STRATEGIC HUMAN RESOURCE MANAGEMENT

LECTURE
Spring 2014 KINNAIRD COLLEGE FOR WOMEN

LECTURER: Amnah Imtiaz

A STRATEGIC APPROACH TO HUMAN RESOURCE MANAGEMENT

A managerial process requiring human resource policies and practices to be linked with the strategic objectives of the organization.

2 Human Resource Management Instructor: Amnah Imtiaz

STRATEGIC MANAGEMENT
Strategy (a plan of actions)
A specific pattern of decisions and actions undertaken by the upper level of the organization in order to accomplish organisational goals.

3 Human Resource Management Instructor: Amnah Imtiaz

STRATEGIC MANAGEMENT: THE THREE TRADITIONAL POLES OF STRATEGIC MANAGEMENT

4 Human Resource Management Instructor: Amnah Imtiaz

STRATEGIC MANAGEMENT MODEL OF STRATEGIC MANAGEMENT

The strategic management process is broken down into five steps: 1- Mission & goals 2- Environmental analysis 3- Strategic formulation 4- Strategy implementation 5- Strategy evaluation

5 Human Resource Management Instructor: Amnah Imtiaz

THE STRATEGIC MANAGEMENT MODEL

Human Resource Management Instructor: Amnah Imtiaz

1- MISSIONS AND GOALS

- Management Philosophy Values

7 Human Resource Management Instructor Amnah Imtiaz

2- ENVIRONMENTAL ANALYSIS
- Internal organizational strengths and weaknesses - External environment for opportunities and threats

8 Human Resource Management Instructor: Amnah Imtiaz

3- STRATEGIC FORMULATION
Involves senior managers evaluating the interaction between strategic factors and making strategic choices that guide managers to meet the organizations goals.

9 Human Resource Management Instructor: Amnah Imtiaz

4- STRATEGY IMPLEMENTATION
Focuses on the techniques used by managers to implement their strategies (e.g. leadership style, organizational structure, control systems, management of human resources).

10 Human Resource Management Instructor: Amnah Imtiaz

5- STRATEGY EVALUATION
Determines to what extent the actual change and performance match the desired change and performance.

11 Human Resource Management Instructor: Amnah Imtiaz

HIERARCHY OF STRATEGY
Corporate Strategy

Businesslevel Strategy

Functionallevel Strategy
12 Human Resource Management Instructor: Amnah Imtiaz

HIERARCHY OF STRATEGY
a. Corporate Strategy:

Describes a corporations overall direction in terms of its general philosophy towards growth and the management of its various business units.

WHAT BUSINESS ARE WE IN?

13 Human Resource Management Instructor: Amnah Imtiaz

CORPORATE STRATEGY
Establishing investment priorities and steering
resources into the most attractive business units

Initiating actions to improve combined performance

of business units

Improving synergy between related business units

to increase performance

Making decisions re-diversification

14 Human Resource Management Instructor: Amnah Imtiaz

HIERARCHY OF STRATEGY
b. Business-Level Strategy:

Deals with decisions and actions pertaining to each business unit in order to make each unit more competitive in its market-place.

HOW DO WE COMPETE?

15 Human Resource Management Instructor: Amnah Imtiaz

BUSINESS-LEVEL STRATEGY

16

Human Resource Management Instructor Amnah Imtiaz

BUSINESS-LEVEL STRATEGY
Low-cost leadership:

To increase market-share by having the lowest unitcost and price compared with competitors.
Differentiation strategy:

Distinguishing products from competitors by providing distinctive levels of service or quality the customer is prepared to pay a premium price.

17 Human Resource Management Instructor Amnah Imtiaz

HIERARCHY OF STRATEGY
c. Functional-level Strategy: Pertains to the major functional operations within the business unit, including research and development, marketing, manufacturing, finance and HR. How do we support the Business Level competitive Strategy?
18 Human Resource Management Instructor: Amnah Imtiaz

STRATEGIC HUMAN RESOURCE MANAGEMENT - DEFINITION

Strategic Human Resource Management is the process of linking human resources function with the strategic objectives of the organisation in order to improve performance.

19 Human Resource Management Instructor: Amnah Imtiaz

DIFFERENCE BETWEEN TRADITIONAL & STRATEGIC HRM

20

Human Resource Management Instructor: Amnah Imtiaz

LINKING HR WITH BUSINESS STRATEGY

Strategic Frameworks:
The formulation of coherent HR strategies is more likely if the overall approaches that organisation intends to adopt in managing its human resources are understood. These can then serve as the frameworks within which specific strategies evolve. The most common approaches are: The development of Resource Capability High commitment Management High Performance Management Best Practice
Human Resource Management Instructor: Amnah Imtiaz

21

1- THE DEVELOPMENT OF RESOURCE CAPABILITY

This approach regards a firm as a bundle of tangible and intangible resources and capabilities required for product/market competition. Human resources are seen as major source of competitive advantage. This approach is concerned with acquisition, development, retention of human or intellectual capital. It focuses on how added value can be obtained by treating people as strategic assets

22 Human Resource Management Instructor: Amnah Imtiaz

2- HIGH COMMITMENT MANAGEMENT

High commitment management is based on the belief that the organisation is worth working when employees are not tightly controlled. Instead, they should be given broader responsibilities, encouraged to contribute and helped to achieve satisfaction in their work. This approach involves treating employees as partners in the enterprise, whose interests are respected, who have a voice on matters that concern them and whose opinions are sought and listened to. It creates an environment, in which a continuing dialogue between managers and the members of their teams takes place to define expectations and share information on the organisations mission, values and objectives. It also develops a mutual understanding of what is to be achieved.
23 Human Resource Management Instructor: Amnah Imtiaz

3- HIGH PERFORMANCE MANAGEMENT

Aims to raise the performance of the organisation through its people. The focus of this group is to create practices that involve the development, performance management and reward process.

24 Human Resource Management Instructor: Amnah Imtiaz

4- BEST PRACTICE

this approach is based on the assumption that there is a set of the best HRM practices and that adopting them will inevitably lead to superior organisational performance.

25 Human Resource Management Instructor: Amnah Imtiaz