STRATEGIC HUMAN RESOURCE MANAGEMENT

By

Sujoy Chowdhury

‘Strategy is problem solving in unstructured situations.’

‘There is a gap between the rhetoric and the reality of SHRM.’

‘Strategy consists of illusions in the board room.’

‘Strategy is emergent and flexible.’

‘Strategy is a pattern in a stream of activities.’

‘Strategy is often fragmentary, evolutionary and largely intuitive.’

THE CLOUDY NATURE OF STRATEGY

SO WHAT IS STRATEGIC HUMAN RESOURCE MANAGEMENT?

Is it about long-range strategic planning?

Is it about day-to-day strategic management?

Or is it about both?

Strategic HRM is the process of defining how the organization’s goals will be achieved through people by means of HR strategies and integrated HR policies and practices.

STRATEGIC HRM DEFINED

MODEL OF STRATEGIC HRM

Strategic HRM

Strategic management – strategic role of HR

HR strategies –overall/specific

Strategic choice

Strategic analysis

SO WHAT IS THE STRATEGIC ROLE OF HR SPECIALISTS?

‘My credibility depends on running an extremely

efficient and cost-effective administrative machine… If I don’t get that right, and consistently, then you can forget about any big ideas.’

‘The CIP thinks that we will all be strategic business

partners, and we’re not, you know. We have to deal with day-to-day HR issues that

arise in the business.’Student practitioner

‘Give me a break! It’s so demeaning. How many people in marketing or

finance have to say they are a partner in the business? Why do we

have to think that we’re not an intimate part of the business, just

like sales, manufacturing and engineering? I detest and loathe the

term and I won’t use it.’

‘The term worries me to death. HR has to be an integral and fundamental part of

developing the strategy of the business. I don’t even like the term ‘close to the

business’ because, like ‘business partner’, it implies we are working alongside our line

management colleagues but on a separate track, rather than people management being

an integral part of the business.’

VIEWS ON THE STRATEGIC BUSINESS PARTNER CONCEPT

Formulate integrated HR strategies

Work with line managers to

support the achievement of

their businessgoals

Contribute to the development of

business strategies

HR’s STRATEGIC ROLES

Aware of businesscontext

Understandthe

business

Appreciate how HRcan add

value

See the big picture

Act as changeagent

Make convincingbusiness

casefor

innovation

Practiceevidence-

basedmanagement

SEVEN STEPS TO BEING STRATEGIC

SO WHAT ABOUT HR STRATEGY?

Overall:• performance• engagement• ‘the big idea’• human capital advantage• HRM process advantage• etc

Specific:• organization development• corporate social responsibility• resourcing• talent management• learning and development• employee reward• employee relations• employee well-being

HR STRATEGY AREAS

EXAMPLES OF OVERALL HR STRATEGIES

A strong focus on the overall effectiveness of the organization, its direction and how it's performing. There is commitment to, belief in, and respect for individuals. New Forest Council

The only HR strategy you really need is the tangible expression of values and the implementation of values. West Water

Stimulate changes on a broad front aimed at achieving competitive advantage through people. Pilkington Optronics

Maintain competitive advantage by continuing to attract very high calibre people. Boots

We want GSK to be a place where the best people do their best work. GlaxoSmithKline

Staff who are enjoying themselves, are being supported and developed, and who feel fulfilled and respected at work, will provide the best service to customers. Lands’ End

BALANCED SCORECARD IN AN INTERNATIONAL CHARITY

Organizational effectiveness perspective:• programme development• programme delivery• process development and management• cost-effectiveness

Stakeholder perspective:• impact on clients• relationships with key funding agencies and supporters• development of brand• influence

Financial perspective:• income growth• enlistment and retention of supporters• cost/income ratio

People perspective:• leadership behaviour• talent management• learning and development• employee satisfaction – a ‘great place to work’

• Clear line of sight between strategic aims of the Corporation and its staff

• Management sets goals for success and monitors performance

• Leadership from the top and at all levels of management

• Focus on promoting engagement and commitment

• Performance management processes aligned to Corporation objectives

• Capacities of people enhanced by comprehensive learning and

development programmes

• People valued and rewarded according to their contribution

HIGH-PERFORMANCE STRATEGY: CORPORATION OF LONDON

• Achieve strategic integration – match HR policies and practices to the business strategy

• Plan coherent approaches to the development of HR processes so that they are interrelated and mutually supporting

• Focus on the needs to achieve flexibility, responsiveness, quality and cost- effectiveness in the delivery of HR services

DECLARATION OF STRATEGIC INTENT: CARE DELIVERY CHARITY

• Aligned to corporate goals

• Set out clear aims

• Supported by business case• Take account of individual as well as business needs

• Contain realistic and achievable plans for implementation

CRITERIA FOR HR STRATEGIES

STRATEGIC HRM TOOLKIT

1. Analysis

2. Diagnosis

3. Conclusions and recommendations

4. Action planning

CONDUCTING A STRATEGIC REVIEW

Involve senior management and

line managers

Involve employees and their

representatives

Possible HR strategic objectives Importance* Effectiveness*

Support the achievement of organizational goals

Meet needs of employees

Develop a high-performance culture

Ensure that the organization is seen as ‘a great place to work’

Increase engagement and commitment

Recruit and retain talented people

Develop talented people

Reward people according to their contribution

Provide employees with a voice

Provide a good working environment

Other (specify)

* Scale: 10 = high 0 = low

HR STRATEGY GOALS: HOW DO THEY RATE?

STRATEGIC HRM GAP ANALYSIS

What are the current and desired SHRM characteristics in your organization? 1 2 3 4 5 6 7

Effective high-performance work system in place

No attempt made to encourage high performance

Integrated talent management programmes are operating

effectively

Talent management is haphazard or ineffective

Sophisticated techniques are used to recruit employees

A traditional approach is adopted with regard to sourcing recruits

and selecting applicants

Focus on using blended learning and development processes

Reliance on the delivery of traditional training courses

Employees given a voice on allmatters that concern them

Only lip service is paid to employee participation and

involvement

High-quality HR practices Poor-quality HR practices

A total reward approach is used effectively

Reward programmes limited tofinancial rewards

Mark on the scale: X for current, O for desired – eg:

XO

HR IMPLICATIONS OF CORPORATE STRATEGIES

Corporate strategy Implications for HR strategy

1.

2.

3.

4.

5.

6.

Possible resourcing goals Importance* Effectiveness*

Match people resources to business requirements

Avoid unexpected deficits or surpluses of staff

Attract and recruit high-quality candidates

Minimize recruitment costs

Maximize ‘recruitment intensity’, ie high numbers of applicants per vacancy

Increase ‘predictive validity’, ie the extent to which predictions of suitability at the point of recruitment are achieved

Increase retention rates

Reduce cost of labour turnover

* Scale: 10 = high, 0 = low

ANALYSIS OF RESOURCING GOALS

Talent management goals Importance* Effectiveness*

Define what is meant by talent in terms of competencies and potential

Ensure that talent is treated as a key corporate resource

Develop a pool of talent that will provide a guaranteed supply of highly qualified people

Provide for management succession

Rely primarily on growth from within, while recognizing the need to bring in fresh blood from time to time

Identify those with talent and potential

Institute programmes to develop talent

Create a compelling employee value proposition

Develop the organization as an employer of choice

* Scale: 10 = high, 0 = low

ANALYSIS OF TALENT MANAGEMENT GOALS

Learning and development goals Importance* Effectiveness*

Create human capital advantage by ensuring that the organization has more skilled and competent people than its competitors

Extend the skills base of the organization

Improve individual, team and organizational performance

Attract and retain high-quality people by offering them learning and development opportunities

Improve organizational flexibility by multi-skilling

Provide additional non-financial reward to people in the form of growth and career opportunities

Reduce the length of learning curves to minimize learning costs

Ensure that talented people are developed to achieve their maximum potential

Provide line managers with the skills required to lead and develop their people

* Scale: 10 = high, 0 = low

ANALYSIS OF LEARNING AND DEVELOPMENT GOALS

Reward management goals Importance* Effectiveness*

Reinforce the achievement of organizational goals

Improve individual, team and organizational performance

Recruit and retain high-calibre staff

Facilitate staff mobility

Achieve strong relationship between pay and performance

Reinforce organizational values

Motivate and engage employees

Cost effective

Well-communicated and understood by employees

Managed effectively by line managers

* Scale: 10 = high, 0 = low

ANALYSIS OF REWARD MANAGEMENT GOALS

Employee relations goals Importance* Effectiveness*

Build stable and cooperative relationships with employees and, where present, their trade unions

Operate on a partnership basis with trade unions

Achieve engagement through employee involvement and communication processes

Minimize conflict with employees and their unions

Adopt a high-commitment approach to develop mutuality

Maintain bargaining structures and negotiating procedures that enable agreements to be reached smoothly

* Scale: 10 = high, 0 = low

ANALYSIS OF EMPLOYEE RELATIONS GOALS

Summary of HR strategy

Business case Timing Responsibility for

1.

2.

3.

4.

5.

6.

PRIORITIZATION OF HR STRATEGIES

STRATEGIC HRM GUIDELINES

• Be clear on what has to be achieved and why

• Ensure that what you do fits the business strategy, culture andcircumstances of the organization

• Aim for continuous improvement – evolution not revolution• Don’t follow fashion – do your own thing• Keep it simple – over-complexity is a common reason for failure• Don’t rush – it takes longer than you think• Assess resource requirements and costs• Manage change – involve, communicate and train

Contact: 9874042424Email: sujoychowdhury1@gmail.com