3. HR Strategy “ The pattern of planned human resource deployments and activities intended to enable the organisation to achieve its goals” Focus: To provide the organisation with sustained competitive advantage … through procurement, development & alingment of people, skills, HR policies etc. Competitive advantage might arise from having best people, but also from being best at managing what you do have
4. External competitive environment Corporate strategy formulation Corporate strategy implementation HR strategy Input Input Division strategies HR FUNCTION OTHER FUNCTIONS Link to Corporate Strategy Evaluation (measurment etc)
5. Role of HRM in Strategy Formulation HR Function HR Function HR Function HR Function Strategic Planning Strategic Planning Strategic Planning Strategic Planning Administrative linkage One-Way linkage Two-way linkage Integrative linkage
8. Core Ideology Core values Core Purpose Essential, enduring tenants What is important? What is inviolate? Reason for being What the organisation offers to society Controlling desire, Dominant aspiration
9. Examples: Core Purposes 3M: to solve unsolved problems innovatively Hewlett-Packard: to make technical contributions for the advancement and welfare of humanity Mary Kay Cosmetics : to give unlimited opportunity to women Nike: to experience the emotion of competition, winning, and crushing the competition W alt Disney: to make people happy
13. Examples: BHAGS Ford (1900’s): Democratise the automobile (Target BHAG) (Nike, 1960’s): Yamaha wo tsubusu! We will destroy Yamaha (Common Enemy BHAG) Stanford (1940’s): Become the Harvard of the west (Role-Model BHAG) GE (1980’s): #1 or #2 in every market we serve & revolutionise this company to have the strengths of a big company combined with the leanness & agility of a small company
14. Examples: Vivid Description Sony: We will create products that become pervasive around the world…We will be the first Japanese company to go into the U.S. market and distribute directly…We will succeed with innovations that U.S. companies have failed at - such as transistor radio…50 years from now our brand name will be as well known as any in the world…and will signify innovation and quality that rival most innovative companies anywhere…’Made in Japan’ will mean something fine, not something shoddy.
15. Strategic Formulation ‘ Step’ 2: SWOT Analysis Brings balance to the more unchanging vision: Organisation’s internal & external environment: Change is often a constant here! S W O T Internal strengths & weaknesses of organisation External opportunities & threats of organisation
16. Strategic Formulation: ‘ Steps’ 3, 4 & 5: Mission, Goals & Objectives ‘ Eternal’ of Vision ‘ Now’ of SWOT Mission : What business / markets are we in to realise our vision? Goals : The tasks that need to be done to enable mission Objectives The quantifiable targets that are set through the goals
17. Examples: Missions Microsoft: A computer on every desktop Saturn: The mission of Saturn is to market vehicles developed and manufactured in the United States that are world leaders in quality and customer satisfaction through the integration or people, technology, and business systems and to transfer knowledge, technology and experience throughout General Motors”. Chevrolet: Manufactirug safe and reliable economy cars, sports cars, sedans and trucks. Electronic Data Systems: Designing & operating information systems for both public and private organisations
18. Strategic Formulation: ‘ Step’ 6: Strategic Choice Vision Mission Goals Objectives Deliberate planning Everyday operations Emergent (organic, evolutionary) strategy + Eventual plans Example : A new customer service process is planned for through consideration of new aims Example : Customer service people discover new process through dealing with customers
20. Strategic Types Categorisations under which any strategy can be typified Porter : Overall cost leadership Differentiation Focus Miles and Snow Defenders Prospectors Analysers Reactors Directional Strategies Concentration Internal growth External growth Divestment
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25. Strategic Types and HR Tasks Different strategic types work better with some HR practices than others, e.g.: Porter / Miles and Snow Cost / defender = efficiency, consistency Differentiation / prospector = quality, effectiveness, knowledge, creative Focus / analyser = flexibility Directional Strategies Concentration = current skills focus Internal growth = new employees, new targets, new training External growth = harmony, cooperation Divestment = minimising loss (retrenchments, morale, severance)
26. Strategic Measurement & Control Strategic Formulation Strategic Implementation Sets standards (esp objectives) Measurement of outcomes Strategic evaluation Thus: Evaluation is the judgment of how the standards set in strategic formulation were achieved in strategic implementation Evaluation is fed back into the formulation of plans and the knowledge base of how to implement them
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