November 01, 2008

Human Resource Management Lesson 2 Exercise



The role of the HR function at Telefónica. Telefónica operates in the global telecommunications market, with headquarters in Spain. With a presence in 24 countries employs an average of 249,000 persons.

The external factors comprising political and economic context, legal content, labour markets, industry and location tend to shape management approaches. Looking at location using Trompenaars (1993) dimensions and considering Telefónica business is concentrated mainly in Spain and Latin America the management practices takes into consideration the culture that is quite emotional, collectivist and achievement oriented (for example pay for performance) however the expansion to Central/East Europe is much more difficult in this aspect.

Considering Storey’s (1992) typology of HR functions, I would characterize the HR role function at Telefónica mainly as ‘advisers’ although due to its recent past as public company in some aspects HR is still operating as regulator. 

The ‘advisor’ role of HR operates in an internal context of a ‘consultative’ management style for most employees; unions have strong influence (Purcell and Ahlstrand 1994). Encouraging its staff to improve by acknowledging their contribution, inculcating employee loyalty, commitment and dependency. However considering the huge workforce of Telefónica I have to say Telefónica adopt different management styles depending on each group, for instance consultative for sales force (view as company most valuable resource) and constitutional for less skilled workers such as operators.


The HR role is influenced by its history. The Compañia Telefónica Nacional de España was incorporated on 19 April 1924 as a public limited company, Telefónica was privatized in 1997. The public company was a bureaucracy with some inefficiency, the employees salaries were determined by the government.

After the privatization the company dramatically changes not only in HR but also its structure , principles and strategy, now Telefónica is a competitive Telefónica in a deregulated market, its goal is maximize earnings, HR have expanded its role and the employees are primarily results-oriented.

Telefónica is a complex organization operating in many countries across the world, due to a a diverse context the HR range of operations is not exactly the same across all of them adopting different roles depending the different factors operating there such as political and economic environment, legal context and labor markets. For instance the labor market in America is more flexible than labor market in most of European countries.


The shift towards the ‘advisor’ role fits much better than “regular” role in the telecommunication industry. The unions have a strong present nowadays so the flexibility of Telefónica is quite imitated. There is resistance of some employees and managers to the change. Telefónica have to face the challenge of globalization, the HR role have to deal with different cultures across the world, so HR role should move towards change-makers.

Telefonica structure


  • Study notes. Warwick University. Human Resource Managemet.

  • Marchington, M. and Wilkinson, A. (2005) Human Resource Management at Work (3rd edn). London: CIPD

  • Purcell, J. (1986) ‘Employee Relations Autonomy Within a Corporate Culture’ . Personnel Management, February

  • Purcell, J. and Alhstrand, B. (1994) Human Resource Management in the Multi-Divisional Company. Oxford: Oxford University Press

  • Storey, J. (1992).Developments in the Management of Human Resources, Oxford: Blackwell

  • Trompenaars, F. (1993).Riding The Waves of Culture: Understanding Cultural Diversity in Business.London: Nicholas Brearly Publishing

- 2 comments by 1 or more people Not publicly viewable

  1. Hi

    I understand that you have an extension until the 10th Nov. So, just a few thoughts on the above.

    Overall a solid (if brief) outline of the relevant models in relation to the organisation. However, if you think about the diagram that you have included it shows a ‘complex’ organisation that operates across several locations around the world. Is it possible given the diversity of context implied by that range of operations that HR can function in the same way across them all? Or does it adopt different roles in different locations depending upon the different factors operating there?

    These would be interesting points to consider or to explain why that is not the caase.



    03 Nov 2008, 20:11

  2. Thanks John, I have included the interesting point you mention.

    09 Nov 2008, 18:51

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