2. INTRODUCTION
• The goal of strategic management in an organization
is to deploy and allocate resources in a way that gives
it a competitive advantage.
• Human resource managers should:
• have input into the strategic plan,
• have specific knowledge of the organization’s strategic
goals,
• know what types of employee skills, behaviors, and
attitudes are needed to support the strategic plan, and
• develop programs to ensure that employees have those
skills, behaviors, and attitudes.
3. STRATEGIC MANAGEMENT - DEFINED
• Strategic Management is a process for
analyzing a company's competitive
situation, developing the company's
strategic goals, and devising a plan of
action and allocation of resources that
will help a company achieve its goals.
• Strategic human resource
management is the pattern of planned
human resource deployments and
activities intended to enable an
organization to achieve its goals.
4. COMPONENTS OF SM PROCESS
• Strategy Formulation: Strategic planning groups decide on a
strategic direction by defining the company's mission and
goals, its external opportunities and threats, and its internal
strengths and weaknesses.
• Strategy Implementation: The organization follows through on
the strategy that has been chosen. This includes structuring
the organization, allocating resources, ensuring that the firm
has skilled employees in place, and developing reward systems
that align employee behavior with the strategic goals.
5. MODEL OF THE SM PROCESS
HR Practices
Recruiting,
Training,
Performance management,
Labor relations,
Employee relations,
Job analysis
Job design,
Selection,
Development,
Pay structure,
Incentives,
Benefits
Firm
Performance
Productivity,
Quality,
Profitability
Human
Resource
Actions
Behaviors,
Results
Human
Resource
Capability
Skills,
Abilities,
Knowledge
Human
Resource
Needs
Skills
Behavior
Culture
Mission Goals
Strategic
Choice
Internal
Analysis
Strengths
Weaknesses
External
Analysis
Opportunities
Threats
Strategy Formulation Strategy Implementation
6. ROLE OF HRM IN STRATEGY
FORMULATION
• Administrative Linkage — Lowest level of integration; HRM function's
attention is focused on day-to-day activities. No input from the HRM
function to the company's strategic plan is given.
• One-Way Linkage — The strategic business planning function develops the
plan and then informs the HRM function of the plan. HRM then helps in
the implementation.
• Two-Way Linkage — Allows for consideration of human resource issues
during the strategy formulation process. The HRM function is expected to
provide input to potential strategic choices and then help implement the
chosen option.
• Integrative Linkage — Is based on continuing, rather than sequential,
interaction. The HR executive is an integral member of the strategic
planning team.
7. STRATEGIC TYPES
• Porter's Generic Strategies —
Michael Porter has hypothesized
that competitive advantage
comes from creating value by:
• reducing costs (overall cost
leadership), or
• charging a premium price for a
differentiated product or service
(differentiation).
8. HRM NEEDS IN STRATEGIC TYPES
• Different strategies require different types of
employees.
• Role behaviors are the behaviors required of an
individual in his or her role as a jobholder in a
social work environment.
• Cost strategy firms seek efficiency and therefore
carefully define the skills they need in employees and
use worker participation to seek cost-saving ideas.
• Differentiation firms need creative risk takers.
10. THE ROLE OF HR IN PROVIDING A
COMPETITIVE ADVANTAGE
• Emergent Strategies - Those that evolve from the grass
roots of the organization.
• What actually is done versus what is planned.
• HR plays an important role in facilitating the communication
of emergent strategies between levels in the hierarchy.
• Enhancing Firm Competitiveness
• By developing a rich pool of talent, HR can assure the
company's ability to adapt to a dynamic environment.
11. STRATEGIC HUMAN RESOURCE
EXECUTIVES
• Four basic competencies:
• Business Competencies - Understanding the company's economic and
financial capabilities.
• Professional/Technical Knowledge - In HR practices such as selection
techniques and compensation systems.
• Change Processes or Organizational Development Techniques - The ability
to diagnose the need for change and develop and implement the
appropriate intervention.
• Integration Competencies - A generalist perspective with the skills of a
specialist in the above three areas.
12. HUMAN RESOURCE COMPETENCIES
HR Professional
Integration
Competence
Professional and
Technical
Knowledge
Ability to
Manage Change
Business
Competence
