What is Strategic HRM?

What is strategy?
It is a plan of action or policy designed to achieve a major or overall aim. Strategy is long term in nature.


To launch a new Product, we require a strategy

What is a plan?
A detailed proposal for doing or achieving something.



What is difference between Strategy and Plan?
Strategy is combination of various plans and is flexible.

Plan is inflexible.

Example of Strategy:

Suppose a Computer Manufacturing Unit has Goal goal to increase production of of out put by 25o more computers a day in 1 year"

Strategy1: Putin Place automated machines
Plan:Plan for what budget is required, where to purchase, etc

Strategy2: Increase Manpower;

Plan for the number, plan for recruitment, plan for their induction etc.


What is Strategic HRM?
It is linking of human resources with strategic goals and objectives in order to improve business performance and obtain competitive advantage.

Example:

A XYZ Petroleum Refining Company wants to venture in to Petroleum Products Marketing Bussiness. Then as SHRM Professional what we are required to do

1. Asses the existing talent pool
2.recommend for Recruit Manpower or Train the existing Manpower to get the skills required for new business

3.Implement the Policies/Procedures so that existing talent pool acquires skills for new business.

4. Devise HR Policies to attract and Retain manpower for new Business.

Why SHRM is important?
Resource-based view (RBV) is a business management tool used to determine the strategic resources available to a company to achieve Competitive Advantage (Competitive advantage is the advantage attained by one company becoz of resources/capability it has which can not be copied by competetiors. For example, Microsoft has competitive advantage of windows operating system thru which it is selling office products).

The fundamental principle of the RBV is that the basis for a competitive advantage of a firm lies primarily in the application of the bundle of valuable resources at the firm's disposal.

RBV uses SHRM as tool to assess the valuable Human Resources for Competitive Advantage.


How can SHRM used in Business to achieve Competitive advantage?

The Human Resource competitive advantage can be achieved by adopting the following approaches:


Approach 1:The high-performance management approach is set of interrelated HR practices to make Human capital a competitive advantage. Usually High performance work system comprise of self managed teams, learning organization, Pay for Performance system, Involvement of employees in decision making.

Approach 2: High Involvement/Commitment Management Model:
It is a form of Management which is aimed at eliciting a commitment so that behaviour is
primarily self-regulated rather than controlled by sanctions and pressures external to the
individual, and relations within the organization are based on high levels of trust.

Tools for Achieving High Involvement/Commitment are


High Involvement Practices
Work Organization
Flexible job descriptions
Team-working
Quality circles
Production workers are responsible for their own quality
Skill and Knowledge Acquisition
Team briefing
Training budgets
Formal assessment
Work Enrichment
Explicit policy of designing fulfilling jobs
Motivational Practices
Trainability as a major selection criteria
Commitment as a major selection criteria
Career ladders and progression
No compulsory redundancy
Single status
Merit pay of production workers
Profit-sharing for production workers

From this document u can more details http://www.niesr.ac.uk/pdf/280808_140035.pdf

What is HR Strategy?

HR Strategy is deciding a strategic objective and plan/deploy resources to achieve them. They are end results of Strategic HRM Process.

How to choose HR strategy?

There are three approaches to choosing a HR strategy.

Approach 1: Best Practices strategy.
It believes that there are set of best HR practices which if implemented would result in superior performance.

Approach 2: Best Fit strategy

This involves choosing strategy out of the practices which would best fit in terms of Business alignment as well as culturally in an Organization.

Approach 3: Bundling

It using interrelated and interactive HR Practices which are Horizontally and vertically.
Examples:
Calculative practices
1. Training
2. Share-options
3. Evaluation of HR

4. Profit-sharing
5. Group-bonus

6. Merit-pay

Collaborative practices
7. Joint HR-Mgt

8. Communication on strategy

9. Communication on finance

10. Communication on change
-
11. Communication on organisation of work

12. Communication to management

13. Wider-jobs

Intermediary practices
14. Career
15. RIFs