Scribd Logo
Upload

Welcome to Scribd!

  • 142 views

    Presentation 2

    Uploaded by

    Shuvo Datta

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd

    Presentation 2

    Uploaded by

    Shuvo Datta
    142 views22 pages

    Copyright

    © © All Rights Reserved

    Available Formats

    PPTX, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    142 views22 pages

    Presentation 2

    Uploaded by

    Shuvo Datta

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 22

    C HA P TE R 2

    ALIGNING HR WITH
    STRATEGY
    LEARNING OBJECTIVES

    After reading this chapter, you should be able to:


    • Understand the importance of strategic HR
    planning
    • Identify the risks associated with not planning
    • Discuss approaches to linking strategy and HR,
    including the barriers to becoming a strategic
    partner

    © 2010 by Nelson Education Ltd. 2


    LEARNING OBJECTIVES

    After reading this chapter, you should be able to:


    • List the characteristics of an effective HR strategy
    • Delineate the steps in the strategic HR planning model

    © 2010 by Nelson Education Ltd. 3


    WHAT GIVES THE FIRM COMPETITIVE
    ADVANTAGE?

    • Unique (differentiation, focus)


    • Hard to copy
    • Sustainable

    4
    WHAT ARE HR STRATEGIES?
    • HR strategies set out what the organization intends to do about its
    human resource management policies and practices and how they
    should be integrated with the business strategy. Key elements:

    – Strategic objectives

    – Plan of action

    “There is no great strategy only great execution” (Gratton 2000)


    A GOOD HR STRATEGY
    • satisfy business needs
    • is founded on detailed analysis
    • can be turned into actionable programmes
    • is coherent and integrated
    • takes account of the needs of line managers,
    employees and other stakeholders
    CATEGORIES OF OVERALL
    STRATEGIES

    • Evolutionary approach to HRM.


    • Broad-bush statements of aims and purpose that set the scene for more
    specific strategies.
    • Specific and articulated plans to create sets of HR practices and
    develop a coherent HR system.
    • Conscious introduction of overall approaches to HRM such as:
    – High-performance management
    – High-involvement management
    – High-commitment management
    HIGH-PERFORMANCE MANAGEMENT
    • Aims to effect organizational performance through people.
    • HRM areas involved
    (HPWS – high performance work systems):
    – Recruitment & selection
    – Training and development
    – Reward management
    – Performance management
    HIGH-INVOLVEMENT MANAGEMENT

    • Commitment ad involvement opposed to bureaucratic control.


    • Treating employees as partners. Providing opportunity for the
    employee to control and understand their work.
    • Communication for mutual understanding.
    HIGH-COMMITMENT MANAGEMENT
    • A form of management aimed at eliciting a commitment so that behavior is primarily
    self-regulated rather than controlled. Organizational relations based on trust.
    • Approaches to achieve commitment:
    – Career ladders and emphasis on trainability
    – Functional flexibility
    – Reduction of hierarchy, ending of status differentials
    – Reliance on teams: dissemination, structuring work, problem solving
    – Intrinsic satisfaction via job design
    – Permanent employment with temporary workers
    – Merit pay and profit sharing
    – Involvement in quality management
    SPECIFIC HR STRATEGIES
    • HC management
    • High-performance management
    • Corporate social responsibility
    • Organization development
    • Engagement
    • Knowledge management
    • Resourcing
    • Talent management
    • Learning and development
    • Rewarding
    • Employee relations
    THE IMPORTANCE OF SHRM
    • Human capital is the sum of employee’s (KSA) knowledge, skill,
    abilities, experience and commitment invested in the
    organization.
    • HR should move from articulating perceived value to
    demonstrate real value.
    Two reasons:
    • Employees help an organization to achieve success because
    they are strategic resources.
    • Planning process itself results in improved goal attainment.
    EMPLOYEES AS STRATEGIC
    RESOURCES
    • Resource-Based View: suggests that
    the management of resources and • Typical capabilities might include:
    capabilities will lead to competitive -Adaptability
    advantage resulting in superior -Flexibility
    performance and value creation. -Speed of bringing new products to
    market
    • Typical resources might include:
    -Human resources
    -Proprietary knowledge
    -Reputation
    IMPROVED GOAL ATTAINMENT
    Organizations with clear strategies provide direction and meaning to
    employees and mitigate the need for control by substituting a
    consistency of purpose - in other words, a mission. This articulated
    vision for the future may result in a more effective organization
    through increased motivation and performance, lowered absenteeism
    and turnover, and heightened stability, satisfaction, and involvement.
    RISKS TO STRATEGIC HR
    PLANNING

    • Costs: Increased time and energy in making decisions, increased


    potential for information overload, unrealistic commitments to
    employees, over-concern with employee reactions that may be
    incompatible with industry conditions
    • False employee expectations: Future plans may raise employee
    expectations that hey have a job for life and will be trained for that job
    • Loss of Flexibility: Committing to one strategy may cause the
    organization to become blind to changes in the environment
    LINKING HR PROCESS TO STRATEGY

    1. Corporate strategy leads to HR Strategy


    2. HR competencies lead to Business strategy
    3. HR strategy and Corporate strategy
    4. HR becomes a business partner

    16
    Corporate Strategies Leads to HR
    Strategy
    Internal Methods External Methods
    Penetration of existing markets Acquiring other organizations
    Developing new markets Vertical integration
    Developing new products or services for HR Issues
    existing or new market Merging organizations
    Benefits Dismissing redundant employees
    Gaining economies of scale in operations
    and functions
    Enhancing competitive position vis-à-vis
    industry competitors
    Providing opportunities for employee
    professional development and advancement
    HR Issues
    Planning for new hiring
    Alerting current employees
    Ensuring quality and performance standards
    are maintained

    17
    17
    Corporate Strategies Leads to HR
    Strategy(Cont)
    Stability
     Maintaining the status quo due to limited environmental
    opportunities for gaining competitive advantage.
     Few employees will have opportunities for advancement.
     Critical that management identify key employees and develop
    specific HR retention strategies to keep them.

    Turnaround or Retrenchment
     Downsizing or streamlining the organization in a cost-cutting
    attempt to adjust to the competitive environment.
     Few opportunities and many environmental threats.
     Important to develop HR practices to manage the “survivors.”

    18
    18
    HR BECOMES A BUSINESS PARTNER

    • HR desires to be an active participant in the running of the business.HR


    becomes a business partner by:

     Focusing on developing HR programs that enhance


    organizational performance.
     Involving HR in strategic planning at the onset.
     Participating in decision making on mergers, acquisitions,
    and downsizing.
     Redesigning organizations and work processes
     Accounting and documenting the financial results of HR
    activities.
     Emergence of new models-Ulrich’s "three-legged" model.
     Cross-functional initiatives-
    19
    CONTINUED …….
    • HR’s success as true strategic business partner dependent on five
    specific competencies:
    – Strategic contribution - development of strategy
    – Business knowledge - understanding nuts & bolts of organization
    – Personal credibility - measurable value demonstrated in programs &
    policies
    – HR delivery - serving internal customers through effective & efficient
    programs
    – HR technology - using technology to improve organization’s management
    of people

    20
    STRATEGIC FIT
    • External fit:
    HR programs must align with or fit the overall strategy of the organization. If
    business strategy is to differentiate the organization from its competitors
    based
    on superior service then selection and training should be developed to hire and
    train employees in the skill and attitudes necessary to deliver superior service.

    • Internal fit:
    a) fit with other functional areas of business such as marketing, production etc.
    If customer service requires 24 hour service HR planning must ensure that.
    (b) consistent with each other. “bundling HR services” – training , staffing,
    compensation ,appraisal all consistent with each other.

    • Focus on benefit measured and result oriented. 


    Tracking of the results is an important to be able to measure results in order to
    see if the goal has been achieved
    LINKING ORGANIZATIONAL
    STRATEGY TO HR PLANNING
    STRATEGIC DIRECTION HR LINKAGE

    mission determining organization’s


    business

    setting goals and


    objectives and goals
    objectives

    strategy determining how to attain


    goals and objectives

    determining what jobs need to be


    structure
    done and by whom

    matching skills, knowledge, and


    people abilities to required jobs

    You might also like