HRM-Lec-2

Strategic Human Resource Management

Strategic Human Resource Management

 

Strategy

The strategy is derived from the Greek word “Strategos”. It’s meaning is general. It is used in different way. Strategy is a way of doing something. It is a game plan for action. It usually includes the formulation of a goal and a set of action plans for accomplishment. It implies consideration of the competitive forces at work in managing an organization and the impact of the outside environment on organization action.

The strategic approach is relatively new to management literature. The concept of strategy has its roots in military literature and particularly it is developed by the Chinese strategist Sun Tzu.


According to W.P. Anthony and others

“Strategy may be defined as the formulation of organizational missions, goals, and objectives, as well as action plans for achievement that explicitly recognize the competition and the impact of outside environmental forces”.

According to Gary Dessler­

“A strategy is a specific pattern of decisions and actions that managers take to achieve an organization’s goals. Thus a strategy can often be defined more precisely as the specific pattern of decisions and actions that managers take to achieve superior organizational performance”.

“Strategy is a set of actions to be crafted or implemented for attaining some regular and special objectives”.

So Strategy implies choosing among alternatives. It implies making major decisions about human resources ‑ decisions that commit the organizations resources toward a particular direction. Strategy is the determination of the purpose or mission and the basic long term objective of an enterprise and the adoption of course of action and allocation resources necessary to action these aims.

Strategic Human Resource Management

Human resources strategies are the course of action human resources uses to help the company achieve its strategic aims. It a firm’s competitiveness depends on its employees, then the business function responsible for acquiring, appraising and compensating these employees has to play a bigger role in the firm’s success.


Different authors defined strategies HRM in a different way­

According to W. P Anthony and others, ” strategic human resources Management is involved in strategic planning and decision making and coordinates all human resources functions for all employees”.

Strategic human resource management may be defined as “a set of actions moves crafted or to be crafted for discovering, developing, maintaining and utilizing the human resources of an organization.”

According to Gary Dessler­

“The linking of HRM with strategic goals and objectives in order to improve business performance and develop organizational cultures that foster innovation and flexibility”

AAccording-toPatric Wright and Gary Mcmeham‑ defmed strategic human resource management in the following way‑” Strategic Human Resource Management is the pattern of planned human resources developments and activities intended to enable an organization to achieve its goal.”


According to Schuler Randall S. ‑defined the strategic human resource in the following manner “Strategic human resource management is largely/mainly about integration and adoption. Its concern is to ensure that human resource management is fully integrated with the strategy and strategic needs of firm’s human resource policies cohere both across the policy areas and across hierarchies and human resource practices are adjusted, accepted and used by line managers and employees as part of their everyday work.”

In conclusion, we can say thattap” strategic human resource management is a more recent development in human resource management. Different writers have defmed strategic human resource management in different ways from different points of view. But the main things are more or less the same

 

Strategic Choices:

When managers, such as those at GM, are faced with deciding which corporate strategy they should embark upon, they must make several decisions. The following is only a partial list of some of the strategic choices managers face.

  1. Routinely managers must evaluate where they are. They must decide if they should remain with the strategy they have selected and implemented or if they need a new strategy.
  2. To make this decision, managers must know exactly what has and hasn’t changed since the current strategic approach was implemented. For example, has the economy changed dramatically in any way that may influence whether or not the selected strategy wil continue to be effective?
  3. If any changes are suggested, it is important that managers understand the ripple efects these changes may have on other functions. For example, if a ripple effects these changes may have on other functions. For example, if a growth strategy is selected, will the human resources unit be able to provide the qualified personnel needed to develop this strategy?
  4. Finally, managers should try to evaluate the current appraoch and what any changes to this approach might have on what their competitors do. For example, if GM offers a low financing rate, is Chrysler or Ford in a position to offer an even lower rate, thereby making GM’s offer unattractive?

Principal tasks of HRM

Human resource management has a variety of tasks associated with acquiring, training, developing, motivating, organizing and maintaining the human employees of the firm. These tasks should be performed in a way that helps the company deal effectively with any environmental forces and company’s long term achievement of its goals and objectives. In 1989, the American society for training and development (ASM) determine the activities that professionals considered to be HR roles Among those roles included the following points –

1) Personal selection and staffing

2) Human resource planning

3) Organization and job design

4) Career planning

5) Organization development

6) Training and development

7) Research and information

8) Labor relation

9) Employee assistance and support and

10) Compensation and benefits administration.

The human resource mmanagementalso performs the following tasks:

1) Conducting job analysis to establish the scientific requirements of individuals job within the

organization.

2) Forecasting the personnel requirements to achieve the organization objective

3) Developing and implementing the plan.

4) Recruiting the human resources to achieve organizational objectives.

5) Selecting or hiring personinel. to fill the specific job within an organization.

6) Orienting and training employees.

7)  Designing and implementing management and organizational development programs.

8) Designing and implementing the compensation system for all employees.

9) Designing a system for appraising the performance of individual employees.

10)    Assigning employees in developing career plan.

11)    Designing discipline and grievance handling system.

12)   Serving as an interinediary between the organization and its union.

13)   Designing and implementing programs to ensure employee health and safety.

14)   Designing and implementing employee communication systems.

 

The Strategic Approach to Human Resource Management:

 The strategic approach to human resource management appies the concept of strategy to managing a firm’s human resources. This approach has six key elements as shown in Exhibit 1.3. Let’s look at each of these. 

Characteristics of a Strategic Approach to Human Resource Management:

 Human Resource Strategy

  • Explicitly recognizes the impact of the outside environment.
  • Explicity recognizes the impact of competition and the dynamics of the labor market.
  • Has a long-range focus (three to five years)
  • Focuses on the issue of choice and decision making.
  • Considers all personnel, not just hourly or operational employees.
  • Is integrated with overall corporate strategy and functional strategies.

Difference between Strategic Human Resource Approach and Traditional Personnel Approach

 

Dimensions Strategic human resource approach Traditional personnel management approach
Planning and Strategy Formulation Participates in formulating overall organizational strategic plan and aligning human resource functions with company strategy In involved in operational planning only.

 

 

 

Authority Has high status and authority for top personnel officer (e.g. vice-president for Human Resources) Has medium status and authority (e.g., personnel director)

 

Scope Is concerned with all managers and employees Is concerned primariy with hourly, operational, and clerical employees

 

Decision Making Is involved in making strategic decisions Makes operational decisiions only

 

Integration Is fully integrated with other organizational functions: marketing, finance, legal production Has moderate to small integration with other organizational functions

 

Coordination Coordinates all human resource activities (e.g., training, recruitment, staffing, Equal Employment Opportunity) Does not coordinate all human resource functions

 

Management Guidelines

 Based on the material covered in this chapter, we can provide the following management guidelines.

  1. Corporate strategy should be determined first, and then the human resource strategy should be developed. The human resource strategy that is developed should be consistent with the corporate strategy.
  2. Human resource strategy should be consistent with other functional strategies such as finance, marketing, and engineering.
  3. The strategy formulation process should remain flexible and readily adaptable to change.
  4. Human resource managers, particularly those at the top of the organization, should be involved in the strategy formulation process.
  5. Human resource strategy should consider all human resources in the organization, not just hourly or operative employees.
  6. The outside environment and competition should be explicitly considered in furmulating both overall organizations and human resource strategy.
  7. The better and more accurately that managers make sense of the organization’s internal and external environment, the better their decisions will be.
  8. Human resources should project both intended and unintended consequences of decitions as they might affect human resources.
  9. Competition and labor market dynamics have an impact on the success of strategic human resource decisions; human resource managers should develop a realistic match between corporate strategies and the economics of the labor market.

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