chapter_ 03 strategic human resource management

1

1

Human Resource

Management TWELFTH EDITION

G A R Y D E S S L E R

B I J U V A R K K E Y

Copyright 2011 Dorling Kindersley (India) Pvt. Ltd

Authorized adaptation from the United States edition of Human

Resource Management, 12/e

The Managers Role in Strategic Human Resource Management

Chapter 3

Part 1 | Introduction



Resource Management, 12/e 32

After reading this chapter, you should be able to:

1. Outline the steps in the strategic management

process.

2. Explain and give examples of each type of

companywide and competitive strategy.

3. Explain what a strategy-oriented human resource

management system is and why it is important.

4. Illustrate and explain each of the eight steps in the HR

Scorecard approach to creating human resource

management systems.




The Strategic Management Process

Strategic Management

The process of identifying and executing the

organizations mission by matching its capabilities with the demands of its environment.

Strategy

A chosen course of action.

Strategic Plan

How an organization intends to balance its internal

strengths and weaknesses with its external

opportunities and threats to maintain a competitive

advantage over the long-term.




Business Vision and Mission

Vision

A general statement of an organizations intended direction that evokes emotional feelings in

organization members.

Mission

Spells out who the company is, what it does, and

where its headed.

2




FIGURE 35 The Strategic Management Process




FIGURE 37 A SWOT Chart

Strengths

Example: Market leadership

Weaknesses

Example: Large inventories

Opportunities

Example: New overseas markets

Threats

Example: Market saturation




FIGURE 38 Relationships Among Strategies in Multiple-Business Firms




Types of Strategies

Diversification

Strategy

Geographic

Expansion

Strategy

Vertical

Integration

Strategy

Corporate-Level

Strategies

Consolidation

Strategy

3




Types of Strategies (continued)

Cost Leadership Focus/Niche

Business-Level/

Competitive

Strategies

Differentiation




Achieving Strategic Fit

The Fit Point of View (Porter) consists of the idea that each departments strategy needs to fit the parent businesss competitive aims.




Strategic Human Resource Management

Strategic Human Resource Management

The linking of HRM with strategic goals and

objectives in order to improve business performance

and develop organizational cultures that foster

innovation and flexibility.

Involves formulating and executing HR systemsHR policies and activitiesthat produce the employee competencies and behaviors that the company needs

to achieve its strategic aims.




FIGURE 36 Linking Company-Wide and HR Strategies

4




Creating the Strategic Human Resource

Management System

Human Resource

Professionals

Employee

Behaviors and

Competencies

Components of a

Strategic HRM System

Human Resource

Policies and

Practices




FIGURE 310 Strategy

Map for

Southwest

Airlines

Source: Adapted from Creating a Strategy Map, Ravi Tangri, [email protected].




FIGURE 312 Three Important Strategic HR Tools

Source: Adapted from Brian Becker et al., The HR Scorecard: Linking People,

Strategy, and Performance (Boston: Harvard Business School Press, 2001), p. 12.




Measuring HRs Contribution

The HR Scorecard

Shows the quantitative standards,

or metrics the firm uses to measure HR activities.

Measures the employee behaviors

resulting from these activities.

Measures the strategically relevant

organizational outcomes of those

employee behaviors.

5




Creating an HR Scorecard

1

2

3

4

5

Outline value chain activities

Define the business strategy

Outline a strategy map

Identify strategically required

outcomes

Identify required workforce

competencies and behaviors

6

7

8

Choose HR Scorecard

measures

Identify required HR policies

and activities

Summarize Scorecard

measures on digital dashboard

and monitor, predict, and

evaluate

The 10-Step HR Scorecard Process




FIGURE 314 Simple Value Chain for The Hotel Paris




Five Sample HR Metrics HR Metric* How to Calculate It

Absence rate # of days absent in month 100

Average # of employees during month # of workdays

Cost per hire Advertising + agency fees + employee referrals + travel cost of

applicants and staff + relocation costs + recruiter pay and benefits

Number of hires

HR expense

factor

HR expense

Total operating expense

Time to fill Total days elapsed to fill job requisitions

Number hired

Turnover rate Number of separations during month 100

Average number of employees during month Sources: Robert Grossman, Measuring Up, HR Magazine, January 2000, pp. 2935; Peter V. Le Blanc, Paul Mulvey, and Jude T. Rich, Improving the Return on Human Capital: New Metrics, Compensation and Benefits Review, January/February 2000, pp. 1320; Thomas E. Murphy and Sourushe Zandvakili, Data and Metrics-Driven Approach to Human Resource Practices: Using Customers, Employees, and Financial Metrics, Human Resource Management 39, no. 1 (Spring 2000), pp. 93105; [HR Planning, Commerce Clearing House Incorporated, July 17, 1996;] SHRM/BNA 2000 Cost Per Hire and Staffing Metrics

Survey; www.shrm.org. See also, SHRM Research 2006 Strategic HR Management Survey Report, Society for Human Resource Management..




K E Y T E R M S

strategic plan

strategic management

vision

mission

SWOT analysis

strategy

strategic control

competitive advantage

strategic human resource management

HR Scorecard

metrics

value chain analysis

chapter_ 03 strategic human resource management

Documents

authorized adaptation

dorling kindersley india

e y copyright

edition g

introduction copyright

competitive strategy

market saturation copyright

strategic plan