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7/28/2019 04 HR Strategies
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LECTURE 04
HR Strategies
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Contents
Importance of HR to Strategy
What are HR Strategies
Types of HR Strategies
Criteria for an Effective HR Strategy
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IMPORTANCE OF HR TO STRATEGY
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Importance of HR to Strategy
Providing Competitive Advantage (CA) Michael E Porter HRM is the key to obtaining CA
CA can be obtained through a high quality workforce, whichenables organizations to compete on the basis of marketresponsiveness, product and services quality, differentiated
products and technological innovation Rush to competencies
Controlling Labor Costs
Eliminating inefficient use of workforce underutilizedworkers, lack of trust, resistance to change, antagonistic labor-
management relations, motivation problems, and restrictivework practices leading to low productivity
Better HR utilization would prove to be more cost efficientthan investing in plant and equipment.
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Importance of HR to Strategy (Contd.)
Rush to competencies (Contd.)
Potential cost efficiencies and improved HRM would play a key
role in organizations competitive strategy and development of
distinctive competencies
Awareness of the demands of the technologically advancedenvironment of the future
Means of buffering environmental uncertainty
Gauging effects of environmental turbulence, globalization,
technology, dramatically changing demographics and differencesin workforce values
Through congruence/consistency between HR and strategy
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Importance of HR to Strategy (Contd.)
HR Contributions to Strategy: -
1. Environmental Scanning and Competitive Intelligence
2. Implementation of Resource Reallocation Decisions
3. Lead time for dealing with Labor Shortages
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WHAT ARE HR STRATEGIES?
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What are HR Strategies?
HR strategies set out what the organization intends to do about its
HRM policies and practices and how they should be integrated
with the business strategy and with each other
As per Dyer and Reeves: -
Internally consistent bundles of human resource practices
Richardson and Thompson: -
A strategy whether it is an HR strategy or any other kind of
management strategy, must have two key elements: there must be
strategic objectives (i.e. things the strategy is supposed toachieve), and there must be a plan of action (i.e. the means by
which it is proposed that the objectives will be met)
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TYPES OF HR STRATEGIES
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Types of HR Strategies
Types: -
Overall HR Strategies
These describe the general intentions of the organization about howpeople should be managed and developed and what steps should betaken to ensure that the organization can attract and retain the
people it needs and ensure so far as possible that employees arecommitted, motivated and engaged.
Categories: -
An emergent, evolutionary and possibly unarticulated understanding ofthe required approach to HRM. This will be influenced by the BusinessStrategy, organizations life-cycle and the views, experiences and
management style of the chief executive, manager, HR Head, etc. Broad brush statements of aims and purpose that set the scene for more
specific targets. These are concerned with overall organizationaleffectiveness
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Types of HR Strategies
Types: -
Overall HR Strategies
Categories (Contd.): -
Specific plans to create bundles of HR practices and develop a coherent
HR system Overall approaches to HRM: -
High Performance Management
High-Involvement Management
High-Commitment Management
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Types of HR Strategies
Types: -
Specific HR Strategies
Human capital management
High performance management
CSR OD
Knowledge management
Talent management
Resourcing
Learning and development Reward
Engagement
Employee Relations
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CRITERIA FOR AN EFFECTIVE HR STRATEGY
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Criteria for an effective HR Strategy
Would satisfy business needs
Would be founded on detailed analysis
Can be turnable into actionable programmes
Is coherent and integrated
Takes into account the needs of line managers and employees
generally as well as those of the organization and its other
stakeholders