Strategic Role of HRM

Lecture 2
Learning Outcomes
Strategic Management Process
Types of strategy
Strategic HRM
The SHRM tools
Strategic Management Process
 Strategy- A strategy is a course of action

 Strategic plan- organization’s plan for how it aims to

match or balance its internal strengths and weaknesses
with external opportunities and threats to maintain
competitive advantages over the long-term

 Strategic management- the process of identifying and

executing organization’s strategic plan by matching the
internal competencies with the demands of environment
Strategic Management Process (Cont.)

Step 1: Define the Current Business

- What products to sell, where to sell and how to
differentiate
Step 2: Perform external and Internal
Audits
 SWOT analysis for internal audit and external audit
 PEST analysis for external audit
SWOT Analysis
PEST Analysis
SWOT Analysis
Strategic Management Process (Cont.)
 Step 3: Formulate New Direction
 What should our business be
 Vision Statement (what do we want to become?)
 Mission Statement (what business are we in?) (Why do
we exist?)
 (Ford- Where QUALITY is job one)
Strategic Management Process (Cont.)
Step 4: Translate the Mission into Strategic Goals
 Ford’s goal- No more than 1 initial defect per 1000 car

 Step 5: Formulate Strategies to Achieve Strategic

Goals

 Step 6: Implement the Strategies

Evaluate Performance
 Things don’t always turned out as planned
 Evaluation is the strategic imperative
Types of Strategies
Corporate Strategies
Competitive Strategy
Strategic Human Resources Management
 SHRM involves formulating and
executing human resource policies and
practices that produce the employee
competencies and behaviors the company
needs to achieve the strategic aims.

 SHRM aligns HR practices with

organizational strategic goals
http://www.cipd.co.uk/hr-resources/factshee
ts/strategic-human-resource-management.as
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SHRM
Examples of SHRM
Ford (reducing defects)
Apple (more innovation)
John Lewis (great customer service)
SHRM Tools
Balance Score Card
HRM Tools
Thank you!