Human resource management gaining a competitive advantage 2014 chapter 2

Human Resource
Management:
Gaining a Competitive
Advantage

Chapter 02
Strategic Human Resource Management

McGraw-Hill/Irwin

Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.


Learning Objectives
1. Describe the differences between strategy formulation and
strategy implementation.

2. List strategic management process components.
3. Discuss HRM function’s role in strategy formulation.
4. Describe the linkages between HRM and strategy
formulation.
5. Discuss typologies of strategies and associated
HRM practices.

6. Describe HR issues and practices associated with various
directional strategies.

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Introduction

• Goal of strategic management is to deploy and
allocate resources in a way that gives an
organization competitive advantage.

• HRM function must be integrally involved in the
company’s strategic management process.

• A business model is how the firm will create
value for customers profitably.

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What is Strategic
Management?
 Strategic human resource management
(SHRM) is the pattern of planned HR activities
and deployments intended to enable an
organization to achieve its goals.

 Strategic management is a process to address
the organization’s competitive challenges by
integrating an organization’s goals, policies and
action sequences into a cohesive whole.

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Strategic Management Process
Model
Strategy Formulation

Strategy Implementation
HR Practices

Mission

Goals

Strategic
Choice

Internal
Analysis

•Strengths
•Weaknesses

HR
Needs

•Skills
•Behavior
•Culture

•Recruiting
•Training

•Performance management
•Labor relations
•Employee relations
•Job analysis
•Job design
•Selection
•Development
•Pay structure
•Incentives
•Benefits

HR
Capability

•Skills,
•Abilities
•Knowledge

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Strategy- Competition Decisions

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Strategic Planning and HRM Linkages

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Strategy Formulation
External
Analysis
•Opportunities
•Threats

Internal
Analysis
•Strengths
•Weaknesses

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SHRM-Strategy Formulation
Mission
Mission
Goals
Goals

Strategic
Strategic Choice
Choice
Internal
Internal Analysis
Analysis
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SWOT Analysis for Google,
Inc.

SWOT Analysis for Google Inc.

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Strategy Implementation
Variables
Organizational
Structure

Types
of
Information

Reward
Systems

Task
Design

Select
Train
Develop
People

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HRM’s 3 Implementation
Variables:

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HR Practices

•Recruiting
•Training
•Performance management
•Labor relations
•Employee relations
•Job analysis
•Job design
•Selection
•Development
•Pay structure
•Incentives
•Benefits

Strategic Implementation
Human
Resource
Needs
•Skills
•Behavior
•Culture

Human
Resource
Capability
•Skills,
•Abilities
•Knowledge

Human
Resource
Actions
•Behaviors
•Results
-productivity
-absenteeism
- turnover
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HRM Practices

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Porter’s Strategies

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5 Categories of Directional
Strategies

Concentration
Concentration
Internal
Internal Growth
Growth
External
External Growth
Growth

Mergers
Mergers &
&
Acquisitions
Acquisitions
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Role Behaviors
 Behaviors that are required of an
individual in his or her role as a
jobholder in a social work
environment.
 Different role behaviors are required
for different strategies.

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Summary
Human Resources are the most important

asset and single largest most controllable cost
within the business model.
HR professionals must develop business,
professional-technical, change management and
integration competencies.
HRM has a profound impact on the strategic
plan implementation by developing and aligning
HRM practices that ensure the company has
motivated employees with necessary skills.
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