strategic human resource management strategy abell’s (1993) ‘ mastering the present and...

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/hr

Outsourced 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.