Academic journal article
By Katz, Jerome A.; Aldrich, Howard E.; Welbourne, Theresa M.; Williams, Pamela M.
Entrepreneurship: Theory and Practice , Vol. 25, No. 1
Employers in developed nations at the dawn of the new millennium are coming to understand the human limitations of the past twenty year's pattern of economic growth. Whereas economies in some parts of the world are struggling to regain their strength, healthy economies in North America and Europe are approaching full-employment, with skilled employees increasingly the scarcest resource. Increasingly, firms profess that people are the source of their competitive advantage, whether they be technological experts, accommodating customer service experts, or visionary managers. For example, the Internet companies fueling part of the boom are unable to find the managerial and technological expertise they need. At a time of unparalleled technological development, it is the human resources that paradoxically spell success or failure for all firms, and especially entrepreneurial ones.
What human resource management advice can we offer to small- or medium-sized entrepreneurial enterprises? In surveying our field in 1999, our answer was, "Not as much as we'd like." Although the fields of entrepreneurship and human resource management are well developed and recognized disciplines of study by themselves, the combination of the two had been overlooked. Our intent for this special issue was to bring together these two topics. Why? We thought we could learn something new from synthesizing these two areas of work, and the papers compiled in this issue support our conjecture.
Historically, entrepreneurship researchers have studied founding processes, entrepreneurs as individuals, and high growth firms. Scholars in human resource management have been studying the management of employees for many years. However, very little serious academic work on human resource management was carried out within smaller firms. The first article in this special issue, by Heneman, Tansky, and Camp, carefully reviews what is known about HRM in SMEs through the use of surveys, focus groups, and a literature search. Not only is there very little research at the crossroads of entrepreneurship and human resource management, but there is also tremendous opportunity for expanding our knowledge of these topics. Williamson demonstrates how we might combine work in organization theory and HRM by focusing on the recruitment process in smaller organizations and the challenge they face in recruiting qualified employees. He draws upon institutional sociology to offer some propositions about how an employer s perc eived legitimacy affects the success of its recruiting strategies. Both papers provide a wealth of ideas for researchers and suggest that there is ample opportunity for theory testing in a population that has been largely ignored by many organizational behavior researchers.
Small and medium-size firms are predominant in the United States and around the world and they provide a fertile ground for research. Not only are these firms important to industrial economies, but they also share a trait that makes them particularly interesting to researchers who want to study cause and effect. SMEs can be considered the "fruit flies" of management because they live and die quickly. The process of rapid birth and death gives researchers an opportunity to examine many different types of theories in a unique environment. Important medical discoveries have been made by studying fruit flies because the effect of a drug or intervention on the fly or on subsequent generations can be quickly assessed. The empirical studies in this special issue show that the effects of human resource interventions on firm performance can also be more easily assessed in SMEs.
But you may wonder, if SMEs present such a great research environment, why have human resource management scholars stayed away so long? Or why have entrepreneurship researchers avoided the HRM issues? We think it may be because HRM is considered by many to be a large company phenomenon. Ask any manager to define HRM, and he/she will likely talk about bureaucracy, policies, procedures, and paperwork. …