STRATEGIC HUMAN RESOURCES MANAGEMENT

Saurabh FN-102 Nikhil FN-121 Vishal DM-176 Srikanth FN-109 Tushar FN-115 Tarun DM-162

HUMAN RESOURCE MANAGEMENT FUNCTION

Training & Development

Planning Manpower

Hire People

Managing Change

Managing Attrition

Appraising Performance

BUSINESS STRATEGY

Environmental Scanning

External
Strategy Formulation

Internal

Mission

Objectives

Strategies

Policies

Strategy Implementation

Program

Budgets
Evaluation and Control

Procedures

Performance

STRATEGY + HUMAN RESOURCE MANAGEMENT = STRATEGIC HRM

Linking HRM with strategic goals and objectives to improve business performance and develop organizational cultures fostering innovation and flexibility Defines the organisations intentions and plans on how its business goals should be achieved through people
Identify Employee Competencies and Behaviors that HR must deliver to achieve the strategy

HRS STRATEGIC ROLE

Strategy Formulation Role Supplying competitive intelligent regarding the external environment Supplying information regarding the companys internal human strengths and weaknesses Showing how the firms HR activities can and do contribute to creating value for the company

Strategy Execution Role

Formulating HR Policies & Activities that will lead to required Employee Competencies and Behaviors to achieve strategic goals Creating and sustaining competitive advantage Conceptualizing and executing organizational change.

Evolution of Strategic HRM

Early 20th century

1950s

1970s

1990s

Staffing function

Personnel department

Human Resource department

Strategic HRM

People treated as commodities

No attention paid to sensitivity

Hiring, compensation, benefits Talent availability

Happy employee Administrative productive to strategic employee Department still administrative Linking HR policies with company goals

Why SHRM is getting attention now?

Decline in employee loyalty

Globalization - Outsourcing -Increased Competition

Decline in customer loyalty

Why SHRM now?

War for top talent

Increased pace of technological change

SHRM in Whirlpool
Company Goals Innovation to be embedded as a core competency Increase in sales Increase in customer loyalty

1990s

Sales at a standstill Reason being stagnation in product line

HR Strategy

Results

Invited ideas from all employees Best 25 sent to Italy headquarters Brainstorming sessions to come up with new ideas

Revenues from innovative products up 80 times in a course of 4 years Share price doubled in the same period Increase in customer loyalty

Point of difference
Focus

TRADITIONAL HRM
Employee relations

STRATEGIC HRM
Partnership with internal and external customers Transformational, change leader and initiator

Role of HR

Transactional, change follower and respondent

Initiatives Time horizon

Slow, reactive, fragmented Short term Tight division of labour, independence, specialisation

Fast, proactive, integrated Short, medium, long Broad, flexible, crosstraining teams

Job design

Key investments Accountability

Capital, products Cost centre

People, knowledge Investment centre

Organizations and their strategies

Organisational Strategies

HR Strategies

- Intense supervision of labor

- Tight cost control requiring frequent, detailed control reports - Low-cost distribution system - Products designed for ease in manufacture . - Strong marketing abilities - Product engineering - Corporate reputation for quality or technological leadership - Amenities to attract highly skilled labor, scientists, or creative people.

- Detailed work planning - Emphasis on job-specific training - Emphasis on job-based pay - Use of performance appraisal as a control device - Emphasis on innovation & flexibility - Broad job classes - External recruitment - Team-based training - Emphasis on individual- based pay

- Combination of cost-leadership and differentiation strategy directed at a particular strategic target

- Combination of HR strategies of the other two strategies

Cost of HR vs Value added by HR

COST 10% 30% 60%

HR ACTIVITY Strategic (Planning)

VALUE ADDED

60%
30% 10%

Operational (Service delivery) Administrative (Record keeping and Compliance)

TRANSCENDING FROM HRM TO SHRM

Asses organizations readiness for change To position the change effort with appropriate focus Recognize the roadblocks and political landmines Know what you stand for and what you believe in, have courage to follow them Institutionalize framework Is it widely used, recognized and reinforced. Does it provide a high level understanding of the role

Asses & upgrade HR talent Change some key leaders, make series of hires at early and midcareer levels, develop skills at existing levels

Understand senior HRs role and clarify line managers role Facilitating leadership sessions and engaging top

Clarify the roles of generalist and specialist, Design the structure of your new organization Tasks of HR as change agent Look afresh, know reality, bridge gap, align line leadership, identify needed resources

Create a human and organizational plan What do I want to do? What I can do? What I am expected to do?

Hewitt Best Employers 2009

Top five organizations HCL Technologies Hindustan Zinc Ltd. Taj Hotel Resorts & Palaces Cisco Systems ITC-Welcomegroup

SURVEY STATISTICS

1.Employee engagement
Able to Engage passionte employees algined with organisation goals

SURVEY STATISTICS

2. Stronger Cultural Alignment

Resulting more productive beahviour

3. Strong Reputation
Helps in retaining and attracting employees. 91% will like to recommend their firm to their friends compared to 77%.

4.Better Financial Results

Strategic HR Consultancy firms

Need for Consultancies Rein in cost protecting bottom line Provides tailored employee communication Improve performance of company Outsourcing Concentrate your core competencies Concentrate and customer satisfaction and new products and services. Better and faster solution.

The Road Ahead

Management will continue to emphasize the need to pay attention to the organization and human issues.

HR leaders will become increasingly strategic and increasingly effective business leaders.

The administrative components will become separated from HR.

New attention will be paid to employee relations and workforce planning.

THANK YOU
Strategic thinking in HR is a choice that organizations make. There is a wide gap between theorization and implementation. This gap can only be reduced with practical testing of the HR philosophy and its core values.