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STRATEGIC HUMAN RESOURCE MANAGEMENT

STRATEGIC HUMAN RESOURCE MANAGEMENT

OBJECTIVES
Understand the Scope of SHRM Factors Influencing SHRM Linking of Corporate Strategies to HR Functions Understand the New Role of HR

STRATEGIC HUMAN RESOURCE MANAGEMENT

Strategic management is drafting, implementing and evaluating cross-functional decisions that will enable an organization to achieve its long-term objectives. (David, 1989)

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Two Views of Strategy

STRATEGIC HUMAN RESOURCE MANAGEMENT

Mainstream view- Strategy as a plan (i) Strategies are plans made by top managers and their corporate strategy advisors (ii) Strategy is a matter of policy and it precedes action (iii) Strategy and implementation are separate

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Two Views of Strategy

STRATEGIC HUMAN RESOURCE MANAGEMENT

Processual view- Strategy as a pattern (i) Strategies are more usefully seen as the outcome of both planned and unplanned activities (ii) Policies often emerge out of actions that have already been taken (iii) Strategy and implementation tend to happen simultaneously

STRATEGIC HUMAN RESOURCE MANAGEMENT

Table 2.1 Defining Human Resources and Strategic Human Resource Management Human Resources
The efforts, skills or capabilities that people contribute to an employing organization to enable it to continue its existence.

Strategic Human Resource Management

The general direction followed by an organization in how it secures, develops and from time to time dispenses with human resources to help it continue in the long-term.

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Scope Ranges of SHRM

STRATEGIC HUMAN RESOURCE MANAGEMENT

Exhibit 2.1 The Scope of SHRM

From such matters as: The overall organizational structure Merger & acquisition Recruitment policies To: Employees punching cards The smoking/non-smoking policy Casuals on Saturdays

STRATEGIC HUMAN RESOURCE MANAGEMENT

Figure 2.1 HR Strategy: Strategic Fit

STRATEGIC HUMAN RESOURCE MANAGEMENT

Table 2.2 Two Key and Alternative Human Resourcing Principles Direct control/low commitment Indirect control/high commitment

Employees given little discretion, closely Employees empowered encouraged supervised to use discretion and monitored Limited psychological commitment sought from employees High psychological commitment sought from employees

STRATEGIC HUMAN RESOURCE MANAGEMENT

Key factors influence the HR system External environment Changing workforce Organization culture Organization structure Technology

STRATEGIC HUMAN RESOURCE MANAGEMENT

STRATEGIC HRM MODELS

(i) Life Cycle Model (ii) Competitive Advantage Model

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Introductory stage Growth stage Maturity stage Decline stage

STRATEGIC HUMAN RESOURCE MANAGEMENT

Life Cycle Model

STRATEGIC HUMAN RESOURCE MANAGEMENT

Competitive Advantage Model (Porter,1985)

Three Major Parameters: (i) Cost leadership, (ii) Differentiation, and (iii) Focus.

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Arthur(1992)

STRATEGIC HUMAN RESOURCE MANAGEMENT

Table 2.3 Best Practice Approaches to SHRM

Broadly Defi ne Jobs, Employee Participation, Formal Dispute Resolution, Information Sharing, Highly Skilled Workers, Self-Managed Teams, Extensive Skills Training, High Wages, Salaried Workers, Stock Ownership1 Employment Security, Selectivity in Recruiting, High Wages, Incentive Pay, Employee Ownership, Information Sharing Participation and Empowerment, Self Managed Teams Training and Skill Development, Cross- Utilization and Cross Training, Symbolic Egalitarianism, Wage Compression, Promotion from Within2 Personnel Selection, Performance Appraisal, Incentive Procedures, Information Sharing, Attitude Assessment, Labor/Management Participation, Recruiting Intensity, Training Hours, Promotion Criteria (Seniority Vs. Merit)3 Work Leaves, Problem Solving Groups, Employee Suggestions, Job Orientation, Decentralization, Recruitment and Hiring, Contingent Compensation, Status Differentiation, Training of New Employees, Training of Experienced Employees4 Employment Security, Selective Hiring, Self-Managed Teams and Decentralization. Comparatively High Compensation, Contingent on Organizational Performance, Extensive Training, Reduction of Status Differences, Sharing Information5

Pfeffer(1995)

Huselid(1995)

Mac Duffie (1995)

Pfeffer & Veiga (1999)

STRATEGIC HUMAN RESOURCE MANAGEMENT

SHRM AND FUNCTIONS OF HRM

Human Resource Planning Recruitment Selection Performance Appraisal and Management Training & Development Compensation

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Strategic Partner

STRATEGIC HUMAN RESOURCE MANAGEMENT

Role of Strategic HRM

Administrative Expert Employee Champion Company Champion Change Agent

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1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

STRATEGIC HUMAN RESOURCE MANAGEMENT

The Top Ten Trends:

Rise in health care costs Focus on domestic safety and security Use of technology to communicate with employees Growing complexity of legal compliance Use of technology to perform transactional HR functions Focus on global security Preparing for the next wave of retirement/labour shortage Use and development of e-learning Exporting US manufacturing jobs to developing countries Changing definition of family