All this implied the development of a much closer relationship between managers
and employees, and therefore also changes in the work of managers as well as
that of workers. In particular, it meant that the traditional approach of managing
people – ‘personnel management’ or ‘personnel administration’, which had
evolved to help manage Taylorist/Fordist organisations more effectively – was
no longer viable. In an increasingly competitive global economy, with advancing
technology and better-educated workforces, it was not enough to manage people
reactively or passively. In the industries that mattered, competitive advantage
now ultimately came not from capital investment but from human resources, and
these had to be managed proactively and strategically if an organisation was to be
successful.