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1StrategicHumanResourceManagement2Objectives•Compareandcontrastthestrategicviewofhumanresourcemanagementandthetraditionalviewofhumanresourcemanagement.•Explaintheroleofstrategichumanresourcemanagementinthestrategicmanagementprocess.•Givenaparticularstrategy,recommendthefunctionalhumanresourcepracticesthatneedtobechosen.•DescribetheessentialelementsofSHRM•Explainhowanorganization'sstrategicplanisintegratedwiththemajorhumanresourcemanagementfunctions.3HRMRoleChange•TheHRfunctionhashistoricallybeenreactiveandsubservienttotheotherbusinessfunctions.•Rolehaschangedrecentlyduetoenvironmentalchangeanduncertainty•Needtomaintainaneffectivealignmentwiththeenvironmentwhilemanaginginternalinterdependencies.4HRMRoleChange•Increasingly,competitivenessisviewedasbeingdependentonhumancapitalandthushumanresources.•Competitiveadvantageincompaniesisitsworkers--itiswhatoftendistinguishescompanieswithsimilartechnology.•HRMhascometobeseenasdirectlyrelatedtotheabilityofthefirmtocopewithorganizationalandenvironmentcontingencies.•Recently,therehasbeenareorientationtoanintegrative,proactive,andstrategicwayoflookingatanorganization'semployees.5HRMRoleChange•Historically,topmanagementandsubordinatelinemanagersdelegatedpersonnelmatterstothepersonneldepartment.•Primaryfunctionsincluded:–Humanresourceplanning;–Recruitingstaff–Jobanalysis–performancereviewsystems–Wage,salary,andbenefitsadministration–Employeetraining–Personnelrecordkeeping6CharacteristicsofPastApproach•HR/Personnelfunctionwasphysicallyandpsychologyseparatedfromtherealworkoftheorganization.•Personneldepts.grewinarelativelyuncoordinated,piecemealfashion.•HR/Personnellackedanintegrative,proactive,and,aboveall,strategicorientation.7Figure2.1TraditionalandStrategicViewsofHRM(a)Personnel-TheTraditionalView8CharacteristicsofCurrentApproach1)ThesystematicintegrationofseparateHRMfunctions2)HumanresourcesarenowviewedfromageneralmanagementperspectiveratherfromtheperspectiveofafunctionalareaandmanagementnowsharesresponsibilityforHR.3)TheinclusionofHRconsiderationsindecisionsaffectingcorporatestrategiesandstructures.4)StrategicmanagementandstrategichumanresourcemanagementintegratetheseparateHRMfunctions.9Figure2.1TraditionalandStrategicViewsofHRM(b)HRM--TheStrategicView10Table2.1TheoreticalPerspectivesonSHRM11CompetitiveAdvantageThroughHumanResourcesBasicthesis:EffectiveutilizationofHRcanassistorganizationsinachievingcompetitiveadvantage.Competitiveadvantage:a.Referstotheabilityofanorganizationtoformulatestrategiestoexploitprofitableopportunities(i.e.,maximizingitsreturnoninvestment).b.Perceivedcustomervaluecancreatecompetitiveadvantage.12CompetitiveAdvantageThroughHumanResourcesC.Offeringaproductorservicethatisuniquecancreatecompetitiveadvantages.4sources:1.Financialoreconomiccapitalcapability.2.Physicalcapitalcapability.3.Humancapitalcapability:Compositionofworkforce4.Organizationalcapability:Thefirm’sabilitytomanagepeopleD.Keyissuefororganizationsistoachievealignmentamongtheirvariousfunctionsandbeflexibleinrespondingtotheirenvironment.13StrategicHRMHRMasacompetitiveadvantageinvolvesstrategichumanresourcemanagement.•1)RepresentsanefforttolinkHRMactivitiestoafirm'sbusinessstrategy.•2)BasedonagrowingrecognitionforHRmanagerstoassumeabroaderroleintheoverallorganizationalstrategy.•3)RecognitionthattheHRfunctionshouldbeplanned,organized,andevaluatedonthebasisofitscontributiontothebusiness.•4)SHRMisbasedontherecognitionthatHRMactivitiesareorganizationalinscope.14StrategicHRM•5)RecognitionthatHRMissuesneedtobeconsideredintheformulationandtheimplementationoforganizationalstrategy.•6)RecognitionthatHRMpracticewillinfluencetheorganization'sperformance.•7)TherecognitionofHRattheexecutiveorstrategiclevelinadditiontothefirmandoperationallevels.•9)Emphasizeslonger-termplanningthroughtheexaminationofasetofenvironmental,publicpolicy,industrystructureandorganizationalframeworks.15IntegratingHRintoStrategicPlanning•TheStrategicPlanningProcess:UluruEnergy•Mission,Goals,andValuesStatements–EnvironmentalThreatsandOpportunities–OrganizationalStrengthsandWeaknesses–GoalsandObjectives–FormulationofStrategies•HowToStrategicallyIntegrateHRM:SomeIdeasandExamples16EssentialElementsofSHRM1.InternallytransformingHRstaffandstructure2.Enhancingadministrativeefficiency3.IntegratingHRintothestrategicplanningprocess4.LinkingHRpracticestobusinessstrategyandoneanother.5.Developingapartnershipwithlinemanagement6.Focusingonthebottom-lineimpactofHRandmeasuringthatimpact.17DevelopingPartnership•Learnaboutthefirm’sbusiness•Respondtoandbeawareofthefirm’sneedsanddirection•ShiftawayfromtraditionalHRMfunctions•Movetowardsupportive,collaborativerelationshipswithlinemanagers•DemonstratehowHRiscriticaltobusinesssuccess18MeasuringHRM•CustomerReactions•HRImpact•DollarValueofHRPrograms•BenchmarkingHRPractices19Table2.7SixmeasuresofHRServiceDelivery20Review•WhyisManagingHumanResourcesSoImportant?•WhatisStrategicHumanResourceManagement(SHRM)?•TransformingHRStaffandStructure•EnhancingAdministrativeEfficiency•IntegratingHRintoStrategicPlann