Unit 1.

1
Introduction to SHRM
Introduction to SHRM
• Strategic human resource management is the process of linking the
human resource function with the strategic objectives of the
organization to improve performance. Attracting and keeping talented
and skilled employees is one of the most important challenges
organizations face in today’s dynamic business world.
• Strategic HRM is a systematic approach that aligns human resource
policies and practices with the strategic goals of an organization to
achieve long-term success.
• Strategic human resource management is the proactive management
of people to the desired value to them. It is designed to help
companies better meet the needs of their employees while
promoting company goals.
• SHRM is a philosophy of people management based on the belief that
human resources are uniquely important to sustain business success.
• SHRM aims to ensure that the culture, style, and structure of the
organization and the quality, commitment and motivation of its
employees contribute fully to the achievement of business objectives.
• HR strategies combine all people management activities into an
organized and integrated program to meet the strategic objectives of
an enterprise.
Definition
• “Strategic human resource management means formulating and
executing human resource policies and practices that produce the
employee competencies and behaviors that the company needs to
achieve its strategic aims.”- Gary Dessler
• “Strategic human resource management is an approach to making
decisions on the intentions and plans of the organization concerning
the employment relationship and the organization’s recruitment,
training, development, performance management, and the
organization’s strategies, policies, and practices.” – Armstrong
NATURE OF SHRM
1.Long-term Focus: As business strategies have a long-term orientation, therefore,
focus of SHRM is also long-term probably more than one year
2.Associated with Goal-Setting: SHRM involves setting objectives, formulating
policies, and allocating resources at all levels of top management.
3.Interrelated with Business Strategies: There is an interrelation between business
strategies and SHRM. E.g. it gives significant inputs when business strategy is
formulated, and human resource strategies (like recruitment, staffing, training
and performance appraisal)
4.Fosters Corporate Excellence Skills: SHRM considers employees as the strategic
potential of the organization and on that basis makes effort to differentiate the
organization from its competitors present in the markets. It also promotes
learning of modern skills
Objectives of SHRM
1.Manpower Planning: Plan for manpower requirements for its business located in
national and international markets.
2.Scientific Selection: Conduct scientific selection and appointment of employees for
business operation of right type and right in number
3.Employee Training: Train the employees on technology in use and working procedure
for developing their skills and knowledge.
4.Job Placement: Place the employees at jobs according to their areas of specialization.
5.Opportunities Provision: Provide opportunities for the employees deserving on the
scientific basis.
6.Fair Compensation: Compensate employees according to their skills, experience and
contributions.
7.Employee Motivation: Maintain employees motivated, satisfied and cooperative in
organisation.
6. Industrial Relations: Improve industrial relations, industrial peace
and harmony at workplace.
7. Encouragement: Encourage employees for their cooperation,
commitments and higher performance at work.
8. Organizational Performance: Contribute through manpower in
improvement of organisational performance and organisational
effectiveness in business.
For effective accomplishment of the objectives the Strategic HRM
should keep in mind the interests of all concerned parties or
stakeholders in the organisation in designing its strategies. The main
stakeholders are employees, employer and management. The focus of
SHRM should be on human relations, regular development,
empowerment of employees; leadership, communication, welfare and
security of employees, quality of work life.
Need of SHRM
1. Competitive Differentiation: The first & at most concern of SHRM is to focus on actions that
distinguish an organization from its competitors.
2. Resource Allocation: It provides idea to allocate the resources of organization to most match &
capable Employee.
3. Organizational Foundation: It design the foundation of organization to achieve efficient business
benefits, structure, culture, employees values propositions and effective communication strategic
plan for HRM.
4. Risk Management: SHRM also keep track of down turns, down falls, risks and other business
acquirement.
5. Recruitment and Training: SHRM also take part in employee recruitment, hiring, training and
assessments processes.
6. Ethical Management: Strategic Human Resource Management give emphasis to organizational
codes of moral values and manage public crash of business.
7. Business Advancement: SHRM take your business to the new level, integrates HR workflow,
defines new goals, aligned employee work force for business flourishment.
Importance of SHRM
1. Identifying and analysing external opportunities and threats that may be crucial to the
company’s success.
2.Provides a clear business strategy and vision for the future.
3.To supply competitive intelligence that may be useful in the strategic planning process.
4.To recruit, retain and motivate people.
5.To develop and retain highly competent people.
6.To ensure that people development issues are addressed systematically.
7.To supply information regarding the company’s internal strengths and weaknesses.
8.To meet the expectations of the customers effectively.
9.To ensure high productivity.
10.To ensure business surplus thorough competency.
Roles of SHRM
The major roles of Strategic HRM in an organization are given below:
1. Strategic role – The strategic role of HR involves formulating
business decisions, translating corporate strategy into a human
resource strategy, and training employees to concentrate on
customer needs.
2. Information and decision-making role – In this role, the HR
department must inform and advice the organization about the
various best practices like efficiency in customer services or new
product development. In the information and decision- making role,
HR must take decisions about problems in employee relations.
3. Strategic HR functional role – This is a very important role. In this
role, HR must select, design and implement planning and appraisal
systems for the employees. These systems should fit both the strategy
and the culture of the organization concerned.
4. Administrative role – In this role, HR must implement policies and
procedures for the organization. In addition, the HR department must
try to improve the administrative system of the organization. SHRM
organizes various training and development programmed to encourage
employee involvement. It thus, motivates the employees to become
flexible to achieve the strategic goals of the organization.
Key elements of the framework:
1. Strategic alignment: SHRM ensures that HR objectives and activities
are aligned with the overarching business strategy.
For example, in a growth-oriented organization, SHRM would
emphasize recruiting talent with high potential and developing
leadership capabilities.
2. Proactive approach: Unlike traditional HRM, which is reactive, SHRM
anticipates future workforce challenges and proactively designs policies
to address them.
3. Integration: SHRM integrates HR functions (recruitment, training,
performance management, etc.) With other organizational functions
like marketing, finance, and operations.
4. Focus on sustainability and adaptability: SHRM emphasizes creating
a resilient workforce that can adapt to changes in the external
environment, such as technological advancements or global economic
shifts.
This involves fostering a culture of innovation and promoting practices
that ensure long-term organizational sustainability.
Models Of SHRM
• The Best Practice Model/Universalistic theory
• The Best Fit Model/Contingency Theory
• Configurational Model/Combination
• Competitive Theory Model (Multilevel)
• Harvard Model or the Integrated System Model
• Devanna Model or The matching Model
• Resource based Value Model
Purpose Of Different Models
• They serve as a heuristic device-something to help us discover and
understand the world for explaining the nature and significance of key
HR practices.
• They legitimize certain HRM practices; a key issue here is the
distinctiveness of HRM practices: "It is not the presence of selection
or training but a distinctive approach to selection or training that
matters".
• They provide an analytical framework for studying Human resource
management.
• They provide a characterization of human resource management that
establishes variables and relationships to be researched.
1.The Best Practice Model: This model suggests that there are universal HR
practices that lead to superior organizational performance, regardless of context
or industry.
2.The Best Fit Model: This approach emphasizes aligning HR strategies with the
specific context of the organization, including its culture, structure, and external
environment.
3.Configurational Model: This model focuses on achieving internal consistency
among HR practices and aligning them with the overall strategy of the
organization to enhance performance.
4.Competitive Theory Model (Multilevel): This model integrates multiple levels of
analysis, considering how HR practices impact individual, team, and
organizational performance in a competitive context.
5.Harvard Model or the Integrated System Model: This comprehensive model
considers multiple stakeholders and emphasizes the integration of HR policies
with broader organizational goals and societal expectations.
6.Devanna Model or The Matching Model: This model highlights the alignment
of HR practices with the strategic objectives of the organization, ensuring that HR
activities support overall business goals.
7.Resource-Based Value Model: This approach focuses on leveraging the
organization's unique resources and capabilities, including human capital, to
achieve a sustainable competitive advantage.
Thanks
SHRM for Competitive Advantage