HRM 390
Strategic Human Resource
Management
Chapter One
Introduction: Human Resource Management: Gaining a Competitive
Advantage
Strategic Human Resource Management
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Management is what
Manager Does
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All managers share one
common element
They work in an
organizational setting
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Organization
An organization is deliberate and systematic arrangement of
people brought together to accomplish some specific purpose.
Goals People Structure
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Characteristics of Organization
The first characteristics of an organization is that it has a distinct
purpose, which is typically expressed as a goal or set of goals.
Achieving those goals is done by the people in the organization which
is the second characteristics of an organization.
Finally, the third characteristics is that organization is structured in
some way that defines or limits the behavior of its members.
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HRM 390
What is Management?
Management is the process of getting things , efficiently and effectively ,
done with and through other people.
Process refers to a set of interrelated and ongoing activities. In the
definition, process indicates the primary activities and function that
managers perform. For e.g. planning, organizing, leading & controlling.
Getting things indicates the ultimate objective of business. For e.g.
profitability, sustainability, productivity etc.
Effectiveness/ effectively refers to achieving the desired goal and
efficiency indicates achieving desired goal with minimum efforts.
Other people refers to the skilled workforce or manpower of the
organization.
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What is HRM?
Human resource management is concerned with the
people dimension in management. It is a process
consisting of the acquisition, development, motivation,
and maintenance of human resources.
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HRM ….
The term “Human Resource” refers to people in organization. Human
Resource Management refers to the philosophy, policies,
procedures and the practices related to management of people.
Managing people within the employer-employee relationship. It
involves the productive use of people in achieving the
organisation’s strategic business objectives and the satisfaction
of individual employee needs.
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Philosophy
Soft
HRM
of HRM
Hard
HRM
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Philosophy 01: Labor is viewed as a technical factor of
production
They are treated as a commodity, Consistent with theory X
and they can be bought and sold. suggested by Douglas
They are considered as cogs in McGregor
the machine. They can be hired
and fired at will.
Main Theme Employee must be controlled and supervised
Assumpti
by management to attain company goals.
ar d ons
Employees have limited potentiality
H M
H R
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HRM 390
Philosophy 02: Labor has been viewed as a human
factor with a lot of positive potentials.
People are assets – not cost.
Investment in people is very
o f t
rewarding. Management must S M
develop and utilize the talent
of people to achieve common H R
goals. Assumption
Main Theme Employee must be treated with respect
and dignity because they are the
sources of competitive advantages.
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HRM 390
HRM Activities
Job analysis defines a job in terms of specific tasks and responsibilities and
identifies the abilities, skills and qualifications needed to perform it
successfully.
Human resource planning or employment planning is the process by which
an organisation attempts to ensure that it has the right number of qualified
people in the right jobs at the right time.
Employee recruitment is the process of seeking and attracting a pool of
applicants from which qualified candidates for job vacancies within an
organisation can be selected.
Employee selection involves choosing from the available candidates the
individual predicted toHuman
Strategic be most likely
Resource to perform successfully in the job.
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Continue. .. . ..
Performance appraisal is concerned with determining how well employees are
doing their jobs, communicating that information to the employees and
establishing a plan for performance improvement.
Training and development activities help employees learn how to perform
their jobs, improve their performance and prepare themselves for more senior
positions.
Career planning and development activities benefit both employees - by
identifying employee career goals, possible future job opportunities and
personal improvement requirements - and the organisation - by ensuring that
qualified employees are available when needed.
Employee motivation is vital to the success of any organisation. Highly
motivated employees tend to be more productive and have lower rates of
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absenteeism, turnover and HRMlateness.
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Continue. .. . ..
Compensation refers to the cash rewards, such as the base
salary, bonus, incentive payments and allowances which
employees receive for working in an organisation.
Benefits are sometimes referred to as indirect or non-cash
compensation.
Industrial relations is concerned with the relationship between
an organisation and its employees.
Effective health and safety programs help guarantee the
physical and mental wellbeing of employees.
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Acquisition
HR planning + Recruitment+
Selection+ Orientation
Maintenance Training &
HRM Development
Health and Safety + Function
Labor Relation Training + Managerial
s Development+ Career
Development
Motivation
Job design+ Job Evaluation+
Performance Evaluation+
Wages & Salary +
Compensation
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Responsibilities of HR Department
Functions Responsibilities
Analysis & Design of Job analysis, work analysis and Job description
Work
Recruitment & Selection Recruiting, posting job descriptions, interviewing,
testing, and use of temporary employees.
Training & Development Orientation, skill training, development programs and
career development.
Compensation and Wage and salary administration, incentive pay,
Benefits insurance, vacation, retirement plans, profit sharing,
health and wellness and stock plans.
Employee Attitude Survey, employee handbooks, labor law
Relation/Labor relation compliance, relocation and outplacement services.
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Responsibilities of HR Department
Functions Responsibilities
Personnel Policies Policy creation and policy communication
Employee Data and Record keeping, HR Information Systems, workforce
Information System analytics, social media, intranet and Internet access.
Legal Compliance Policies to ensure lawful behavior, safety inspection,
Privacy policies, ethics.
Support for Business Human Resource Planning and Forecasting, Talent
Strategy Management, Change Management, Organizational
Development.
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Line & Staff Aspect of HR Manager
Line Manager Staff Manager
A manger who is authorized A manger who assists and
to direct the work of advises line managers.
subordinates and
responsible for
accomplishing organization’s
tasks. HR Manager ???
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Line Managers’ HR Duties
• Placing the right person on the right job
• Starting new employees in the organization (orientation)
• Training employees for jobs that are new to them
• Improving the job performance of each person
• Gaining creative cooperation and developing smooth working
relationships
• Interpreting the firm's policies and procedures
• Controlling labor costs
• Developing the abilities of each person
• Creating and maintaining department morale
• Protecting employees' health and physical condition
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HR Manager Duties
Staff Manager usually help and advise line manager in achieving
organizational goals. HR experts are basically staff manager. They
assist line manager in recruiting, selecting and compensating.
For recruiting and hiring, a line manager specifies the qualification
that a candidate need. According to their requirements, HR
manager take steps for recruiting. They conduct interview, written
and medical test etc. They refer the best candidate to the line
manager who selects the right candidate for his/her department.
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Generalization
A fine function: The human resource manager directs the
activities of the people in his or her own department.
A coordinative function: The human resource manager also
ensures that line managers are implementing the firms human
resource policies and practices .
(for example, adhering to its sexual harassment policies)
Staff functions: Assisting and advising line managers is the heart
of the human resource managers' job. He or she advises the
CEO so the CEO can better understand the personnel aspects of
the company's strategic options. HR assists in hiring, training,
evaluating, rewarding, counseling, promoting, and firing
employees. It administers the various benefit programs.
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Personnel Management vs. HRM vs. SHRM
Focus: Employee Focus: Aligning HR
Focus: development and with business
Administrative tasks motivation. strategy.
(hiring, payroll, Approach: Proactive Approach: Strategic
compliance). – invests in training – uses HR for
Approach: and performance long-term competitive
Reactive: solves management. advantage.
immediate problems. View on Employees: View on Employees:
View on Valuable assets. Key to competitive
Employees: Cost to Example: Developing advantage.
control. training programs and Example: Aligning
Example: Managing performance talent management
payroll and employee appraisals.
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Strategic HRM (SHRM)
Strategic Human Resource Strategic Objectives
Management (SHRM) is the practice of the Organization
of aligning human resource (HR)
policies and practices with the
long-term goals and strategy of an
organization.
SHRM goes beyond traditional HR HR Policies &
Practice
management by linking the
management of people to the
company’s broader strategic
objectives, Strategic
ensuring that
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Key Elements of SHRM
Alignment with
Business
Long-term Focus Strategy
Proactive and
Employee Strategic
Development
Creating
Competitive
Advantage
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Perspective of SHRM
Universalistic
1 Perspective
Contingency
2
Perspective
Configurational
3
Perspective
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The Universalistic perspective, also called the
best practices approach, argues that there are
certain HR practices that are universally
effective, regardless of the organization or
Universalistic industry. These "best practices" are believed to
lead to better performance for all companies, no
Perspective
matter∙ the context.
There is a set of universal HR practices
(e.g., employee training, performance-based
Key pay, job security) that are beneficial for every
Features organization.
∙ The idea is that if companies adopt these
best practices, they will perform better than
those that don't.
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The Contingency perspective argues that HR
practices should be aligned with the company’s
specific context, including its strategy,
environment, and organizational structure. What
works well for one organization may not work for
Contingency another. Success depends on achieving a "fit"
Perspective between HR practices and the business
HR practices should be tailored to fit the
environment.
▪
Key specific strategy and circumstances of the
Features organization.
▪ Different companies with different strategies
(e.g., cost leadership, differentiation) should
use different HR practices.
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HRM 390
The Configurational perspective suggests that
organizations should adopt a set or configuration
of HR practices that work well together and
support the organization's strategy. It
emphasizes that different HR practices should be
Configuration consistent with each other and with the
al Perspective company's overall objectives, forming a coherent
system that
✔ HR practices
reinforces should not only fit the
performance.
Key
organization’s strategy but also be internally
Features consistent with each other.
✔ This perspective sees HR practices as a
bundle or system that works best when
combined, rather than in isolation.
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Concept Strategic Fit
Resource-Bas
of SHRM
ed View (RBV)
Strategic
Flexibility
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Resource Focus
Based View Develop valuable, rare,
(RBV) inimitable, and
non-substitutable (VRIN)
Objective talent. Outco
me
Use employees' unique skills to Create a workforce that's
give the company an advantage difficult to replicate for
over competitors. long-term success.
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Objective Align HR practices with business
goals.
Strategic Fit Integrate recruitment, training, and
Focus
performance management with company
strategy.
Ensure HR policies support overall
Outcome
efficiency and competitive edge.
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Objective Adapt HR to external changes and market
shifts.
Strategic Build a dynamic workforce through
Focus
Flexibility cross-training and a learning culture.
Outcome Maintain agility in responding to industry
changes.
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End of the
chapter 1
Strategic Human Resource Management
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HRM 390