STRATEGIC HUMAN RESOURCE MANAGEMENT

1. This resource is part of a range offered free to academics and/or students using Armstrong’s Essential Human Resource Management Practice as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources. STRATEGIC HUMAN RESOURCE MANAGEMENT

2. STRATEGIC HRM – SESSION PLAN • The essence of strategic HRM • Strategic management • The concept of strategy • Critical evaluation of the concept of strategy • Key concepts of strategic HRM • Perspectives on SHRM • Best practice • Best fit • Bundling • HR strategies • Criteria for an effective HR strategy • Case Study

3. This resource is part of a range offered free to academics and/or students using Armstrong’s Essential Human Resource Management Practice as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources. THE CLOUDY NATURE OF STRATEGY Strategy consists of illusions in the board room. John Purcell Strategy is problem solving in unstructured situations. Lester Dignam There is a gap between the rhetoric and the reality of SHRM. Lynda Grattan Strategy is often fragmentary, evolutionary and largely intuitive. James Quinn Strategy is emergent and flexible. Sean Tyson Strategy is a pattern in a stream of activities. Henry Mintzberg

4. THE ESSENCE OF STRATEGIC HRM • Achieve integration or ‘fit’ between HR and business strategies is achieved • Take a longer-term view of where HR should be going and how to get there • Decide how coherent and mutually supporting HR strategies should be developed and implemented How members of HR function should adopt a strategic approach

5. SO WHAT IS STRATEGIC HUMAN RESOURCE MANAGEMENT? Is it about long-range strategic planning? Is it about day-to-day strategic management? Or is it about both?

6. This resource is part of a range offered free to academics and/or students using Armstrong’s Essential Human Resource Management Practice as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources. STRATEGIC HRM DEFINED Strategic HRM is the process of defining how the organization’s goals will be achieved through people by means of HR strategies and integrated HR policies and practices.

7. SO WHAT IS THE STRATEGIC ROLE OF HR SPECIALISTS?

8. This resource is part of a range offered free to academics and/or students using Armstrong’s Essential Human Resource Management Practice as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources. SEVEN STEPS TO BEING STRATEGIC Practice evidence- based management Make convincing business case for innovation Act as change agent See the big picture Appreciate how HR can add value Understand the business Aware of business context

9. This resource is part of a range offered free to academics and/or students using Armstrong’s Essential Human Resource Management Practice as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources. SO WHAT ABOUT HR STRATEGY?

10. This resource is part of a range offered free to academics and/or students using Armstrong’s Essential Human Resource Management Practice as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources. HR STRATEGY AREAS • Overall: • performance; • engagement; • ‘the big idea’; • human capital • advantage; • HRM process • advantage • Specific: • organization • development; • corporate social • responsibility; • resourcing; • talent management; • learning and • development; • employee reward; • employee relations; • employee well-being.

11. This resource is part of a range offered free to academics and/or students using Armstrong’s Essential Human Resource Management Practice as part of their course. For more academic resources and other FREE material, please visit www.koganpage.com/resources and then click on Academic Resources. EXAMPLES OF OVERALL HR STRATEGIES Stimulate changes on a broad front aimed at achieving competitive advantage through people. Pilkington Optronics The only HR strategy you really need is the tangible expression of values and the implementation of values. West Water We want GSK to be a place where the best people do their best work. GlaxoSmithKline Staff who are enjoying themselves, are being supported and developed, and who feel fulfilled and respected at work, will provide the best service to customers. Lands’ End A strong focus on the overall effectiveness of the organization, its direction and how it's performing. There is commitment to, belief in, and respect for individuals. New Forest Council Maintain competitive advantage by continuing to attract very high calibre people. Boots

12. PERSPECTIVES ON SHRM • The universalistic perspective • organizations should adopt the best approach which develops the relationship between individual ‘best’ practices and firm performance. • The contingency perspective • HRpolicies must be consistent with other aspects of the organization. • The configurational perspective • is an holistic approach which emphasises the importance of the pattern of HR practices and is concerned with how this pattern of independent variables is related to the dependent variable of organizational performance. (Delery and Doty, 1996)

13. BEST PRACTICE Assumed is that there is a set of best HRM practices that are universal in the sense that they are best in any situation This is questionable

14. KEY CONCEPTS OF STRATEGIC HRM The resource-based view • This states that it is the range of resources in an organization, including its human resources, that produces its unique character and creates competitive advantage. • Competitive advantage will be achieved if the organization’s resources are valuable, rare, inimitable, and non-substitutable.

15. BEST FIT • The best fit approach emphasizes that HR strategies should be congruent with the context and circumstances of the organization • Best fit involves vertical integration or alignment between the organization’s business and HR strategies • There are three models: lifecycle, competitive strategy, and strategic configuration Often said that ‘best fit is better than best practice’ but best fit models can be unrealistic

16. Strategic fit • Schuler (1992:18) stated that: ‘Strategic human resource management is largely about integration and adaptation. Its concern is to ensure that: (1) human resources (HR) management is fully integrated with the strategy and strategic needs of the firm (vertical fit) (2) HR policies cohere both across policy areas and across hierarchies (horizontal fit) and (3) HR practices are adjusted, accepted and used by line managers and employees as part of their everyday work’.

17. BUNDLING ‘Bundling’ is the development and implementation of several HR practices together so that they are interrelated and therefore complement and reinforce each other

18. HR STRATEGIES HR strategies indicate what the organization wants to do about its human resource management policies and practices and how they should be integrated with the business strategy and each other

19. CRITERIA FOR AN EFFECTIVE HR STRATEGY An effective HR strategy is one that works in the sense that it achieves what it sets out to achieve. • Aligned to corporate goals. • Set out clear aims. • Supported by business case. • Take account of individual as well as business needs. • Contain realistic and achievable plans for implementation.

20. Checking understanding 2 Hotels • Read the case studies and answer the questions