Explain Strategic fit of Strategic Human Resource Management. 8.

Count on analytics
Strategic fit expresses the degree to which an organization is matching its Compensation history, turnover rates, employee engagement, and other HR
resources and capabilities with the opportunities in the external environment. metrics can all be used to inform strategic decisions.
The matching takes place through strategy, and it is therefore vital that the 9. Make a mission and vision statement for your company
company has the actual resources and capabilities to execute and support the The mission and vision statements summarise the HR strategy and serve as a
strategy. litmus test for all subsequent policies and decisions.
Strategic fit relates to the situation in which various resources of
2) Setting out HR Strategies,
organization (human, financial, material, technology, knowledge) are aligned
HR strategies set out what the organization intends to do about its human
with strategic goals and development objectives set by managers in the
organization during strategic management process. Strategic fit can be divided resource management policies and practices and how they should be integrated
into various sub-fits e.g. financial strategic fit, market strategic fit, with the business strategy and each other.
technology strategic fit. By achieving high degree of strategic fit, managers 3) Conducting Strategic reviews
can exploit opportunities of the organization and reduce negative impact of A strategic review is a structured process to identify new value-creating
threats. Strategic analysis opportunities within a business. This could be about improving the performance
and strategic planning helps to identify optimal degree of strategic fit needed to of an existing division or taking advantage of a new market adjacency
achieve long- opportunity. Many companies undertake strategic reviews on an annual basis
term competitive advantage. as part of their strategic planning process. Other businesses will undertake them
Strategic fit could be classified into on a more ad hoc basis when presented with a specific opportunity or problem
1. Market related Fits. within the business.
2. Operating Fit
4) Implementing HR strategies.
3. Management Fit.
Implemented HRM is the set of HR practices as delivered by managers. An HR
Market related fit arises when value chains of different businesses overlap so
that the products can be used by same customers, marketed and promoted in a practice that is being implemented goes through each of these steps. For example,
similar way and have a common distribution channel (common dealers and HR designs a new performance management system. Then, managers deliver
retailers) the performance management system, and employees experience it. These
Operational Fit arises when different businesses work along in order to explore steps are important because managers may differ in how they deliver the
opportunities for cost-sharing or skill transfer. system. And employees may have different needs, preferences, and backgrounds.
Management fit revolves around a comfort that is built among both the This can also lead to having different perceptions of the same system.
businesses in terms of some comparable units like Entreasures, Administration These implementation steps are often neglected when evaluating an HR
and various administrative activities, operating problems. It allows accumulated initiative. Usually, companies only measure ‘intended HRM’ and performance
managerial know-how in one business to be used in managing another business. outcomes. This does give some information, but not enough to be able to take
It is necessary that business management should take actions to capture benefits action, as we have no idea of what happens – and where it goes wrong.
as they don’t just happen! Benefits with sharing potential must be recognized so Having the resources and having a perfect strategy would not be worth it if action
that activities to be shared are merged and coordinated. When skill transfer takes
is not taken. Implementation is the most important part of a developing a
place, a means must be found to make it effective.
human resources strategy. Putting your plans into action and seeing the process
linking business strategy and HR strategy
An HR strategy is your plan to build and maintain a team capable of delivering through to completion is essential.
business
objectives. A typical HR strategy will cover elements such as:
● Recruitment and onboarding
● Training and professional development
● Employee engagement What is the rationale of HR evaluation?
● Organizational culture and work environment • HRM evaluation refers to the procedures and processes that
● Operational policies and compliance measure, evaluate and communicate the value added of HRM
● Compensation strategy and Total Rewards
practices to the organisation.
● Employee retention
● Succession planning • HRM evaluation assumes significance because of the intensive
An effective HR strategy looks at human capital on multiple levels. You will need emphasis on cost control, need for efficient allocation of
to consider the individual employee experience and ask whether people are resources, contribution to the bottom line, and capability of
engaged and if your Total Rewards offering is sufficient. human resources to provide a competitive advantage to the firm.
Five steps to align HR with the business strategy • Specifically, HRM evaluation has been advocated for several
1. Understand the main strategic goals reasons including:
All strategies should be aligned towards the same outcomes. If the main ▪ Promotion of the HR function, through demonstration of bottom-line
business goal is growth, the HR strategy should aim to reduce time-to-hire, contributions through reduced turnover.
improve onboarding, and scale up training and development. If the goal is ▪ The demonstration of accountability in utilisation of resources.
business resilience, HR needs to look at operational ▪ Promotion of change by identifying strengths and weaknesses.
efficiency and compensation planning. ▪ Introduction of financial assessment as a decision tool in human resource
2. Map out a skills matrix
programme selection.
How does your current team contribute to the company strategy? Each
individual brings something different, so you'll speak with team members one ▪ Highlighting key HR practices.
by one and discuss their strengths and weaknesses. This approach will help you ▪ Gauging the performance of HR function.
prioritize training resources where they're needed most. ▪ Demonstrating the function’s role in the accomplishment of firm’s goals.
3. Formalize your talent strategy
Once you know where the organization is headed and what it requires of its
people to get there, you must determine the gaps between its current
workforce and what is necessary to accomplish the main business goals.
4. Measure HR outcomes
Whether you use an HR scorecard or other metrics, these measures indicate if
your HR talent strategy is successful or when a course correction is necessary.
Pay close attention to things like:
● Time-to-hire
● Engagement survey results
● Professional development progress
● Stay interview and exit interview results
5. Stay in touch with the strategists
But what happens if the business strategy changes? That's why it's essential
to have a connection between HR leadership and primary decision-makers.
You can't support the business strategy unless you know what that strategy is.
Formulating and Implementing HR Strategies:
1) Developing HR Strategies,
Developing a Human Resource strategy entail conducting a thorough
examination of an organization's strengths, weaknesses, opportunities, and
threats, a process known as a SWOT analysis. Every business is unique, but the
following steps are taken by most of them:
1. Learn about the company and its goals
Speak with people from all levels of the organisation to gain a thorough
understanding of the company's history, the products or services it provides
today, and the goals it hopes to achieve in the future.
2. Examine employee skill sets
Examine employee performance, resumes, project history, and continuing
education to determine the overall skill level of the workforce.
3. Perform a gap analysis
Determine whether employees have what they need to be productive, or whether
additional resources must be purchased.
4. Analyse the talent strategy
Auditing compensation, benefits, work environments, and employee engagement
on a regular basis can help employers compete for new talent while also
retaining valued workforce members.
5. Develop existing employees
Create a development plan for any employees who appear to be ready for new
challenges or who have skills outside of their current role. This will allow them
to grow with the company.
6. Limit turnover
Determine the root cause of why employees leave a company and devise a
comprehensive plan to address the issue and avoid labour shortages.
7. Plan of time for succession
Knowing which employees can easily fill other positions should they become
vacant reduces disruptions when someone leaves the organisation unexpectedly.
Explain the strategic HRM models. Four types in Hrm strategy
There are various models that attempt to explore the link between business The success of HRM lies in its flexibility in reorienting itself in tune with
strategy and HR policies and practices. changing internal and external focus of organizations. HR strategy that is most
1. Life cycle Model suitable to a particular market condition like change in product strategy may not
2. Competitive Advantage Model be suitable to a condition like organizational turnaround. In this context, D. Stace
3. Multiple ROLE model of Hrm and D. Dunphy proposed four HRM strategies that can fit in with four different
Life cycle Model This model was developed by Kochan and Borocci. According
organizational conditions in their paper titled "Beyond Traditional Paternalistic
to this model, the policies and practices of the organization should fit the relevant
and Developmental Approaches to Organizational Changes" published in
stage of an organization development or life cycle.
• Introductory stage at this startup phase of the business, there is an emphasis International Journal of HRM in 1991.
on 'flexibility' in HR to enable the growth of business and faster Task Focused HRM Strategy
entrepreneurialism. HRM strategy strongly focused on the business unit :
• Growth stage at this stage, when the business grows beyond a certain size, ▪ Strong bottom line orientation.
emphasis moves to the development of formal HR policies and procedures. ▪ Emphasis on workforce planning, job redesign and work practice
• Maturity stage at this stage, as the market matures, margins decrease the reviews.
performance of certain products or the organization plateaus, then the focus of ▪ Focus on tangible reward structures.
HR strategy is on cost control. ▪ Internal or external recruitment.
• Decline stage at this stage, the emphasis shifts to rationalization, downsizing ▪ Functional skills training and formalized multi- skilling.
and redundancy implications for the HR function. ▪ Formalized industrial relations procedures.
There are various issues emerging for the SHRM. Two kinds of mature
▪ Strong business unit culture.
organizations manage to survive industry development:
Use when markets/products/services are undergoing major change and niche
(i) The firm that succeeds in dominating the direction of industry change
(ii) The firm that manages to adopt the direction of change strategies is prevalent. HRM strategies must deliver the capacity for rapid
The route to the advantage of SHRM lies in the preparation for retaining viability structural, systems, skill and cultural changes. Strong emphasis on business unit
and competitive advantage in the mature phase. autonomy, maximum devolution, rightsizing (continuous
The model also keeps the organization agile by building the internal capacity to redeployment),outsourcing of labour.
flex and adapt to changes in the external context and by enabling the business to Development
change as a matter of course. HRM strategy is jointly carried out by the corporate Use when markets are
Competitive Advantage Model This model was developed by Porter in 1985. It growing and product/market HR unit and the business units
has three major parameters: (i) Cost leadership, (ii) Differentiation, and (iii) ▪ Emphasis on developing the individual, and the team.
Focus. ▪ Internal recruitment, where possible.
(i) Cost leadership focuses on the delivery of efficiency mainly through 'hard' HR ▪ Extensive development programmes.
techniques ▪ Use of intrinsic rewards.
(ii) Differentiation is focus on the delivery of added values through 'softer' HR
▪ Corporate organizational development given high priority.
techniques and policies
▪ Strong emphasis on corporate culture.
(iii) Focus is on softer HR techniques/policies for the delivery of added value
According to the model, the business performance will improve when HR Use when markets are growing and product/market innovation is desired. HRM
practices mutually reinforce the organization's choice of competitive strategy. strategies must create cross-organizational synergy, and a market-leader culture.
Herein, the mission and values are expressed through their desired competitive Strong emphasis on individual development, corporate culture management,
strategy. developing strong internal labour market (promotions/appointments) and team
Multiple role model of Hrm Dave Ulrich, Professor of Business Administration skills.
at University of Michigan argues that the roles of HR professionals must be Turnaround HRM Strategy
redefined to meet the competitive challenges organizations face today and are HRM strategy is driven for a short period by the executive leadership,
likely to face in the future in his remarkable and insightful book titled Human characterized by challenging, restructuring or abolishing HR systems, structures
Resource Champions: The Next Agenda for Adding Value and Delivering Results and methodologies.
published in 1997. Based on numerous examples from dozens of companies that ▪ Major structural changes affecting the total organization and career
have transformed their HRM functions, he provided a framework that identifies structures.
four distinct roles that HR professional must perform simultaneously in order to
▪ Downsizing, retrenchments.
contribute fully to their organizations, i.e. adding value and delivering results.
This framework called as multiple role models is illustrated here: ▪ Lateral recruitment of key executives from outside.
1. Strategic partners. This role involves systematically assessing and aligning ▪ Executive team building, creating a new mindset.
HR practices with business strategy. They need to have skills to design, integrate ▪ Breaking with the old culture.
and operate HR system to build new organizational capabilities. Building new Use when the business environment changes dramatically, i.e. when the
organizational capabilities call for performance management programmes organization is not compatible with its environment, and when the business
aligned with the desired outcomes. Here the deliverable outcome is executing strategy of the organization radically changes. HRM strategies must break and
strategy. abolish redundant HRM practices, structures, and redefine a new culture. Strong
2. Administrative experts. This role is characterized by improving the emphasis on forced downsizing. lateral recruitment, new HRM systems and
processes, applying the principles of reengineering to HR processes, creating radical work and job restructuring.
value in work performance, measuring HR results in terms of efficiency (cost) Paternalistic HRM Strategy
and effectiveness (quality). The deliverables in this role is building an efficient HRM practice is centrally administered
infrastructure.
▪ Centralist personnel orientation.
3. Employee champions. Listening and responding to employees and finding
▪ Emphasis on procedures, precedent and uniformity.
the right balance between demands on employees and resources available to them
are the characteristics of this role. The key deliverable is increasing employee ▪ Organization and methods studies.
commitment and capability. ▪ Inflexible internal appointments policy.
4. Change agents. The deliverable in this role is creating a renewed ▪ Emphasis on operational and supervisory training.
organization. To this end, HR professionals need to understand the theory and ▪ Industrial awards and agreements set the HR framework.
application of tools for change. They lead transformation by doing it first within Use only in very limited mass production situations where the organization has
the HR function; they serve as catalysts and facilitators of change. an absolute monopoly on stable markets/ products, HRM strategies are used as
Apart from above, the model advocates mutually beneficial partnership between devices for control and uniformity of procedures/ operations. Strong emphasis
line and HR staff and prescribes guidelines on how to establish this partnership on formal, detailed job descriptions, formal employer-employee industrial
to deliver value and make their organizations more competitive. relationships and industrial awards.
How are business strategy linked in HR? Discuss Strategic workforce planning.
It is essential that the HR of a company thoroughly understands the goals and The first component of HR management strategy is strategic workforce planning.
objectives of the company. This is required so that they can align the business The second component, the design of work systems, is covered in Chapter 6. All
strategies accordingly. In the HR environment there are the following elements: other functional HR activities, such as staffing, training, performance
i) Some overarching, broad elements like HR architecture, HR principles or HR management, compensation, labour relations, and employee separation, are
philosophy that provide general direction for the management of human capital derived and should flow from the strategic workforce planning process. When
undertaking strategic workforce planning, the organization considers the
ii) Some mid-range elements like HR policies or HR programmes that provide
implications of its future on the nature and types of individuals it will need to
alternative approaches to align HR practices with HR architecture and strategic employ and the necessary skills and training they will require. The organization
objectives, and will also need to assess its current stock of employees as well as those available
iii) Some lower-range elements like HR practices and HR processes that reflect for employment externally. The key facet of strategic workforce planning is that
the actual HR activities implemented in specific circumstances. it is a proactive process. It attempts to plan and anticipate what might happen in
Central to the concept of SHRM is the idea of strategic fit. To ensure that HR the various domains of the organization’s internal and external environments and
strategies facilitate the achievement of business strategies, a strategic integration to develop plans to address these events prior to their happening.
between the two is necessary. A key factor that influences the linkage between Strategic workforce planning goes far beyond simple hiring and firing. It
business strategy and HR strategy is the organization’s quest to attain competitive involves planning for the deployment of the organization’s human capital in the
advantage. An organization may pursue several different strategies to achieve its most effective and efficient ways, in line with the organization and/or business
goals. unit strategy. In addition to hiring and/or separation, human capital management
Three types of business strategies that may be adopted by an organization are may involve reassignment, training and development, outsourcing, and/or using
temporary help or outside contractors. Modern organizations need as much
cost leadership, differentiation, and focus. This classification of business
flexibility as possible in how they utilize human talent in the pursuit of their
strategies was advanced by Porter (1985) and has been extensively used in
strategic goals.
SHRM literature. According to Porter, an organization may adopt any one of the Objectives of Strategic Workforce Planning
three business strategies to compete successfully in a particular market and gain There are five major objectives of strategic workforce planning,
and sustain superior performance as well as an advantage over its competitors. The first is to prevent overstaffing and understaffing. When an organization has
Bases of Classification of HR Strategies: too many employees, it experiences a loss of efficiency in operations because of
There are various conceptualizations of the relationship between business excessive payroll costs and/or surplus production that cannot be marketed and
strategy and HR strategy in SHRM literature. Beaumont (1992) noted three bases must be inventoried. Having too few employees results in lost sales revenue
of classification of HR strategies: because the organization is unable to satisfy the existing demand of customers.
Different types of business strategies Moreover, the inability to meet current demand for products or services due to
When an organization selects a strategy of becoming a ‘low-cost producer’, it understaffing can also result in the loss of future customers who turn to
adopts different HR approaches to compensation as compared to an organization competitors. Strategic workforce planning helps to ensure that operations are not
that adopts a ‘product innovation’ strategy. Taking a similar approach, earlier, only efficient but also timely in response to customer demand.
The second objective is to ensure that the organization has the right employees
Schuler and Jackson (1987) had proposed that the different business strategies
with the right skills in the right places at the right times. Organizations need to
described by Porter (1985) will result in variations in HR practices. Stages in the
anticipate the kinds of employees they need in terms of skills, work habits, and
business or product cycle According to this classification, HR practices are personal characteristics and time their recruiting efforts so that the best
related to variations in the life cycle stages of a business— start-up, growth, employees have been hired, fully trained, and prepared to deliver peak
maturity, and decline. Different dimensions of HR practices are important at performance exactly when the organization needs them. Nonetheless, the
various stages of the business life cycle. planning process needs to consider myriad factors, including skill levels,
Types and numbers of products individual employee “fit” with the organization, training, work systems, and
Fombrun et al. (1984) suggested that the strategy aimed at achieving variations projected demand, and then integrate these factors as a critical component of its
in product focus (the numbers and types of products), results in structural HR strategy.
modifications and influences HR strategy. On the other hand, an organization that The third objective is to ensure that the organization is responsive to changes in
follows a strategy of growth by acquisition (holding company) of unrelated its environment. The strategic workforce planning process requires decision
businesses, with separate self-contained businesses, has different criteria of makers to consider a variety of scenarios relative to the numerous domains in the
selection that vary from business to business. Performance appraisals and environment. For example, the economy might grow, remain stagnant, or shrink;
the industry might remain the same or become either more or less competitive;
rewards are impersonal and are based on the return on investment and
government regulation may remain the same, be relaxed, or become more
profitability. Development is cross-functional but not cross-business. stringent; technology may or may not be further developed. Strategic workforce
HR Strategy Classification planning
Of these three bases of classification of HR strategy, the most popular approach forces the organization to speculate and assess the state of its eternal
is the type of business strategy and the adoption of complementary HR strategies. environment. Anticipating and planning for any possible changes rather than
Some approaches linking business strategy with HR strategy are discussed. passively reacting to such conditions can allow the organization to stay one step
Porter emphasized the fit point of view by stating that all the activities of an ahead of its competitors.
organization must be tailored to fit its business strategy. The fourth objective is to provide direction and coherence to all HR activities
Schuler and Jackson focused on Porter’s classification of the three generic and systems. Strategic workforce planning sets the direction for all other HR
business strategies, i.e., cost leadership, differentiation, and focus. They argued functions, such as staffing, training, and development, performance
that HR practices should be designed to reinforce the behavioural implications measurement, and compensation. It also ensures that the organization takes a
of these generic strategies. Based on the role requirements, each competitive more systemic view of its HR management activities by understanding the
interrelatedness of the HR programs and systems and how changes in one area
strategy is defined in terms of a matching HRM strategy.
may impact another area. A coherent HR plan will ensure, for example, that the
Miles and Snow’s Classification of Business Strategy and HR Strategy
areas in which employees are trained are being incorporated into their
Miles and Snow (1984) suggested that HRM practices should be tailored to the performance measurements and that these factors are additionally considered in
demands of the business strategy. They identified four types of organizational compensation decisions.
strategies based on the dominant culture of the organization. These are The fifth objective is to unite the perspectives of line and staff managers.
defenders, prospectors, analysers, and reactors, classifying the first three Although strategic workforce planning is usually initiated and managed by the
types as ‘ideal’ organizations: corporate HR staff, it requires the input and cooperation of all managers within
• Prospectors, which operate in an environment characterized by an organization. No one knows the needs of a particular unit or department better
rapid and unpredictable changes. They react to this environment than the individual manager responsible for that area. Communication between
by focusing on the development of new products, markets and HR staff and line managers is essential for the success of any HR planning
technologies. They create change in their markets and are the initiatives. Corporate HR staff needs to assist line managers in the planning
forces to which competitors must respond. Prospectors have low process but simultaneously acknowledge the expertise of and responsibility
assigned to individual line managers in considering their input to the planning
levels of formalization and specialization and high levels of
process.
decentralization. They have relatively few hierarchical levels.
• Defenders, which operate in a more stable and predictable
environment than prospectors and engage in more long-term
planning. Their emphasis is on defending their markets, and they
do little research and development. Defenders focus on efficiency
by relying on routine technologies and economies of scale. They
have more mechanistic or bureaucratic structures than prospectors
and obtain coordination through formalization, centralization,
specialization and vertical differentiation.
• Analysers, which are a combination of the prospector and
defender types. They operate in stable environments like
defenders and in markets where new products are prospectors, but
they follow the changes more rapidly than defenders. Analysers
seek effectiveness through both efficiency and new products or
markets. This dual focus may result in increased size, because
analysers must engage in both mass production and research and
development. They are usually not the initiators of change, as are
prospectors, but they follow the changes more rapidly than
defenders. They may also exhibit higher levels of
interdependence than either prospectors or defenders.
• Reactors, which are unstable organizations existing in what they
believe to be an unpredictable environment. They lack consistent,
well-articulated strategies and do not undertake long-range
planning .
The first three strategies pursue consistent business strategies. The reactors do
not have consistency in their strategies. The type of HR practices that are likely
to be adopted by an organization with the three consistent strategies.
. Briefly explain strategic approaches to recruitment and selection. Behavioural interviewing evaluates how candidates have behaved or would
Staffing, the process of recruiting applicants and selecting prospective behave in job-related situations, focusing on interpersonal traits, decision-
employees, remains a key strategic area for human resource (HR) management. making, and problem-solving rather than just technical skills. Using the
Given that an organization’s performance is a direct result of the individuals it Situation–Action–Outcome (SAO) format, candidates describe situations,
employs, the specific strategies used, and decisions made in the staffing process actions, and results. It applies to both experienced and less experienced
will directly impact an organization’s success or lack thereof. Decisions made as candidates, reduces legal risks, assesses cultural fit, and is often structured or
part of the staffing process can have a significant impact on an organization’s semi-structured for consistency. Combined with other tools like tests or work
bottom line. samples, it ensures reliable and valid selection of suitable candidates.
RECRUITING Structured interviews follow a set protocol: All interviewees are asked the same
Active vs Passive Approach of Recruitment questions and are given the same opportunity to respond. There is standardization
• Passive approach involves job announcements through suitable in that it becomes easier to compare applicant responses to identical questions,
communication channels and waiting to see who applies. passive and legal liability can be minimized because all applicants are treated the same.
candidates are employed and not currently seeking out new However, structured interviewing provides limited opportunity to adapt the
opportunities. interview process to any unique circumstances surrounding any applicant.
• Active approach deals with targeting specific individuals within An unstructured interview is totally spontaneous and one in which questions
professional networks to ensure broad and most appropriate pool are not planned. The topics of discussion can vary dramatically from one
of applicants. This can be done through conferences, industry candidate to another. Such a process allows interviewers to gain a greater sense
trade shows, networking events and social media etc. Active of the applicant as an individual, but it often makes comparison among different
candidates are ones who are openly and actively looking for new candidates difficult.
job opportunities. A semi structured interview would fall somewhere between these two
When And How Extensively to Recruit? extremes. With a semi structured interview, the interviewer asks each candidate
Regardless of whether recruiting is done internally or externally, effective a set of standard questions. However, the interviewer can determine exactly
planning and strategizing are essential to the success of the process. An which questions each candidate is asked and can be flexible and probe for
organization needs to know that it has the right employees with the right skills in specifics when answers are provided. Although structured interviews provide the
the right places at the right time. This involves determining
greatest consistency, unstructured interviews provide the greatest flexibility. The
(1) how large an applicant pool is needed and
organization must determine which is more important strategically.
(2) when recruiting efforts should begin.
Both these questions can be answered by reviewing data from past recruiting TESTING
efforts. A recruiting pyramid can be constructed by using yield ratios that show, Another critical decision in the selection process involves applicant testing and
traditionally, how many employees pass from one stage of the recruiting process the kinds of tests to use. The needs of the organization and job will determine
to the next. This can help the organization determine how large an applicant pool whether any or all of the following should be assessed: technical skills,
to seek. The organization could use historic yield ratios to determine how interpersonal skills, personality traits, problem-solving abilities, or any other job-
extensively to recruit. related performance indicators.
The key variable that should influence testing is job requirements. Any testing
that is not specifically job related could be legally challenged, particularly if
adverse impact can be shown. The timing of testing can vary from organization
to organization. Traditionally, testing has been conducted after the interviewing
and screening process because of the expense of testing and time required to
score and evaluate test results. However, some organizations are now testing
earlier in the selection process because costs involved with interviewing often
exceed the costs of testing. Clearly, it makes sense for an employer to use more
cost-effective screening techniques earlier in the selection process. Perhaps the
most useful types of tests are work sample and trainability tests.
Work sample tests simply involve giving the applicant a representative sample
of work that would be part of the job and asking the individual to complete it.
These tests are useful when the employer needs employees who will be able to
perform job responsibilities from the first day of employment.
Trainability tests measure an applicant’s aptitude and ability to understand
critical components of the job that the company may be willing to teach once the
employee is hired. They are useful when the employer needs some familiarity
with the nature of the work but seeks to train the new employee in the
organization’s way of doing things.
Personality testing often centres around what have been called the “Big Five”
One caution must be issued concerning the use of recruiting pyramids and personality dimensions. These traits are considered most relevant to performance
timelines. Because they are based on past recruiting data, they may need to be in any kind of work environment. Personality testing can be useful to anticipate
adjusted if labour market conditions have changed dramatically. Higher or lower how employees might behave, particularly on an interpersonal level, but
unemployment, changes in the competitiveness of the industry, and/or the personality tests can be problematic on two levels. First, personality testing has
attractiveness of the employer vis-à-vis competitors might make the staffing been successfully challenged in many courts because of the impact of certain
process easier or more difficult than it had been in the past. Managers should questions on members of protected classes. Second, few, if any, jobs require one
assess how any changed conditions might impact the size of the applicant pool, specific type of personality to ensure success. No employer has ever been able to
the ratios, and the timeline. argue successfully in court that a specific personality type or dimension was
SELECTION necessary for effective job performance.
Once a sufficient pool of applicants has been recruited, critical decisions need to
be made regarding applicant screening. Selection decisions can and do have
significant economic and strategic consequences for organizations, and these
decisions need to be made with great care. Before the application of any selection
tools or criteria, the organization needs to determine if the methods being
employed are both reliable and valid.
Validity is critical not only to ensure proper selection, but it also becomes the
chief measure by which employers defend discrimination allegations in court.
There are two types of validity that support selection criteria. The first is content
validity. Content validity illustrates that the measure or criterion is
representative of the actual job content and/or the desired knowledge that the Physical testing can be done only after a job offer has been made unless an
employee should have to perform the job. Content validity is determined through employer can show that there are specific, critical physical requirements for job
the process of job analysis. Content validity, in and of itself, does not guarantee performance.
successful performance on the job, much as completing a prerequisite course in REFERENCES AND BACKGROUND CHECKS
a degree program does not guarantee successful completion of a later course. Reference checking is usually part of the selection process; however, most
The second validity measure is empirical, or criterion-related, validity. This prospective employers do little more than waste valuable time during this
measure demonstrates the relationship between certain screening criteria and job process.
performance. If individuals who obtain higher scores or evaluations on these Much like testing, reference checking was often done after the interviewing
screening criteria also turn out to be high performers on the job, then this type of process and usually as the final step in the selection decision. More recently,
validity is established. It is important to realize that reliability alone is not however, many organizations have begun checking references prior to
sufficient for determining the appropriate screening criteria. These criteria must interviewing to allow them to eliminate candidates and gather information to be
also be valid. used later in the interviewing process. One potential limitation with reference
INTERVIEWING checking is that many past employers will not provide any information at all.
The first set of critical decisions in the selection process involves the Reference checking has become more critical for organizations because courts
interviewing process. Employers first need to determine who should be involved have been holding employers responsible for an employee’s acts if the employer
in interviewing applicants. Several different constituents can provide input. did not conduct a reasonable investigation into the employee’s background.
Prospective immediate supervisors, peers, and/or subordinates might be asked to
participate in interviewing candidates. Co-worker input can be critical in
organizations that emphasize teams and project groups. The input of customers
might also be sought, particularly for employers in service industries. Those
involved in selecting appropriate interviewers must consider the different
perspectives that different individuals or groups offer and the relevance of these
perspectives for selecting the best applicant. Interviewers should be chosen from
diverse racial, ethnic, age, and gender backgrounds.
Another decision must be made as to whether interviews will be conducted in an
individual or group format. Group interviews can save time for both the
organization and applicant, but they often involve creating a less personal
atmosphere for applicants. Group interviews may make it more difficult for
interviewers to get a sense of the applicant’s interpersonal style. Interviewing
applicants involves making subjective assessments of each applicant’s
qualifications for a job.
What is HRIS?  Time & Attendance. This module gathers time and attendance data from
Human resource information system (HRIS) can be defined as a software or employees. These are especially relevant for blue-collar work where employees’
online solution that is used for data entry, data tracking, and the data management clock in and out. Back in the day when I worked in a supermarket, we wrote the
of all human resources operations of an organization. With the world of work in time worked down on a piece of paper, which was then manually entered into the
a state of continuous, digital flux, HR systems and processes need to adapt to a time tracking system by the manager. Based on this data, payment orders were
world that is datafied, technology-driven, and people-centric. Human resource generated and paid to all employees.
information systems have evolved over the last decade as well to embrace these  Training. Learning and development is a key element when it comes to
new trends at work. employee management. This module allows HR to track qualification,
The goal of any HR software is to help you manage your HR initiatives and to certification, and skills of the employees, as well as an outline of available
better support your company’s objectives. There are 8 steps which are required courses for company employees. This module is often referred to as an LMS, or
to be undertaken to ensure a successful implementation. Learning Management System, when it’s stand-alone. An LMS usually includes
• Identify your current HRIS needs and plans for future growth available e-learning and other courses to be
- Know what you want your HRIS software to do. Having a clear followed by employees.
goal in mind will help you to set your expectations for the new  Performance management. Performance management is a key part of
platform. Are you seeking to reduce time spent on manually managing people. Performance ratings are generated once or multiple times a
processing tasks or eliminating paperwork? Does the new system year by the direct manager or peers of the employee.
need to work seamlessly with your existing ATS, international  Succession planning. Creating a talent pipeline and having replacements
Payroll or other software in your HR/IT/Finance ecosystem? available for key roles in the organization is another key component of an HRIS.
What must the new system do that your current HRIS cannot  Employee self-service. Employee self-service was already mentioned.
manage? Answering these and other questions early in the process Organizations are focusing increasingly on having employees and their direct
will help you to develop your Request for Proposal and to assess supervisors manage their own data. Requests like holidays can be asked for by
your prospective vendors. the employee him/herself. After approval, these are then immediately saved into
• Establish your HRIS budget - Be clear on which features are the the system
most critical for your team and for the company. Would employee  Reporting & Analytics. A much rarer module in HRIS systems is reporting
self-service cut down on tracking PTO requests? Does leadership and analytics. Modern systems enable the creation of automated HR reports on
need access to advanced reporting to make data-driven people various topics like employee turnover, absence, performance, and more.
decisions? Do you want to accelerate time to productivity for your Analytics involves the analysis of this data for better-informed decision making.
new hires with structured onboarding? Include an additional We’ll explain more about this in the section below.
budget for IT, additional staff training time and possible budget Functions / Role of HR Systems
over-runs.  Record-keeping. An HRIS is a record-keeping system that keeps track of
• Send out a Request for Proposal (RFP), interview vendors and changes to anything related to employees. The HRIS can be seen as the one
then select an HRIS platform- Do your research by connecting source of truth when it comes to personnel data.
with industry peers, reviewing what HR blogs and other sites are  Compliance. Some data is collected and stored for compliance reasons. This
saying about best-in-class HRIS vendors. Invite your shortlisted includes material for the identification for employees in case of theft, fraud, or
vendors to give a presentation to both you and your team. Aside other misbehaviours, first contact information in case of accidents, citizens
from the sales pitch, ensure that the vendors have aligned their identification information for the tax office, and expiration dates for mandatory
systems’ capabilities with your expressed current and future plans certification. All this information can be stored in the HRIS.
while staying within established budget and timeline for  Efficiency. Having all this information in one place not only benefits accuracy
implementation. Discuss whether the system can be integrated but also saves time.
with the tools you already use and develop an understanding of  HR strategy. The HRIS enables the tracking of data required to advance the
their Professional Services Program to ensure you’re set up for HR and business strategy. Depending on the priorities of the organization,
success. different data will be essential to track. This is where the HRIS comes in.
• Partner with the chosen vendor to create a comprehensive  Self-Service HR. A final benefit is the ability to offer self-service HR to
implementation project plan - Identify both your internal and employees and managers. This enables employees to manage their own affairs.
external implementation project teams and garner support from When done right, the HRIS can offer a good employee experience. Keep in mind
your company stakeholders and sponsors. If possible, have a that not all HRIS systems offer this in a user-friendly manner!
skilled in-house project manager be the liaison between the
vendor and your internal teams. Establish dedicated resources (IT,
consultants, etc.) at both the technical and the functional level,
who are available throughout each implementation phase.
• Next up, implementation kick-off - Work with your chosen
vendor and your internal and external stakeholders to establish a
multi-phased approach to implementation. This can ensure that
sufficient time and resources are allocated at each phase, and day-
to-day work can continue without major disruptions.
Phases may include IT and connectivity, security, systems
integration, data migration, testing, super-user training, and
usability testing. Communicate the implementations progress to
sponsors and stakeholders on a regular basis.
• Communicate the HRIS Company-wide rollout - Establish a
communications plan for company-wide messages as you move
toward your rollout date. Your plan can include specifically timed
and focused messages to super-users, stakeholders and end-users.
Identify and promote internally information on technical support,
functional support, and end-user training.
• Identify challenges and provide support - Once your HRIS
system is fully functional, have additional resources in place to
support late or slow adopters. Have a 2-way communication
system in place to gather feedback from super-users, stakeholders
and end-users. Continue to work with the vendor, internal and
external resources to make any necessary technical adjustments.
• Evaluate Implementation Success - Once you’ve reached the
end of your implementation, spend time reviewing the process
with both your internal stakeholders and your HRIS vendors.
Identify the impact of any cost over-runs, unexpected delays, and
additional resources. Ensure that your vendor has addressed all
outstanding issues. Have a plan in place for future add-ons, new
technology or upgrades to the HRIS system.
Implementing an HRIS and executing it effectively require forethought,
communication, and project management. But the results will lead to higher
productivity and engagement from your team.
Components of HR Systems
There are different kinds of HRIS systems and software. Because an HRIS
encompasses all the functionalities for HR, all separate functionalities are part of
the system. These functionalities include:
 Applicant Tracking System (ATS). This software handles all the company’s
recruiting needs. It tracks candidate information and resumes, enables recruiters
to match job openings to suitable candidates from the company’s application
pool, and helps in guiding the hiring process.
 Payroll. Payroll automates the pay process of employees. Contractual data is
often entered into this system – sometimes combined with time & attendance
data – and at the end of the month, payments orders are created.
 Benefits. Another functionality of the HRIS is benefits management.
Employee benefits are an important aspect of compensation and are also
managed in this system. More advanced systems offer an employee self-service
model for employee benefits. In this case, employees can select the benefits they
are looking for themselves. One may want more paternity leave, the other one a
more expensive company car. This self-service approach to benefits is also called
a cafeteria model.