STRATEGIC HUMAN RESOURCE MANAGEMENT

DISCUSSIONWhat is meant by the term Strategic Human Resource Management and how has it been used to study the employment relationship?

HUMAN RESOURCE MANAGEMENT human resource management (alternatively, employee relations or labor management) includes the firms work systems and its models of employment. It embraces both individual and collective aspects of people management. It is not restricted to any one style or ideology. It engages the energies of both line and specialist managers and typically entails a blend of messages for a variety of workforce groups. Purcell & Boxall (2003) P. 24

HUMAN RESOURCE MANAGEMENTHRM as a subject of study assumes that the interests of employees and employers will coincide and is preoccupied with the shared goal of organizational effectiveness that marginalizes the interests of other stakeholders such as employees. HRM is also predominantly focused on the individual and seeks solutions to HR problems within the firm, with an analytical focus on the motivations and aspirations of individual employees. Bach (2005) P. 4

STRATEGYThe determination of the basic long-term goals and objectives of an enterprise and the adoption of courses of action and the allocation of resources necessary for carrying out these goals. Alfred Chandler, Strategy and Structure, (MIT Press, 1962), P. 13

STRATEGYAt the core, its is the debate between best fit and best practiceUsed for gaining a competitive advantageInnovationOffer something new; different from competitorsQuality EnhancementProducts and servicesCost ReductionAttempt to be the lowest cost providerOptimal strategy depends on the wants and nature of competitors

TYPES OF STRATEGYBusinessExamines correspondence between each firms competitive strategy and its system of high performance work practicesOperationsAn internal approach; connected to the work organization inside a firmResource ViewViews human resources as sources of sustained competitive advantage

STRATEGIC HRM(S)trategic HRM is about how the employment relationships for all employees can be managed in such a way as to contribute optimally to the organizations goal achievement. Legge (2005) P. 223

HR PRACTICES LINKED WITH COMPETITIVE STRATEGYRecruitmentTrainingCareer PathPromotionsSocializationOpenness

HIGH PERFORMANCE PRACTICESFeaturesComprehensive selection/recruitment proceduresIncentive compensationExtensive employee involvement/trainingExpected ResultsImprove knowledge, skills, and abilities of employeesIncrease motivationReduce shirkingEnhance retention of quality employees (reduce tenure of non-performers)

Huselid (1995) P. 635

HIGH COMMITMENT PRACTICESUnique to the High-Performance ParadigmSophisticated selection and trainingEmphasis on values, human relations skills, and knowledge skillsBehavior-based appraisalSingle status policiesContingent pay systemsTraditional Personnel PracticesJob securityAbove market pay and benefitsGrievance systemsGodard (2004) P. 351

CONCLUSIONModel of the Basic Strategic HRM Components

HUMAN CAPITAL POOL:Knowledge, Skill, AbilityEMPLOYEE RELATIONSHIP BEHAVIORS:Psychological Contracts, Citizenship, DiscretionWright, P. Dunford, B. and Snell, S. (2001) Human Resources and the Resource Based View of the Firm, Journal of Management, 27:6 PEOPLE MANAGING PRACTICES:Staffing, Training, Rewards, Appraisal,Work Design, Participation, Recognition, Communication

CONCLUSIONEffectiveness can be increased by systematically melding human resource practices with the selected competitive strategy The success or failure of a firm is not likely to turn entirely on its strategic human resource management practices, but these practices are likely to be critical

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