Human Resource Management Risks: Sources and Control Strategies Based on Dairy Farmer Focus Groups

By Bitsch, Vera; Kassa, Getachew Abate et al. | Journal of Agricultural and Applied Economics, April 2006 | Go to article overview

Human Resource Management Risks: Sources and Control Strategies Based on Dairy Farmer Focus Groups


Bitsch, Vera, Kassa, Getachew Abate, Harsh, Stephen B., Mugera, Amin W., Journal of Agricultural and Applied Economics


Human resource management in agriculture and associated risks are under-researched topics. To identify the sources of human resource management risks confronting dairy farms, gain insights into how dairy farmers perceive the impacts of these risks, and identify control strategies, four focus group discussions were held with dairy farm managers. Managers' perceptions served to develop a framework for the analysis of human resource management risks in agriculture and derive recommendations for reducing these risks. Results of this study have been used to tailor educational programs for farmers and suggest strategies for future research.

Key Words: focus group discussion, labor management, personnel management, qualitative research, risk management, risk perception

JEL Classifications: B49, M12, M50, M52, M53, M54, M59, Q12, Q19

The role and impact of human resource management (HRM) practices, strategies, and policies have been widely researched in businesses and organizations, mostly in large entities (Heneman and Tansky). Researchers have developed and applied different HRM frameworks and models to analyze and evaluate the effect of HRM practices on firm performance (for empirical examples, see Arthur; Becker and Gerhardt; for a conceptual example, see Delery and Doty). A common assumption of these approaches is the existence of a relationship between HRM practices and firm performance.

With rapidly changing economic conditions, characterized by increasing competition, market deregulation, and globalization, and growing farm sizes with greater numbers of hired employees (for the dairy industry, see Hadley, Harsh, and Wolf; Tauer and Mishra), HRM is increasingly viewed as a means for agricultural firms to become more efficient and competitive. Although HRM is not new as a research topic in agriculture, few studies have been conducted on HRM practices and strategies of agribusinesses and farms. HRM-related programs in agriculture have mainly focused on farmer education, including providing information on training, management, and related legal and policy issues. Knowledge regarding the specific HRM challenges farms are currently facing, and even their specific HRM practices and strategies, is limited.

One area that demands research is the risk associated with HRM practices. According to Bitsch and Harsh, the agricultural economics literature treats HRM risks as one of the five major sources of risk: (1) production and yield risk; (2) price and market risk; (3) financial risk; (4) human resource risk; and (5) institutional, legal, and environmental risk. Most risk studies in agriculture have dealt with production, market, and financial risks. In June 2004, the national agricultural risk education library (www.agrisk.umn.edu/library) listed 386 documents on production risk, 487 documents on price risk, 459 documents on financial risk, 288 documents on legal risk, and 214 documents on human risk. The category human risk included documents on safety (115), family issues (33), and health (32). Only 57 documents addressed personnel management, which is understood as HRM in the management literature. One of the documents listed described focus group discussions in Texas and Kansas during which farmers, other agribusiness firms, and lenders ranked risk sources on farms. Availability of skilled labor was one of the top 10 risks farmers faced (Texas and Kansas Risk Management Education Teams).

Addressing risk management for businesses in general, Jeynes listed a number of risk factors associated with HRM practices, such as employee skills and expertise for current or future work, supervision and management of workers, work group organization, training, organizational culture, careers and development (motivation, commitment), and legislative factors. Aside from a recent study by Bitsch and Harsh of horticultural managers' labor risk perceptions, risks that result from these factors have not been studied in agriculture. …

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