Strategic Human Resource Management
Strategy Abell’s (1993) ‘ mastering the present and pre-empting the future.StrategyIt is forward looking.It is about deciding where you want to go and how you mean to get there.
Strategy formulation
The process of deciding on a strategic direction by defining a company’s mission and goals, its external opportunities and threats, and its internal strengths and weaknesses
Formulation of Strategy
It is a process for developing a sense of direction and ensuring strategic fit.
Whittington model1. Define the mission2. Set objectives3. SWOT4. Analyze existing strategies5. Define the light of the analysis
Formulation of Strategy
6. Define the key strategic issues7. Determine corporate and functional strategies8. Prepare integrated strategic plans for implementing strategies.9. Implement the strategies10. Monitor implementation and revise.
Concept of SHRM
Strategic HRM is an approach that defines how the organization’s goals will be achieved through people by means of HR strategies and integrated HR policies and practices.
Strategic HRM focuses on actions that differentiate the firm from its competitors.
Fitting HR characteristics to competitive strategies
• Innovation Strategy• Quality Strategy• Cost Leadership Strategy
Challenges related to technology
• Telecommuting• Employee Surveillance and Monitoring• e-HR• Ethical Behavior• Intrapreneurship at intel- New Business
Initiative (NBI)• Workforce Demographic changes and diversity
Challenges in SHRM- demographics changes on job satisfaction
A shifting Industrial BaseAgeGenderImmigrationCompany sizeCommunicationWork/life balanceRelationship with supervisorCareer development and opportunitiesJob securityBenefits and Compensation
5- P Model
• HR Philosophy• HR Policies• HR Programs• HR Practices• HR Processes
Traditional HR Vs strategic HRResponsibility for HRStaff specialists- Line managers
FocusEmployee relations - internal /external customers
Role of HRTransactional, change follower, and respondentTransformational, change leader, and initiator
InitiativesSlow, reactive, fragmentedFast , proactive, integrated
Traditional HR Vs strategic HRTime horizonshort term short, medium, long
ControlBureaucratic-roles, policies, proceduresOrganic- flexible
Job designTight division of labor, independence, specializationBroad, flexible, cross-training, teams
Key investmentsCapital , Products People, Knowledge
AccountabilityCost center Investment center
Barriers to strategic HR• Short term mentality/ focus on current performance• Inability of HR to think strategically• Lack of appreciation of what HR can contribute• Failure to understand general manager’s role as an
HR manager• Difficulty in quantifying many HR outcomes• Perception of human assets as higher-risk
investments• Incentives for change that might arise
Best- HR Practices
General Electric (GE)Leadership ProgrammeSuccession PlanningLearning and Development360 degree performance appraisalRegular employee satisfaction surveysFlattened organization structure
Best- HR Practices
WIPRO1. Recruitment2. Succession Planning3. Rigorous Leadership Training Programme4. Open and Transparent5. Family like work atmosphereINFOSYS1. Competency based HR Practices2. Promoting based on competencies3. Continuous appraisal Process4. Developing Training programmes
Best- HR Practices
South West Airlines- ‘LUV’ & ‘FUN’- Value creating-Value capturing-Value sharing- Rigorous Training Programme-Treat employees well
Best- HR Practices
• IBMDeveloping LeadersClassroom and internet coursesWork-life balanceVariable pay program based on Individual performance.Changing Technology- Strategy
• Hero HondaEmployment engagementDeveloping leadership skills through broad visionFamily like work atmosphereUniformity in Dress codes
Best- HR Practices
• CaterpillarWelfare and Fringe benefitsIncentive (Profit sharing)Flexible hoursFood Coupon PassOn –the- job and Off-the –job Training
Best- HR Practices• TCS
-Competency Mapping exercises- Balanced Scorecard- Benchmarking of remuneration Strategies with that of the industry- Performance Linked Variable Compensation
OthersDiversity in the work place (Intel)HPWS (high performance work systems)HR Value chain-employee, organizational, financial& accounting and market basedIntelligence Vs Conscientiousness
Sarasota Memorial Hospital
“Pillars of exellence”Service, people, quality, finance and growth
Cross functional teamsLeadership developmentService recoveryReward and recognitionInpatient, outpatient satisfactionCustomer satisfaction increased from 43% to 97%
First Tennessee National Corporation
HR -Maximize Financial performance-Demonstrate to shareholders the value added benefits of HR programs and policies-Strategic Partnership-HR and finance
HR Strategies
• HR Strategies• Purpose• Types• Main areas in Which HR Strategies are developed• Criteria for an effective HR Strategy• Development of HR Strategy• Implementation of HR Strategy
HR roles at Mercantile Bank
• Strategic partner• Change agent• Administrative expert• Employee Champion
-1990’s strategically redesigned its HR functions-record keeping and compliance-streamlining work processes, eliminating unnecessary activities-reevaluating technology, outsourcing non strategic functions.-39 M& A’s
Barriers to strategic HR
• Short term mentality/focus on current performance
• Inability of HR to think strategically• Lack of appreciation of what HR can contribute• Failure to understand general manager’s role as an
HR manager• Difficulty in quantifying many HR outcomes• Perception of human assets as higher-risk
investments• Incentives for change that might arise
Strategic reorganization of the HR at GE
• Decentralization• 3T’s- technology ,talent and transformation.
Design of work systems
Job Enlargement
IBM -Product quality-Reduction in idle time
Eli Lilly Pharma-Salary increases-Promotions-Career development opportunities
Design of work systems
• Job enrichment• Job rotation
U.S. and Japanese Culture1. Conflict and conformity2. Power and hierarchy3. Time orientation4. Cultural and demographic homogeneity
Employment Law
• EEOC pay’s $1 million to the victims of sexual harassment case.
• Equal Pay Act• Racial Discrimination at Coca-cola
Staffing
• Kroger Co -1,400 supermarkets , 200,000 employees -45 min
• Turnover Cost differs based on sectors• Recruiting- Temporary versus Permanent
employees - Internal versus External
Recruiting
Recruiting
Internal-AdvantagesHave performance data availableMotivationalLess training/socialization timeFasterLess Expensive-DisadvantagesPossible Politics“Loser” effectsInbreedingPromotions chain
Recruiting
ExternalAdvantagesFresh ideas and viewpointsExpand Knowledge baseDisadvantagesUnknown entitiesDetrimental to internal applicantsTraining and socializationTime consumingCan be expensive
Recruiting
When and how extensively to recruitStages of Recruiting Process which takes 15 weeks.Accept Job Offer 10Receive job offer 15Attend Second Interview 30Invited to Second Interview 40Invited to first interview 60 Applicants 120
Recruiting
Methodsword of mouthinternetJ & J (employee referral)
Staffing at St.Peter’s Health Care- nurses biding for shifts at a rate/hrOutsourced Recruitment at KelloggCollege Recruiting via Internships at MicrosoftCall – Center Staffing at Capital One-VISA credit cards , consumer Master Card –extensive assessments in selection.
Training and Development
• Benefits of Training and Development• Planning and Strategizing Training• Integrating Training with Performance systems
and compensation• *Marketing Products• *e-Training• *Boot camp (exposed and committed to
culture)
T &D
T & D frameworkPlan Do Check Act
Targeting and the four P’s of Training level analysisPlaceon-the-joboff- the –jobEquipment required
T &D• Product
purpose, content , constraint, Presentation option• Promotion
Strategic Planning InvolvementCompany newsletterPersonal communicationWord-of-mouth
• Price (budget)EmployeesmaterialsEquipmentTravel
Employee Separation
Layoffs at KodakRange of services
Allowance of two weeks’ pay for each year of employmentretained medical, dental, and life insurance for four months;outplacement counseling; and a retraining allowance of up to $5000 for schooling.
