Human Resource Management 1

Human Resource Management 1

Introduction A strategy: Indicates what an organization's key executives hope to accomplish in the long run Is concerned with competition and aligning the resources of the firm Good HR strategy results in a fit between organizational strategy and HRM policies and programs Recruitment, selection, outsourcing, telecommuting, performance evaluation, compensation Human Resource Management 2

Strategic human resource management formulating and executing HR systems that produce the employee competencies and behaviors the company needs to achieve its strategic aims Taking a strategic HRM approach means: Making human resources management a top priority Integrating HRM with the company s strategy, mission, and goals HRM can make significant contributions if included in the strategic planning process from the outset The strategic management process helps determine: What must be done to achieve priority objectives How they will be achieved Human Resource Management 3

Strategic HRM: A Key to Success Three levels of strategy apply to HRM activities: Strategic (long term) Managerial (medium term) Operational (short term) The HRM activities are: Employee selection/placement Rewards Appraisal Development Human Resource Management 4

Strategic HRM: A Key to Success Strategic HRM planning leads to: Growth Profits Survival Planning also: Expands awareness of possibilities Identifies strengths and weaknesses Reveals opportunities Points to the need to evaluate the impact of internal and external forces Human Resource Management 5

Traditional HR vs. Strategic HR Point of distinction Focus Role of HR Initiatives Time horizon Control Job design Key investments Accountability Responsibility for HR Traditional HR Employee Relations Transactional change follower and respondent Slow, reactive, fragmented Short-term Bureaucratic-roles, policies, procedures Tight division of labor; independence, specialization Capital, products Cost centre Staff specialists Strategic HR Partnerships with internal and external customers Transformational change leader and initiator Fast, proactive and integrated Short, medium and long (as required) Organic-flexible, whatever is necessary to succeed Broad, flexible, cross-training teams People, knowledge Investment centre Line managers Human Resource Management 6

Shifts in HR management in India Traditional HR practice Emerging HR practice Administrative role Strategic role Reactive Proactive Separate, isolated from company mission Key part of organizational mission Production focus Service focus Functional organization Process-based organization Individuals encouraged, Cross-functional teams, singled out for praise, teamwork most important rewards People as expenses People as key investments/assets Human Resource Management 7

Linking Corporate and HR Strategies Human Resource Management 8

Strategic Management Process Environmental Scanning Strategy Formulation Corporate level Business unit level Functional level Strategy Implementation Strategy Evaluation Human Resource Management 9

HR Role in Strategic Management In strategy formulation HR manager supplies competitive intelligence that is useful In strategy implementation Encouraging proactive behavior Explicit communication goals Stimulate critical thinking Productivity Quality and Service Proficient strategic management Human Resource Management 10

A Model to Organize HRM ARDM means: Acquiring Rewarding Developing Maintaining and protecting The goals of the ARDM model are: Socially responsible and ethical practices Human Resource Management 11

A Model to Organize HRM The eventual success of any HRM activity is: The organization's employees are the best qualified They perform jobs that suit their needs, skills, and abilities Matching people and activities in order to accomplish goals is easier with a diagnostic approach Human Resource Management 12

Taking a Diagnostic Approach to HRM The ARDM model has four specific steps: Diagnosis Prescription Implementation Evaluation Managers typically diagnose a work situation by observing and identifying key factors A prescription is then made to translate the diagnosis into action Most human resource problems are too complex to have a single correct prescription Human Resource Management 13

Taking a Diagnostic Approach to HRM Implementing a solution is the next step, followed by evaluation Evaluation tells managers whether improvement in the ARDM process is needed If an organization teaches its members to focus on ARDM plus the environment, it is likely to achieve: Socially responsible, ethical behaviors Competitive, high-quality products and services The ARDM model calls for thorough, timely, and systematic review of each situation Human Resource Management 14

External Environmental Influences HRM processes are influenced by both the internal and external environments External influences include: Government laws and regulations Union procedures and requirements Economic conditions The labor force HR planning must operate within: Guidelines Limits of available resources Competencies Human Resource Management 15

Economic Conditions Two economic factors affect HRM programs: Productivity The work sector of the organization Productivity is: An important part of a nation's economic condition Representative of an organization s overall efficiency The output of goods and services per unit of input (resources) used in a production process Human Resource Management 16

Economic Conditions Managers can influence productivity through sound HRM programs Diagnosis, prescription, implementation, and evaluation Recruitment and selection Motivational and compensation techniques Training and development Human Resource Management 17

Internal Environmental Influences HRM programs are influenced by: Strategy Goals Organizational culture Nature of the task Work groups The leader s style and experience Human Resource Management 18

Goals Organizational goals differ within and among departments Most departments have similar goals Differences arise from the importance placed on the goals In organizations where profits take precedence, HRM goals receive little attention This results in effectiveness problems (absenteeism, performance decrements, high grievance rates) Human Resource Management 19

Organization Culture A firm's organizational culture is shown by: The way it does business How it treats customers and employees The autonomy or freedom that exists in the departments or offices The degree of loyalty expressed by employees Human Resource Management 20

Organization Culture Organization culture represents the perceptions held by the employees There is no one "best" culture for the development of human resources Culture can: Impact behavior, productivity, expectations Provide a benchmark for standards of performance Human Resource Management 21

Work Group An employee s experiences are largely influenced by the work group A group is two or more people who: Consider themselves a group Work interdependently to accomplish a purpose Communicate and interact with one another on a continuous basis In many cases, work next to each other Human Resource Management 22

Leader s Style and Experience The experience and leadership style of the operating manager directly affects HRM activities Orchestrating the skills, experiences, personalities, and motives of individuals Facilitating interaction within work groups Providing direction, encouragement, and authority to evoke desired behaviors Reinforcing desirable behavior Human Resource Management 23