Organizational Life-Cycle Stages

and HR Activities
LIFE- TRAINING LABOR /
CYCLE STAFFING COMPENSATION AND EMPLOYEE
STAGE DEVELOPME RELATIONS
NT
Introductio Attract best Meet or exceed Define future Set basic
n technical and labor market skill employee-
professional rates to attract requirements relations
talent. needed talent. and begin philosophy
establishing of
career ladders. organization
Growth Recruit Meet external Mold effective .Maintain
adequate market but management labor peace,
numbers and consider internal team through employee
mix of qualifies equity effects. management motivation,
workers. Plan Establish formal development and morale.
management compensation and
succession. structures. organizational
Mange rapid development.
internal labor
market
movements
 Organizational Life-Cycle
Stages and HR Activities
(cont’d)
LIFE- TRAINING AND LABOR /
CYCLE STAFFING COMPENSATIO DEVELOPMENT EMPLOYEE
STAGE N RELATIONS

Maturity Encourage Control Maintain Control labor

sufficient compensation flexibility and costs and
turnover to costs. skills of an aging maintain labor
minimize layoffs workforce. peace. Improve
and provide new productivity.
openings.
Encourage
mobility
Decline Plan andas Implement Implement Improve
reorganizations
implement tighter cost retraining and productivity and
shift jobs around.
workforce control. career consulting achieve
reductions and services. flexibility in
reallocations, work rules.
downsizing and Negotiate job
outplacement security and
may occur during employment-
this stage. adjustment
policies
COKE
Hires Graduates , with no corporate exp ,
invests in Training
Life time employment , Seniority based
salary increments
HRM produces career managers
PEPSI
Hires exp employees
Fast tracks employees with high talent
Continuous flow of new ideas
Hiring and firing employees
Strategic HRM
Interrelated practices , policies and
philosophies that facilitate the attainment of
organizational strategy
Human Capital : Intangible asset
The sum of employees’ knowledge , skills ,
experience , and commitment invested in the
organization .
Employees as Strategic
Resources
Porter estimates that it takes
approximately 7 years to duplicate a
competitive edge in Human Resources
The less a resource can be imitated the
more durable is the source of competitive
advantage
These resources cannot be imitated as
their effectiveness is embedded in the
systems and culture that allow them to
work productively
The Risks of Strategic
Planning
A HR Plan for the future may raise employees
expectations for life time jobs . In times of
recession it will result in jobs losses
Orgn may become blinded in implementation
and lose flexibility
Eg Hindustan Motors
Linking HR Processes To
Strategy
Form Organization Strategy than create
HR Strategy Eg McDonald
Create HR Competencies and than create
corporate strategies based on them Eg
Infosys into Japanese and Chinese Markets
A Combination of Both in a form of
reciprocal relationship
HR Strategy-------Business Stgy-------HR
Strategy
HR Becomes a Business Partner
Must be able to understand analysis
presented by Marketing , Financial and
Operational Managers
Eg Big Bazaar , Low cost strategy
HR has to develop strategies to deal with rapid
training and High Turnover rates
Getting Involved in the Strategic
Plan Process
Member of the executive Team
Review / React Linkage
Integrative Linkage
HR Strategy by Division
Microsoft
HR Practices that support innovation in the R &
D Branch
Policies that support low cost in the
Manufacturing Branch
To achieve equality Employee benefits to be the
same in both locations
Using National /International Labor pool eg
Nike
Characteristics of an Effective HRM
Strategy
External Fit eg Strategy based on Service , T
& D aligned to the above
Internal Fit eg BPO 24* 7 CSE , Shift
Differentials
Focus on Results
MILES & SNOW’S Organisational
Types
Defender – Low cost Opr , Focus on Efficiency
by Std jobs
Prospector –Innovation & Adaptation through
Investments in R & D ,
Analyzer --- Scan Competitors and react
Reactor ---No apparent Strategy
Ex HR Alignment with 2 strategies
of Porter
Low cost & Differentiation

Employee
HR Planning
Selection
Compensation
Training
Performance Evaluation
Thank you
Please read case 1 from your case booklet And
the chapter on Job Analysis