The growth strategy of an organisation depends upon many factors one such factor is the concerns related to global human resources of the organisation. In the business world there are pressing concerns regarding issues like cross cultural diversity, business practices and host country laws. This is where strategic human resource management comes into play as it is a concept of HR management which involves processes that defines the plans and intentions of an organisation. It is designed to help the organisations that meet the needs and desires of their employees. HRM deals with aspects in organisations or business that affects employees directly aspects such as training, pay, firing, hiring and administration. They are also responsible for providing safety procedure information, work incentives and providing vacation and sick leaves. The strategic HRM role is to define the organisation plans and intentions on how the goals of the organisation can be achieved through employees. It is usually based on these three propositions:-
Purcell in the year 1999 defined strategic HRM as the process that focuses on the actions that differentiate the business of a firm than its competitors. Pettigrew and Hendry in the year 1986 explained how strategic human resource management can have four meanings:-
The strategic HRM issues are mostly associated with changes in the culture and structure of the organisation, organisation performance and effectiveness, the development of capabilities, to match the resources with the organisations resources, change and its management and knowledge management. Their concern is to get things done with the development of capabilities and fulfilling the human capital requirements. (Boxall&Purcell, 1999)Boxall in the year 1996 said that the central concern of strategic human resource management is the choice of leadership and the formation of labour relations through positive patterns. The rationale of strategic HRM is understanding and agreeing with the approach of people management in the longer duration or term. Lengnick Hall in the year 1990 suggested that in a business that rationale of strategic HRM is the underlying concept which helps in achieving the competitive advantage through human resource management. It is all about proactively managing people. The people involved in this field have to plan and think ahead for a business to meet the requirements of the people and thus helping the employees to meet the goals that are decided for the company. HRM is the best way to cultivate a atmosphere in a company that is work based and is about productivity.
The fundamental aim of strategic human resource management is to ensure that the firm or organisation has the committed, well motivated and skilled employees that help in achieving a sustained competitive edge or advantage. Their objective is to steer the business in a direction that can ensure that the individual need of the employees are fulfilled with the business needs of the firm which can be met collectively. They can be achieved collectively by developing and implementing the practical and coherent human resource programmes and policies. According to a remark by Holder and Dyer in the year 1988 strategic human resource management is about unifying frameworks that are integrative, broad and contingency based. The aims of strategic human resource management can be considered only when we consider the interests of all the stakeholders through the human resource strategies which take into account the employees as well as management and owners. Storey in the year 1989 termed that strategic human resource management places greater emphasis on the HR aspect of the management of people as it is continuously stressing on the development of people through securing their employment, communication, work life balance and improving the quality of life.
Strategic human resource management has five main approaches. These consist of:-
1. Resource based approach:- Barney in the year 1991 indicated that in order to generate a strategic capability it is primarily to achieve a strategic balance or fit between the oppurtunities and resources.( Barney, 1991) A RBV approach helps in addressing the methods of increasing the organisation strategic capability by the development of staff and management who can plan and think strategically along with understanding the strategic issues. The RBV approach is based on the belief that if a firm develops and obtains its human resources it can achieve competitive advantage by enabling them to learn faster and then apply their learning on their rivals. Barney in the year 1995 explained that Strategic human resource management is about including the knowledge, experience, wisdom, risk taking propensity and judgement of employees that work in the firm or organisations. Kamoche in the year 1996 suggested that in resource based approach the organisation is a bundle of intangible and tangible capabilities and resources that require market/product competition.
There are many theories and models based on human resource management. Some of the most influential and renowned theories in HRM are:-
1. David Guest gave a model in the year 1997 about how organisation will see improvements and will benefit in their performance if they identify and commit to implement some HRM practices.( Guest, 1997) It included theories like normative theories, descriptive theories, and strategic theories. Strategic theory was about having a good fit between the HRM practices and structure and business strategy of an organisation. Descriptive theory was about a system approach which related outcomes with the HR practices. Normative theory was about a standard practice that is a norm which is established as a best practice by the organisation. He stressed on “high commitment” that links with the human factor. There should be a ideal set of HR practices that should be followed in the case of the human factor in the organisations. These steps will ensure that the effectiveness and productivity of the employees will increase as they will be motivated to reach the organisations goals.( Guest,Michie,Conway&Sheehan, 2003) He laid a view that the policies needed to be horizontally integrated and congruent to each other and named this concept as “universal best practices set”. But many believe that this view point given by Guest is disputable as it presents a non accurate and non specific definition of human resource policies. This model constitutes of different policies that significantly vary from one model to another. It is very hard to measure the performance of organisations that adopt this model as it is difficult to conceptualize and generalize. He was able to acknowledge that commitment is a “messy” concept thus establishing a relationship between high performance and commitment is difficult.
The HR professionals have to cater to the ever changing needs and goals of the organisations. They have numerous roles that they have to play to cater to these needs. These roles are performed in different proportions in different organisations as they vary according to the organisations objectives and vision.
Some of these roles are:-
1. As a strategic Partner:- HR professionals are becoming strategic partners in many organisations by aligning business objectives with HR strategies. These professionals are able to identify weaknesses that affect the organisation performance, this helps in shaping the HR strategies according to the firm’s needs.
The understanding of the relationship between performance and HRM can be achieved by taking into consideration all the theories and models that are stated above. But even now the real picture can be obtained by the studying about the developments in the field of SHRM. As the speed by which the organisations are changing and how they are managing the stakeholders and employees can be understood by following their progress.
Armstrong&Baron, M&A, 1998. Performance management:The new realities. 1st ed. London: Institute of Personnel and development
Armstrong&Baron, M&A, 2005. Managing Performance:Performance management in action. 1st ed. London: Institute of Personnel and development
Barney, J.B, 1991. Firm resources and sustainable competitive advantage. Journal of Management, 17(1), 99-120
Boselie,Dietz&Boon, P., G. & C, 2005. Commonalities and contradictions in research on Human Resource Management and Performance. Human Resourcce Management Journal , 1(1), 53-96
Boxall&Purcell, P. & J, 1999. Strategy and human resource management. 1st ed. London: Palgrave Macmillan
Pfeffer, J, 1994. Competitive advantage through people. 1st ed. Boston: Harvard Business School Press
Wood, S, 1999. Human resource management and performance. International Journal of Management Reviews, 1(1), 367-413
Purcell, J, 2004. Business strategies and human resource management: Uneasy bedfellows or strategic partners?. International seminar on HRM: What’s Next?, 1(1), 120-136
Guest, D.E, 1997. Human resource management and performance: a review and research agenda. The International Journal of Human Resource Management, 8(1), 263- 276
Guest,Michie,Conway&Sheehan, D.E., J., N. & M, 2003. Human resource management and corporate performance in the UK. British Journal of Industrial Relations, 41(2), 291-314.
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