Human resource management executive presence in top management

Abstract

PurposeThis study aims to draw upon research from strategic human resource management (HRM) and strategic management to examine how HRM demands influence the likelihood that chief executive officers (CEOs) will staff top management with a human resource (HR) executive.Design/methodology/approachThe theory and hypotheses developed in this study are tested on a sample of US initial public offering firms from the calendar year 2007, using logistic regression.FindingsThe results of hypothesis tests suggest that HR executive presence in top management is positively related to the HRM demands faced by a CEO stemming from product/service innovation strategies, the number of HRs employed by the firm and CEO’s financial orientation.Research limitations/implicationsThe results of this study may not generalize to other settings. This study does not simultaneously consider the role of other structural forms which may increase or reduce the degree of HRM demands faced by the CEO. This study extends prior research on executive job demands by expanding the understanding of factors which give rise to HRM sources of executive job demands. Study results suggest that CEOs with financial orientations are more likely to staff their top management teams with an HR executive, which suggests that in the face of executive job demands stemming from a particular functional area, CEOs delegate responsibility for that function to another member of top management. This finding suggests that CEOs can, and in fact do, recognize the limitations engendered by their experiences and that when confronted with a specific type of executive job demand that does not align with their expertise, they take steps to address their individual limitations by appointing others that are more capable of addressing the particular source of executive job demand.Practical implicationsStudy results suggest that product/service innovation strategies, CEO’s financial background and the number of HRs employed by the firm increase the likelihood of HR functional representation in top management.Originality/valueThe theory and results of this study extend the focus of extant research on factors giving rise to HRM’s functional representation in top management. Although prior research has emphasized the role of ownership characteristics and risk preferences in the adoption of this structural form, this study examines the role of CEO HRM demands. This approach allows for the integration of the upper echelons theory with the strategic HRM literature and provides an empirical examination of CEO job demands arising from the HRM function.