Conceptual Framework of SHRM

atta (2007) pointed out that SHRM is an approach of decision making relating to the
organisational objectives connecting people rather than employees who are essential to
implementing the business strategy of the organisation.

At the same time, SHRM sets up a rapport connecting HRM with Strategic management
while SHRM aimed to clarify the whole course of action that the organisation would like
to accomplish its objectives by the concerned people.

Wright (1998) added that as a component of the strategic management, SHRM would
consider to handling with all people linked with the business for long-term and integrate
inclusive issues of the organisational structure, its culture, managerial effectiveness,
performance, resources, as well as changes of management that deals with HR actions
applied to support the competitive strategy of the organisation.

Jakson and Schuler (1995) indicated SHRM as a means and approach of supporting
the management of HR connecting with the strategic context of the business while it
aimed to endow with an intellect to directing any disorderly environment of the
organisation towards an ordered and coherent way adopting effectual actions and
policies.

Becker and Huselid (2006) explained that the SHRM takes into account those verdicts
and course actions to managing the employees of all stages in the way that rooted to
the direction of generating sustaining competitive advantage for the organisation.

Sheehan (2005) explored that SHRM should make available of guidelines to selecting
triumphant action to gaining eventual trial of the authenticity of strategic HRM where HR
is considered a strategic issue for overall corporate function and evidence.

To implementing SHRM, it is essential to enlarge the existing strategy of the

organisation with clear reflection on the HR dimensions and comprehensible guidance
for the HR management regarding their responsibility and accountability.

Datta (2007) also mentioned that a great deal of the literature endows with the facts of
strategic amalgamation, but it is necessary to address the reasons why strategic
incorporation would be advantageous to organizations.
The wider viewpoint of modern business advocates to amplify the input of HR
reflections within the strategic planning with an outlook to caring employees as an asset
of the organisation ensuring their further participation and apprehension through
effectual communications, result oriented procedural practices, well aliened training,
reward and career expansion opportunities concerned with performance.

Schuler and Jakson (1987) explained the necessity of SHRM arguing that it will provide
well-built visionary and captivate leadership at the top of the organisation that dedicated
to the exposed missions and values with clear understanding to the business strategies,
eager to implementing them effectually, positive focus to the critical success factors,
and friendly to working consistent management team

Model for SHRM

Delery and Doty (1996) introduced the two stages model of SHRM while Truss and
Gratton (1994) presented the three stages model to deliver the process of SHRM.
Krishnan and Singh (2006) integrated both the two stages and three stages strategy
into a single platform and presented a modified version that has demonstrated in
diagram – 1 with explanation of the three stages.

Wright (1998) pointed out that the first stage is to put together with the business
strategy and decode this connecting with the strategic objectives of HRM while the HR
strategy generates from the strategic objectives of HRM.

The next level is to put into practice of HRM systems supporting the HR strategy while
the concluding level is to weigh up and reviewing the efficiency as well as strategic
incorporation of the HRM systems within the organisation.

The course of action of SHRM is enough dynamic with the three levelled strongly inter-linked
procedure including diverse enablers and deterrents for every level, which are the
organisational factors to assist the course of action of SHRM practice
Diagram – 1: Three Stages SHRM Model with Enablers

Source: Krishnan and Singh (2006)

The above model is a modified version of both two and three stage method of SHRM
practice where the horizontal configuration presents assorted HR practices as well as
the connections of then with strategic objectives including the entire five major features
of SHRM.

The First Steep of SHRM Model

Krishnan and Singh (2006) described that the elementary stage of the model endow
with the basic opinion for commencing efficient SHRM and the organisation considers
its HR department just like a business collaborator and facilitate it with the opportunities
to be a convenient partner.
At this level, the strategy team would put together the business strategy where the
integration of the HR departmental head as top of the team would generate the
organisational strategy that aimed to build up a positive strategic association with the
HRM systems of the organisation.

Delery and Doty (1996) mentioned that, both the external and internal environment of
the organisation would seriously influence the strategy formulation where the external
factors identified as environment of the product market and level of competition, labour
market condition including demography, politics, legislation, and economic
circumstances together with external stakeholders of the organisation.

Trussa & Grattona (1994) added that the organisational factors have been identified as
the organisational state of affairs that stand for different departments as well as
functions, which contribute to put together the business strategy integrating with
people’s management factors and all other internal factors.

One of the key factors for successful execution of SHRM is the requirement of
competencies at HR while the other necessary factors are the organisational capacities,
training the HR to improve and meet up the existing gaps, identifying critical factors for
HR strategy and competencies to executing business strategy including HRM
components.

The Second Steep of SHRM Model

Wright (1998) pointed out that the second step of SHRM is to putting into operation of a
range of HRM systems supporting the HR strategy connecting through vertically,
horizontally, and temporally.

Truss and Gratton (1994) identified that the vertical linkage involved with HR selection,
recruitment, performance measure, reward, training and career development while the
horizontal linkage integrated with HRM related policies and practices and the temporal
linkages concerned with organisational development and sudden changes through
automation or for any merger.

Integration of Information System within HRM practice and outsourcing also contribute
the HR department to implementing SHRM while the first step and second step of the
model has interlined as a strategic partner (Krishnan and Singh, 2006).
The Third Steep of SHRM Model
Krishnan and Singh (2006) mentioned that the third steep of SHRM the model
concentrated to assessing and reviewing the efficiency of HRM systems including their
strategic amalgamation to gaining strategic objectives as an essential component of
SHRM.

At this stage, the total HRM systems supporting business strategy would be evaluated
with aim to determining the effectiveness of the HR practices and presentation through
scrutinising the association between the three steps.

It is essential for the HR department what are the standard and measures to assessing
the progress as the model involved with different survey and reviewing process while
some of the theoretician suggest to measuring the productivity of employees in terms of
financial returns, others argued for turnover as well as advanced performance shaping
the intensity of strategic integration.

SHRM & Competitive Advantage

Elliott (2006) identified three major standpoints that have come into sight to delivering
competitive advantages from SHRM practice and the first one is Universalistic viewpoint
that engage with a HRM practice to ensure prolonging competitive advantage, but a
number of researchers disagreed with this view.

Guest (1997) put down to a contingency viewpoint as well as argue that one
organisation to another the HR strategy and practices would be dissimilar for which the
HR practices are not quite synergistic and dependable with organisational strategies
and may equally unfavourable for both individual and organisational performance.

Delery, et al. (1996) and Bobko, et al. (2008) explained the configurational viewpoint of
SHRM that support the HR practices to contribute the organisational performance and
to attain business objectives fitting with configurational perspectives that put forward the
organisation to establish the HR system complying with both horizontal and vertical fits.

SHRM to linking Competitive Advantage & HR

Strategy
Elliott (2006) and Inyang (2010) established the linkage of competitive advantage and
HR practices based on SHRM with the resource-based framework for which it is
essential to highlight on the following points-

 Human capital resources as valuable: organisations must provide highest

value and care to the HR treating it as tremendous source to provide competitive
advantage where the demand and supply of workforce are heterogeneous to the
organisation (Miles & Snow, 1984);
 Human capital resources as rare: Under this approach of SHRM, the rarity of
human capital has derived of HR expertise and capabilities altitude as well as
predestined on the proposition HR skills and competencies as a rare feature;
 Human resources as inimitable: The SHRM scholars delivered this approach
arguing that HR is inimitable to generate sustained competitive advantage for the
organisation based on complex social networks (Elliott, 2006 & Wright, 1998).

This SHRM loom applying the HR practices is further fitting from resource-based
observation to deliver competitive advantage for the organisation to systemically to
control and administer the HR pool through implementation HR behaviour that has
demonstrated in the following diagram – 2:

Diagram – 2: Model for HR as Foundation of Sustained Competitive Advantage

Source: Elliott (2006)

Linking corporate strategy with HR strategy:

Porter (2009) clarified the corporate strategy as an overall road map for the diversified
organisations though there is long gap among the top management to understanding
the core context of corporate strategy and the root to implication.

A diversified organisation belong to double ranked strategy that formed with business
unit strategy and corporate strategy with reference to two queries – first one is for which
business the different units would go for and the second query is how the corporate
office would administer the assortment of business units.

The corporate strategy drives the diversified organisations add and sum up the activities
of the business units including portfolio management, reengineering, transmitting skills,
and shared vision and activities where the HR is the vital strength for implication.

Deloitte (2009) added that the key success factors for the modern diversified
organisations have to taking into account their people first as the ultramodern HR
executives have to face the challenge to enlarge the well-organised, effectual, and
influential, but easygoing solutions for the people related to the business.

It is enough complicated to settle on the exact input of HR function to gaining such

objectives, but integrating SHRM framework it will exclusively contribute the
organisations to reinforce the strategic responsibility of HR function supporting the
business strategy.

Ulrich, et al. (2009) added that recognising the human capital value, this approach
uphold the corporate strategy through transforming business strategy into actionable
HR strategy, then transforming HR strategy into people’s initiatives and programs of the
organisation identifying the best fit to motivate and retain existing employees and pull
attention of the new workforce.

Consequently, the entire process would contribute the organisation to survive and grow
up by accelerating the greater shareholder value (Delery, et al., 1996).

Boxall and Purcell (2000) investigated and identified a number of logical linkages
among the HR strategies and corporate strategies where the major acquaintance set up
through the portfolio theory that correspond to the market growth rate considering as a
function market share and the adoption of HR strategies would generate a changing
organisational circumstances.

Graetz, et al, (2010) recognised other linkages such as value chain that endorse with
service quality, continuous innovation, sensitivity where the HR treated as a critical
success factor complying with complexity, emergence, and organisational structure.

2.2.2 Aspects of SHRM Strategic human resource management (SHRM) includes;

1. All those activities affecting the behavior of individuals in their efforts to formulate and implement
the strategic needs of business. (Schuler, 1992) 2. The pattern of planned human resource deployment
and activities intended to enable the organisation to achieve its goals. (Wright and McMahan, 1992) 3.
That part of the management process that specialises in the management of human capital. It
emphasises that employees are the primary resource for gaining sustainable competitive advantage,
that human resource activities need to be integrated with corporate strategy, and that human resource
specialists help management meet both efficiency and equity objectives. (Tracey, 1994). 2.2.3 Features
of SHRM Features of strategic human resource management could be inferred as mentioned below: •
Organisational level - Because strategies involve decisions about key goals, major policies and the
allocation of resources, they tend to be formulated at the top; • Focus - Strategies are business-driven
and focus on ‘organisational effectiveness’; people are seen primarily as resources to be managed
towards the achievement of strategic business goals; and • Framework - Strategies by their very nature
provide a unifying framework that is broad, contingency-based and integrative. They incorporate a full
complement of the HR goals and activities designed specifically to fit extant environments and be
mutually reinforcing and synergistic. 2.2.4 Application of SHRM The degree to which the concept of
strategic human resource management is applied within an organisation, its form and content vary in
organisations. It is understood that organisations may be so preoccupied with survival tactics and
managing the here and now of organising that perhaps unwisely, they miss an articulated corporate or
business strategy to plan for human resource management. In these circumstances, which are typical of
many organisations in the UK, where a ‘short-term’ perspective has prevailed, strategic human resource
management cannot be practiced. Strategic approach to human resource issues is possible only in an
environment where there is a strategic long- term approach of corporate or business strategy. In many
organizations, planning the human resource function fulfils primarily an administrative and service role
and is not involved in strategic matters. Mintzberg argues that strategies which are actually carried
through in practice show unintended features, which he terms 'emergent strategies'. This might 8 result
from poor strategic thinking, poor implementation or even, a sound state of realism. It reflects the view
that strategic management should not be confined to the top echelons in an organisation. Emergent
strategy rarely comes from the top, but rather from bright ideas and initiatives emerging from local
levels which are found to work in practice and then adopted. Modern technology allows us to develop
organisations, which are differentiated, allow for local flexibility and autonomy but are highly integrated
at the same time. (Price, 2004). In modern organisations, HR strategy is supported by information
technology in the form of human resource management information systems and workforce
management systems. 2.2.5 Implications of SHRM Academically, the area of enquiry is interdisciplinary
and as a practical craft, integrative. Understanding of the political and economic ‘environment of
constraints’ as well as the internal sociological dynamics of the organisation, specifically the
psychological underpinnings to human behaviour at work, are important in strategic human resource
management. SHRM has the following distinct implications: 1. The use of planning to maximise
advantage from human resource management; 2. A coherent approach to the design and management
of personnel systems based on employment policy and manpower strategy underpinned by
‘philosophy’; and 3. Human resource management activities and policies are aspects of explicitly
formulated business strategy. SHRM implies accepting the HR function as integral to the formulation of
the companies’ strategies and implementation of the same through specific human resource processes
viz. recruiting, selecting, training and rewarding personnel. To clarify further, whereas strategic human
resource management recognises HR’s partnership role in the strategising process, the term HR
strategies refers to specific HR policies or practices undertaken or pursued towards clearly formulated
aims. These goals (like any other objectives) need to be expressed preferably in quantifiable terms so
that outcomes can be measured. However, strategic HR objectives go beyond simplistic calculations and
control of staff numbers and overall cost control. Strategic thinking incorporates ethical and legal
considerations, which have complex implications for the achievement of a wide range of business
objectives. A few are listed below. . (a) Equity: Applicants and employees should be treated fairly to
minimise complaints or negative publicity. (b) Consideration: There should be consideration for
individual circumstances and aspirations while taking strategic decisions which affect the security,
prospects and self-respect of employees. (c) Commitment: Commitment and motivation of employees
should be secured as a priority issue. Staff tends not to be committed to organisations, which are not
committed to them. (d) Working Conditions: Safe, healthy and pleasant conditions enhance wellbeing,
minimise stress and improve efficiency. Physical and social working 9 conditions determine work
efficiency significantly and need to be included in strategy.

2.5 MODELS OF SHRM There are a number of models within the rubric of prescriptive and descriptive,
which within the framework of the concept of strategic human resource management form various
approaches to the concept’s theoretical development and practical implementation. First, there are
those that refer to general approaches to strategic human resource management; second, there are
those that prescribe particular approaches to the practice of strategic HRM, namely, resource capability,
high –performance management (high performance working), high-commitment management, and
high- involvement management. The models of SHRM are either prescriptive or descriptive. As per
Guest’s model of 1987, HRM can be derived empirically and conceptually from analyses of individual
practices overtime leading to testable propositions and finally, prescription of policy. There are four key
elements or goals of strategic human resource management, as identified by Guest. These are: (1)
integration; (2) commitment; (3) flexibility, and (4) quality. Guest’s model however takes little account
of contextual circumstances such as impact of situational and environmental factors on organisational
practice. The other major paradigm is functionalism, which draws upon functionalist sociology
propounded by Comte. It follows the positive tradition adapting biological concepts to sociology.
Anthropologists Malinowski and Radcliff Brown (1952) emphasised social order, stability and continuity
of the ‘organic whole’; the chief argument is that society holds together underpinned by the notion of
purposive rationality. Transporting the concept to organisational life, hence functionalism aims at the
establishment of objective knowledge. The purpose of HRM accordingly is to sustain organisational
coherence by way of integration between sections constituting an organisation through strategy. The
High-Performance Working Model High-performance working involves the development of a number of
interrelated approaches which together impact favourably on the performance of the firm in areas like
productivity, quality, and levels of customer service, growth, profits, and delivery of increased
shareholder value. This is achieved by ‘enhancing the skills and engaging the enthusiasm of employees’
in goal accomplishment. The starting point is leadership vision and benchmarking to create momentum
and identify direction for measuring progress constantly. It involves structural and cultural stipulations
to that end. Guest suggests that the main drivers of support system or culture are: • Decentralised
decision- making, especially at the cutting edge level so as to constantly renew and improve offers or
services made to customers or people in general; • Development of people -capacities through induced
learning at all levels, with particular emphasis on self-management and team capability to enable and
support ‘performance improvement’ and enhance ‘organisational potential’; • Performance, operational
and people management processes are aligned to organisational objectives to build trust, enthusiasm
and commitment towards the direction or course of action adopted by the organisation. 16 • Fair
treatment of those who leave the organisation mid-course, and engagement with the needs of the
community outside the organisation. This is an important component of trust and commitment based
relationships, both within and outside the organisation; and; • High-performance management practices
that include rigorous recruitment and selection procedures, extensive and relevant training and
management development activities, and incentive pay systems and performance management
processes. In the United States, this approach is described as the use of high-performance work systems
or practices. The characteristics of a high-performance work system have been defined by the United
States Department of Labour (1993) as: • Careful and extensive recruitment, selection and training; •
Formal system for information sharing with individuals who work in the organisation; • Clear job design;
• High-level participation process; • Monitoring attitudes; and studying behaviour; • Regular
performance appraisals; • Properly functioning grievance redress system; and • Promotion and
compensation schemes that provide for recognition and financial reward for high performing members
of the workforce. High-performance working involves the adoption of high-performance design
methods. These require certain steps in a logical sequence; as stated below: • Management clearly
defines what it needs by way of new methods of working and articulation of results expected; •
Management extends success parameters in that it continually sets goals and standards for enhanced
success; • Multi-skill acquisition is encouraged. Encouragement and training are provided for employees
to acquire new skills; • Equipment is selected that can be used flexibly and allows easy handling for
optimising the socio-technical system (aspect of organisation); • Establishment of self-managed teams
or autonomous work groups for better human relations; • Adoption of supportive rather than autocratic
style (this is most difficult part of the system to introduce) of leadership to support innovation and
initiative on the part of employees; • Support systems are provided that help teams function effectively
as operating units; • The new system is introduced with care through employee involvement and
communication programmes for employee empowerment; • Training is based an objective assessment
of training needs; 17 • Payment system is designed with employee participation to ‘fit’ employee needs
as well as those of the management; • Payment is related to team performance (team pay) but with
provision for skill-based pay for individuals; and • In some cases, ‘peer performance review’ process is
used which involves team members assessing one another’s performance as well as the performance of
the team as a whole. The High-Commitment Management Model One of the defining characteristics of
HRM is its emphasis on the importance of enhancing mutual commitment among co-contributors. High-
commitment management may be described as a form of management that aims at eliciting
commitment so that behavior is primarily self-regulated rather than controlled by sanctions and
pressures applied by the management and relations within the organisation are based on high levels of
trust. Ways to achieve high commitment are: • Development of leadership through training, with
premium on commitment as highly valued characteristic at all levels in the organisation; • A high level of
functional flexibility abandoning potentially rigid job descriptions; • Reduction of hierarchies and de-
emphasis of status differentials; • A heavy reliance on team infrastructure for disseminating information
(team briefing), designing and distributing work (team working) and problem solving (quality circles); •
Understanding job design as an area of management craft to provide intrinsic satisfaction to workers; •
A policy of no compulsory lay-offs and permanent employment guarantees with the possible use of
temporary workers to withstand fluctuations in the demand of labour; • New forms of assessment and
payment systems; more specifically, merit pay and profit sharing; and; • High degree of involvement of
employees in the management of quality. The High-Involvement Management Model While
commitment might still suggest subjugation, this model is more democratic in approach, in that it
involves treating employees as partners in the enterprise whose interests are respected and who have a
voice in matters concerning or relating to them. There is focus on communication and participation with
the aim of creating ‘climate’ in which continuing dialogue between managers and the members of their
teams is continually maintained in order to reiterate or revise expectations as the case may be and
consistently share information on the organisation’s mission values and objectives. This establishes full
mutual understanding of what is desired by both the management and workers and also establishes the
means of managing and developing employee potential to ensure target accomplishment through
better 18 involvement across the region. Specifically, the following structural and functional attributes
are desired. • ‘On line’ work teams; • ‘Off-line’ employee involvement activities and problem solving
groups; • Job rotation; • Suggestion programmers; and • Decentralisation of quality efforts. Clear
evidence emerges from the above recount that high-involvement work practices result in superior
performance although there might be tremendous variance in actual application. High - involvement
work practices have a clear and demonstrated effect on productivity. The effect is ‘large’ enough to be
of economic consequence and significance to the organisations that adopt these ‘new practices’.

Strategic HRM models