Professional Documents
Culture Documents
Strategic human resource management is designed to help companies best meet the
needs of their employees while promoting company goals. Human resource
management deals with any aspects of a business that affects employees, such as
hiring and firing, pay, benefits, training, and administration. Human resources may also
provide work incentives, safety procedure information, and sick or vacation days.
In Human Resource (HR) and management circles nowadays there is much talk about
Strategic Human Resource Management and many expensive books can be seen on
the shelves of bookshops. But what exactly is SHRM (Strategic Human Resource
Development), what are its key features and how does it differ from traditional human
resource management?
Definition of SHRM
In the last two decades there has been an increasing awareness that HR functions were
like an island unto itself with softer people-centred values far away from the hard world
of real business. In order to justify its own existence HR functions had to be seen as
more intimately connected with the strategy and day to day running of the business side
of the enterprise. Many writers in the late 1980s, started clamoring for a more strategic
approach to the management of people than the standard practices of traditional
management of people or industrial relations models. Strategic human resource
management focuses on human resource programs with long-term objectives. Instead
of focusing on internal human resource issues, the focus is on addressing and solving
problems that effect people management programs in the long run and often globally.
Therefore the primary goal of strategic human resources is to increase employee
productivity by focusing on business obstacles that occur outside of human resources.
The primary actions of a strategic human resource manager are to identify key HR
areas where strategies can be implemented in the long run to improve the overall
employee motivation and productivity. Communication between HR and top
management of the company is vital as without active participation no cooperation is
possible.
Facts [+]
The Center for Human Resources at the University of Pennsylvania was founded in 1921.
The Center's mission is to foster research on the strategic role of HR management in
such areas as employment, labor relations, public policy, diversity, and training and
education. The Center supports its mission through research, regular meetings,
information bulletins, and conferences and public forums.
Benefits of SHRM
1. Identifying and analyzing external opportunities and threats that may be crucial to
the company's success.
Barriers of SHRM
Barriers to successful SHRM implementation are complex. The main reason is a lack of
growth strategy or failure to implement one. Other major barriers are summarized as
follows:
3. Interdepartmental conflict.
17. Economic and market pressures influenced the adoption of strategic HRM.
The aim of this report is to study and analysis the difference between Strategic
HRM and conventional HRM in different points in business field.
With the fast changing environment of the business, economic globalization and
the competition among businesses increase fierce led to the business rethink
how to organize and management the human resource. Since the traditional HRM
aim to daily administration management cause the HRM is shortage of strategic
and guiding the management system thus cannot response to the complex,
changeable, expanse environment which brought us an increasing number
demanding of flexible and innovation the changes in strategy. Reduced
productivity of workers and industrial innovation deteriorate, the traditional HRM
facing the big challenge. All these changes forced the professionals and
managers thinking deeply of the source of advantage of the competitive. Most of
them started to find out from inner business, then the based on resources, ability
and knowledge the competitive statement developed. The roots of HRM go back
as far as the 1950s, when writers like Drucker and McGregor stressed the need
for visionary goal-directed leadership and management of business integration
(Armstrong, 1987).
In the nearly 20 years, SHRM in research content and scope got lots of progress.
The main shortcoming: Steering based on the strategic management of the
resource base from environment-based strategic management.
Business strategy
Typologies for characterizing the business strategies used by firms abound, but
the two most frequently cited in discussions of HRM were proposed by
Miles&Snow (1978) and Porter (1980, 1985). Miles& Snow classified organizations
as prospectors, analysers, or defenders. Prospectors actively seek new products
and markets and, therefore, seek to grow; analysers also seek to grow, but in a
more stable and predictable way through the internal development of new
products rather than creation of new markets; Porters (1985) competitive
strategies distinguish among firms that compete on the basis of cost leadership,
product differentiation, and market focus. According to the above analysis,
strategic HR offers three critical outcomes: increased performance enhanced
customer and employee satisfaction and increased shareholder value. These
outcomes are accomplished through effective management of staffing, retention
and turnover processes, selection of employees that fit with both the
organizational strategy and culture, cost effective utilization of employee
through investment in identified human capital with the potential for higher
return ; integrated HR programs and policies that clearly follow from corporate
strategy facilitation of change and adaptation through a flexible more dynamic
organization ;and tighter focus on customer needs, emerging markets and
quality.( Charles J. Fombrun and Noel M.Tichy and Mary Anne Devanna; 1984)
Focus
In SHRM, except focus on whether the candidates suitable for the particular
position with job matching, they also pay special attention to the values of the
candidate meets the company's core values, whether the company can provide
other factors for the candidate development expectations of future to ensure
that the recruitment of candidates long-term services for enterprises. Knowing
who to let go can be just as important as knowing who to promote when building
a happy, productive workforce. (David Ingram; No Date)
Performance appraisal
According to the needs of corporate strategic, SHRM based on combining with
the staff capacity to develop a comprehensive performance management
system, concerned about the enterprise wide performance management,
including performance planning, performance assessment, performance
evaluation, performance feedback and performance incentives, the whole
process; Paying more attenuation to performance feedback corporate
performance and incentives, to ensure that employees continuously improve
performance while enabling spiralling. Traditional HRM is only concerned with
the performance evaluation and punishment, most of them play the role of the
corporate police are only responsible for the fault finding, find loopholes, it is
impossible to form a scientific performance management system. ( Charles J.
Fombrun and Noel M.Tichy and Mary Anne Devanna; 1984)
Reward system
The SHRM role of reward systems is to consider what behavioural impact they
can have in organizations. The research so far on reward systems suggests that
potentially they can influence the following factors which, in turn, influence
organizational effectiveness.
Motivation
Culture
Cost
The design of an effective reward system demands not only a close articulation
between the business strategy of an organization and the reward system, but
also a clear fit between the reward system and the other design features of the
organization. The implication of these for-reward systems, it is also impossible to
design an effective reward system in the absence of knowing how other design
features of the organization are arrayed. So the key strategic decisions about the
reward system need to be made in an interactive fashion in which tentative
reward system design decisions are drive by the business strategy and then are
tested against how other features of the organization are being designed.
Conventional
With strategy
Promotion
Open posting for all jobs; Decision-making process through all the groups
Status symbols
A great many, carefully allocated on the basis of job position
Base rate
Incentive plan
Piece rate
Communication policy
Individual rates, salary survey data, all other information made public
Decision-making locus
Top management
Training
SHRM based on the need of enterprise development, offering the full systematic
completely training program for individual development. Ensure a steady stream
of transport required for various types of talent for the enterprise to achieve the
rapid development of enterprise and staff career development of win-win.
Conventional HRM is responsible only for new employees into the enterprise
organization and discipline, labour safety, quality management and other aspects
of training, and rarely will organize the training of employees; limited to
departments limitations reasons, it is not possible to establish a comprehensive
human resource training and development system.
Performance Management
Summary
2. Definition
3. Key Differences
4. Conclusion
Comparison Chart
BASIS FOR
HRM SHRM
COMPARISON
Traditional and strategic human resources models differ significantly from each other. Many
businesses have moved toward the strategic HR model because of its utility in building a
business. Strategic human resources management is geared toward developing strategic
plans that fit within the larger structure of the company's plans, whereas traditional HR
management is almost purely administrative in nature. Understanding the difference
between traditional and strategic human resources can be important for the development of
your small business.
1. Examine the role of human resources managers as they have been traditionally
understood. Human resources managers are often perceived as individuals responsible for
hiring and recruiting workers for open jobs within a company or corporation. Aside from the
hiring and recruiting aspect of the their job, human resources managers and professionals
spend a considerable amount of time performing administrative tasks such as completing
paperwork for new employees or training them for their new positions.
2. Note the primary difference in strategic HR, which is the fact that strategic human
resources professionals are recognized as being strategic partners within the company. They
work alongside top executives and other management professionals to determine how to
best fit human resources initiatives within the overall strategic trajectory of the organization.
Company strategy plays a more important role in the development of human resource
policies than do basic administrative matters.
3. Recognize how the roles of the human resources manager traditionally have been defined.
Traditional HR managers are primarily concerned with the acquisition and exit of workers
from an organization. They also have played a role in training and development that is
integral to the functioning of the company for which they work. Aside from these duties,
human resources managers also administer pay plans and benefits received by employees.
4. Compare the differences between the two models. Traditional HR management lacks focus
on the overall strategic initiatives of the company, whereas these are primary in strategic
human resources management. Human resources policies and procedures revolve around
these strategic plans and are developed in response to these plans. The traditional human
resources department may develop policies in response to such plans, but it does not
necessarily play an integral role in the planning process.