STRATEGIC HUMAN RESOURCE MANAGEMENT
MODULE 1: INTRODUCTION TO STRATEGIC HUMAN RESOURCE MANAGEMENT
UNIT 3: STRATEGIC HUMAN RESOURCE
Strategic HRM is in some ways an attitude of mind that expresses a way of doing things.
Strategic HRM defines the organization’s intentions and plans on how its business goals should
be achieved through people. It is based on three positions:
1. That human capital is a major source of competitive advantage.
2. That it is people who implement the strategic plan.
3. That a systematic approach should be adopted to defining where the organization wants to go
and how it should get there.
Strategic HRM is a process that involves the use of overarching approaches to the development of
HR strategies, which are integrated vertically with the business strategy and horizontally with one
another. These strategies define intentions and plans related to overall organizational
considerations, such as organizational effectiveness, and to more specific aspects of people
management, such as resourcing, learning and development, reward and employee relations.
I. Human Capital as a Scarce Resource
- According to Peter Drucker, ‘The ultimate goal of the corporation is survival’, and it
remains as the ultimate legacy for every present and future organizations.
- Every organization has to manage changes like increasing competitiveness, rapid
technological changes, globalization and information revolutions which have brought
about uncertainty and instability.
- The knowledge worker has become the real capital.
- The skills and the cumulative experience of the employees are the most important asset in
any organization.
- Unlike other resources, human resources cannot be replicated and to attract and retain the
right kind of people for the right job, is always a difficult proposition.
- Increasingly, the corporations are realizing that managing human relations is the most
important criteria and with rapid change in the advancement of technology has traversed
the knowledge of managing human resources from ‘Scientific Management Theory’ to
‘Situational Theory of Management.’
- Employees are now the key persons responsible for increasing the performance of the
organizations thus giving a competitive edge to the organizations.
- This is only possible when new strategies are human centric rather than capital centric.
- The organization must invest in developing new skills among the employees s they can be
partners in the future and newer technologies.
, II. Driving Business Orientations
- Increasing competition and technological changes have made the organizations to respond
to very quickly to the changing needs and expectations of the customers.
- The effectiveness and efficiency of then organization depends upon how fast it reaches the
customer before the competitor.
- The challenge of every HR practitioner is how to align its human, resource, various
processes of HR in relation with business plans and meeting the customer requirements.
- Every employee must be inducted appropriately with the business plan of the company.
- The orientation and attitude of each employee varies and may differ from time to time.
- The role of HR is to ensure the employee’s development of their competencies in business
orientation.
- Indeed, one of the most important concerns that organizations face is the improvement of
productivity of every employee and in turn the organizational productivity.
- Human resource is the only source where all the other resources are being converted into
products and services.
- Hence, getting the right kind of resources is a must and HR policies need to be impact
oriented rather than activity oriented.
III. HR Strategy and Linking Business Strategy
- The strategy of HR is to design and integrate systems, processes and resources to suit the
business strategy.
- It helps in ensuring the goals and accomplishing the objectives of an organization.
- The ability of the employees to provide high quality service and value to the customer
depends upon the policies and practices that enable them to foster the bondage with the
customers.
- The HR strategy for the organization must comprise of what is being required and what
would enable the company to derive the strategy to bring in the synergy between the
systems, practices, and activities in line with the business objectives.
- Organizations must realize that dynamic and creative workforce can only bring in sustained
competitive advantage.
IV. Aims of Strategic Human Resource Management
- The rationale for strategic HRM is the perceived advantage of having an agreed and
understood basis for developing approaches to people management in the longer term.
- It has been suggested by Lengnick-Hall and Lengnick-Hall (1990) that underlying this
rationale in a business is the concept of achieving competitive advantage through HRM.
- Strategic HRM supplies a perspective on the way in which critical issues or success factors
related to people can be addressed, and strategic decisions are made that have a major and
long-term impact on the behaviour and success of the organization.
- The fundamental aim of strategic HRM is to generate strategic capability by ensuring that
the organization has the skilled, committed and well-motivated employees it needs
- to achieve sustained competitive advantage.
MODULE 1: INTRODUCTION TO STRATEGIC HUMAN RESOURCE MANAGEMENT
UNIT 3: STRATEGIC HUMAN RESOURCE
Strategic HRM is in some ways an attitude of mind that expresses a way of doing things.
Strategic HRM defines the organization’s intentions and plans on how its business goals should
be achieved through people. It is based on three positions:
1. That human capital is a major source of competitive advantage.
2. That it is people who implement the strategic plan.
3. That a systematic approach should be adopted to defining where the organization wants to go
and how it should get there.
Strategic HRM is a process that involves the use of overarching approaches to the development of
HR strategies, which are integrated vertically with the business strategy and horizontally with one
another. These strategies define intentions and plans related to overall organizational
considerations, such as organizational effectiveness, and to more specific aspects of people
management, such as resourcing, learning and development, reward and employee relations.
I. Human Capital as a Scarce Resource
- According to Peter Drucker, ‘The ultimate goal of the corporation is survival’, and it
remains as the ultimate legacy for every present and future organizations.
- Every organization has to manage changes like increasing competitiveness, rapid
technological changes, globalization and information revolutions which have brought
about uncertainty and instability.
- The knowledge worker has become the real capital.
- The skills and the cumulative experience of the employees are the most important asset in
any organization.
- Unlike other resources, human resources cannot be replicated and to attract and retain the
right kind of people for the right job, is always a difficult proposition.
- Increasingly, the corporations are realizing that managing human relations is the most
important criteria and with rapid change in the advancement of technology has traversed
the knowledge of managing human resources from ‘Scientific Management Theory’ to
‘Situational Theory of Management.’
- Employees are now the key persons responsible for increasing the performance of the
organizations thus giving a competitive edge to the organizations.
- This is only possible when new strategies are human centric rather than capital centric.
- The organization must invest in developing new skills among the employees s they can be
partners in the future and newer technologies.
, II. Driving Business Orientations
- Increasing competition and technological changes have made the organizations to respond
to very quickly to the changing needs and expectations of the customers.
- The effectiveness and efficiency of then organization depends upon how fast it reaches the
customer before the competitor.
- The challenge of every HR practitioner is how to align its human, resource, various
processes of HR in relation with business plans and meeting the customer requirements.
- Every employee must be inducted appropriately with the business plan of the company.
- The orientation and attitude of each employee varies and may differ from time to time.
- The role of HR is to ensure the employee’s development of their competencies in business
orientation.
- Indeed, one of the most important concerns that organizations face is the improvement of
productivity of every employee and in turn the organizational productivity.
- Human resource is the only source where all the other resources are being converted into
products and services.
- Hence, getting the right kind of resources is a must and HR policies need to be impact
oriented rather than activity oriented.
III. HR Strategy and Linking Business Strategy
- The strategy of HR is to design and integrate systems, processes and resources to suit the
business strategy.
- It helps in ensuring the goals and accomplishing the objectives of an organization.
- The ability of the employees to provide high quality service and value to the customer
depends upon the policies and practices that enable them to foster the bondage with the
customers.
- The HR strategy for the organization must comprise of what is being required and what
would enable the company to derive the strategy to bring in the synergy between the
systems, practices, and activities in line with the business objectives.
- Organizations must realize that dynamic and creative workforce can only bring in sustained
competitive advantage.
IV. Aims of Strategic Human Resource Management
- The rationale for strategic HRM is the perceived advantage of having an agreed and
understood basis for developing approaches to people management in the longer term.
- It has been suggested by Lengnick-Hall and Lengnick-Hall (1990) that underlying this
rationale in a business is the concept of achieving competitive advantage through HRM.
- Strategic HRM supplies a perspective on the way in which critical issues or success factors
related to people can be addressed, and strategic decisions are made that have a major and
long-term impact on the behaviour and success of the organization.
- The fundamental aim of strategic HRM is to generate strategic capability by ensuring that
the organization has the skilled, committed and well-motivated employees it needs
- to achieve sustained competitive advantage.
