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Strategy

Strategy is deciding where to go and the


means to get there.
Strategy is a declaration of intent.

Some Organisational Strategies

Company

Strategic Principle

General
Electric

Be number one or number two in


every industry in which we
compete, or get out

Wal-Mart

Low prices, every day

3M

Foster innovation

Strategic Planning

There are three levels of strategic planning Corporate


Strategy

Business
Strategy

Business
Strategy
Functional
Strategies

Business
Strategy

Types of Strategic Planning

Corporate-level strategy
Identifies the portfolio of businesses that, in total,
comprise the company and the ways in which these
businesses relate to each other.
Diversification strategy
Vertical integration strategy
Consolidation strategy
Geographic expansion strategy

Types of Strategic Planning


(contd)

Business-level/competitive strategy
Identifies how to build and strengthen the businesss
long-term competitive position in the marketplace.
Cost leadership
Differentiation
Focus

Types of Strategic Planning

(contd)
Functional strategies
Identify the basic courses of action that each
department will pursue in order to help the
business attain its competitive goals.

Business Strategy = Overall Cost


Leadership

Common Organizational
Characteristics

Intense supervision of
labor
Tight cost control
requiring frequent,
detailed control reports
Low-cost distribution
system
Structured organization
and responsibilities
Products designed for
ease in manufacture

HR Strategies

Detailed work planning


Emphasis on technical
qualifications and skills
Emphasis on job-specific
training
Emphasis on job-based pay
Use of performance
appraisal as a control device

Business Strategy =
Differentiation

Common Organizational
Characteristics

Strong marketing
abilities
Product engineering
Corporate reputation for
quality or technological
leadership
Amenities to attract
highly skilled labor,
scientists, or creative
people.

HR Strategies

Emphasis on innovation
and flexibility
Broad job classes
Loose work planning
External recruitment
Team-based training
Emphasis on individualbased pay

Business Strategy = Focus

Common Organizational
Characteristics

Combination of costleadership and


differentiation
strategy directed at a
particular strategic
target.

HR Strategies

Combination of HR
strategies of the
other two
strategies.

Achieving Strategic Fit

Michael Porter
Emphasizes the fit point of view that all of the firms
activities must be tailored to or fit its strategy

Gary Hamel and C. K. Prahalad


Argue for stretch in leveraging resources
supplementing what you have and doing more with what
you have

STRATEGIC HUMAN RESOURCE


MANAGEMENT

Linking HRM with strategic goals and objectives to


improve business performance and develop
organizational cultures fostering innovation and
flexibility.

Defines the organisations intentions and plans on how


its business goals should be achieved through people.

Linking Corporate and HR Strategy


External
environment

Formulate Business
Strategy

Internal
Strengths &
Weaknesses

Identify Employee Competencies and


Behaviors that HR must deliver to achieve the
strategy
Formulate HR Policies & Activities that will lead
to these Employee Competencies and Behaviors

HRs Strategic Roles

Identify the human issues that are vital to


business strategy.

Help establish and execute strategy.


Provide alternative insights.

Are centrally involved in creating responsive


and market-driven organizations.
Conceptualize
change.

and

execute

organizational

HRs Strategy Formulation Role

HR helps top management formulate strategy in a variety


of ways by.
Supplying competitive intelligence regarding the external
environment
Supplying information regarding the companys internal
human strengths and weaknesses.
Showing how the firms HR activities can and do
contribute to creating value for the company.

HRs Strategy Execution Role

The HR departments strategies, policies, and


activities must make sense in terms of the
companys corporate and competitive
strategies, and they must support those
strategies.

Implications
of
SHRM

Successful SHRM efforts begin with identification of strategic


needs.

Employee participation is critical to linking strategy and HR


practices.

Strategic HR depends on a systematic and analytical mindset.


Corporate HR departments can have an impact on their
organizations efforts to launch strategic initiatives.

HRs evolving role as


Strategic
Partner

Corporate strategy
HR operations

Corporate strategy
HR operations
Corporate strategy

HR function
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HRD CULTURE - O C T A P A C E

O Openness
C Collaboration
T Trust
A Authenticity
P Proactivity

A Autonomy
C Confrontation
E Experimentation
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