HRMStrateg

y

Strategy:Strategy:1. The process of determining &

articulating the organisation’s:

• vision, mission, values, goals & objectives, and • its internal &external environments; then:

2. Formulating plans to attain outcomes consistent with

the above; then:

3 Implementing those plans(including evaluation)

HR StrategyHR Strategy“The pattern of planned human resource deployments and activities intended to enable the organisation to achieve its goals”

Focus: To provide the organisation with sustained competitive advantage

…through procurement, development & alingment of people, skills, HR policies etc.

Competitive advantage might arise from having best people, but also from being best at managing what you do have

External competitive environment

Corporate strategy

formulation

Corporate strategy

implementation

HRstrateg

y

Input Input

Divisionstrategies

HR FUNCTION

OTHER

FUNCTIO

NS

Link to Corporate Link to Corporate StrategyStrategy

Evaluation (measurment

etc)

Role of HRM inStrategy

Formulation

HR Function

HR Function

HR Function

HR Function

StrategicPlanning

StrategicPlanning

StrategicPlanning

StrategicPlanning

Administrative linkage

One-Way linkage

Two-way linkage

Integrative linkage

Strategic Formulation: Overview

VISION

MISSION

GOALS / OBJECTIVES

EXTERNAL ANALYSIS:OpportunitiesThreat

INTERNAL ANALYSIS:StrengthsWeaknesses

STRATEGIC CHOICE

Strategic Formulation:‘Step’ 1: Vision

OrganisationalVision

Coreideology

Envisagedfuture

Core Ideology

Core values Core Purpose

Essential, enduring tenants

What is important?

What isinviolate?

Reason for being

What the organisation

offers to society

Controlling desire,Dominant aspiration

Examples: Core Purposes

3M: to solve unsolved problems innovatively

Hewlett-Packard: to make technical contributions for the advancement and welfare of humanity

Mary Kay Cosmetics: to give unlimited opportunity to women

Nike: to experience the emotion of competition, winning, and crushing the competition

Walt Disney: to make people happy

Example: Core Values

Walt Disney:

• No Cynicism • Nurturing & promulgation of

wholesome American values• Creativity, dreams and imagination• Fanatical attention to consistency and detail• Preservation and control of the ‘Disney Magic’

Strategic Formulation:‘Step’ 1: Vision

OrganisationalVision

Coreideology

Envisagedfuture

BHAGSVivid Description

Envisaged Future

BHAGS Vivid Description

Huge, daunting goals

Clear & compelling, tangible

Unifying, inspiring,engaging

Making goals ‘imaginable’

The ‘mind’s eye’

Hopeful, passionate,

inspiringimages & symbols

1. Difficult Target2. Common enemy3. Role-model4. Internal -transformation

Examples: BHAGS

Ford (1900’s): Democratise the automobile (Target BHAG)

(Nike, 1960’s): Yamaha wo tsubusu! We will destroy Yamaha (Common Enemy BHAG)

Stanford (1940’s): Become the Harvard of the west (Role-Model BHAG)

GE (1980’s): #1 or #2 in every market we serve & revolutionise this company to have the strengths of a big company combined with the leanness & agility of a small company   

Examples: Vivid Description

Sony:

We will create products that become pervasive around the world…We will be the first Japanese company to go into the U.S. market and distribute directly…We will succeed with innovations that U.S. companies have failed at - such as transistor radio…50 years from now our brand name will be as well known as any in the world…and will signify innovation and quality that rival most innovative companies anywhere…’Made in Japan’ will mean something fine, not something shoddy. 

Strategic Formulation‘Step’ 2: SWOT

AnalysisBrings balance to the more

unchanging vision:

Organisation’s internal & external

environment:Change is often a constant

here!SW

OT

Internal strengths & weaknesses of organisation

External opportunities &threats of organisation

Strategic Formulation:‘Steps’ 3, 4 & 5: Mission,

Goals & Objectives

‘Eternal’ ofVision

‘Now’ ofSWOT

Mission:What business / markets are we in to realise our vision?

Goals:The tasks that need to be done

to enable mission

ObjectivesThe quantifiable targets that are

set through the goals

Examples: Missions

Microsoft: A computer on every desktop

Saturn: The mission of Saturn is to market vehicles developed and manufactured in the United States that are world leaders in quality and customer satisfaction through the integration or people, technology, and business systems and to transfer knowledge, technology and experience throughout General Motors”.

Chevrolet: Manufactirug safe and reliable economy cars, sports cars, sedans and trucks. 

Electronic Data Systems: Designing & operating information systems for both public and private organisations

Strategic Formulation:‘Step’ 6: Strategic Choice

VisionMissionGoals

Objectives

Deliberateplanning

Everydayoperations

Emergent(organic,

evolutionary)

strategy

+

Eventual plans

Example:A new customer

service process is planned for

through consideration of

new aims

Example:Customer service people discover

new process through dealing with customers

HR & Corporate Strategic Choice

Deliberate planning

Emergent strategy

Eventual

plans

HRFunction

Limit or enable choices

Surface, communicate& integrate suggestions

Strategic Types

Categorisations under which any strategy can be typified

Porter:Overall cost leadershipDifferentiationFocus

Miles and SnowDefendersProspectorsAnalysersReactors

Directional StrategiesConcentrationInternal growthExternal growthDivestment

StrategicImplementatio

n: Overview2nd major part of strategy

Implementation by all functions, but six major implementation “musts”:

1) Organisational structure2) Task design3) Selection, training &

development of people4) Reward systems5) Leadership, power & culture*6) Information & information systems

* Not in textbook

HR Function andImplementation

HR enables the six implementation musts through various HR tasks:

•Job analysis and design•Recruitment and selection•Training & selection•Performance management•Rewards and benefits•Labour relations•etc!

Culture, Leaders, Strategy

These can support or hinder strategy

Culture

Strategy

Leadershipba

d

c

e

There is a complex interaction between culture, leadership &

strategy:

•Culture affects how leaders will lead (a)•Leaders can have a hand in shaping culture (b)•Culture can have a direct impact on the type of strategies leaders choose now (c)•Culture can have an indirect impact on the strategies chosen through historical patterns (d)•Strategy can have a hand in shaping future culture (e)

Culture, Leaders, Strategy

Culture is influential! Leaders must learn to shape and manipulate corporate cultures:

•What they pay attention to•How they react to critical incidences•Deliberate role behaviour•Rewarding right things•Type of people they work with•ETC!!!

Leadership = Top management!

HR function must shape culture by shaping leadership throughout the organisation:

•Teaching•Enabling•Releasing•Sharing of knowledge•Attitudes

ETC!

Strategic Types and HR Tasks

Different strategic types work better with some HR practices than others, e.g.:

Porter / Miles and Snow

Cost / defender = efficiency, consistencyDifferentiation / prospector = quality, effectiveness, knowledge, creativeFocus / analyser = flexibilityDirectional Strategies

Concentration = current skills focusInternal growth = new employees, new targets, new trainingExternal growth = harmony, cooperationDivestment = minimising loss (retrenchments, morale, severance)

Strategic Measurement

& ControlStrategic Formulatio

n

StrategicImplementation

Sets standards(esp

objectives)

Measurementof outcomes

Strategic evaluation

Thus:Evaluation is the judgment of how the standards set in strategic formulation

were achieved in strategic implementation

Evaluation is fed back into the formulation of plans and the knowledge

base of how to implement them