STRATEGIC HUMAN RESOURCE MANAGEMENT

DISCUSSION

What 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 MANAGEMENT

HRM 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

STRATEGY
The 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

STRATEGY
At the core, its is the debate between best fit and best practice Used for gaining a competitive advantage

Innovation

Offer something new; different from competitors Products and services Attempt to be the lowest cost provider

Quality Enhancement

Cost Reduction

Optimal strategy depends on the wants and nature of competitors

TYPES OF STRATEGY
Business

Examines correspondence between each firms competitive strategy and its system of high performance work practices
An internal approach; connected to the work organization inside a firm

Operations

Resource View

Views 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 STRATEGY

Recruitment Training Career Path Promotions Socialization Openness

HIGH PERFORMANCE PRACTICES

Features

Comprehensive selection/recruitment procedures Incentive compensation Extensive employee involvement/training

Improve knowledge, skills, and abilities of employees Increase motivation Reduce shirking Enhance retention of quality employees (reduce tenure of non-performers)
Huselid (1995) P. 635

Expected Results

HIGH COMMITMENT PRACTICES

Unique to the High-Performance Paradigm

Sophisticated selection and training

Emphasis on values, human relations skills, and knowledge skills

Behavior-based appraisal Single status policies Contingent pay systems Job security Above market pay and benefits Grievance systems
Godard (2004) P. 351

Traditional Personnel Practices

CONCLUSION
Model of the Basic Strategic HRM Components
HUMAN CAPITAL POOL: Knowledge, Skill, Ability EMPLOYEE RELATIONSHIP BEHAVIORS: Psychological Contracts, Citizenship, Discretion

PEOPLE MANAGING PRACTICES: Staffing, Training, Rewards, Appraisal, Work Design, Participation, Recognition, Communication

Wright, P. Dunford, B. and Snell, S. (2001) Human Resources and the Resource Based View of the Firm, Journal of Management, 27:6

CONCLUSION
Effectiveness 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