mgto 0231 -- the importance of hrm

8/12/2019 MGTO 0231 -- The Importance of HRM

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MGTO 231

Human ResourcesManagement

The Importance of HRM

Dr. Kin Fai Ellick WONG


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Personnel vs. HRM

Personnel Department vs.

Human Resource Management

Are they the same? If no, what are the differences?

How come there are two names?

You will know the answer at the end ofthis class


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Outline

Business Strategy

Strategy and HRM

Strategic HR Choices Importance of strategic HR Planning


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Outline

Business Strategy

Strategy and HRM



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Business Strategy

What is a strategy

Text book definition: The companys long-term

plan for how it will balance its internal strengths

and weaknesses with its external opportunityand threats to maintain a competitive advantage

Simply speaking: A plan that is expected to

make an organization adaptive and competitive

Simplest speaking: A plan to make money


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Business Strategy

Example of strategic choices

Defender vs. Prospector

Exploitation vs. Exploration Quality vs. Quantity

Focused vs. Diversified


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Examples

Defender vs. Prospector strategy

A defender strategy ()

Conservative, prefer to maintain a secureposition in relatively stable product or service

areas

Not so looking to expand into new territory

Attempting to protect market share fromcompetitors; not to engage in new-product

development

Low risk, stable return


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Examples

Defender vs. Prospector strategy

A prospector strategy ()

Aggressive, emphasize growth andinnovation

Looking to expand into new territory

Attempting to engage in new-product

development Failure is regarded as normal

High risk, high return


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Examples

Exploitation vs. Exploration

Exploitation Seeking to improve the current version of

product Incremental improvement

Exploration Seeking to have breakthrough in product

development Dramatic changes in the fundamental

concepts or architect of a product


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Examples

Exploitation vs. Exploration Examples

Game software

EA Sports vs. Nintendo

Game lists of EA

NBA Live 1996

NBA Live 1997

NBA Live 1998

NBA Live. 07

http://www.easports.com/

How about Nintendo?

Made in Wario (key control)

Mawaru Made in Wario (key + motion control)
http://www.easports.com/http://www.easports.com/


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Examples


Examples

TV industry Panasonic vs. Samsung

Panasonic: Improving the quality of CRT TV

Samsung: Switching to LCD TV

Mobile phone

Keep improving 2G vs. Switching to 3G


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Examples


Similar to prospector, exploration is high

risk high return

Anyone remember this product by NOKIA


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Examples

Focused vs. Diversified

Examples

Hey, would you give me an example?


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Outline

Business Strategy

Strategy and HRM



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Personnel vs. HR

For organizations with a HR

department

Top-management often regard variousHR functions (e.g., recruitment, pay,

training) as a part of business strategy;

Their managers usually play an important

role in strategic planning of organizations


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The role of HR managers

They have to decide policies and

actions that are consistent with their

goals! There are many strategies they can

choose in various HR contexts

The choices may be different fordifferent business strategies


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Strategic HR Choices


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Strategic HR choices

Managers or top-management have to

decide policies and actions that are

consistent with their goals! There are many strategies they can

choose in various HR contexts

The choices may be different fordifferent business strategies


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Some strategic HR Choices

Work FlowsEfficiency Innovation

Control Flexibility

Explicit job description Broad job classes

Detailed work planning Loose work planning


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Staffing Internal recruitment External recruitment

Supervisor makes hiring HR makes hiring

Fit in with firms culture Skill and qualification Informal hiring Formal hiring


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Separations Inducing voluntary retirement Layoffs

Hiring freeze Recruitment as needed

Continuing support after termination Letting them fend for themselves

Preferential rehiring No preference


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Performance appraisal Customized appraisals Uniform appraisal procedures

Multiple-purpose appraisals Control-oriented appraisals

Multiple inputs (peers, subordinate)

Supervisory input only


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Training and development Individual training Team training

Job-specific training Generic training

Buy skills with higher wages Make skills at lower wages


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Compensation Fix pay Variable pay

Job-based pay Individual-based pay

Seniority-based pay Performance-based pay Centralized pay decisions Decentralized one


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International management Create global company culture Adapt to local culture

Rely on expatriates Rely on own country nationals

Repatriation agreement

No formal repatriation

Universal company policies Country-specific company polices


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Choices of HR strategies

No HR strategy is good or bad in

and of itself

Depend on situation context Fit between the strategies and

organizations


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Outline

Business Strategy

Strategy and HRM



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Importance of strategic HR planning

Encourage proactive behavior

Vision, active, anticipation

Translating the strategic plans intoactions

A good HR planning makes strategic

HR choices that fit the overallorganizational strategies


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A good HR planning

Fits organizational strategies

Fits environments


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Conclusions

HRM is at a strategic level

Managers can formulate HR functions

in a way that facilitate businessstrategies

It is a matter of fit between the HR

choices and (1) business strategies,and (2) environments

mgto 0231 -- the importance of hrm

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