The document discusses strategic human resource management and the strategic management process. It describes strategic HRM as having three steps: deciding strategic goals, identifying required employee skills, and developing HR policies to produce those skills. The strategic management process involves 7 steps: defining the current business, performing internal/external audits, formulating a new direction, translating mission into goals, formulating achievement strategies, implementing strategies, and evaluating performance. The document also discusses types of strategies like corporate, competitive, and functional strategies and how HR can create competitive advantage through strategic involvement.

1. Mergers, Acquisitions, and Strategic
Human Resource Management
Chapter 3
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2. What is strategic HRM?
Strategic HRM is developed through three steps:
1. Decide on the strategic goals
2. Identify employee skills and
behaviors necessary for success
3. Formulate HR management policies
and practices that will produce
these required skills
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3. The Strategic Management Process
The process begins by
developing a strategic
plan that describes how
internal strengths and
weaknesses will be
matched with external
opportunities and
threats
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4. Steps in Strategic Management
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5. Step 1: Define the current business
Begin by asking these questions:
– What products do we sell?
– Where do we sell these products?
– How do our products or services differ from
our competitors?
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6. Step 2: Perform External and Internal
Situational Audits
• The key to success is adaptation
• Situational audits require SWOT (strengths,
weaknesses, opportunities, and threats) analysis
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7. Step 3: Formulate a New Business
Direction
• What should our new business be in terms of
product, placement and competitive advantage?
• The vision statement describes the following:
What do we want to become?
• The mission statement explains the following:
Where are we now?
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8. Step 4: Translate the Mission into
Strategic Goals
• Operationalize the mission for managers
• What does the mission mean to each
department?
• What goals follow implementation?
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9. Step 5: Formulate Strategies to
Achieve the Strategic Goals
• What is the game plan?
• Decide on a course of
action
– Best strategies are
concise
– Easily communicated
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10. Step 6: Implement the Strategies
• Get the game plan going
• Do what needs to be done
– Hire or fire people
– Build or close plants
– Adding or eliminating products and product
lines
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11. Step 7: Evaluate Performance
• Evaluate, evaluate, evaluate
• Ongoing process vis-à-vis strategic control
• Addresses the following questions:
– Are resources being utilized as planned?
– Are discrepancies explained?
– Do changes in our situation suggest change?
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12. Types of Strategies
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13. Corporate Strategy
• Top-level, company-wide
• Identifies the portfolio of existing business
segments
• Strategic possibilities include the following:
– Diversification or vertical integration
– Consolidation
– Geographic expansion
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14. Competitive Strategy
• Identifies how to build upon and strengthen the
business’s
long-term
marketplace
position
• Identifies and
develops
competitive
advantage
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15. Competitive Advantage
• Cost leadership indicates that the enterprise
intends to become the low-cost leader in the
industry
• Differentiation strategies seek to be unique in its
industry along dimensions valued by buyers
• Focusers carve out niche markets and compete
by providing a product/service that customers
can get through no other means
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16. Functional Strategies
• Identifies basic courses of action that each
department will pursue to achieve strategic goals
– consider Southwest Airlines
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17. The Importance of Leverage
• Leverage means
supplementing what you
have and doing more
with what you’ve got!
• Human resources can
be a crucial competitive
advantage!
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18. HRM Creates Competitive Advantage
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19. Four Important Strategic HR Issues
1. HR must understand that employees play a
key role in employers’ performance
improvement efforts
2. HR teams should support corporate
productivity and performance improvement
efforts
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20. Four Important Strategic HR Issues, cont.
3. HR units must be more involved in designing –
not just executing – the strategic plan
4. HR managers must understand how to create
value
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21. How Involved Is HR in Strategic
Management?
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22. What Roles Does HR Play?
• Strategy
execution
• Strategy
formulation
• SWOT analysis
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23. Translating Strategy into HR Policy and
Practice
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