Abstract

The paper develops an analytical exercise about the effects the present shift from action oriented to knowledge centered work systems should have on human resources employment and the management of employment relationship. The focus of the exercise is on continuous learning. To the extent that in advanced technological and organizational settings continuous learning becomes an intrinsic feature of work roles at all level of the organization, as such hardly distinguishable from the performance of work tasks, the rationale of the traditional internal labor market vanishes. Moreover, the conventional wisdom about the investment in training becomes insufficient, and two previously unforeseen coordination problems ensue, which must be solved, in order to obtain an adequate development of the learning process: i) between employer and employees about the interest of the latter in sustaining the effort to learn; ii) between employers who recruit in a same labour market, about their willingness to make own employees' competencies easily observable. Privileging the first of these problems, it is argued that reward systems, by which increases in pay are parameterized on the acquired competencies (the so called "horizontal career"), provide he best solution, inasmuch as they capture the main advantages of linear incentive systems, overcoming the drawbacks of absolute performance evaluation, and in principle permit to link internal promotions and external mobility, so to ensure employers and adequate flexibility and their employees some governance over their own careers. After an essential survey of the empirical evidences of such reward systems, the paper concludes with a brief discussion of the conditions for the solution of the second coordination problem.