Strategic Human Resource

Management
 Strategic Human Resource
Management
Strategic human resource management has been defined as
‘the linking of human resources with strategic goals and
objectives in order to improve business performance and
develop innovative organizational culture that foster
innovation and flexibility.

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
Approaches of SHRM
 Business-oriented model

This model aims at value creation by developing a HR system

that creates and sustains the competitive advantage through
human resources.
 Strategic fit model
This model focuses on matching the HR capabilities and
resources with the external opportunities.

It also focuses on developing HR practices in such a way that

they complement one another.
 Strategic fit model (contd.)
Two types of strategic fits are:

Vertical fit (deals with the extent of alignment between the HR

strategies and business strategy).

Horizontal fit (deals with the extent of alignment among the

components of the HR strategy).
 SLAP model

This method focuses on the interdependences among HR

strategies, business strategies and organizational changes.

This model acknowledges HRM as a continuous process of

balancing the demand for and the supply of labour.
Models of strategic formulation
High involvement management model

High commitment management model

High performance management model

 High involvement
management model
This model aims at creating an environment
that facilitates the continuous exchange of
information between the superiors and the
subordinates.
 High commitment
management model
This model aims at obtaining voluntary
commitment from employees by adopting
mutually beneficial HR practices.
 High performance
management model
This model aims at constantly improving
the performance of individuals and the
organization.
A high-performance management is
achieved by continuously educating the
employees and improving their skills.
 Benefits of strategic HRM
Achieves cost-effective engagement of
labour.
Meets the changing needs and
expectations of the customers effectively.
Necessities the development of clear-cut
goals, direction and future focus to the
entire organization.
Benefits of strategic HRM
(contd.)
Facilitates the planning and execution
of organizational changes in a timely
and effective manner.
Ensure the optimum utilization of
organizational resources.
Helps in developing, managing and
sustaining the skills and knowledge of
its human resources.
Benefits of strategic HRM
(contd.)
Enhances the coordination among the
various functional centres and the top
management.
Facilitates the continuous scanning of
external environment.
 Barriers to an effective SHRM
Absence of long-term orientation.

Lack of strategic reasoning.

Lack of adequate support from top management.

Resistance from labor unions.
Fear of failure.

Rigidity of HR practices.
Fear of attrition.
Absence of measurement techniques.
 HR’s STRATEGIC ROLES

Formulate
integrated
HR strategies

Work with line

managers to
Contribute to the support the
development of achievement
business strategies of
their business
goals
 Difference Between Strategic HRM &
HR strategies:-
STRATEGIC HRM HR Strategies [ HR StrategiesHRS ]

General Approach to Strategic Mgnt of HR Outcome [manifestation] of general HRM

approach

Aligned with organizational intention about future Focus on specific organizational intentions about
direction what needs to be done.

Focus on long term people issue Focuses on short term performance measures that
is result/outcome.

SHRM decisions are built into strategic business HRSs decisions are derived from SHRM.
plan

Deals with macro-concerns such as quality, HRSs are concerned with ensuring availability of
commitment, performance, culture & mgnt an efficient workforce, training, good employee
development relations

Defines areas in which specific HR strategies need HRSs facilitate the successful achievement of
to be developed. Ref: SHRM – Charles Greerobjectives + goals
corporate
Difference Between Strategic HRM &
HR strategies:-

STRATEGIC HRM

HR Strategies [ HR StrategiesHRS ]

General Approach to Strategic Mgnt of HR

STRATEGIC HRM GUIDELINES

• Be clear on what has to be achieved

and why
• Ensure that what you do fits the
business strategy, culture and
circumstances of the organization
• Aim for continuous improvement –
evolution not revolution
• Don’t follow fashion – do your own
thing
• Keep it simple – over-complexity is a
common reason for failure
• Don’t rush – it takes longer than you
think
• Assess resource requirements and
costs
• Manage change – involve,
communicate and train