Lecture 2 :

The Strategic Role of

Human Resource Management
32
1. Explain why strategic planning is important to all
managers.
2. Explain with examples each of the seven steps in the
strategic planning process.
3. List with examples the main generic types of corporate
strategies and competitive strategies.
4. Define strategic human resource management and give
an example of strategic human resource management
in practice.
5. Briefly describe three important strategic human
resource management tools.


LEARNING OBJECTIVES
The firms strategic plan guides much of what
is done by all to accomplish organizational
goals.
Decisions made by managers depend on the
goals set at each organizational level in
support of higher level goals.
Why Strategic Planning Is Important
To All Managers
3
3
34
FIGURE 31 Sample Hierarchy of Goals Diagram for a Company
Strategy
A course of action the organization intends to pursue
to achieve its strategic aims.
Strategic Plan
How an organization intends to match its internal
strengths and weaknesses with its external
opportunities and threats to maintain a competitive
advantage over the long term.
Strategic Management
The process of identifying and executing the
organizations mission by matching its capabilities with
the demands of its environment.
The Strategic Management Process
3
5
36
FIGURE 35 The Strategic Management Process
37
FIGURE 36 Worksheet for Environmental Scanning
38
FIGURE 37 SWOT Matrix, with Generic Examples
39
FIGURE 38 Type of Strategy at Each Company Level
Types of Corporate Strategies
310
Concentration
Vertical
integration
Diversification
Corporate Strategy Possibilities
Consolidation
Geographic
expansion
Types of Competitive Strategies
311
Cost leadership Differentiation
Business-Level
Competitive Strategies
Focus/Niche
Strategic Human Resource Management
The linking of HRM with strategic goals and
objectives in order to improve business
performance and develop organisational cultures
that foster innovation and flexibility.
Involves formulating and executing HR systems
HR policies and activitiesthat produce the
employee competencies and behaviours that the
company needs to achieve its strategic aims.
Strategic Human Resource
Management
3
12
313
FIGURE 310 Linking Company-Wide and HR Strategies
314
FIGURE 311 Basic Model of How to Align HR Strategy
and Actions with Business Strategy
Strategic HRM Tools
315
Strategy map HR scorecard
Strategic HRM Tools
Digital dashboard
316
FIGURE 315 Three Important Strategic HR Tools
HR Scorecard Strategy Map Digital Dashboard
A process for managing
employee performance
and for aligning all
employees with key
objectives, by assigning
financial and
nonfinancial goals,
monitoring and
assessing performance,
and quickly taking
corrective action.
A graphical tool that
summarizes the chain of
activities that contribute
to a company's success,
and so shows employees
the "big picture" of how
their performance
contributes to achieving
the company's overall
strategic goals.
An information
technology tool that
presents the manager
with desktop graphs and
charts, so he or she gets
a picture of where the
company has been and
where it's going, in terms
of each activity in the
strategy map.
317
FIGURE 313 Strategy Map for Southwest Airlines
318
FIGURE 314 The Basic HR Scorecard Relationships
HR activities
Organizational
performance
Emergent employee
behaviours
Strategically relevant
organizational outcomes
Achieve strategic goals