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Table of content

1.0 Introduction..............................................................................................................3

2.0 Critical Discussion...................................................................................................5

2.1 Strategic HRM and business performance...........................................................6

2.2 The Impact of SHRM on performance.................................................................8

2.3 How SHRM would make an Impact....................................................................9

2.4 Implementation...................................................................................................10

3.0 Conclusion..............................................................................................................13

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1.0 Introduction
This is called "strategic human resource management" or "people strategy." It's the
process of coming up with a plan for how to hire, manage, and train employees in a
way that helps an organization achieve its long-term goals. It helps to make sure that
all of the parts of human resource management work together to make sure that the
behaviors and environments needed to make money and meet goals are available.
Long-term human resource issues, such as how to make sure resources are available
for the future, are also part of this field. It also looks at big-picture issues like how to
make sure the structure, quality, culture, values, and commitment of a company are all
right (Armstrong, 2016).

You can't use the same kind of human resource management strategy in every
situation and expect it to work out well. It's up to each organization to come up with a
unique way to reach their goals in their own environment, culture, and way of
thinking. Human resource specialists play a big role in figuring out what's going on in
an organization and making sure that the value chains for human capital work for the
people who need them.

As part of their book, Armstrong and Baron talked about a lot of different ways to
think about human resource management and strategy, as well as the different types of
strategic human resource management. They say that strategic human resource
management is a difficult, always-changing process that academics and other critics
don't agree with because it's hard and always changing. It's not clear what it means
and how it relates to other parts of business planning and strategy.

In the early 1990s, academics came up with the term "strategic human resource
management." They came up with principles like:
 All acts that have an effect on people's behavior in the course of developing
and implementing business strategy (Schuler).

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  The sequence of planned human resource deployments and activities that will
assist the organization in accomplishing its goals (Wright and McMahan).

According to Boxall and Purcell, strategic human resource management is concerned

with defining how human resource management influences organizational
performance. Additionally, they assert that strategy and strategic planning are not
synonymous because:

 In larger organizations, strategic planning is a methodical process that

determines how things will be done.
 In comparison, strategy exists in all organizations (even if it is not documented
or expressed explicitly) and guides the organization's behavior and strives to
adapt to its environment.

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2.0 Critical Discussion
This is called "strategic human resource management" or "people strategy." It's the
process of coming up with a plan for how to hire, manage, and train employees in a
way that helps an organization achieve its long-term goals. (Beer, 2015) Explains that,
It helps to make sure that all of the parts of human resource management work
together to make sure that the behaviors and environments needed to make money and
meet goals are available. Long-term human resource issues, such as how to make sure
resources are available for the future, are also part of this field. Further he explains
that, it also looks at big-picture issues like how to make sure the structure, quality,
culture, values, and commitment of a company are all right. It must also be a response
to the changing nature of work, which we talked about in our Megatrends series and
Profession for the Future project.

(Fombrun & Tichy, 2011)Explains that, there is no such thing as a one-size-fits-all

human resource management strategy that guarantees success in every circumstance.
Organizations must design their own unique method based on their unique
environment, culture, and objectives. Human resource specialists are crucial in
analyzing organizational circumstances and developing human capital value chains
that suit the demands of stakeholders.

As part of their book, Armstrong and Baron talked about a lot of different ways to
think about human resource management and strategy, as well as the different types of
strategic human resource management. They say that strategic human resource
management is a difficult, always-changing process that academics and other critics
don't agree with because it's hard and always changing. It's not clear what it means
and how it relates to other parts of business planning and strategy. Academics
invented the phrase "strategic human resource management" in the early 1990s after
developing principles such as:

All acts that have an effect on people's behavior in the course of developing and
implementing business strategy (Schuler).

5
The sequence of planned human resource deployments and activities that will assist
the organization in accomplishing its goals (Wright and McMahan).

According to Boxall and Purcell, strategic human resource management is concerned

with defining how human resource management influences organizational
performance. Additionally, they assert that strategy and strategic planning are not
synonymous because:
 In larger organizations, strategic planning is a methodical process that
determines how things will be done.
 In comparison, strategy exists in all organizations (even if it is not documented
or expressed explicitly) and guides the organization's behavior and strives to
adapt to its environment.

2.1 Strategic HRM and business performance

Since the mid-1990s, the CIPD and other organizations have been amassing evidence
on the impact of people management methods on business performance. The
significance of 'fit' has attracted much attention. In other words, for maximum impact,
human resource interventions should be linked with other organizational strategies.
Job design and skill development are two critical areas of practises recognized to have
an effect on performance.

(Allen & Wright, 2015) Explains in his study that, Understanding the People-
Performance Connection: Unlocking the Black Box report highlighted the 'people-
performance model' established at Bath University through CIPD-sponsored research.
According to the research, individual human resource plans must be consistent with
one another and function within a strategic framework that addresses both people and
business concerns.

According to this study, individual human resource policies do not result in greater
business performance. For example, highly skilled employees with significant human
capital can only create value if they have strong relationships with their superiors and
work in a supportive and values-driven environment. All of these conditions will

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increase an individual's proclivity for "discretionary behavior," or the proclivity to go
above and beyond the minimal minimum. As a result, strategic human resource
management must take into account the significance of promoting employee
engagement, as well as associated states such as motivation and dedication, all of
which contribute to an organization's success.

Always, SHRM has put a lot of emphasis on performance, and (Maritz, 2013), put it
in the right order: HR strategy, HR practises, HR outcomes, behavioral outcomes,
performance results, and financial repercussions. When SHRM was first being used in
the 1990s, a lot of research was done to find and show that effective SHRM improves
the performance of an organization.

It's been argued that good HRM practises and good organizational performance are
linked to some extent in the United Kingdom by people like Birdi and Carlson, Guest,
Purcell, and West. But the nature and direction of the link has been a hot topic. There
have been a lot of changes and new ideas in the study of SHRM in the last few years,
according to (Ivancevich, 2008). There are also a few new ideas or paths that could
help us learn more about this field. One thing to keep in mind: There is still a lot of
evidence that HR systems have an impact on how well a company does. But the
causal chain may be more reciprocal than direct.

HRM is at the heart of strategic HRM, which is a field of study. Page 47 of the book
by Boxall in 2013. According to Lengnick-Hall et al. (2009), strategic HRM includes
all of the HR strategies that businesses and corporations use and tries to figure out
how they affect their performance. Guest (1997: 269): 'The unique thing about HRM
is that it thinks that better performance comes from the people in the company.'
According to (Allen & Wright, 2015), HPWSs encourage employees to participate,
learn new skills, and be motivated. According to (Salaman & John, 2015), HRM's
ability to get people excited is a must for better organization performance.
This part of the review refers to a lot of research on how HRM affects performance,
talks about how HRM works, and looks at the challenges of adopting and
implementing the idea.

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2.2 The Impact of SHRM on performance
(Boxall , 2014) explains that, 'The idea is that HR rules have an impact on HR
practices, which in turn have an impact on HR practices, which in turn have an impact
on staff attitudes and behavior, which, in turn, have an impact on service offerings
and customer perceptions of value. (Salaman & John, 2015), (Venohr & Meyer, 2008)
showed in their study that strong HRM practices are linked to corporate success.

There were 1000 businesses that (Delery & Roumpi , 2017) investigated to see how
high-performance work systems (HPWS) and company performance were linked.
HPWSs, he found, cut attrition and increased productivity, which led to a better
company's financial performance.

Strategy and HR practices were studied by (Dany, 2020). He looked at 200 of

Singapore's best-known businesses from all major industries to see how HR practices
and business performance were linked. People who work for an organization have a
direct impact on how well it does, and business strategy changes the link between HR
practices and how well it does.

However, there are problems with the relationship between HRM and performance,
but they can be fixed. According to (Salaman & John, 2015), 'HR practises seem to
have an impact; reasoning suggests that they do, and survey data back this up.' This is
how you would say it. Direct links between performance and attention to HR
practises, on the other hand, are often unclear and can change based on the group and
the measurement used. According to (Allen & Wright, 2015), there are still questions
about what caused and what happened.

A lot of work has been done in the field of HRM and performance research, but there
are still a lot of problems with the way that research is done. Observing HRM inputs
in the form of HR practices and measuring firm performance outputs may be easy. It
may be hard to figure out what happened in the middle, or what HRM outcomes
turned the input of HR practices into firm performance outputs, through research,
though.

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This is the "black box," as it's called. If you want to find an empirical link between
HR practices and organizational performance, you can't do research, says Alvesson
(2009: 56). In a black box, only input and output are recorded, and no one knows
what is going on. '
(Cook & MacKenzie, 2016) Explains. After a lot of research, we can't say for sure
that good HRM has an effect on how well a company does. In addition, he said that
some of the study is filled with mistakes, both when it comes to HRM data and when
it comes to how the study turned out.

2.3 How SHRM would make an Impact

Professor John Purcell and his colleagues at Bath University conducted a large The
CIPD did long-term research for them that explained one of the first convincingly
what happened in the "black box" between SHRM and the performance of an
organization (Beer, 2015). The researchers said that human resource practises are a
"ingredient" that enters the workplace and, through a variety of processes, ends up
with better performance at the workplace. '

There is strong evidence that positive attitudes about HR policies and procedures,
levels of satisfaction, motivation, and commitment, and operational performance all
go together,' (Ivancevich, 2008), (Salaman & John, 2015) and (Venohr & Meyer,
2008) has found out this in their study as well.

According to (Venohr & Meyer, 2008) and (]French, 1995), human resource
strategies communicate to workers major organizational goals and desirable employee
behaviors. They are seen as’ signals' by individual employees, and they might be
viewed as such. Due to individual variances in experience, values, and interests, HR
system signals are frequently received or reacted to differently.

Additionally, (Ahmad & Schroeder, 2013) noted that employee outcomes are
determined by how employees perceive the human resource processes that have been
implemented, rather than by the human resource practises as intended by
policymakers. In contrast to a body of research that focuses exclusively on (and

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frequently conflates) the effect of the human resources function, the AMO model
attributes a significant role to line managers in 'landing' the concept.

2.4 Implementation
Gratton was the first to recognize the challenge of reconciling SHRM rhetoric
(intention) with reality. Following that, several SHRM commentators addressed the
issue: ( (Armstrong, 2016), (Boon , Eckardt, & Lepak, 2018).

According to (Venohr & Meyer, 2008), "there is a growing recognition that intended
SHRM practises may differ from implemented SHRM practises, and that relying
solely on what is stated rather than what is actually in place may result in ineffective
implementation and ambiguous results in studies of the relationship between human
resource practises and organizational performance." Employee alignment with
strategic objectives is a notion that provides a better understanding of the
implementation process. Employees that do not understand or understand how to
contribute to strategic goals are unlikely to be effective.

(Boon , Eckardt, & Lepak, 2018), discovered a disconnect between planned and actual
human resource practises at Pakistani banks, with some line managers refusing to
comply with the standards. According to (Maritz, 2013), new SHRM initiatives
usually achieve relatively modest results and have limited lasting power. This is
because "much time and thought had been expended on analyzing and formulating
strategy, but relatively little time had been expended on implementing it" in many
organizations.

According to (Ivancevich, 2008), human resource strategies are not always

implemented, and when they are, they may be utilized in ways that deviate from the
intended objective. As (]French, 1995), point out, it is critical to distinguish between
'intended HRM,' which refers to human resource practises formulated by
policymakers, and 'implemented HRM,' which refers to human resource practises
operationalized inside organizations.

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'A logical model of human resource performance has three dimensions,' Guest and
Conway (2011: 1700) found following an extensive study effort. Human resource
management practises must exist, be effective, and be successfully implemented.'
Ahmad and Schroeder (2013) say that there is a growing understanding that intended
SHRM practises may be different from what is actually done, and that relying only on
what is said instead of what is actually done may lead to ineffective implementation
and mixed results in studies of the relationship between human resource practises and
organizational performance. Employees who are aligned with the company's long-
term goals can better understand how the process works. Employees who don't
understand or understand how to help the company achieve its strategic goals aren't
likely to be very good.

(Allen & Wright, 2015) Explains that, A strategy that is successful is one that is
implemented. 'There is no big design; there is simply outstanding execution,’ Human
resource planning may easily deteriorate into wishful thinking. According to
(Fombrun & Tichy, 2011), it must be a 'activity vehicle'. Making a strategy work is
challenging. Not always do excellent intentions result in action. Too frequently,
strategists behave like Mr Pecksmith, who Dickens compared to a "direction post"
that "constantly points the way to a destination but never arrives"

(Boon , Eckardt, & Lepak, 2018), did research on the pay plan implementation at
seven important consumer goods businesses in the United Kingdom and concluded as
follows:
All organizations encounter significant hurdles when establishing strategic pay
systems, which means that in the great majority of cases, what is operationally
realized as pay practises is not what was wanted or theoretically anticipated. Pay in a
number of the sample organizations falls short of the strategic aim of encouraging
management, professional, and technical people to work harder as a result of a
disconnect between intended policy and actual practises, between the professed and
the actual. It does not generate outcomes such as commitment or loyalty, nor does it
offer management with the 'lever' for behavioral change that mainstream theory
promises. Despite the greatest efforts of top businesses and the language of their
declared pay practises, pay practises are operationally non-strategic.

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Figure 01 – The gap between strategy and the execution
Source –

According to Bowen and Ostroff (2004), top management may help improve the
execution of human resource policies and practises provided the message about
human resource practises is distinctive and communicated clearly, consistently, and
unambiguously throughout the organization. This can be considered as a “strength” of
the HRM system that has connected with a favorable environment.

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3.0 Conclusion
SHRM's main idea has stayed the same for the last three decades. Human resources
management is an important part of people management in businesses. These five
main points: HRM as part of people management, a holistic systems view of
individual HRM structures and practises, a strategic view of how the HRM system
can best support the business, HRM system alignment with the business strategy and
integration of practises into the system, and an emphasis on the long-term benefits of
a human capital/high-commitment HRM system. Delery and Roumpi (2017) did a
review of the SHRM literature and concluded that the subject is stagnating. They
asserted that efforts to explain the 'black box' link between human resource
management practises and corporate success have indicated that human capital
resources play a role in the relationship. They did, however, note that this is not novel.
Since the outset, SHRM academics including as Barney and Wright (1998) have
observed this connection. Delery and Roumpi argue that this reintroduces the field to
its original objective of discovering human resource management practises and their
combinations that contribute to organizational performance. SHRM is a conceptual
and aspirational attitude that comes to life only when it results in strategic actions and
reactions, such as general or specialized human resource strategies or strategic
behavior on the part of HR
Professionals collaborating with line managers.

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Purcell J, Wright, The Oxford Handbook of Human Resource Management.
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