Snell 17e PPT Instructor Ch02

Chapter 2
Strategy and
Human
Resources
Planning
Copyright
Copyright©2016
©2016Cengage
CengageLearning.
Learning.All
AllRights
RightsReserved.
Reserved.May
Maynot
notbebescanned,
scanned,copied
copiedororduplicated,
duplicated,ororposted
postedtotoa publicly
a publiclyaccessible
accessiblewebsite,
website,ininwhole
wholeororininpart.
part.
Learning Outcomes
Explain how human resources planning and a firm’s
mission, vision, and values are integrally linked to its
strategy
Understand how an organization’s external
environment influences its strategic planning
Understand why it is important for an organization to
do an internal resource analysis
Explain the linkages between competitive strategies
and HR
Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 2
Learning Outcomes
Understand what is required for a firm to successfully
implement a strategy and assess its effectiveness
Describe how firms evaluate their strategies and HR
implementation
Strategic Planning and Human
Resources
Strategic planning
Procedures for making decisions about the
organization’s long-term goals and strategies
Human resources planning (HRP)

Process of anticipating and providing for the movement
of people into, within, and out of an organization
Strategic Human Resources
Management (SHRM)
Pattern of human resources deployments and
activities that enable an organization to achieve its
strategic goals
Combines strategic planning and HR planning
Strategy formulation - Provides input as to what is
possible given the types and numbers of people available
Strategy implementation - Makes resource allocation
decisions to implement the devised strategy
Alignment of HRP and Strategic Planning
Two-way process
A firm’s HR strategy follows the business strategy and
helps implement it
People, culture, and climate of a company constrain a
firm’s ability to achieve strategically
Step One: Mission, Vision, and Values
Mission
Basic purpose of the organization and its scope of
operations
Strategic vision
Clarifies the long-term direction of the company and its
strategic intent
Core values
Strong and enduring beliefs and principles that the
company uses as a foundation for its decisions
Developing a mission statement
Factors to be considered
 Organization’s reason of existence
 Need fulfilled by the organization in comparison to the
competitors
 Knowledge of the need and methods for fulfilling them
 Knowledge of market and the customers
 Core values of the firm that will be practiced by the employees
HR’s role
Communicates mission, vision, and values frequently
informally and formally
Recruit and hire employees whose values are consistent
with the organization
Translate mission, vision, and values into:
 Specific on-the-job behaviors
 Job descriptions
 Basis of employee rewards
Step Two: External Analysis
Environmental scanning: Systematic monitoring of
major external forces influencing the organization
Business environment: Factors that a firm cannot
directly control but can affect its strategy
Remote environment: Forces that generally affect
specific firms
 Economy and ecological, technological, social, demographic,
and legal and regulatory changes
Step Two: External Analysis
Competitive environment: Consists of a firm’s specific
industry
 Includes the industry’s customers, rival firms, new entrants,
substitutes, and suppliers
HR’s external analysis
 Changes in a firm’s remote and competitive environments are
monitored and analyzed
 Affect hiring plans, recruitment and replacement polices
Figure 2.2 - Five Forces Framework
Step Three: Internal Analysis
Core capabilities: Integrated knowledge sets within
an organization
Distinguish the organization from its competitors and
deliver value to customers
Value creation: What the firm adds to a product or
service by virtue of making it
 Value = benefits – costs
Resources of core capabilities
Processes - Standard routines for how work will be done
and results will be accomplished
Systems - Information systems, databases, and
proprietary technologies
People - Includes knowledge, skills, and abilities of
employees used to create value for customers
Criteria for sustaining competitive advantage
Resources should be:
 Valuable
 Rare
 Difficult to imitate
 Organized
Trends of employment relationships and HR practices
Strategic knowledge workers
 Hold unique skills directly linked to the company’s strategy
 Difficult to replace
Core employees
 Skills are transferable
 Managers invest less in training and development
Supporting workers
 Scope of duties is limited
 Employment relationships are transaction-based and focused
on rules and procedures
External partners
 Hold skills that are unique and specialized
 Skills are not related to the company’s core strategy
Figure 2.3 - Mapping Human Capital
Cultural audits: Audits of the culture and quality of
work life in an organization
Firm surveys its employees on how they feel about a
number of issues
Identifies groups with different views about the nature
of work and how it should be done
 Clan culture - Employees are closely knit and exhibit concern
for one another
 Values their customers, loyalty, and cohesion
 Adhocracy culture - Characterized by risk-taking, innovation,
and a spirit of entrepreneurship
 Market culture - Encourages competitive, result-oriented
behaviors
 Hierarchical culture - Characterized by formal structures and
procedures
 Values efficiency and stability
Value-based hiring: Outlining behaviors that

exemplify a firm’s corporate culture and hiring people
who are a fit for them
Forecasting - Key elements
Forecasting demand for labor
Forecasting supply of labor
Balancing supply and demand considerations
Figure 2.4 - Model of HR Forecasting
Forecasting a firm’s demand for employees
Quantitative approaches
 Trend analysis: Forecasts labor demand based on an
organizational index such as sales
 Modeling or multiple predictive techniques - Combine several
factors to predict employment levels
Qualitative approaches
 Management forecasts: Opinions of supervisors,
department managers, or experts, knowledgeable about the
organization’s future employment needs
 Delphi technique - Solicits and summarizes judgments of a
preselected group of individuals
Forecasting the supply of employees
Staffing tables: Graphic representations of all
organizational jobs
 Contains numbers of employees currently occupying those
jobs and future employment requirements
Markov analysis: Tracks the pattern of employee
movements through various jobs
 Quality of fill: Metric designed to measure how well new
hires are performing on the job
Skill inventories: Files of personnel education,
experience, interests, and skills
 Allow managers to quickly match job openings with employee
backgrounds
Management inventories - Data gathered on managers
Replacement charts: Listings of current jobholders
and potential replacements if an opening occurs, used
for succession planning
 Succession planning: Identifying, developing, and tracking
key individuals for executive positions
Human capital readiness: Evaluating the availability
of critical talent in a company and comparing it to the
firm’s supply
Difference between the quantity and quality of
employees required and available represent the gap that
needs to be remedied
Provides managers a foundation to establish future
strategy and specific requirements for developing talent
to implement it
Step Four: Formulating Strategy
SWOT analysis: Comparison of strengths,
weaknesses, opportunities, and threats for strategy
formulation purposes
Strategy formulation builds on SWOT analysis to
devise a coherent course of action
Corporate strategy
Growth and diversification
Mergers and Acquisitions
Strategic alliances and joint ventures
Business strategy
Low-cost strategy
 Focuses on efficiency, productivity, and minimizing waste
 Linked to HR planning through productivity and outsourcing
activities
Differentiation strategy
 Based on delivering high-quality products, innovative
features, speed to market, or superior service
Functional Strategy
Vertical fit/alignment
 Focuses on the connection between the business objectives

and the major initiatives in HR
Horizontal fit/alignment
 Aligning HR practices with one another internally to establish
a configuration that is mutually reinforcing
Step Five: Strategy Implementation
Organizations strive for balance between demand and
supply considerations
Demand is based on forecasted trends in business
activities
Supply depends on locating required human resource
To meet human resources demands, organizations

have staffing options
Figure 2.9 - The 7-S Model
Step Five: Strategy Implementation
If labor shortage is acute, company develops talent from
ground up
Firms restrict hiring, reduce their employees’ work
hours, and consider layoffs when forecasts project
surplus employees
Organizations have to be prepared to exit and enter new
lines of business, restructure, outsource, offshore and
downsize
HR managers should ensure no laws are violated while
downsizing
Step Six: Evaluation
Benchmarking: Looking at an organization’s
practices and performances in an area and comparing
them with those of other companies
Gathering competitive information
HR metrics
 Human capital metrics assess aspects of the workforce

 HR metrics assess the performance of the HR function
Managers can gather informal information on

competitors through certain legal means
Figure 2.11 - Building the Metrics Model
Measuring a firm’s strategic alignment
Balanced scorecard (BSC): Helps managers translate
strategic goals into operational objectives
 Related cells - Financial, customer, processes and learning
Measuring horizontal fit
Managers identify key workforce objectives they look to
achieve
Identify HR practices used to elicit or reinforce the
objectives
Evaluate each HR practice
Successful HRP helps increase organizational
capability
Organizational capability: Capacity of the
organization to act and change in pursuit of sustainable
competitive advantage
Flexibility
Coordination flexibility - Ability to rapidly reallocate
resources to new or changing needs
Resource flexibility - Result from having adaptable
people and resources that can be used different ways

Snell 17e PPT Instructor Ch02

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Snell 17e PPT Instructor Ch02

Uploaded by

Copyright:

Available Formats

Chapter 2

Human resources planning (HRP)

Value-based hiring: Outlining behaviors that

 Focuses on the connection between the business objectives

To meet human resources demands, organizations

 Human capital metrics assess aspects of the workforce

Managers can gather informal information on

You might also like