MBA-SHRM

SHRM: NEW APPROACH TO HRM

LECTURE-2

1. THE CONCEPT OF SHRM

2. HENDRY AND PETTIGRE`S TYPOLOGY
3. SHRM-A NEW APPROACH
4. STRATEGIC FIT
5. STRATEGIC INTEGRATION
6. THE REQUIREMENTS OF SHRM
 THE CONCEPT OF SHRM

 SHRM is an approach to making decisions on the

intentions of the organisation concerning people
essential components of the organisation`s business
strategy.
 It is about the relationship between HRM and strategic
management in the organisation.
 SHRM deals with `those HR activities used to support
the firms competitive strategy (Wright & Snell, 1989).
 The Means of aligning the management of Human
Resources with the strategic content of the business
(Walker, 1992)

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 HENDRY & PETTIGRE`S TYPOLOGY

According to Hendry and Pettigrew (1986), SHRM has

four meanings:
1. The use of planning
2. A coherent approach to the designed management of
personnel systems based on an employment policy
and manpower strategy and often underpinned by a
philosophy.
3. Matching HRM activities and policies
4. Seeing the people of the organisation as a strategic
resource for the achievement of competitive
advantage.

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 THE MAIN FEATURES OF SHM

According to Dyer and Holder (1988):

 Organisational level
 Focus-strategies are business driven and focus on
organisational effectiveness, thus in this perspective
people are viewed as resources.
 Framework: incorporate a full complement of HR goals
and activities.
 Roles: strategy-making generally is the responsibility of
line managers, with personnel playing a suppotive role.

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 SHRM-NEW APPROACH
 SHRM means Strategic Fit
 SHRM means Strategic integration
 SHRM means competitive advantage
 SHRM means long term consequences
 SHRM means deployment of committed,
dedicated and retainable workforce.
 SHRM means distinctive capabilities

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 STRAEGIC FIT
A `fir` organisation possesses the capabilities to
successfully implement its strategy. These capabilities
include:
 Coordination
 Commitment
 Competence (technical, management & leadership)
 Communication
 Creativity
 Capacity management-allocating resources to fit the
strategy.

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 STRATEGIC INTEGRATION

 HR strategies should be integrated with

corporate or business strategies.
 Strategic integration is necessary to provide
congruence between business and human
resource strategy so that the latter supports
the accomplishment of the former and indeed
helps to define it.
 The aim is to provide strategic fit and
consistency between the policy goals of HRM
and the business.

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 MODELS FOR SHRM

 THE HIGH COMMITMENT MANAGEMENT MODEL

 THE HIGH PERFORMANCE MANAGEMENT MODEL
 THE HIGH INVOLVEMENT MODEL

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 THE HIGH COMMITMENT MANAGEMENT MODEL

The approaches to achieving high commitment as

described by Beer et al (1984) and Walton (1985) are:
 The development of career ladders and emphasis on
trainability and commitment as highly valued
characteristics of employees at all levels in the org.
 High level of functional flexibility
 The reduction of hierarchies
 Mutual interest

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 THE HIGH PERFORMANCE MANAGEMENT MODEL

 HPMM aims to make an impact on the performance through its

people in such areas as productivity, quality levels of customer
service, growth profits.
 Careful and extensive systems for recruitment, selection and
training
 Clear job design
 High-level participation processes
 Monitoring attitudes
 Performance appraisal
 Promotion and compensation schemes

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 THE HIGH INVOLVEMENT MODEL

 Treating employees as partners in the

enterprise.
 Dialogue
 Mutual understanding
 Framework for managing and developing
people
 Shared vision and corporate culture
 Unified voice In matters

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 THE REQUIREMENTS OF SHRM

 Strong visionary, and often charismatic leadership

from the top.
 Well articulated missions and values
 A clear expressed business strategy, which had been
implemented successfully.
 A positive focus on well understood critical success
factors.
 The organisation offers a closely related range of
products or services to customers.

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