The first pillar of the strategic HRM model - strategic integration of HRM - refers to the organisation's ability to integrate HRM into its strategic plans (vertical integration) and to ensure that the various aspects of HRM cohere (horizontal integration) (Storey 1989; Armstrong 2000).

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Study on Strategic integration of
Human Resource Management
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2.  LIST OF ORIGINAL PUBLICATIONS ......................................................... 4
 INTRODUCTION.............................................................................................. 5
 Scope and aim ................................................................................................ 5
 Methodological note and the structure of the thesis.................................... 12
 1. Strategic integration of HRM................................................................... 13
 1.1 External fit ......................................................................................... 14
 1.2 Fit between macro- and micro-level HRM ........................................ 22
 1.3 Internal fit .......................................................................................... 24
 2. Role of managers in strategic HRM......................................................... 28
 3. Organisational performance and strategic HRM..................................... 34
 Summary and conclusions ........................................................................... 38
 References.................................................................................................... 42
 SUMMARY IN ESTONIAN ........................................................................... 50
 ACKNOWLEDGEMENTS ............................................................................. 55
 PUBLICATIONS...................................................................................... .... ..57
 CURRICULUM VITAE............................................................................ ... ..139
 ELULOOKIRJELDUS............................................................................... .. ..142
CONTENTS
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Scope and aim
The concept of strategic human resource management has played a key
role in management research and practice for the last three decades (Guest
1987; Boxall and Purcell 2011). Ongoing analysis within the field generally
focuses on how human resource management (HRM) can add strategic
value and contribute to the organisational success. According to this
approach, originating from the private sector, people are a key resource and
a critical element in an organisation’s performance. The main
rationale for strategic HRM thinking is that by integrating HRM with the
organisation’s strategy and by applying
particular sets of human resource (HR) policies and practices, employees wi
ll be managed more effectively, individual and organisational performance
will
improve, and therefore success will follow (Holbeche 2001; Farnham 2010).

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The term HRM, defined as a strategic and coherent approach to the
management of people who contribute to the achievement of
organisations’ objectives, has entered the management vocabulary as a
replacement for “personnel management” (Armstrong 2000). Although
HRM is regarded to have many similarities to personnel management,
as just “old wine in new bottles”, the main
defining characteristic of HRM is considered to be its strategic focus
(Guest 1989; Legge 2005). In order to emphasise this focus even
more, often the adjective “strategic” is added to HRM, referring to HRM
as a strategic function which does not only build organisations’
performance, but also is forward- looking and creates competitive
advantage (Holbeche 2001). “Strategic”
highlights the need for the determination of long-term goals of an
organisation, the undertaking of courses of action and the allocation of
resources necessary for carrying out these goals (Goldsmith 1997;
Armstrong 2000).

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