The Harvard Framework of HRM, created by Ketan Chande, is a strategic model emphasizing the alignment of HR practices with organizational goals while considering stakeholder interests and environmental factors. It incorporates six critical components, including stakeholder interests, situational factors, HR policies, HR outcomes, and long-term consequences, promoting a holistic approach to human resource management. By utilizing this framework, organizations can make informed HR decisions that enhance performance and employee satisfaction.

1. Harvard
Framework of
HRM
Created by
Ketan Chande

2. Introduction to Harvard Framework
Overview Significance Implementation
The Harvard Framework of HRM
is a strategic approach that
emphasizes the importance of
aligning HR practices with
organizational goals. It considers
the impact of external and
internal factors on HR decision-
making.
Understanding the Harvard
Framework helps organizations
develop HR strategies that are
responsive to changing
environments and stakeholder
needs. It promotes a holistic
view of HRM.
By applying the Harvard
Framework, organizations can
tailor HR practices to specific
situations, leading to improved
organizational performance and
employee satisfaction.

3. The Harvard Model
Harvard Model
This model was developed by Beer et al (1984)
The Harvard model claims to be comprehensive in as much as it seeks to
comprise six critical components of HRM. The dimensions included in the
model are stakeholders
· Interests
Situational factors
· HRM policy choices
HR outcomes
· Long-term consequences
· Feedback loop through.
The outputs flow directly into the organization and the stakeholders

5. Application of Harvard
Framework
Stakeholder Interest
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 The Harvard Framework Model of HRM begins with stakeholders’
interests.
 It emphasizes considering the values, input, and perspectives of the
stakeholders before developing any HRM policies to create a fair and
equitable workplace environment.
 These policies can be related to recruitment, training, performance,
staff development, workplace safety, and other HR-focus areas.
 All interests, including stakeholders’ and an organization’s, are
balanced to ensure the policies meet the needs of all the parties
involved.
 These stakeholders can be the management, government, community,

6. Situational factors
 Before choosing the policies to be developed,
factors influencing the HRM policies are called
situational factors.
 These factors can be categorized into internal and
external factors. Internal factors cover
organizational culture, corporate strategies,
structures, and human resources.
 External factors include the labor market, economic
situation, technological environment, legal
environment, competition, and public policies.
 All these factors must be analyzed as they help
understand how humans operate. They also help
choose the HRM policies to reach the organizational
objectives. Also, the external and internal factors
must be balanced.

7. HRM policies and
policy choices
 This component covers the actual strategies that
must be pursued to achieve the organizational
goals.
 They are designed in such a way that they are
compliant with the laws and regulations and
capable of adapting to the changing organizational
environment and conditions.
 These include everything related to HR function.
Once these policies are designed, they enable the
organizations to focus on their core objectives and
achieve their long-term goals.
 HR policies require work systems and reward
systems to function. It determines the approach to
be taken towards work and rewards such that
employees are positively influenced.

8. HR outcomes
 HR outcomes is possibly the best-known component
of this model.
 These outcomes of HR policies can be tangible or
intangible.
 Some examples included improved employee
retention, recruitment, better job satisfaction,
increased engagement levels, motivation,
communication, and many more.
 These outcomes make a significant contribution to the
overall objectives of the organization. These outcomes
can also be classified into: Commitment, congruence,
competence, and cost-effectiveness.

9. Long-term
consequences
 The main objective of the Harvard Model of HRM is to
execute an HR strategy that gives long-term
consequences.
 According to this model, if the HRM strategies meet
the employees’ needs, the organization will be able to
compete with the external competition while also
benefiting the employees, society, and the community
(stakeholders).
 Some long-term consequences are improved
customer service, enhanced organizational culture
and values, improved retention, and even profitability.

10. Harvard Model of
HRM example
For example, let’s say that a company wants to cut costs. If it
has decided to achieve this by reducing the number of
employees, it can start to evaluate its decision by considering
the stakeholders’ interests.
It considers the interests of employee groups or the
management before deciding. Through the Harvard Model of
HRM, the company comes to the conclusion that the above
decision will lead to lower morale, decreased motivation, and
increased turnover among the remaining employees. These
could be the outcomes.
As for the long-lasting consequences, the above decision could
impact the company’s reputation, profitability, productivity,
and bottom line.

11. Example cont’d
Hence, the company may reach its goal by investing
in training and development. This not only improves
the knowledge, skills, and motivation of the
employees (outcomes), but also leads to increased
profitability and a positive work culture.
Overall, this model helps HR take informed decisions
while also considering an organization’s strategic
needs. By focusing on utilizing people wisely and
taking into account all the interests and factors, HR
will be able to make policy decisions that help reach
the goals.

12. Advantages of
Harvard Framework
Benefits
The Harvard Framework enables organizations to adapt HR
practices to changing environments, foster employee
engagement, and achieve strategic objectives effectively.
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