Human Resource

Management

Strategic Human Resource

Management (SHRM)
 SHRM Definition

 Proactive SHRM- HRM practioner

actively involved in strategy formulation
 Re-active SHRM -Matching, policies,
philosophy, programs, processes and
practices in a way which will stimulate
and reinforce different employee role
behaviours appropriate for each
competitive strategy (Bratton and Gold (1999)
Traditional Weaknesses of
HRM
 LACK OF PLANNING

 LACK OF CREDIBILITY

 TOO BUREAUCRATIC

 CINDERELLA ACTIVITY
SHRM AND BEHAVIOUR
OUTCOMES
 EFFORT/MOTIVATION

 COOPERATION

 INVOLVEMENT

 CITIZENSHIP
SHRM AND PERFORMANCE
OUTCOMES
 HIGH PRODUCTIVITY

 QUALITY

 INNOVATION

 LOW ABSENCE
SHRM AND PERFORMANCE
OUTCOMES
 LOW LABOUR TURNOVER

 CONFLICT

 CUSTOMER COMPLAINTS
 The SHRM Resource-based
View of the Firm

 Emphasises that the firm is a bundle of

capabilities and competencies, both
human and physical.

 The competitive advantage of each firm

is tied to how these resources are
organised (internal strengths)
 The SHRM Resource-based
View of the Firm

Soft HRM
 The management of human resources is
central to the organisation of
competencies and thus the
competitiveness of the enterprise.
 Focus on firm specific skills and
capabilities (valuable resources) which
cannon be imitated
 The SHRM Resource-based
View of the Firm

 Emphasises long-term HRM strategies

that focus on intangible learning and
skill transfer
 Limitations of the SHRM
Resource Model

 Unitary perspective that omits the

dynamics of workplace trade unionism

 Implies long-term job security

 Commits excessive financial resources

to training
Matching SHRM Theory of the
Firm -Best Fit argument
 Low-cost or differentiation strategy

 Hard HRM

 one set of HR practices can be

identified which when implemented
improves business performance
Matching SHRM Theory of the
Firm -Best Fit argument
 business performance will be improved
only when the ‘right fit’ between external
competitive business strategy and
internal HRM strategy and practices is
achieved.

 Must also be a fit amongst the elements

of HRM strategy
Matching SHRM Theory of the
Firm-Best Fit argument
 Transformative change argument

 to be sustainable and credible HRM

innovations must be diffused in an
integrated and radical manner.
 Consistency of practices is essential to
avoid role conflict and ambiguity
 Best Fit and SHRM

 Internal’ Fit
 emphasises the interdependency between
individual HR policies and practices

 Hrm practices should be introduced in

bundles and in a mutually reinforcing
manner.
 Best Fit and SHRM

 External ’ Fit
 the HR policies must be congruent with
the firm’s policy choices outside the area
of HR
 The competencies, behaviours and
values developed by the HR system
must reflect and enhance the overall
competitive posture of the organisation
Limitations of Matching Model

 Reactive assumes rational decision

making

 Can make a firm inflexible

 Essentially unitary and assumes that

workers will comply with needed role
behaviours