Strategic Human Resource Management

1. Dr.V.Mohanasundaram
manlymohan@gmail.com

2. • Today's HR professionals contribute to
creating engagement capital, or building
engagement over time, to improve
employee effort, retention, and key
business outcomes. As we balance
short-term improvements with
engagement drivers that sustain
engagement over time, there is a
greater alignment of the HR function to
an organization's strategic needs
TODAY’S SCENARIO

3. HR’s Strategic Challenges
• Strategic plan
– A company’s plan for how it will match its
internal strengths and weaknesses with
external opportunities and threats in
order to maintain a competitive
advantage.
• Three basic challenges
– The need to support corporate
productivity and performance
improvement efforts.
– That employees play an expanded role in
employers’ performance improvement
efforts.
– HR must be more involved in designing—
not just executing—the company’s
strategic plan.

4. Strategic Human Resource
Management
• Strategic Human Resource
Management
– The linking of HRM with
strategic goals and objectives
in order to improve business
performance and develop
organizational cultures that
foster innovation and flexibility.
-Formulating and executing
HR systems—HR policies
and activities—that produce
the employee competencies
and behaviors the company
needs to achieve its strategic
aims.

5. SHRM
• Strategic human resource management has
been defined as ‘the linking of human
resources with strategic goals and objectives
in order to improve business performance
and develop innovative organizational
culture that foster innovation and flexibility.

6. • Strategic human resource management means
formulating and executing human resource
policies and practices that produce the
employee competencies and behaviours that
the company needs to achieve its strategic
aims.
• Gary Dessler

7. • Strategic human resource management is
concerned with all those activities that affect
the behaviour of individuals in their efforts to
formulate and implement the strategic needs
of business.
— R. S. Schuler

8. Evolution of SHRM
Personnel
Management
Human
Resource
Management
(early 1970s)
Strategic
Human
Resource
Management
(early 1980s)

9. Features of Strategic Human Resource Management
• As strategic human resource management is closely associated with
goal-setting, policy formulation and allocation of resources, it is
performed at top management levels.
• Strategic human resource management aims at fulfilling the long-
term HR requirements of the organization and, thus, focuses on the
expansion of process capabilities (process refers to HR policies and
procedures that produce efficiency).
• It is interrelated with business strategies. For instance, it provides
critical inputs to the formulation of business strategy, and specific
HR strategies (like recruitment, training and performance appraisal)
are in turn shaped by overall business strategies.
• Strategic human resource management entrusts strategy
formulation tasks with line managers while HR professionals play an
advisory role.
• It views employees as the strategic capability of the organization
and attempts to distinguish the organization from its competitors in
the market on that basis.

10. Difference b/w SHRM & Traditional HRM
Traditional HRM SHRM
Focus of activity Employee relations Partnership with internal
& external groups
Role of HR Reactive & transactional Proactive &
transformational, change
leader
Initiative for change Slow & not integrated
with larger issues
Fast,flexible & systematic
Time Horizon Short-term Consider various time
frames
Control Bureaucratic control Organic control
Job design Focused job design Broad job design
Important investment Capital,products,technolo
gy & finance
People & their knowledge
skills & abilities
Accountability Cost centre Investment centre

11. Linking Corporate and HR Strategies

12. HR’S Strategic Roles
• HR professionals should be part of the firm’s
strategic planning executive team.
– Identify the human issues that are vital to business
strategy.
– Help establish and execute strategy.
– Provide alternative insights.
– Are centrally involved in creating responsive and market-
driven organizations.
– Conceptualize and execute organizational change.

13. HR’s Strategy Formulation Role
• HR helps top management formulate strategy in a variety of ways
by.
– Supplying competitive intelligence that may be useful in the
strategic planning process.
– Supplying information regarding the company’s internal human
strengths and weaknesses.
– Build a persuasive case that shows how—in specific and
measurable terms—the firm’s HR activities can and do
contribute to creating value for the company

14. HR’s Strategy Formulation Role
• HR helps top management formulate strategy in a variety of ways
by.
– Supplying competitive intelligence that may be useful in the
strategic planning process.
– Supplying information regarding the company’s internal human
strengths and weaknesses.
– Build a persuasive case that shows how—in specific and
measurable terms—the firm’s HR activities can and do
contribute to creating value for the company

15. The Basic Architecture of HR

16. The High-Performance Work System
• High-performance work system
(HPWS) practices.
– High-involvement employee
practices (such as job
enrichment and team-based
organizations),
– High commitment work practices
(such as improved employee
development, communications,
and disciplinary practices)
– Flexible work assignments.
– Other practices include those
that foster skilled workforces
and expanded opportunities to
use those skills.

17. Translating
Strategy into
HR Policy and
Practice
Basic Model of
How to Align
HR Strategy
and Actions
with Business
Strategy

18. FACTORS CONTRIBUTING TO STRATEGIC
ASPECTS OF HR FUNCTIONS
Internal factors :
• organization structure
• organization culture
• organization competencies
• organization internal policies
• organization processes, etc.
External factors:
• market scenario
• competitors
• government policies
• technological advancements, etc."

19. Emerging Trends In The Field Of Strategic
Human Resource Management
• The employee
involvement
• Flow rate of an HR
• Performance
Management
• Reward Systems
• Loyalty towards the
work
• Focus on employee
retention
• Cross cultural issues
• Effects of rapid
changes in technology
• New emerging
concepts of line and
general management

20. Difference b/w SHRM & HR Strategy
SHRM HR Strategies
• A general approach to strategic
management to HR
• Aligned with the organizational
intention with future directions
• Focus on long term people issue
• Defines the areas in which specific HR
strategies need to be developed
• Focus on macro concern such as
structure & culture
• Strategic HRM decisions are built into
strategic business plans
• Outcome of the general SHRM
approach.
• Focus on specific organizational
intentions about what needs to be
done.
• Focus on specific issues that facilitate
the achievement of corporate strategy.
• Human resource strategy derived
from SHRM

21. THREE IMPORTANT
STRATEGIC HR TOOLS
STARTEGYIC MAP
 HR SCORECARD
 DIGITAL
DASHBOARD

22. Strategic map - A strategy map is a diagram that is used to document
the primary strategic goals being pursued by
an organisation or management team

23. The HR Scorecard
Approach
to Formulating HR
Policies,
Activities, and
Strategies

24. Strategic Map

25. HR SCORECARD

26. DIGITAL DASHBOARD
• Presents the manager
with desktop graphs and
charts, so he or she gets a
picture of where the
company has been and
where it’s going. In terms
of each activity in the
strategy map.

27. Models
• Control based: the way in which
management attempts to
monitor and control employee role
performance
• Resource Based: grounded in the nature of
the employer–employee exchange
• Integrative Based: combination of above
models

28. Control-Based Model
Management structure + HR practice
To Secure all aspect of work
High level of labour productivity
& Profitability
Starting point:
Marx’s
‘Transformation of labour
power into labour’

29. What Alternatives HR have?
Edward:
1. Bureaucratic control:
written rules &
procedures
2. Technological control:
assembly line,
surveillance camera
3. Divide & rule policy

30. Control-Based Model
Burawoy:
From Despotic regime To Hegemonic
regime
Despotic refers to coercive manager
Hegemonic refers
to industrial citizenship[the collective
rights and duties legislatively granted to
employees]
Bamberger & Meshoulam:
Process-based control : focus is on
efficiency and cost containment
Outcome-based control: focus is on actual
results

31. Resource-Based Model
Based on nature of the reward–effort exchange
• Selznick: work organizations each possess ‘distinctive competence’ that
enables them to outperform their competitors
Barney:
• The resource-based perspective emphasizes the strategic importance of
exploiting internal ‘strengths’ and neutralizing internal ‘weaknesses’
• Its all about making competitive advantage, for that”
• Exploitation of resource & capability should be done
Four characteristics of resources and capabilities –
• value,
• rarity,
• inimitability and
• non-substitutability – are important in sustaining competitive advantage

32. Integrative Model
Bamberger and Meshoulam
integrated the two models
arguing none of them were
sufficient enough to give a
appropriate flow to the HR
strategy, so they took two main
dimensions:
Acquisition & development:
• make-or-buy’ aspect of HR
strategy. organizations can lean
more towards ‘making’ their
workers(high investment in
training) or more towards
‘buying’ their workers from the
external labour market.
.