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Strategic hrm
The document discusses the evolution of human resource management from an administrative function to a strategic partner. It outlines the key roles of strategic HRM in attracting, motivating and retaining talent, and aligning HR strategies with organizational strategies. Some of the barriers to strategic HRM include a short-term focus and the difficulty in quantifying HR outcomes. The document also provides frameworks for the components and critical competencies of strategic HRM.
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Introduction to Strategic Human Resource Management presented by Kuldeep Mathur.
Quotes emphasize the significance of passionate commitment and knowledge in successful companies.
Describes HR's transformation into a strategic partner focusing on attracting and retaining talent as a competitive edge.
Details the enhanced performance, shareholder value, and satisfaction resulting from effective HR management.
Emphasizes the necessity for HR strategy to be clear, documented, and aligned with overall business strategy.
Visual representation of the proportion of HR costs and the value added by effective HR strategies.
Outlines roles including Strategy Architect, Talent Manager, and Operational Executor in aligning HR with business needs.
Highlights essential components such as human capital optimization and various people management practices.
Defines strategic HR deliverables focusing on performance drivers and enablers that align HR with business strategies.
Explores crucial HR roles like human capital steward and knowledge facilitator necessary for competitiveness.
Discusses the necessity of adaptable HR systems in responding to rapid changes in the knowledge economy.
Lists competencies that HR executives must master to align HR strategy with overall organizational goals.
Identifies obstacles faced by HR in becoming strategic partners and how to measure HR success effectively.
Highlights the ongoing quest for excellence in HR, emphasizing character strength in leading future initiatives.
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Strategic hrm
- 1. Strategic HRM KULDEEP MATHUR M.B.A.JIWAJI UNIVERSITY GWALIOR
- 2. “People with credentialsare often outperformed by those with a passionate commitment for something” Anonymous “Successful Companies of the 21st Century will be those who do the best job of capturing. Storing and leveraging what their employees know” - Lew Platt, Hewlett-Packard
- 3. With the boomin the economy and growth of the knowledge economy, HR has taken on a new avatar. As the focus moves from traditional brick and mortar organizations to more ‘people-oriented business’ like IT-ITES, media, retail, health care, hotels etc, HR has become significant in nature and management of its role in an organization. As the competitive advantage of organization has moved from machines and production to the expertise and creativity of its people, HR has a large role to play in attracting, motivating and finally, retaining these very people.
- 4. Human resource personnelwill have to take on the role of a strategist and an enabler for the organization to face the next wave of changes that are mind boggling & complex.
- 5. The role ofhuman resource management in organizations has been evolving dramatically in recent years. The days of human resources management in organizations has been evolving dramatically in recent years. The days of human resources as the “personnel management” – performing recordkeeping, paper pushing, file maintenance, and other largely clerical functions – are over. Any organization that continues to utilize its HR function solely to perform these administrative duties doesn’t understand the contributions that HR can make to an organization’s performance. In the most
- 6. successful, profit makingorganizations, HR is increasingly being seen as a critical strategic partner and assuming far-reaching and transformational roles and responsibilities.
- 7. Traditional HR versusStrategic HR Traditional HR Strategic HR Responsibility for HR Staff specialists Line managers Focus Employee relations Partnerships with internal and external customers Role of HR Transactional, change follower, and respondent Transformational, change leader, and initiator Initiatives Slow, reactive, fragmented Fast, proactive, integrated Time horizon Short-term Short, medium, long Control Bureaucratic –roles, policies, procedures Organic – flexible, whatever is necessary to succeed Job design Tight division of labor, independence, specialization Broad, flexible, cross-training, teams Key investments Capital, products People, knowledge Accountability Cost center Investment center
- 8. There has beena paradigm change in functioning & role of HR as strategic partner. Taking a strategic approach to human resource management involves abandoning the mindset and practices of “personnel management” and focusing more on “strategic issues than operational & routine issues”. Strategic human resource management realizes that people make or break an organization because all decisions made regarding finance, marketing, operations, or technology are made by an organization’s people.
- 9. Strategic human resourcemanagement involves the development of a consistent, aligned collection of practices, programs, and policies to facilitate the achievement of the organization’s strategic objectives. It considers the implications of corporate strategy for all HR systems within an organization by translating company objectives into specific people management systems.
- 10. External Environment Competition Government regulation Technology Markettrends Economic Corporate Strategy Business Unit Strategy Internal Environment Culture Structure Politics Employee skills Past strategy Employee Separation Laws Regulating Employment HR Strategy HR planning Design of jobs & and work systems What worker do What workers need How jobs interface with others HR Information Systems Staffing Training Performance Management Compensation Labor Relations Strategic Human Resource Management
- 11. Increased Performance Enhanced Shareholders Value Customer and EmployeeSatisfaction through • Effective management of staffing, retention, and turnover through selection of employees that fit with both strategy and culture • Cost-effective utilization of employees through investment in identified human capital with potential for high retention • Integrated HR programs and policies that clearly follow from corporate strategy • Facilitation of change and adaptation through a flexible, more dynamic organization • Tighter focus on customer needs, key and emerging markets, quality Outcomes of Strategic HR
- 12. Probably the singlemost important caveat of strategic human resource management is that there is no one best way to manage people in any given organization
- 13. Establishing a strongHR strategy that is clearly linked to the organization’s strategy is not enough. HR strategy needs to be communicated, practiced, and – perhaps most important – spelled out and written down. Strategic HR can be contrasted to the more traditional administrative focus of HR through an examination of different roles that HR can play in an organization. It has shifted from “cost & examples” to value added & wealth creation.
- 14. Strategic planning Service delivery Administration Cost Valueadded 10% 30% 60% 10% 30% 60% HR Cost and value added
- 15. Designing Strategic HRStrategies - (A) Strategy Architect • Developing & linking/ aligning HR strategies with organizational strategies • Sustaining Strategic agility • Engaging customers – internal as well external (B) Talent Manager/ Org Designer • Planning Ensuring today’s and tomorrow’s talent • Developing talent/Nurturing talent • Shaping organization – flexible, responsive etc. • Fostering communication • Designing rewards systems++
- 16. (c) Operational Executor •Designing new workplaces practices • Implementing workplace policies / practices • Advancing HR Technology
- 17. (D) Credible Activist •Deliverables than doubles • Delivering results with integrity • Sharing information • Building relationships of trust • Doing HR with attitude (E) Culture and Change Steward • Facilitating change • Valuing culture • Crafting culture • Personalizing culture
- 18. Human Capital Pool* Knowledge Skill Ability Employee Relationships and Behaviors Psychological Contracts Job Related/Required Organizational Citizenship People Management Practices Staffing Training Rewards Appraisal Work Design Participation Recognition Communication The basic strategic HRM Components
- 19. * •Optimizing the humancapital through Development •Optimizing the human capital through Talent Management
- 20. To integrate HRinto a business performance measurement system, managers must identify the points of intersection between HR and the organization’s strategy implementation plan. These points are strategic HR deliverables namely those outcomes of the HR architecture that serve to execute the firm’s strategy. This is in contrast to HR doables that focus on HR efficiency and activity counts. These deliverables
- 21. are of twocategories , viz, performance drivers and enablers. HR performance drivers are people related capabilities or assets such as employee productivity or employee satisfaction. These drivers are not generic; it is company specific. Enablers are methods which reinforce performance drivers. A single performance driver may have several enablers.
- 22. HR Roles ina knowledge-based economy • Human capital steward • Knowledge facilitator • Relationship builder • Rapid deployment specialist
- 23. The human capitalsteward role involves the creation of an environment and culture in which employees voluntarily want to contribute their skills, ideas, and energy. This is based on the premise that, unlike raw materials, plant, and equipment, human capital is not “owned” by the organization; it can move freely from organization to organization at the employee’s whim. A competitive advantage can be maintained only when the best employees are recruited, duly motivated, and retained. The knowledge facilitator role involves the procurement of the necessary employee knowledge and skill sets that allow information to
- 24. be acquired, developed,and disseminated, providing a competitive advantage. This process can succeed only as part of a strategically designed employee development plan, whereby employees teach and learn from each other and knowledge sharing is valued and rewarded. The relationship builder role involves the development of structure, work practices, and organizational culture that allow individuals to work together, across departments and functions. To ensure competitiveness, networks need to be developed that focus on the strategic objectives of the organization and how synergies and teamwork
- 25. that lead tooutstanding performance are valued and rewarded. The rapid deployment specialist role involves the creation of an organization structure and HR systems that are fluid and adaptable to rapid change in response to external opportunities and threats. The global, knowledge-based economy changes quickly and frequently and success in such an environment mandates flexibility and a culture that embraces change. The first, strategic contribution, requires the development of strategy, connecting organizations
- 26. to external constituents,and implementing systems that align employee performance with company strategy. The second, business knowledge, involves understanding the nuts and bolts of the organization’s operations and leveraging this knowledge into results. The third, personal credibility, requires that measurable value be demonstrated in programs and policies implemented. The fourth, HR delivery, involves serving internal customers through effective and efficient programs related to staffing, performance management, and employee development.
- 27. The fifth, HRtechnology, involves using technology to improve the organization’s management of its people Critical HR Competencies required by HR Executives Competencies to Master “Competence in the absence of strategy is like acting without an audience” David Ulrich • Knowing how to reduce costs • Improve service in non-core functions of the business • Provide defined career ladder to people • Cross sell service • Ability to assess why a void exists in a business • Recruiting and retaining top talent • To strive for operational excellence and discipline
- 28. Barriers to StrategicHR • Short-term mentality/ focus on current performance • Inability of HR to think strategically • Lack of appreciation of what HR can contribute • Failure to understand general manager’s role as an HR manager • Difficulty in quantifying many HR outcomes • Perception of human assets as higher-risk investments • Incentives for change that might arise
- 29. Consistently find resistancetoward resources being allocated to programs that have less tangible, measurable benefits than those that do. Another barrier to strategic HR is the fact that human assets aren’t owned by organizations and, therefore, are perceived as a higher risk investment than capital assets. Finally, strategic HR may be resisted because of the incentives for change that might arise.
- 30. Dave Ulrich outlinesfive areas HR can measure to demonstrate results • Productivity measures – output per unit of input. Improvements in these areas might be traced back to increased training, improved work structure and so on. • Process measures, such as improving systems and workflow • HR costs and/or benefits for any specific initiatives. • Employee retention, morale, commitment and skills. • Capabilities of the organization, such as speed (response time) learning, shared mind set and accountability. It is time to elevate HR to a new playing field, and measuring results may be the only credible way for HR to truly step up to it. Once they have developed good business relationships throughout the Organization, and the value add is seen by the people, HR Managers will become involved to help the organization move towards a vision created for the new millennium.
- 31. The preparation forthis process of completion is also known as “Future”. “With strength of a character, nothing is impossible, when your heart expands, to embrace the impossible, you are able to lead the path…” Tao The quest for achieving excellence through people in the future continues….