Strategic Human Resorce Management

1. STRATEGIC HUMAN
RESOURCE
MANAGEMENT

2. DISCUSSION
What is meant by the term “Strategic Human
Resource Management” and how has it been
used to study the employment relationship?

3. HUMAN RESOURCE
MANAGEMENT
“… human resource management (alternatively,
‘employee relations’ or ‘labor management’) includes
the firm’s work systems and its models of employment.
It embraces both individual and collective aspects of
people management. It is not restricted to any one
style or ideology. It engages the energies of both line
and specialist managers… and typically entails a blend
of messages for a variety of workforce groups.”
Purcell & Boxall (2003) P. 24

4. HUMAN RESOURCE
MANAGEMENT
“HRM as a subject of study assumes that the interests of
employees and employers will coincide and is preoccupied
with the shared goal of organizational effectiveness that
marginalizes the interests of other stakeholders such as
employees. HRM is also predominantly focused on the
individual and seeks solutions to HR problems within the
firm, with an analytical focus on the motivations and
aspirations of individual employees.”
Bach (2005) P. 4

5. STRATEGY
“The determination of the basic long-term goals and
objectives of an enterprise and the adoption of courses
of action and the allocation of resources necessary for
carrying out these goals.”
Alfred Chandler, Strategy and Structure, (MIT Press, 1962), P. 13

6. STRATEGY
 At the core, its is the debate between best fit and
best practice
 Used for gaining a competitive advantage
 Innovation
 Offer something new; different from competitors
 Quality Enhancement
 Products and services
 Cost Reduction
 Attempt to be the lowest cost provider
 Optimal strategy depends on the wants and
nature of competitors

7. TYPES OF STRATEGY
 Business
Examines correspondence between each firm’s
competitive strategy and its system of high
performance work practices
 Operations
An internal approach; connected to the work
organization inside a firm
 Resource View
Views human resources as sources of
sustained competitive advantage

8. STRATEGIC HRM
 “(S)trategic HRM is about how the employment
relationships for all employees can be managed
in such a way as to contribute optimally to the
organization’s goal achievement.” Legge (2005) P. 223

9. HR PRACTICES LINKED WITH
COMPETITIVE STRATEGY
 Recruitment
 Training
 Career Path
 Promotions
 Socialization
 Openness

10. HIGH PERFORMANCE PRACTICES
 Features
Comprehensive selection/recruitment
procedures
Incentive compensation
Extensive employee involvement/training
 Expected Results
Improve knowledge, skills, and abilities of
employees
Increase motivation
Reduce shirking
Enhance retention of quality employees
(reduce tenure of non-performers)
Huselid (1995) P. 635

11. HIGH COMMITMENT PRACTICES
 Unique to the High-Performance
Paradigm
Sophisticated selection and training
 Emphasis on values, human relations skills, and
knowledge skills
Behavior-based appraisal
Single status policies
Contingent pay systems
 Traditional Personnel Practices
Job security
Above market pay and benefits
Grievance systems Godard (2004) P. 351

12. CONCLUSION
Model of the Basic Strategic HRM Components
HUMAN CAPITAL POOL:
Knowledge, Skill, Ability
EMPLOYEE RELATIONSHIP BEHAVIORS:
Psychological Contracts, Citizenship, Discretion
Wright, P. Dunford, B. and Snell, S. (2001) Human Resources and the Resource Based View of the Firm, Journal of Management, 27:6
PEOPLE MANAGING PRACTICES:
Staffing, Training, Rewards, Appraisal,
Work Design, Participation, Recognition, Communication

13. CONCLUSION
 Effectiveness can be increased by systematically
melding human resource practices with the
selected competitive strategy
 The success or failure of a firm is not likely to
turn entirely on its strategic human resource
management practices, but these practices are
likely to be critical