worked some time
within the companies and therefore can be expected to have knowledge
and reflections concerning organisational changes over time.
Moreover, many of them have experiences from working in different
parts of the firms and from various offices. Table 2 summarises the
total number of interviews conducted at each company and the roles of
the interviewees.

Interviews as conversations
The interviews had the character of conversations, where the
interviewees had the possibility to focus the discussion on what they
found most interesting and important. I had a preliminary interview
guide, which listed themes of discussion developed from literature
studies and pre-studies. However, as Miles & Huberman (1994:35)
points out: “If you are running an exploratory, largely descriptive
study, you do not really know the parameters or dynamics of a
social setting. So heavy instrumentation or closed-ended devices are
inappropriate.” Hence, my interview guide was not very detailed; it
was rather designed to give a basic direction and support to the
conversation. My aim with the interviews was to take part of the
interviewees’ reflections upon the
challenges that the increased use of project-based structures bring,
especially concerning the management of human resources. Their
perspective on this development and its consequences was
important for the study; a pre-designed interview structure could
have hampered their own reflections and imposed my own ideas
26
from the beginning (see e.g. Ryen, 2004). Furthermore, as both
Ryen (2004) and Miles & Huberman (1994) point out, very
elaborated interview questions downplay the importance of the
context, which is highly relevant in qualitative studies, case studies
in particular (see e.g. Yin, 1994). For the aim of this thesis, the
organisational context is at the core and allowing the interviewees
to reflect openly gave me a possibility to understand the contextual
characteristics.
moreover, the interviews make up an important first step of the
analysis. The interviewees were in a way invited to create
theoretical constructs together with me. Through my questions, I
tested the theoretical ‘fragments’ that I had started to construct
from earlier interviews, or during the same interview. In the
discussion with the interviewee I could discard or affirm and in
many cases develop these constructs together with the interviewee.
Of course, making the interviewees feel comfortable to reflect
openly puts some pressure on the interviewer to ‘set the stage’
and create an open and trusting atmosphere. Hence, for example
the informal procedures outside the interview have in many
cases been of great importance. In some cases, I have gotten
more depth in the information given during coffee breaks, or
over lunch, which has complemented the information from the
interview. Each interviewee has also been informed that the
interview material will be handled with caution and that they
would get the opportunity to approve the quotations used.
As pointed to in the discussion above, the qualitative and open
character of the interview is not about one person handing over
information to another; it is much more complex than that.
Alvesson (2003:19) describes the qualitative interview as:complex
interaction in which the participants make efforts to produce a
particular order, drawing upon cultural knowledge to structure
the situation and minimize embarrassments and frustrations,
feelings of asymmetrical relations of status and power, and so
forth.”
Hence, there is a danger is that the interviewees tell what they think
27
that the researcher expects to hear, what they think would give a good
image of the company, what they think would make them appear in a
good way, etc. As Alvesson (2003) points out, this is not necessarily
conscious, but it is still important to be aware of. I have during the
interviews tried to ask follow up questions that make the interviewees
reflect upon what they just told me, in order to get behind the first
informative answers. Often, I have also related to discussions at other
companies in order to send the signals that other persons are thinking
in similar ways and have trusted me with that information.
I will now continue with describing the actual research process, how
one thing led to another, and my reflections along the way.

28
Case Interviewees Total no. of
interviews
Posten 2 HR directors 5
2 Senior project managers
1 Competence
Manager, Project
Management Center
Saab 1HR director 5 (two with the HR
2HR managers director)
2 Line managers with project
management experiences
Volvo 2 HR managers 5 (two with the
1 HR specialist manager at the
1 Manager at the Technical Technical Project
Project Management Office Management
Office)
AstraZenec 1 HR business partner 5 (two with one of
a 1Global Project Manager the managers at the
with experience as line Project
manager Management
2Managers at the Project Support Office)
Management
Support Office
TetraPak Managing 7
Director 1
HR director
1 HR manager
1 Process Owner/Competence
Coach for the Competence
Coaches
3 Competence Coaches (1 with
background
as project director)
Table 2 Interviews

29
 RESEARCH PROCESS
Given the explorative, qualitative character of this thesis, I want to
give you as a reader the possibility to follow my research process in
order for you to understand the logic of the studies and to judge the
trustworthiness of the results. First of all, I am the first to
acknowledge
that a research process is anything but a paved highway from
idea to results. It is rather like a brushwood where you try to set
a direction without knowing exactly where you are going. From
time to time you encounter a trail that leads to an open glade
where you can see a number of new and interesting trails to
follow. But just as often, you follow an intriguing trail for a
time, only to find out that it is going in the wrong direction, or
that it leads you to a dead end. However, looking back at the
trails that I have followed and the glades that I have found on
the way, it is quite easy to follow my way through the
brushwood. Every trail that I followed and every trail that I
chose not to follow, led me one step closer to where I am today.
My research process from the first broad research aim to the
findings presented in this thesis can be divided into four phases,
where each phase has resulted in a paper and has set the
direction for the next phase. I will here go through each of the
four phases in order to give an insight into the work process as
well as into my ‘road map’ through the empirical brushwood
and the glades I found along the way. The description of my
process also gives a brief introduction to the empirical findings
in each study and how each study formed the basis for the
following study. This will hopefully clarify the logic and
constructs that build up to each of the paper themes. Table 3
displays the four papers, their aims, the case studies that make
up the basis for each study, and the total number of interviews
for each study.

30
 FROM CASE STUDIES TO CONSTRUCTS
As can be seen from the description of my research process, my
intention has been to create constructs within this area of
research. Each phase of the process leads to some tentative
constructs, which on the one hand increase the knowledge of
PBOs and on the other and drives the research process forward,
to new constructs. Following the arguments of e.g. Eisenhardt
(1989), case studies are a good way of creating constructs since,
as she puts it, “attempts to reconcile evidence across cases, types
of data, and different investigators, and between cases and
literature increase the likelihood of creative reframing into a new
theoretical vision” (Eisenhardt, 1989:p. 546). The quotation of
Eisenhardt actually describes quite well what I have tried to
accomplish with my research process. However, I have tried to
balance the multiple case study logic, as suggested by
Eisenhardt, with the rich story logic of single and comparative
cases as suggested by e.g. Dyer & Wilkins (1991).
One of the most important difficulties for myself in this
research process has been to not fall in the ‘pitfall’ of trying to
find simple relations of cause and effect. It would have been
possible to regard the project- based context as an explanation to
almost every challenge the organisations struggle with. As a
researcher it is hard to distance oneself from the material and be
open to all possible explanations. Nevertheless, I have had this in
mind during the process and what I am trying to do is not to
find simple relations of cause and effect. It is rather to explore
the nature of PBOs from an angle that is likely to increase the
understanding of this type of organisation that is becoming an
increasingly important part of peoples working life. It is hardly
possible to entirely isolate the impact of the project-based
organisational context on HRM in comparison with other
internal and external contingencies.

31
 3.Literature Review

APPLYING THE HRM FIELD TO UNDERSTAND

PROJECT-BASED ORGANISATIONS

In this thesis, I use concepts from the HRM field in order to explore
HRM in project-based organisations. This field of research is not a
common reference base for mainstream project research and hence I
dedicate this chapter to a further introduction into the world of HRM. I
start off with a historical overview of the development from ‘personnel
administration’ to ‘HRM’ and a discussion about the HRM concept.
The following sections give an introduction to the content and structure
of HRM, the changing role of line managers, and the design of HR
departments. Apart from providing a background and general insight
into the HRM field of research, this chapter also aims at strengthening
the argument for the overall aim, as well as at laying down the
theoretical foundation for the paper themes.

FROM MANAGING PERSONNEL TO MANAGING

HUMAN RESOURCES
The concept of Human Resource Management (HRM) had its
big breakthrough in the 1980s in North American management
literature. It was a reaction to traditional personnel
management, which focused on the administration of
personnel issues, such as recruitment, job
evaluation, salaries, training, and union relations (Guest, 1987). The
HRM advocators instead proclaimed a more strategic approach to
handling people issues in the organisations and a view of the
organisation as being dependent on its employees and their
competencies, not the other way around. In the 1980s, the North
American industry was threatened by the competition of the rapidly
expanding and highly efficient Japanese industry. The Japanese
management traditions, based on a strong relation between employees
32
and employer, life-long work contracts and working methods directed
at quality rather than cost management strongly contributed to the
rising interest in HRM (e.g. Guest, 1987; Hendry & Pettigrew, 1990).
This was also one of the strong driving-forces for the break-through of
the HRM concept at this particular time.
The development of the HRM concept consisted of the development
within and interplay between two different fields of research: the
strategic management field on the one hand and the human relations
field on the other (Hendry & Pettigrew, 1990). The strategic
management literature had since the 1950s developed a concern for
regarding the ‘human resources’ as a strategic organisational asset
and a base for competitive advantage. The main argument for this
stream was to maximise the contribution of people to the
organisation. The writings of Fombrun, Tichy & Devanna (1984)
was an important contribution to the development of this view The
human relations stream on the other hand was, according to Hendry
& Pettigrew (1990), more concerned with “the impact of managers
on organizational climate (culture) and the relationship between
management and other employees…”(p. 23). Here, the
interdependence of the organisation and its people was a critical
argument and the management of this relationship was in focus for
the discussions. From this perspective, HRM as opposed to
personnel management is a general management responsibility, not
a responsibility for personnel specialists only. One of the key texts
representing this stream was written by Michael Beer and his
colleagues at Harvard Business School, in which they state that:

“Human resource management involves all management decisions

and actions that affect the nature of the relationship between the
organisation and its employees – its human resources. General
managers make important decisions daily that affect this
relationship.” (Beer, et al., 1984:1)
In Europe, and in Sweden, the idea of regarding employees a
‘resource’ instead of a ‘cost’ started to enter the academic field
during the 1970s, inspired of the U.S. trends .

33
Social commitment: Increasing welfare

The developments during the period from 1920-1950 were

basically a reaction to the poor working conditions in the
recently industrialised society. Damm & Tengblad (2000) refer
to this period as ‘the personnel- social era’. Employers started
to undertake various types of activities in order to increase the
welfare of their workers, who often worked under
At the beginning of the century the Swedish government, inspired
by Great Britain, established a Labour Inspectorate, with the
purpose of improving the working conditions particularly for
women and minors. This led to the hiring of ‘personnel officers’ at
many companies, who were to be responsible for handling the
relation between the company and the Labour Inspectorate. The
work of these personnel officers was mainly to supervise the
general hygienic conditions, assist in selection and hiring of new
personnel, and help employees with information, advice and
administration within areas such as loans, education, housing, and
child care (Damm & Tengblad, 2000:29).
In both Europe and the U.S., the World War II had great influence on
the development and diffusion of personnel practices. The study of
Baron et al. (1986) suggests a tremendous diffusion of personnel
practices and an increase in the incidence of personnel departments in
the U.S. industry during the war. Following the argument of Damm &
Tengblad (2000), this had most likely to do with the scarcity of work
force during the war and the post-war period, which also in Sweden led
to an increased interest for the work of the personnel officers. At the
end of the 1940s, there were wide discussions about the role of
personnel officers, both in the academic and the industrial world in
Sweden. Many argued that the social function and the personnel
function needed to be separated. Personnel officers needed to become
more integrated in the business; not only ally their selves with the
workers and their problems, but also with the management of the firms
(Damm & Tengblad, 2000). This led to a significant shift in the role of

34
personnel officers, from social commitment to company commitment.

Company commitment: efficient administration of personnel

Between 1950 and 1980, (by Damm & Tengblad, 2000, referred to
as the personnel-administrative era), there was a dramatic increase
in the number of personnel officers in Swedish companies and they
were now increasingly called ‘personnel administrators’. These
administrators started to take over much of the responsibilities
concerning recruitment, introduction and training; activities that
traditionally had been the
responsibility of foremen and middle managers. Many companies
now started to organise their personnel administrators in
centralised personnel departments, which created a new
management role: the personnel manager. The development in the
U.S., where the commitment to the company and its business
already was the foundation for personnel work, was an important
influence. Here, central personnel departments with responsibility
for bureaucratic personnel practices became very common already
in the 1930s-1940s (Baron, Dobbin, & Jennings, 1986).
During the personnel-administrative era, personnel
administrators, working at personnel departments to serve the
needs of the company, forged a stronger professional identity.
Companies also started to demand more scientifically founded
knowledge within the area. In Sweden, academic education
within social sciences started to have special programmes with
a ‘personnel’ focus (Damm & Tengblad, 2000). A new
profession emerged in the industry and it grew rapidly. In the
U.S., the number of personnel and labour relations
professionals increased with 43% between 1946 and 1950 and
with as much as 75% between 1950 and
1960 (Baron, Dobbin, & Jennings, 1986).
However, in the 1970s, the personnel administration area was again
subject to discussions and critics, in Europe as well as in the U.S. Just
moving from social commitment to company commitment was not

35
enough, the personnel administrative work needed to be more
strategically oriented and based on the overall company strategy (Hendry
& Pettigrew, 1990). Moreover, personnel departments were accused for
being too alienated from the organisation they were supposed to support;
they needed to be more integrated in firm operations. Many argued that
line managers had to recuperate responsibilities from the personnel
departments, which were considered to be too bureaucratic, centralistic
and not competent in business issues(Damm & Tengblad, 2000). In
addition, new theories and ideas started to influence the field of
management. Japanese quality models and the ideas of ‘excellence’
(Peters & Waterman, 1982) encouraged new ways of thinking
concerning management. In Sweden, there was a strong movement of
‘industrial democracy’, driven by left wing forces which proclaimed a
break down of bureaucratic structures and an increase of employees’
right to participation. This movement strived for decentralised personnel
departments and for devolving personnel responsibilities to the line
(Damm & Tengblad, 2000

People as strategic resources

Damm & Tengblad (2000) describe the period from 1980 until the time
of their writing as the ‘post-bureaucratic HRM-era’, during which there
was a wave of decentralisation of personnel departments in Sweden.
The work of personnel specialists started to become more oriented
towards supporting line managers with personnel responsibilities and
meeting their demands. Some scholars argued that the personnel
departments had to become more service oriented and that they should
not see themselves as specialists but rather as generalists with the role
of internal consultants (Hansson, 1988). During the mid-eighties, the
term ‘human resource management’ started to enter the personnel
discussions in Sweden and various CEOs at large Swedish companies
adhered to the ideas of “dumping the personnel administration
terminology” (Damm & Tengblad, 2000:40). The development in
Sweden was presumably influenced by the changes and the discussions

36
in the U.S and Great Britain on the field. In one of the first key text
within the area of HRM in the U.S., Devanna, et al. (1984:preface)
described the need for drastic changes in the following way “While the
current concern with management technique has all the characteristics
of a ‘fad’, there is a good reason to believe that it reflects an underlying
transformation in the organization of work in modern society, one
which is expressing itself in the broad concern with general
management and Hendry & Pettigrew (1990:20) points to a
combination of various factors contributing to “the feeling that
personnel management, in its general and functional sense, was
undergoing change and was open to a fundamental reorientation” in
Great Britain. The authors mention for example new management
philosophies and a demand for a strategic approach towards
employment issues. They also point to an increased integration of
personnel specialists’ activities with top management and
with the long-term strategies of the organisation. Guest (1987)
highlights the development towards a workforce with higher
educational level that has higher expectations and demands, as
well as the changing technology and structural trends leading to
more flexible jobs, which together require a new form of personnel
management (see also Sisson & Storey, 2003).
According to Hendry & Pettigrew (1990:20), HRM became a
general term highlighting the changes in the personnel
management field at this time:
“What HRM did at this point was to provide a label to wrap
around some of the observable changes, while providing a
focus for challenging deficiencies – in attitudes, scope,
coherence, and direction – of existing personnel management.”
One important trend during this era was the boost intemporary
workforce and employment agencies, which implied
fundamental changes in traditional employment contracts. In
Sweden, a new law came into force in 1993 which deregulated
the market for employment services (law 1993:440). This made
it possible for employment agencies to meet companies’
increased need for flexible workforce and flexible employment
37
contracts (Pekkari, 1999 The awareness of the possibilities of
considering people and their competencies as strategic resources
grew strong. It was also strengthened by scholarly writings, such
as Pfeffer’s “Competitive Advantage through People” (1994),
which attracted much attention. Several researchers see the
increased focus on knowledge as a strong driving force for the
development of HRM. For example, Brewster & Larsen (2000:ix)
argue that:

“This qualitative shift was caused – and made possible – by

changes in societal structure, in particular the transition from
mainly industrial, manufacturing economy to a service- and
knowledge-based society. Providing service, knowledge, skills
and know-how (at the individual and organizational level)
implies an hitherto unseen focus on immaterial resources, core
competencies, commitment and other features related to the
individuals (that is, human resources) of the organization. The
competitive strength of an organization is determined by its
ability to attract and develop human resources, rather than
optimizing the use of raw materials, machinery and financial
resources.”
According to Damm & Tengblad (2000), there were intense
discussions in Sweden during the 1990s about the concept of HRM,
but particularly about the ‘to be or not to be’ of personnel departments
as separate units. The ideal model advocated for was a small personnel
unit close to the top management and as much personnel responsibility
as possible delegated to line managers. Fewer personnel specialists
should take on a supporting and consultative role towards the line. This
was also in line with the need for drastic downsizing during the slump
of the 1990s in Swedish economy. Damm & Tengblad (2000) argue
that the discussions during the 1990s indicate a vagueness in the
meaning of the HRM concept and the justification for having personnel
departments or not.

New organisational forms, competence and individualization

38
 The last of the eras discussed by Damm & Tengblad (2000)
ceases at the end of the 1990s and the question is what has
happened since? What are the characteristics of the current era?
According to Wolfgang Mayrhofer and Henrik Holt Larsen,
interviewed in the leading magazine for HR professionals in
Sweden, the results from the Cranet Survey 2004 5 indicate a
number of general change patterns in HRM in Europe (Åberg
Aas, 2005). Firstly, HR departments have been downsized and
HR responsibilities transferred to line managers. Secondly, firms
invest more than ever in competence development of their
employees. Thirdly, reward and bonus systems include more
benefits, which are offered to a larger number of employees.
Finally, employment contracts are increasingly closed on an
individual level; the importance of central union negotiations
has decreased. specialists in the organisation seems to be
somewhat of a never-ending story. However, this is for natural
reasons; requirements and needs of the organisations are
constantly changing. In their analysis of the results of the Cranet
Survey, Mayrhofer, Morley & Brewster (2004) particularly point
to the increased use of flexible, project-based forms of
organisation, which according to the authors leads to greater
autonomy and increased HR responsibilities for line managers as
well as changes for HR departments. For example, the authors
argue that:

Later in this chapter, I will return to the discussion of changing

HR departments and line management roles. Apart from these
two topics, competence and individualisation seem to be at the
core of contemporary HRM.
The increased importance of competence development is
highlighted also by the chairman of the Swedish HR society, Sune
Karlsson. He argues that today’s working life, where employees
change employer and assignments increasingly often, requires a
solid competence base and an individual responsibility to develop
39
that base (Hedlund, 2004). Karlsson claims that the only realistic
alternative for companies who want to stay competitive is to back
the competence issues. Moreover, the knowledge of employees is
increasingly seen as the basic source of competitive advantage. For
example, Legge (2005) discusses the ‘knowledge workers’ as “the
wealth-generator of the networked ‘information society’” (p. 13,
italics in original).
However, the results of the Human Capital Survey 2002/2003,
performed by the Swedish Institute for Personnel and Corporate
Development, reveal severe drawbacks in competence
developments programmes in Swedish companies due to the
economic slump in 2001 (Hansson, 2003). The question is who is
really responsible for competence
development – the company or the individual? Damm & Tengblad
(2000) argue that contemporary working life promotes loyalty to the
own competence area, rather than to an organisation, which should
lead to a break up of the traditional concept of employment. According
to the authors, this might imply that organisations no longer have to
take on the responsibility for competence development, but that it is
each individual’s own responsibility to develop her competencies in
order to be attractive for future assignments This bridges over to the
‘individualisation’ of society, which has had, and keeps having, a great
influence on HRM (cf. Damm & Tengblad, 2000). The Cranet Survey
2004 indicates that individuals seek less support from central unions
and increasingly act independently. Lindgren, Packendorff & Wåhlin
(2001) argue that work and career have become a ‘life-project’ with the
purpose of self-realisation and that loyalty therefore is closer attached
to the own person than to any collective forms of loyalty bases. The
authors claim that jumping between organisations is becoming a
natural part of working life. As Damm & Tengblad (2000) points out,
that implies increased requirements on organisations to create
attractive and developing working environments in order to keep their
employees. In an article in the Swedish magazine for HR professionals,
one of the most important challenges for HRM in the 21 st century is
expressed as “Winning the battle for talents” (Hedlund, 2000).
40
 THE CONCEPT OF HRM
Having read this far, the reader is probably aware of that a well-
defined and all-embracing definition of ‘HRM’ is not available. I
would like to believe that is actually a good thing, since a
variation of perspectives and opinions together cover the area in
a better way than a single view. Browsing through HRM
literature, the different views of HRM can be summarised in
three main approaches (similar divisions have been done by e.g.
Guest, 1987; Legge, 2005; Sisson & Storey, 2003).

1. HRM as a ‘new label for personnel management’

2. HRM as a ‘management philosophy’
3. HRM as the ‘management of the relation between
individuals and their organisational context’.

A new label for traditional personnel management activities

The first approach is that HRM is basically the same activities as

traditional personnel management; it is just a new label. This
approach is described by e.g. Guest (1987), who discusses
various ways in which HRM has been used. In the words of
Guest, this approach is to “retitle personnel management to
capture the new fashion” (p. 506). By ‘new fashion’, Guest
refers to, for example, new models of excellence, changes in the
workforce and the nature of work, and the search for competitive
advantage through people. According to Guest, this approach is
evident for example in cases where ‘personnel departments’
have become ‘HR departments’ without any obvious changes in
role and where textbooks with new editions contain only minor
changes, but have a new title. The change of label is rather a sign
of the need for a modernisation of personnel management
activities in order to deal with a changing context, for instance,
41
 increased globalisation, new flexible organisational forms, and
an increased focus on knowledge workers.
Inherent in this approach is the conception of HRM as the
traditional activities directed towards the management of
employees, carried out by managers and/or HR departments.
This can be seen in for example the definition provided by
Dessler (1999:2)

“Human Resource Management refers to the practices and

policies you need to carry out the personnel aspects of your
management job, specifically, acquiring, training, appraising,
rewarding, and providing a safe and fair environment for your
company’s employees”

The risk with this kind of definitions is that HRM is broadly defined,
but still misses out on processes, activities and structures that include
others than managers. The conception of HRM as the work carried out
by HR departments (see e.g. Guest, 1987) is even more common. Even
if one of the key arguments for HRM, regardless of the approach
applied, stresses line management’s active participation in and
responsibility for personnel issues, both academics and practitioners
often regard ‘HR’ as a matter for the HR department. However,
regarding HRM as solely the activities carried out by the HR
department creates a very limited definition of HRM. This is
acknowledged by e.g. Hendry & Pettigrew (1992), who in their case
study of strategic change in the development of human resource
management argue that what they refer to as ‘front-end’ HRM activity
“/…/ is more probably the preserve of key line or general managers,
rather than of the personnel specialist. This argues for expanding the
concept of HRM further, to embrace the political and change
management skills of the line/general manager” (p. 154).
My strongest critique towards this approach to HRM is directed
towards the limitations of considering HRM to be the personnel
activities carried out by managers and/or the HR department..

42
A new management philosophy
The second approach to HRM is that it is a management philosophy,
offering a new approach for management. This view seems to be
particularly common among scholars during the period of transition
from personnel management to HRM. For example, in his article from
1987, Guest adheres to this approach, stating that HRM is usually
contrasted to personnel management with the assumption that HRM is
better, but without taking variations in context into consideration.
Guest suggests that there are organisational contexts where traditional
personnel management could be more successful, arguing:
“Until convincing evidence to the contrary is available, this
suggests that human resource management can most
sensibly be viewed as one approach to managing work force.
Other approaches are equally legitimate and likely in certain
contexts to be more successful” (Guest, 1987p.508)

Also Hendry & Pettigrew (1990:35) subscribe to this approach, by

seeing “HRM as a perspective on employment systems,
characterized by their closer alignment with business strategy”. In
contrast to the first approach, where HRM is treated as a modern
form of personnel management itself, this approach rather
considers HRM to be “a ‘special variant’ of personnel
management, reflecting a particular discipline or ideology about
how employees should be treated” (Legge, 2005:107). According
to Guest, the ‘HRM approach to management’ is distinct to other
approaches, and it strives to achieve the goals of integration,
employee commitment, flexibility/adaptability and quality. If these
goals could be achieved, “then the company’s strategic plans are
likely to be more successfully implemented” (Guest, 1987:512).
Considering HRM as a ‘management philosophy’ strengthens the
strategic dimension. In fact one might say that HRM per se is a
distinctive management strategy from this approach. And it
probably was just that in the 1980s, when the ideas were new and
posed a clear contrast to traditional personnel management.
However, since then, this ‘management philosophy’ has come to
43
dominate and today it is regarded more or less as general
knowledge of how to run a company. If we look back at the goals
of ‘the HRM approach to management’, as suggested by Guest
(1987) cited above, most of today’s managers would probably not
regard this as a particular HRM approach, but rather as the general
way of doing business in order to stay competitive.

Managing the relation between the individuals and their

organisational context
Following the last quotation of Brewster & Larsen (2000) above, are
we not back in the first approach? Is HRM nothing but a new label on
the traditional personnel management activities? Actually, there is
another way of understanding the concept. While the first approach
regards HRM to be managing the employees and the second regards
HRM to be a particular philosophy about how to manage the
employees, this approach is that HRM essentially concerns managing
the relation between the people working in the organisation and the
organisation.
This approach builds on for example Beer, et al. (1984:1),
referring to HRM as “all management decisions and actions that
affect the nature of the relation between the organization and
employees – their human resources” and on Brewster & Larsen
(2000) who, as quoted above, consider HRM to rest on the
assumption of an organisational interplay between individuals and
their organisational contexts. However, Brewster & Larsen never
say clearly if they see HRM as an approach to management or as
the actual management activities. They speak of the assumptions
and focus for HRM as opposed to personnel management, which
would suggest the former. On the other hand they also say that
HRM has become the institutionalised way of handling the central
personnel management activities.

44
HRM: CONTENT AND STRUCTURE

After having clarified my approach to HRM, it is time to get

down to what HRM is really about. The focus of this thesis is
the HRM dimension in PBOs. Following the definition
subscribed to, HRM refers to the dimension of management
focusing the structures, processes and activities directed towards
managing the relation between individuals and their
organisational context. But, what structures, processes and
activities are we talking about? In the following paragraphs, I
give my view of what current HRM research is telling us about
this. I have divided the description in two parts. The first part
deals with the processes and activities, i.e. the content of HRM,
while the second part deals with the organisation of those
processes and activities, i.e. the structure of HRM.

The content of HRM: the HRM practice

One of the more classical descriptions of the processes and
activities of HRM – from now on referred to as HRM practices –
is the one provided by Devanna, Fombrun & Tichy (1984). They
refer to four generic functions for HRM; selection, appraisal,
development and rewards. According to the authors, these
functions “are ideally designed to have an impact on
performance at both the individual and the organizational levels”
(Devanna, Fombrun, & Tichy, 1984:41). In contemporary HRM
literature, these functions are still considered to be at the core,
but an overview of the writings since 1984, depicts a more
elaborate image of the central HRM practices. However, it is
important to be aware of that most of the literature that discusses
HRM practices does that in terms of the responsibilities and
functions of HR specialists in the organisation. As pointed out
earlier, my approach to HRM is broader than that. However, I
still argue that the practices discussed are central for the content
of HRM. In this section I therefore focus on what the HRM
practices are and in the following section, I discuss how they are
45
organised.
In order to get a picture of what HRM researchers concern
to be the core processes and activities, I consulted ten well-cited
sources, covering the time period from 1984-20036. I listed the
HRM processes and activities focused by these researchers and
categorised them according to their main functions and
purposes. As a result, the core content of the HRM practice, as
perceived by the HRM field of research, can be summarised in
five core areas (see Table 4):
Managing human resource Directed towards the
flows: selection, recruitment and
deployment of human
resources. Basically about
managing in- and out flows of
human
resources.
Managing performance Directed towards the design of
work systems,
appraisal and reward systems
Managing participation and Directed towards the
communication individuals’ influence on the
organisation’s operations,
communication and
motivation, as well as relations
with trade
unions.
Managing and developing Directed towards
competencies competence planning,
mapping, and
development. Also about
managing careers and career
structures.
Managing change Directed towards identifying
needs for change and
contribute to business strategy
development. Also about
facilitating change
46
Table 4 Core areas of the HRM practice
This overview of the core content of HRM practice does not attempt to
be all-embracing. There may be aspects not covered by existing
literature and other researchers may chose to categorise them
differently. However, it provides a useful theoretical basis for the
analysis of the content of HRM.

The structure of HRM: the HR organization

Previous section aimed at giving a picture of what HRM delivers,

a topic quite well covered in HRM literature. However, if we turn
to how these HRM practices are performed – the structure of HRM
– it is much harder to find research to help us draw the picture.
One of the problems is related to what I have discussed earlier:
Even if most HRM researchers seem to agree on the important role
of for example line and general managers in performing HRM
practices, their research is very much focused on the role of HR
specialists and the HR department. The argument seems to be that
since HRM is becoming increasing recognised as central for the
competitiveness of a firm, the HR department must change. For
example, Lawler (2005:165) uses the term ‘HR’ synonymously to
HR department and argues that “HR can and should add more
value to corporations. … It needs to move beyond performing the
many administrative and legally mandated tasks that traditional
personnel functions have performed…”
However, the approach to HRM that I subscribe to in this
thesis implies that there are other players that could be (and
probably are) critical participants in HRM. I already mentioned
the active role of all individuals contributing with their human
resources in managing the relation to their organisational
context. Depending on the character of the organisation, other
players might also be critical. For example, in PBOs, project
managers might assume a greater responsibility for some of the
HRM practices. My point is that HRM can be organised in
different ways and consist of different central players, depending
47
 on the needs of the organisation and the individuals in it.
Hence, I see a need to analytically separate the term ‘HR
department’ from ‘HR organisation’. While the HR organisation
refers to the way an organisation chooses to structure the HRM
practices, the HR department refers to the unit containing the HR
professionals within the organisation. The HR department might
be, but is not necessarily, an important player in the overall HR
organisation. The competitiveness of an organisation is not only
dependent of an efficient HR department, but of an efficient HR
organisation (this separation is further discussed in Paper IV).
For the purposes of this thesis, this is an important distinction,
since the particularities of the PBO as an organisational context
might imply changes and challenges for HRM which would not
be captured solely by a study of the HR department.

LINE MANAGERS: FROM SPECIALISTS TO HR

MANAGERS
One of the key themes in contemporary research on HRM is the
devolution of HR responsibilities from HR departments to line
managers (e.g. Cunningham & Hyman, 1999; Larsen &
Brewster, 2003; Thornhill & Saunders, 1998). Responsibilities
that were taken over by personnel departments during the
personnel administrative era are now being devolved to line
managers. This development is very much in line with the HRM
advocators of the 1980s (e.g. Beer, et al., 1984), who argued that
HRM is a general management responsibility and not reserved
for personnel specialists. More recent research also suggests that
organisational change is a driving force for this process of devolution.
For example, Larsen & Brewster (2003:234) argue:

“Major changes within organisations will influence the allocation of

roles in even more fundamental ways. As organisations become more
knowledge intensive, dependent on know-how and service, HR
becomes a more critical part of the operation and a more critical role
for the immediate manage

48
The case study by Thornhill & Saunders (1998) also suggests that
the organisational structure might influence the devolution process.
In their case, a management buyout and privatisation implied new,
flatter, non bureaucratic structures, and a requirement for more
flexible employees. After the buyout, the organisation had not
access to the central HR department of the former owner and no
new HR department was set up. Instead, HR responsibilities were
totally devolved to line managers, who had already started taking
on more responsibilities for HRM prior to the buyout.
However, devolution is not without pain. From the perspective of
HRM researchers, the main concern is that the devolution poses a
threat to HR departments. Various studies therefore strive to justify
HR specialists’ prominent role in organisations. For example, in the
case study by Thornhill & Saunders (1998:474), the authors claim that
line managers have a limited strategic focus and argue that “The
absence of a designated human resource specialist role may therefore
be argued to have had a significant negative effect on the
organization’s ability to achieve strategic integration in relation to the
management of its human resources, with further negative
consequences for commitment to the organization, flexibility and
quality”. Similarly, the study by Cunningham & Hyman (1999:25)
suggests that devolution of HR responsibilities to the line makes HR
departments vulnerable, but that “the acknowledged shortcomings of
line management, particularly with regard to the management of
subordinates, may help to confirm a continued presence for personnel
as a discrete, if less tha strategic, function”. If one concern is the
vulnerability of the HR departments, another
great concern is the possibilities for line managers to assume the
increased
suggests that line managers feel frustration at not having
sufficient time to deal with HR issues because of the dominance
of ‘hard’ objectives, such as output and reducing costs.
Larsen & Brewster (2003) also discuss the impact of new organisational
forms, such as matrix, network, and project organisations, on the line
management’s involvement in performing
49
HRM practices. For example, they state that the link between the
HR department and the line managers looses relevance in
organisations that rely on autonomous teams, where project
managers and the project workers themselves handle recruitment,
pay, discipline, and resource allocation. The authors argue that:
”the line manager roles in organisations become increasingly
complex because new organisational structures (e.g. virtual and
network organisations) have less well-defined line manager
roles than the traditional hierarchical, bureaucratic organisation
which moulded the line manager role in the first place.”
(Larsen & Brewster, 2003:230)
However, the authors do not provide any empirical studies on the
changes in line management roles in such organisations.
Nevertheless, their suggestion is partly supported by some project
researchers. For example, in the ‘heavyweight team structure’
discussed by Clark & Wheelwright (1992), the line manager is no
longer the technical expert, but rather responsible for the
competencies going into the project and for the long-term career
development of the individual project workers. As discussed in the
introduction chapter, there are a number of project researchers that
have highlighted some shortcomings of the temporary character of
PBOs, related to the abolishment of the functional line as home
base for technological as well as for competence development (e.g.
Hobday, 2000; Midler, 1995). The study of Lindkvist (2004)
suggests the emergence of “competence networks” with informal
leaders, compensating for some of the losses of abolishing the line
units and line managers. Maybe the role of line managers as
technical specialists is outplayed in PBOs, but needs to be
substituted with a more HR-oriented managerial

50
 THE DESIGN OF MODERN HR DEPARTMENTS

As mentioned, recent research reveals a picture of HR departments

struggling to find their role and defend their existence (Brockbank,
1999; Jamrog & Overholt, 2004; Torrington & Hall, 1996). Similarly,
Berglund (2002) argues that HR professionals struggle with problems
of legitimacy and difficulties in establishing themselves as an
important profession.
One important reason seems to be the trend pointed to in the previous
section; that the role of the line managers is growing in importance in
most HR organisations. There are a large number of books and articles
suggesting how HR departments should change in order to contribute
to the success of the firm. The majority of these researchers use the
terminology of various ‘roles’ that HR departments (or HR
professionals) need to assume in modern organisations. One of the
most famous texts is written by Ulrich (1997), who suggests that HR
professionals should assume the roles of change agent, employee
champion, strategic partner and administrative expert to contribute to
the firm’s success. Other researchers have suggested similar
frameworks (e.g. Beatty & Schneier, 1997; Mohrman & Lawler, 1997).
However, the problem with these role typologies is that they do not
take into account that different organisational contexts might require
different ‘roles’ (or at least different emphasis on the roles) for the HR
department, nor that the HR department is one of various players in the
HR organisation. Moreover, very few of these scholars discuss how
these roles are put into practice. How can you design a HR department
in order to deliver these roles? Actually, it is very hard to find any
research on the design and structure of HR departments at all.
However, after having discussed various roles for the HR department,
Mohrman & Lawler (1997:161) conclude:
“Clearly one of the most important challenges every human
resource function faces is to reinvent its structure and organization
so that it can deliver in the future the kinds of systems and business
partnership behaviour that will make its organisation more effective

51
 FROM THEORY TO FINDINGS
In this chapter, I have given an overview over the history of the
HRM field. I have also elaborated on the concept, clarified my
own approach to HRM - managing the relation between the
individuals and their organisational context - and provided
primarily three implications this approach brings, which are
central for the purposes of this thesis. The chapter has also
illuminated the content and structure of HRM. One important
issue concerned the HR organisation and its various key players,
including for example line managers and HR specialists, but also
opening up for the increased role of individuals. The changing
role of line managers was highlighted, as well as the importance
of setting up HR- departmental structures that support the other
players of the HR organisation and that fit the needs of the firm.
In the next chapter, I present the main findings of the papers. I
will also try to synthesise the contributions in order to show how
the papers together achieve the aim of the thesis.

52
 4. DATA ANALYSIS INTERPRETATION
AND PRESENTATION

CHALLENGES AND CHANGES FOR HRM IN

PROJECT-BASED ORGANISATIONS

The aim of this thesis is to explore HRM in project-based

organisations. More specifically, to identify and analyse the challenges
and changes for HRM in this particular organisational context. In this
chapter, I present the main contributions from the papers, which each
deals with one of the four research questions. However, the discussions
are not meant to be summaries of the papers. Instead, I intend to take
the discussions one step further, building on the contributions from
each paper. I start my discussion with the challenges that HRM in
PBOs faces and continue with how the HRM practices on an operative
level are affected. I then elaborate on the HR-oriented management role
in PBOs and on the design of HR organisation and HR-departmental
structures. Finally, I conclude with a discussion where I integrate the
findings and clarify the contributions with this thesis.

FOUR PERSPECTIVES TO ILLUMINATE THE

CHALLENGES FACING HRM IN PBOS
In Paper I, we study the challenges related to the management of
the relation between the individuals and their organisational
context in four cases; development units at Posten, AstraZeneca,
Volvo, and Saab. The approach to HRM subscribed to in this
thesis made it possible to capture challenges for HRM from
various angles. For example it highlights the important role of
individuals as active participants of HRM. In the analysis of the
cases, four perspectives appeared as critical for the
understanding of HRM: Competence, Trust, Change, and
Individual. These perspectives are closely nested empirically, but

53
 they still illuminate different aspects of the management of the
relation between individuals and their organisational context.
Thereby, they contribute to a more holistic picture of the
challenges facing HRM in PBOs. In Paper I, these perspectives
are elaborated upon and used as a model for the analysis of the
challenges in the studied firms. In this concluding discussion, I
intend to draw out the essence of the challenges related to each
perspective, as well as clarify the relation between these
challenges and the project-based context

Competence: where to draw the line and how to

develop competencies
As pointed out in Chapter 1, competence has grown to become one of
the most important competitive factors for today’s companies, not only
for PBOs. In all four cases analysed in Paper I, the companies are
struggling with how to handle the building of strategic
competencies, competence
tracking, competence development, etc. The move towards a more
project-based context challenges these issues, firstly because work in
projects is generally more knowledge-intensive, putting an even greater
emphasis on the importance of attaining and developing the right
competencies. Secondly, because work in projects is more difficult to
track and monitor compared to traditional line assignments. This
creates a situation where competence management needs to be
emphasised. Analysing HRM from a ‘competence perspective’ implies
regarding the organisation as based on a combination of competencies
that need to be attained, developed and integrated successfully in order
to achieve success (see also Dubois & Rothwell, 2004). The
individuals in the organisation are primarily seen as ‘knowledge
workers’ in a knowledge- based economy

54
At Posten, a new company was created which employed the senior
project managers, who then worked on a consultancy basis in projects
within and outside Posten. Moreover, external consultants are
becoming a common feature of the project teams. The same pattern is
found in the other cases. On the one hand, the use of temporary
workforce increases the workforce flexibility of the organisation (see
e.g. Handy, 1989). On the other hand, the case studies presented here
also display the organisations’ concerns about failing to build and
sustain important core competencies, which would increase their
vulnerability. This challenge is also identified by e.g. DeFillippi &
Arthur, (1998:1), who pose the question: “How can project-based
enterprises create competitive advantage when its knowledge-based
resources are embodied in highly mobile project participants”. In all
cases, the question of how to improve the strategic use of consultants
and avoid impoverishing core competencies within the company is on
the top management’s agenda.
The second challenge is about developing core competencies; how to
successfully achieve long-term competence development. The case
studies imply that the project-based context does not create the
time or ‘slack’ necessary for formal competence development and
training. Project workers rush from one project to another and even
if there are a large number of competence development programs
available, project workers rarely have the time to follow such
programs. This is a problem also recognised in the case study of
Hobday (2000), where the high pressured work environment in
projects caused a lack of both time and incentives for training and
development (see also Lindgren, Packendorff, & Wåhlin, 2001).
The case studies presented in Paper I indicate that the answer to
this challenge so far seem to be to transfer more of the
responsibility for training and development to the individuals
themselves. If you want new and challenging projects, you need to
“keep yourself employable”. However, this transfer has its
implications. Apart from implying increased freedom as well as
increased requirements on the individual (further discussed under
the Individual perspective), it also puts higher requirements on the
55
organisation to find new ways of supporting the development of
the competencies that are ‘core’ in order to stay competitive.

Trust: integrating project teams and managing temporary workforce

The case studies strengthen the argument that projectification implies
changes in traditional employment contracts as argued by e.g. Ekstedt
(2002). From a ‘trust perspective’, the organisation is seen as a structure
of loosely integrated teams consisting of people who have not worked
together before and who will not work together again in the future (cf.
Burns & Stalker, 1961). Moreover, as mentioned above, the case
studies suggest that the project-based context creates more indistinct
organisational boarders when it comes to workforce; temporary
workforce and consultants are used to a higher extent in the project
operations. Hence, the temporary features of the PBO affect the
possibilities to build trust and confidence between co-workers, as well
as between the co-workers and the organisation. The challenges for
HRM in PBOs from a trust perspective can be summarised in two
points:
The first challenge concerns achieving trust among project workers in
order to enhance efficient project operations. In the case studies we
could observe that the HR departments during the last few years have
spent time on improving the role structures and set-up procedures of
projects. The PBO context implies increased internal mobility;
employees and others engaged in the project operations work together
during the course of one project, but in the next project the project
team consist of other persons. Moreover, an increasing part of the
workforce is temporary, or hired on a consultancy basis, which means
that the project team members do not only have different
competencies, but also different organisational backgrounds.
The project team members do not have the possibilities to ‘socialise’
and build up confidence and trust like in more enduring forms of
organisation, they rather have to rely on their knowledge of ‘who
knows what’ (see also Lindkvist, 2005; Meyerson, Weick, & Kramer,
1996).Various researchers have identified trust as a success factor for
projects. For example, Herzog (2001:32) argues that “successful
56
projects are delivered in environments where high levels of trust exist
among the collaborators, and in which they may openly share their
problems, concerns, and opinions without fear of reprisal”. However,
according to Meyerson, Weick & Kramer (1996), trust among project
workers is primarily built on interaction with roles rather than
personalities, and is more about doing than relating. While Herzog
(2001) and Meyerson, Weick & Kramer (1996) focus on how to build
trust on a project team level, the case studies presented here point to
the challenge of achieving
basic trust among project workers throughout the organisation in
order to facilitate internal mobility and project team set-ups. One of
the efforts seen in the case studies is the improvement of role
structures, but another, more implicit effort is the increased concern
for the reputation of the project workers (see also Grabher, 2001). At
Saab, the HR director made the analogy to a football coach of a junior
league, defending each player’s future possibilities to play in higher
leagues and at Posten

57
 Change: driving change and providing stability
The case studies confirm what literature on organisation theory
and management has discussed for a long time: managing
organisational
change is becoming increasingly important in modern firms
(Whittington, et al., 1999). A number of HRM researchers have
stressed the increased role for HR specialists in managing and
facilitating change in organisations (e.g. Beer, 1997; Brockbank,
1997; Ulrich, 1997). In the AstraZeneca and the Volvo cases, we
observed that the merger and integration processes have been
prioritised HR concerns. In the Posten and the Saab cases, change
dealt more with the transformation to meet the new competitive
challenges, e.g. the transformation of competence areas.
Analysing HRM from a change perspective implies regarding the
organisation as dynamic, flexible, and in constant change (see e.g.
Heydebrand, 1989; Miles, et al., 1997). In Paper I, we acknowledge
that the importance of managing change per se is not unique in PBOs;
it can rather be regarded as a general feature of most organisations of
today. However, one of the very reasons for adapting flexible, project-
based structures is the need to respond swiftly and effectively to
changes (Guest, 1987). Therefore change management is particularly
important in these types of organisation. Moreover, we argue that
change efforts take different forms in PBOs than in other organisations.
Firstly, the case studies suggest that change in PBOs is often organised
as projects; either as separate change projects or as integrated change
processes in regular projects. This implies that organisational change in
PBOs tend to increase the level of projectification, since not only core
activities but also other types of activities are organised in projects (see
also Packendorff, 2002; Whittington, et al., 1999). Secondly, the
project-based context creates a complex environment for change
management. Bresnen, Goussevskaia & Swan (2005), for example,
argue that “understanding and effecting change in project-based forms
of organization is made particularly difficult by the complex and
dynamic nature of project environments and the effects that they have
upon organizational and management processes”
58
As it seems, on the one hand HRM needs to be designed to
manage and facilitate change, and within some areas even to
initiate and drive change initiatives. The case studies give evidence
of that especially the HR departments take on a greater role
concerning this. On the other hand, HRM in a project-based
context needs to be designed to provide and maintain stability in
order to balance the downsides of the temporary features of the
organisation. The challenge is to design HRM activities, processes
and structures that can meet both demands of driving change and
providing stability.

Individuals: professional project workers or overloaded

individuals
In the approach to HRM suggested in this thesis, the individuals are put
forward as an active party in the relation to their organisational
context. Individuals are seen as providers of ‘human resources’ and
thereby also as partly responsible for the management of these
resources. In all four case studies, we could observe a strong emphasis
on the individuals in the organisations. This emphasis seemed to be
related to an increased independence and own responsibility of the
employees and other engaged. A situation of increased freedom but
also increased requirements. Project workers have the possibility to
broaden their competencies and try new challenges through the project-
based way of working. Moreover, the main resources they provide to
the organisation are their knowledge and their experience, which, as
pointed out by Lindgren (1999), cannot be owned by anyone but the
individuals themselves. Therefore, they have a strong position in the
relation with the organisation that is in need of their contributions. On
the other hand, this turns competence development, work situation and
career into each individual’s own responsibility. As a project worker,
you have to keep yourself ‘employable’. In the Posten case, for
example, an HR director stated that “in a project-based way of
working, it is essential that the individual has a strong willingness to
develop her competence and to take on new challenges”. Similarly, at
Saab, one manager emphasised that the project way of working
requires individuals who are more outgoing and more active in creating
59
their own career. Similar observations were made in the other cases.
The projects challenge, develop and motivate the individuals and the
PBO provides the individuals with both opportunities and security.
However, the project-based context also creates problems from an
individual perspective (see also e.g. Boëthius & Durgé, 2002; Hällsten,
2000; Lindgren, 1999; Packendorff, 2002). Based on the case studies
presented in Paper I, I see two central challenges for HRM in project-
based organisations related to this perspective.
The first challenge concerns supporting professional project workers.
This challenge essentially concerns the PBO’s responsibility for the
individuals and their contributions to the organisation. As discussed
earlier, the traditional concept of ‘employment’ and the relation
between employer and employee are going through a transformation
where long- term, permanent employment forms are on the decrease.
Employees do no longer work a life time at the same place and
temporary and project contracts are becoming more common (e.g.
Ekstedt, 2002). Moreover, the characteristics of long-term employment
relations are changed due to the increased use of project-based forms
of organising. In many ways, individuals working in project-based
organisations – with or without permanent contracts – can be seen as
‘professional project workers’. Their careers and development depend
on the projects that they have worked in and the projects they might
get in the future. And the PBOs are dependent on these flexible,
innovative individuals, who have the competence and the initiative to
act upon the situations and problems that might arise. However, as
Lindgren (1999) points out, if the individuals are supposed to take
more own responsibility, the structures in these types of organisation
must be designed to support these Individuals and to provide the
conditions needed for taking on that responsibility.

60
an HR manager expressed that the co-workers are expected to
take on a greater responsibility for their own development. At
Saab, an HR manager argued that co-workers in a project-based
firm evidently have to ask themselves what they should do after
the next project is finished. They have to plan for their
development within, or outside the company.
highlights the importance of regarding the individuals in PBOs
as active participants of HRM, not as passive receivers. Hällsten
(2000) analyses the decentralisation of personnel responsibilities
in an organisation where projects play an increasingly important
role. He argues that HRM essentially refers to a relation
between various parties: line manager, project manager, the HR
department, and the co-worker, where all parties have a
responsibility to maintain the relation and make it work. For the
individual, it is hence not only about keeping oneself
employable, i.e. to develop one’s competencies and social skills
in order to remain attractive for project assignments; it is also
about ‘employeeship’, i.e. managing one’s relation to the
employer (Tengblad & Hällsten, 2002).
This implies that the individual actually holds a critical role in
the HR organisation of PBOs, a role that needs to be
acknowledged and clarified. As Tengblad & Hällsten (2002)
point out, the unclear assignment of responsibilities between the
different players in the HR organisation, especially concerning
the individual’s role, often leads to issues falling between two
stools. And in the end, the issues falling between two stools are
left to the individual to handle.

61
Compete Defining core competencies; where to draw the line
nce between employees and ‘engaged’.
Developing core competencies; how to successfully
achieve long-term
competence development.
Trust Achieving trust among project workers in order to
enhance efficient project operations.
Achieving trust between the project worker and the
organisation.
Change Meeting the conflictingl requirements of facilitating
and driving change on the one hand and providing
stability and permanent features to the temporary
context on the other
Individu Supporting professional project workers.
al Clarifying the role of the individuals in the HR
organisation.
Table 5 Challenges for HRM in project-based organisations: A
summary
The approach to HRM suggested in this thesis made it possible
to observe and analyse important challenges for HRM in a
project-based context, especially regarding issues of
competence, trust, change, and individual. These challenges are
interrelated in many ways. For example, the challenges of
supporting professional project workers and clarifying the role of
the individuals in the HR organisation are probably closely
related to the challenges related to trust and to competence
development. In the following section, I will bring the analysis
to an operative level, addressing changes that the project-based
context has implied for the HRM-practices.

CHANGES IN CONTENT AND STRUCTURE OF HRM

IN PBOS
The research question of which consequences projectification
has for the HRM practice is dealt with in Paper II and the
empirical foundation for this study is a comparative case study
of R&D units at Volvo and AstraZeneca. In the paper, the main
62
 changes related to the ‘project intensification’ are classified
according to whether they primarily concern the content or the
structure of HRM. I will in the following sections present the
findings of the study presented in Paper II, but also reconnect to
earlier discussions to see in what way the changes relate to the
challenges facing HRM in PBOs. I start with a discussion of the
content changes observed in the cases, which is followed by a
discussion of the structural changes. Finally, based on the
findings, I suggest two logics for HR specialists and alternative
roles for line managers.might be a way of giving individuals
that chance to build their career on projects.
The creation of a specialist career path addresses the challenge of
maintaining and developing core competencies since it gives
employees the opportunity to develop and deepen their specialist
competencies, without having to take on general management or
personnel responsibility. In both firms, the creation of the
specialist career path was a way of securing deep technological
competencies. Several managers expressed that the project work in
cross-functional teams enhance broadening rather than deepening
of competencies and they were therefore concerned about losing
depth in critical competencies.
However, the specialist career path does not solve the problems
with the difficulties to find the time and the space for formal
competence development and training. At Volvo, one manager
expressed that they had tried to find some space between the
projects to let the project workers ‘recharge’, but that it had been
impossible. As it seems, this area of the HRM content is severely
affected by the project-based context and this presents a challenge
to both practitioners and scholars of HRM.
The case studies suggest that the project-based context separates
performance from evaluation, which creates frustration for project
workers as well as for line managers, who have difficulties fulfilling
their responsibilities. The development of new systems for evaluation
and compensation can be seen as addressing

63
 the challenges of supporting professional project workers
and achieving trust between the project worker and the
organisation. These two challenges are closely related, since a
PBO that succeeds with supporting its individual project workers
in a satisfactory way are likely to also gain their trust and
commitment.
In Paper II, we argue that one recurrent theme in the content
changes of HRM in the cases is the changing role of the line
manager, and more specifically the line manager’s increased role
in the HR organisation. That leads us over to the structural
changes of HRM observed in the case studies.

Structural changes
The structure of HRM refers to the how the HRM practices are
structured,
i.e. the HR organisation. The HR organisation consists of the
various players that interact and share the responsibility for
managing the relation between the individuals and their
organisational context. In Paper II, we identify four central
players in the HR organisation: the HR department, line
managers, project managers, and HR support to
projects. In Chapter 3, and earlier in this chapter, I argue that the
individual is an important player in the HR organisation of PBOs
and that this role should be acknowledged and clarified. This is
something I hope to develop in future studies, but for this licentiate
thesis, the focus for the empirical studies is primarily the
organisational parties of the relation. Hence, the players identified
in Paper II should be understood as the organisations’
representatives in the HR organisation. Table 7 presents the changes
observed related to the HR organisation and its players.

64
Struct Volvo AstraZeneca
ural
change
s
HR From centralised to From decentralised to
department
decentralised. Increased centralised. Increased gap
gap between HR between HR department
department and project and project operations.
operations. HR HR department divided in
departments on project- different HRM competence
based units work more areas.
with HRM related to the Works on consultancy basis
project operations. towards line units.
Task-based logic for HR HR-based logic for HR
specialists. specialists. Creation of
new HR-specialist role:
HR business partners
affiliated to particular
business units.
Line Increased responsibility Increased responsibility
manager
for HRM and taking for HRM and decreased
back of of responsibility responsibility for
for technological scientific development.
development. Need for increased HR
Need for increased HR orientation. Difficulties to
orientation. Difficulties balance task- and HRM
to balance task- and responsibilities.
HRM responsibilities. Difficulties to overview and
Difficulties to overview plan the individuals work
and plan the individuals’ situation
work situation
Project Increased responsibility Top project manager is
manager
in performance reviews. also the the formal
manager for the assistant
project manager.
Increased responsibility in
performance reviews.
Ongoing discussions about
the HRM responsibilities of
project managers
HR No specific unit. New unit created in order to
support Handled through the support the projects in e.g.
to HR departments on project management
projects the most project-based development, learning and
65
 line units. development,
and knowledge management.
Table 7 Changes related to the structure of HRM
In Paper II we pay special attention to the first two players, the HR
department and line managers, since the roles of these players are
the ones going through the most important changes. Moreover, the
changes to the line management role seem to be closely related to
the content changes.
The case studies suggest that HR responsibilities are increasingly
decentralised from HR departments to line managers, a trend that
is widely recognised in the HRM field of research (e.g.
Cunningham & Hyman, 1999; Larsen & Brewster, 2003; Thornhill
& Saunders, 1998). This trend is also in line with some of the early
writings on HRM, where one of the central arguments was that
HRM as opposed to traditional personnel management is a general
management responsibility and not a responsibility for personnel
specialists only (Beer, et al., 1984). There are many interrelated
forces behind this devolution of HR responsibilities and the case
studies presented in Paper II strengthen the argument that the
increased use of flexible organisational structures, such as project-
based organisations, is one such important force (see also Hällsten,
2000; Larsen & Brewster, 2003; Thornhill & Saunders, 1998). The
cases point to mainly two reasons. Firstly, because the project-
based context creates a more ‘scattered’ and short-term work
structure, which makes it hard for an HR department (centralised
or decentralised) to keep track of employee performance and
development. Secondly, because the management of the core
activities in a project-based organisation is mainly a task for
project managers, while line managers keep the responsibility for
coordinating, developing and supporting the project workers’
contributions to the projects.

The devolution of HR responsibilities to the line not only implies a

changed line management role; it also points to the need for the
HR department to reinvent its role and structure (Larsen &
Brewster, 2003). In fact, the devolution, in combination with the
66
changes required in HRM practices of PBOs, implies that the
responsibilities and interaction between the players in the HR
organisation of a PBO should differ from that of a functional
organisation. In Paper II, we suggest two logics for HR specialists
in PBOs when adapting the HR departmental role and structure to
the requirements of the firm operations. We also argue that the
line management role in PBOs needs to be addressed and suggest
three alternative roles for line managers to adapt, clarifying the
balance between HR and task orientation.

67
 FROM LINE MANAGERS TO HUMAN RESOURCE
AGENTS

The findings from Paper II suggest that the line management role
in project-based organisations needs to be addressed. When core
activities increasingly are performed in projects instead of
functional units, the former line management role seems to
become more about managing the human resources needed in the
project operations and less about being the technical specialist
managing and developing technology. As mentioned earlier, the
devolution of HR responsibilities to line managers has been
widely discussed by HRM scholars, but the focus has mostly
been directed towards the implications for HR specialists and
not towards the implications for line managers.
In Paper III, we present a single-case study of a project-
based organisation where the line management role had been
abolished and replaced with so called “competence coaches”.
The organisation is a unit of a company within the Tetra Pak
group, called Plant Engineering and Automation (PE&A). The
main contribution with this study is the interesting case of an
organisation that tried something new in order to improve their
project operations, including the descriptions of a new HR-
oriented management role replacing the line management role. In
this section, I will therefore give a brief summary of the case,
with the main focus on describing the new organisation and the
main responsibilities of the so-called “competence coaches” at
PE&A. In Paper III, we discuss the role of the new HR-oriented
management role in the terms of ‘human resource agents’,
responsible for ‘inside integration’ and ‘outside integration’. In
this section, I elaborate on that discussion and on a number of
critical functions for the human resource agent in a PBO.
However, first a brief summary of the Tetra Pak case of PE&A.

The case of PE&A

PE&A is a unit of Tetra Pak Processing Systems. The unit is a

68
 project- based organisation and its core activities are directed
towards managing customer projects which develop and
implement food processing systems. The unit also develops
automation systems for food processing plants.
During the 1990´s the need for changing the organisation in order
to improve the project operations became critical. The classical
matrix was split up and the line manager role was abolished.
Instead, permanent cross-functional teams were created, which had
no formal manager.
These teams became the physical “home-base” for the employees and
serve as the permanent resource base for project teams.
Apart from the cross-functional team, each employee was assigned to
a competence centre, coordinated by a competence coach. These
competence centres are not physically co-located, but have meetings
once a week with their competence coaches. In the new organisation,
the individuals were given an increased responsibility for their own
contributions, their development and careers. The idea was to “spur”
the individuals by giving them a greater freedom.
The competence coaches do not have any responsibility for the core
activities performed in the projects, but they need to have adequate
technical competencies and knowledge about the core activities in
order to fulfil their responsibilities. Their main focus is HRM
processes and activities. The critical responsibilities for a competence
coach are: resource planning for the projects, competence development
and career planning, evaluation and waging, individuals’ work
situation, and individuals’ health and well-being. The responsibility
that the line managers traditionally had for technology and production
solutions has been transferred to a so-called “design owner”.
In the new organisation, the competence coaches have taken over many
of the responsibilities formerly assigned to the HR department and are
seen as “the HR department’s extended arm”. The HR department at
PE&A has been downsized and its main responsibility is to support the
competence coaches and inform them about new policies and systems,
work with strategic HRM issues, and handle more complicated cases
that require specialist HRM competencies. Furthermore, a new support
69
unit for HRM has been created, offering support to all Tetra Pak units
within the country area in recruitment, training, and internal mobility.
In Paper III, we discuss the Tetra Pak case as an “inversion of the
matrix”, where the project operations have gone from ‘virtual’ to
‘permanent’, while the skill-based, functional units have done the
opposite. According to the definitions of PBOs by Hobday (2000) and
Lindkvist (2004), discussed in Chapter 1, this organisation would
certainly qualify as project-based. However, the case study strengthens
what I argued early on in this thesis, that projectification does not
necessarily imply that permanent structures are abolished, or as argued
by Hobday (2000) that project-based organisations have no functional
coordination across project lines. At PE&A, the cross-functional
project teams were transformed into permanent structures and the
competence
centres maintained a strong functional coordination across project
lines. The functional coordination in PE&A was transformed from
focusing technology to focusing HRM. With the former line
managers, whose role implied balancing HR and task orientation
(as discussed in Paper II), the responsibilities for supervising the
work had been prioritised over the HRM responsibilities. The new
organisation instead implied a purely HR- oriented management
role responsible for supporting and assessing the project workers
in their work, competence development, careers, and work
situation.

The human resource agent: managing inside and

outside integration
The role of the competence coaches can in several ways be seen
as a way of dealing with some of the challenges identified in
Paper I. The role is very much oriented towards supporting the
project workers and by doing that it also deals with the
challenge of achieving trust between the project worker and the
organisation. The new role is less of a traditional ‘manager’ and
more of an ‘agent’ for the project workers. Moreover, it is
particularly directed towards supporting and facilitating
70
 competence development.
In traditional studies of management roles and functions, one
key concept has been that of the ‘integrator’. Lawrence & Lorsch
(1967), for example, discuss the increased need for managers,
particularly in R&D- intensive firms with a strong need for
cross-functional coordination, to integrate the efforts among the
major functional specialists in a business. However, the
management role that the authors refer is more of a task-
oriented role, directed towards the integration of the various
specialist contributions. In a project-based organisation, this role
is mainly held by project-managers. The case study of PE&A
suggests that the emerging HR-oriented management role deals
with other forms of integration. In Paper III, we point to two
domains of integration activities that the human resource agent
is set to handle; the inside integration domain and the outside
integration domain. In the following sections, I will discuss these
two domains and clarify the activities related in each domain.
Inside integration
Inside integration concerns integrating the requirements of the
organisation and the resources offered by individuals in the
organisation. This also regards taking the demands that the
individual project worker has on the organisation into
consideration. As discussed earlier, one challenge for PBOs is
to achieve long-term development of core

DESIGN OF HR ORGANISATION AND HR-

DEPARTMENTAL
STRUCTURES
The final research question of this thesis is sprung from the
observations and analyses of the previous studies and aims at
further exploring the design of the HR organisation in PBOs,
addressing different forms of HR- departmental structures in
particular. The study is presented in Paper IV and is based on a
multiple case study. The eight cases are all project- based, but the

71
core activities differ among the firms, as well as the basic
organisation of work. The main contribution with this paper in this
stage is the broad empirical base, which provides a range of
opportunities for various tracks of analysis regarding the design of
the HR organisation of PBOs.
In this paper, we have chosen to specifically focus the structure of
the HR departments and the relation that the HR-departmental
structure have with the character of the work organisation and the
design of the HR organisation.
One central problem addressed in Paper IV is the rather
decontextualised approach in previous research on HR-
departmental structures. Overall, the structure of HR departments
has rarely been the centre of attention for HRM researchers and
when it is, the analysis does not take the firm’s organisational
structure into consideration (cf. Beer, 1997; Sisson & Storey,
2003). Sisson (2001) acknowledges that there are a number of
organisational contingencies (e.g. size, sector, ownership and
whether the firm is joining, continuing or leaving the business),
which are critical for the understanding of what is happening to
the HR department. However, he does not bring up organisational
structure as one of these critical contingencies. The studies
presented so far in this thesis indicate that the organisational
structure in which the core activities are performed is a critical
contingency for the design of the HR organisation, the role of HR
specialists, and hence for the design of the HR department. In the
following, I will discuss the patterns observed in the multiple case
study regarding HR-departmental structure, work organisation, and
HR organisation.

Functional HR departments or HR-centres of expertise

In Paper IV, we compare the HR-departmental structures of the

eight firms and identify two basic categories, which indicate two
alternative ‘ideal types’: 1) Functional HR departments, which are
72
structured according to the line structure of the organisation. 2)
HR-centres of expertise, whose structure is based on competence
areas of HRM (for example recruitment, training, contracting,
compensation/benefits). In the case studies, both categories have
examples of centralised and decentralised structures, but the
functional HR departments tend to have a higher propensity to be
decentralised than the HR-centres of expertise.
We also identify a third category, which we label ‘Emergent HR
departments’. This category consists of non-existing or
undeveloped HR departments, which was observed in two out of
the eight cases. This category is an important sign of the
possibility to have an HR organisation that does not include the
player of an HR department. The features and logics of such an
HR organisation would be an interesting topic for further research,
but in this discussion I will focus on the two ideal types of existing
HR departments and the patterns in work organisation and HR
organisation related to these two types.
It should be pointed out that the ideal types are simplifications of
the alternative HR-departmental forms. Some of the cases have
mixed forms of HR departments, with features of both types. For
example, some of the
cases with HR-centres of expertise as main structure for the HR
departments also had a structure of HR specialists especially assigned
to particular line units. Similarly, one of the cases with functional HR
department as main structure also has a small HR-support unit with HR
specialists working on a consultancy basis towards the line. The basic
categories are nevertheless quite clear in the case study and it seems
relevant to compare them to observe whether there are patterns
concerning the way work is organised and the roles of the different
players in the HR organisation that could be related to the choice of
HR- departmental structure.
In paper IV, we therefore make a cross-case analysis focusing on
the one hand the work organisation and on the other hand the roles
and responsibilities of the players in the HR organisation. This
analysis aimed at detecting possible similarities among the cases
73
having the same type of HR-departmental structure, as well as
differences between the cases with different types. In the following
sections, I discuss the patterns observed and suggest three
propositions related to the design of HR organisation and HR-
departmental structures in PBOs.

Characters of functional coordination and project work

In the analysis of the work organisation, we address 1) the character of

functional coordination, 2) the basic affiliation of project workers, 3)
the character of project work, and 4) the co-localisation of project
teams. In some of the cases, there are no traditional ‘line departments’,
but rather other forms of coordination across projects, such as
‘competence centres’. Therefore, I have chosen to use the term
‘functional coordination’ when referring to the coordination across
projects regarding project-workers and competence (cf. Hobday,
2000).
When searching for cross-case patterns related to work organisation
between the types of HR-departmental structures, the strongest pattern
observed regard the differences in functional coordination. The cases
with a Functional HR department tend to have more traditional line
departments with responsibility for both technology and HRM. In the
cases with HR-centres of expertise on the other hand, the functional
coordination tends to be more directed towards providing ‘competence
networks’ and ‘project work pools’ from which the project managers
recruit resources to the projects. The main function of these networks
is HRM, not technology. The cases with ‘Emergent HR departments’
had very similar work organisations as the cases with HR- centres of
expertise.
In the analysis of the character of project work and the co-
localisation or not of project teams, the patterns were not that
obvious, but we could still observe some tendencies. In the cases
with Functional HR departments, project workers tend contribute
to various projects simultaneously and are hence not co-located
with one project team. This situation can be described as

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‘Fragmented project participation’. In the cases with HR-centres of
expertise, on the other hand, project workers are normally assigned
to one project at a time and the project team members are co-
located during the course of the project. This can be described as
‘Focused project participation’. As already mentioned, the patterns
are somewhat weak in this study; additional studies are needed to
strengthen this suggestion.
One reason for the indistinct patterns might be that the PBOs
under study have not considered the character of project work,
but mainly the character of functional coordination, when
designing the HR department. One might assume that
fragmented project participation, where highly specialised
project workers contribute to various projects at the same time,
promotes a stronger affiliation to the line, but at the same time
creates a somewhat ‘scattered’ work situation that might be hard
to overview, assess and support. Focused project participation,
on the other hand, might promote a stronger affiliation to the
project, creating a larger ‘gap’ between project workers and their
line organisation. As discussed earlier this implies difficulties for
the performance of HRM practices. Accordingly, I suggest that
the character of project work should be taken into consideration
in the design of the HR organisation and the HR- departmental
structure.

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 The players in the HR organization

In the analysis of the design of the HR organisation (i.e. the roles

and responsibilities of the various players responsible for the
management of the relation between the individuals and their
organisational context), we particularly addressed the roles of line
managers, project managers and the HR department. The focus of
these particular players is based on the observations from previous
studies, where these roles have emerged as important in the HR
organisation. Hällsten (2000) also identifies the same players as
crucial for HRM in PBOs, including the individual as an important
player. In this study, the role of the individual is not part of the
analysis, even if this role is regarded as increasingly important in
the HR organisation of PBOs. However, as pointed out earlier, this
licentiate thesis mainly focuses on the organisation’s part of
managing the relation.
In the comparisons of the roles of the players in the HR organisation,
the most prominent patterns regarded the role of line managers and the
role of the HR department. There were no obvious differences between
the cases regarding the role of the project managers in the HR
organisation. In all cases, project managers have an important role –
formal or informal – in the HR organisation. This responsibility is
mainly about the day-to-day work relation with the project workers and
SSabout having a dialogue with the line manager concerning the
project worker’s performance and work situation.
The cross-case patterns regarding the roles of line managers and the HR
department seem quite logical in the light of the cross-case patterns of
the work organisation. Regardless of the type of HR department applied,
the HR department has a strategic and administrative role in the HR
organisation. However, when it comes to the relation to the line, the
patterns between the two types differ. In the cases with Functional HR
departments the line managers tend to have a ‘balancing’ line manager
role (as defined in Paper II),

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 Conclusions
 The findings of this study are drawn based on the analysisand
interpretation of the primary data impact on HR Planning on the job
satisfaction of employees in the software development
organizations in Sri Lanka.

 The career development perspective of the software development

employees which was depicted in section clearly stated that very
large numbers of the respondents are satisfied with the
knowledgesharing activities, the skill development programs which
arecommunication skills, Team work and HR/orientation programs
provided by the organization which can extend their knowledge on
respective working areas. However a few are not satisfied with the
quality of in- house training. Some of the employees are not
satisfied with the productivity improvement programsand are not
willing to adopt new technologies concurrently.

 When considering work type/work load planning in the software

organizations, as stated in section ,the results show that a majority
number of employees strongly feel that the workinghours decided
by organization are most convenient for them. A fewof the
employees are not in favor of the working hours. Further, a high
percentage of employees are satisfied with the assignment of their
work and they are willing to work on their tasks since they are most
appropriate for their requirement.From the study it is clear that the
majority of the employees are happy with the freedom at work
given by management for their tasks but only a few of them are not
feeling satisfied with the freedom given at the work place. In order
to carry out the tasks managers should be given enough freedom
and power so that they feel they ‘own’ the result (Syptak et al.,
1999). It is clearly realized that employees are not satisfied with the
work load and resource utilization for the given delivery deadlines
by management.

 When considering the motivation scheme perspective depicted in

section 4.5.4 most of the employees are not really satisfied with the
motivation schemes currently provided by their organizations.
From the analysis it is concluded that a minority (35.6%) of
employees are satisfied with the payment as per their roles and
responsibility and the remaining employees are not satisfied with
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 the payment according to their roles and responsibilities. Hence
from this analysis it can be stated that payment according to roles
and responsibilities is not very satisfactory.Only a few of the
employees are satisfied with the opportunities for promotions given
by the organization. This shows that the employees do not have any
growth opportunities. However they were satisfied with
participation in the decision making process about the project work
and the social work that the company allowsthem to contribute to.

 From the analysis and interpretation in section 4.5.5, it is concluded

that most of the employees (85.3%) are satisfied with the
workplace and only a few employees are not satisfied with the
workplace (3.6%), who are negligible in number. And similarly, in
the case of infrastructure most of the employees are satisfied and
only a very small number of employees are not happy with the
infrastructure of their organization. It is concluded that nearly all
the employees are satisfied with organization policies and
practices. And only some of them (8.5%) do not seem to be
satisfied with the organization policies and practices. Therefore it
shows .that implementation of rules and responsibilities should be
done fairly by the management.

SUGGESTIONS

 The journey of this research has been challenging but equally

fulfilling for the researcher. This inquiry has helped the researcher to
gain knowledge not only related to the HR challenges, but also to
build perspectives related to different aspects of management of not
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 for profit organizations and the role played by other actors such as
government, funding agencies, corporate and community members.
Mentioned below is a brief summary of the preceding chapters of
this report followed by findings and explains the rationale for the
study and explains the theoretical concepts related to Human
Resource Management, ‘Development’ and relationship between
HRM and Development. It also includes discussion about
similarities in Values and Principles in Social work practice and HR
along with the significance of Development Sector Organizations.
There is a list of broad research questions which have been
instrumental in framing the inquiry. Second Chapter includes review
of related literature. Literature review is presented in following
thematic categories: HR challenges and needs of DSOs in general in
India and abroad; Specific areas of HR such as Talent acquisition,
Marketing and communication for recruitment, Performance
management, Employee motivation & rewards, Subjective well-
being; Gender related HR aspects of development sector
organizations and HR aspects of specific categories of employees:
Professional social workers and field workers.

 Explains Research methodology used for the study. Researcher has

used mixed method approach for deriving benefits of both
quantitative and qualitative methodologies. Researcher selected 14
Development Sector Organizations working in variety of focus areas
such as Health care, Education, Agriculture & Livelihood, Disable
Welfare, Training & Skill development and so on. Responses
andidates have been analyzed and presented in which is about Data
analysis and Interpretation. The second part of the same chapter
includes detailed case studies of 11 DSOs describing their HR
challenges, strengths, weaknesses and good practices. Researcher
has made efforts to fulfil all research objectives as mentioned in the
methodology while collecting secondary and primary data and
interpreting it.

 .HR Challenges faced by DSOs along with recommended strategies

Based on the data analysis, various HR challenges of DSOs have
emerged which have been described in seven categories as
mentioned below. Along with the challenges related to each
category, researcher has also recommended some strategies which
would help DSOs to cope up with these challenges.

I. Challenges related to attracting and acquiring talent such as

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 Difficulty to find talent, Identifying the right candidate,
Lack of Career Prospects, Inadequacy of education inputs,
Challenges in Urban areas, Challenges in Rural and Tribal
areas, Gender aspects.
II. Challenges related to Training & Employee Performance
such as Need for training, Lack of resources for training,
Evaluating Employee Performance.Recommended strategies
are Developing competencies among senior
members,Developing skills of employees, Developing
effective Performance managementsystem.
III. Challenges related to employee motivation and retention
such as Inability to
provide competitive Remuneration & Benefits,
The nature of field work, High Aattrition,
Government and policy climate.Recommended
Strategies Are Transcending employees through
motivational levels, providing non-monetary
benefits, Providing Flexibility
IV. Challenges related to Work culture such as Decision making
process, Diversification v/s Consolidation.Recommended
strategies are Inclusive decision making, Providing pleasant
work environment
V. Challenges related to Leadership such as Lack of continuity,
Hiring an ‘outsider’ at top, Lack of vertical
growthRecommended strategies are Succession planning,
Maintaining field presence
VI. Challenges related to Funding and support system such as
Funding pattern, Effect of CSR, Effect of Support system,
Sector specific challengesRecommended strategies are
Exploring alternative forms of organization, seeking active
involvement of donors, Building Institutional Capacity
Lateral strategies These strategies are broad in nature. They
would be helpful in dealing with many of the above
mentioned HR challenges and also in strengthening HR
function. It
includes:
 Assessment of HR function
 Outsourcing HR
 Use of latest Technology

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 BIBLOGRAPHY
WWW.WIKIPEDIA.COM

WWW.SCIBED.COM

WWW.GOOGLE.COM

WWW.PMI.ORG

WWW.DIVA-PORTAL.ORG

WWW.RESEARCHGATE.COM

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