Topic 3
Organisational Strategy
and SIHRM
Lecture Plan
What is strategy?
Strategy and integration of HRM (SHRM)
Matching HRM to organisational strategy
Case Study: Outsourcing Recruitment ---- China
Integration and devolvement
Case Study: People Management Fiasco at Honda
M&S India Ltd
What is Strategy?
1
2
3
Developing a Business Strategy
Mission statement
Environmental assessment
Self/Internal analysis (Philip Morris in CIS)
Goals and objectives
Strategic choice
Implementation
Evaluation
Lessons for HR from Covid-19
Remote work is real and it’s big
Personal safety and health is paramount
Going digital is imperative
Caring, listening, fair (D&I) and empathy are priority – why?
Distribute authority is key
Do less with less
Move fast and come together (future of work)
Real-time data really matters
Continuity planning vital
Leadership matters more than ever + Culture
Stages of the Evolution of
Strategy and HRM
Integration
Greer (1995)
Administrative Linkage; One-Way Linkage
Two-Way Linkage; Integrative Linkage
Guest (1987) Three aspects of integration:
Fit; complementary; internalisation
Matching Strategy and HRM (1)
Generic Strategies and HRM
Cost reduction; differentiation; focus
(Porter, 1990)
Business Life Cycles and HRM
Start-up; Growth; Maturity; Decline;
Turnaround
(Baird & Meshoulam, 1988)
Matching Strategy and HRM (2)
Model of Business Strategies and HRM Systems
Defender; Prospector; Analyser;
Reactor
Miles and Snow (1984)
Portfolio Models & HRM (Mkt. share & Growth rate)
Wild Cat (start-up); Star (Growth);
Cash Cow (maturity); Dog (decline)
Strategic Fit and HRM (Crawshaw et al., 2023)
Each of the strategies on earlier slides requires commensurate
employee roles and organisational and HR policies or practices.
EXERCISE (Break into groups of 5-6)
Focussing on each of generic business strategies...
1. Identify the employee role behaviours associated with that
business strategy
2. Propose HRM policies/practices that would promote these
behaviours
3. Be ready to feedback to the group, explaining your choices
Case: Outsourcing recruitment by an MNC & its
impact on gender equality in China
A highly reputable pharmaceutical MNC outsourced the recruitment function of its
subsidiary in China to a local recruitment agency firm. The HR regional director who
monitored the HR function in the Asia region found out that the recruitment agency firm
systematically rejected female graduate job candidates, even though during the
screening process their CVs were as good as, and in some cases better than, those of
their male counterparts. The MNC had a global corporate policy of equal opportunities
and imposed a gender ratio in its recruitment targets. As a result, the Chinese
subsidiary’s gender ratio statistics consistently fell below the corporate target. When this
discriminatory practice of the recruitment agency firm was discovered, the HR director
drew the attention of the staff from the agency firm to the corporate policy and requested
them not to discriminate against female candidates. This request was dismissed by the
Chinese recruitment agency staff. Instead, they tried to convince the HR director that this
was a common practice in China as women employees were deemed to be less
productive due to their family commitments. By rejecting female candidates, they
argued, they were actually acting in the interest of the MNC by ensuring that only the
most ‘productive’ staff were recruited (Cooke, 2019: 584).
Task
Imagine you were the HR regional director of the pharmaceutical MNC
reported on the earlier page. How are you going to work with the
recruitment agency firm to ensure their recruitment practices are fair and
conform to the company’s corporate values? In view of this discovery, do
you think it will be necessary to review other HR outsourcing services in
the Chinese subsidiary and those in other countries in Asia? What actions
will you propose at the regional level to influence your HR outsourcing
providers’ business ethics?
5-P Model of HRM
Schuler (1992)
The issue of strategic integration & adaptation is central
Internal & external characteristics
5-P model melds various HR activities and strategic business
needs.
HR activities: 5 Ps (philosophy, policies, programmes, practices
and processes)
Propositions + Criticism
Strategic Integration and Devolvement
Definition
Determinants/ Measures of Integration & Devolvement
Benefits of I & D and Concerns
Budhwar and Aryee (2008)
Strategic I & D of HR -
India versus Others
Strategic Fit – Notes of Caution
Many organisations do not have a clear business strategy
A simplistic, ‘theoretically ideal’ model
Assumes rational ‘planned’ strategy formulation – strategic
management is‘messy and‘incremental’
Assumptions of stability
Problems of ‘bounded rationality’ – limits to managerial knowledge
and control
Assumes a unitaristic position
At best mixed empirical support for the matching model
A limited strategic role for HRM
People Management Fiasco
at Honda M&S India Ltd
1. Identify the key actors in the case whose roles have led to the
present state of affairs in the functioning of the company and how
they have influenced the issues it faces today.
2. What factors have contributed to the breakdown in Industrial
Relations at HMSI?
3. What role was played by the state in the HMSI dispute?
4. What are the cross-cultural issues involved that are critical to the
functioning of a company like Honda?
5. If you are the HR manager of Honda then how would you address
the people management issues/processes? What should be your
HR strategy?
Choosing HRM Strategies
Need
Aims
Objectives and plans
HRM policies and procedures
Strategic approach to HRM
Further Input
You are part of Honda’s senior management team.
Prepare a set of corporate and HR objectives for
Honda M&S India.
Identify and discuss three major challenges you
might face while implementing your HR objectives.
Changing Context, Business Strategy &
HR
Top 5 Priorities for HR Leaders in 2025 (Gartner)
[Link]
Caligiuri, P., De Cieri, H., Minbaeva, D., Verbeke, Al. and Zimmermann, A. (2020)
International HRM Insights for Navigating the Covid-19 Pandemic: Implications for
Future Research and Practice. Journal of International Business Studies, June: 1-17.
[Link]
Please go through these two sources and will share your observations during
next meeting
References
Baird, L. and Meshoulam, I. (1988) Managing Two Fits of Strategic Human Resource Management. Academy of
Management Review, 13: 1, pp. 116-128.
* Budhwar, P. and Aryee, S. (2008) An Introduction to Strategic HRM. In Strategic HRM: A Text. Aston Centre
for Human Resources, London: CIPD, 9-32.
* Crawshaw, J., Budhwar, P. and Davis, A. (2023) (Eds) Human Resource Management: Strategic &
International Perspectives. London: Sage (Chapter 2).
Greer, C. R. (1995) Strategy and Human Resources: A General Managerial Perspective. Englewood Cliffs, New
Jersey: Prentice Hall.
Guest, D. (1987) Human Resource Management and Industrial Relations. Journal of Management Studies, 24:
5, pp. 503-521.
Miles, R. E. and Snow, S. S. (1984). ‘Designing Strategic Human Resources Systems’. Organisation Dynamics, 16, pp. 36-
52.
Porter, M. E. (1990) The Competitive Advantage of Nations. New York: Free Press.
Schuler, R. S. (1992) Linking the People with the Strategic Needs of the Business. Organisational Dynamics, 4, pp. 18-32.