Human resource management is concerned with the effective management of people and is a challenge faced by all organizations. It is also one that is increasing in importance. Although operational and technical excellence is fundamental to ensuring continuous customer satisfaction, there is increasing emphasis on gaining and maintaining organizational success and competitive advantage through the effective management of human resources, in line with an organization’s business strategy.
Strategic human resource management is based on the recognition that an organization’s effectiveness can be increased if its human resources are managed with HR policies and practices that deliver the right number of employees with appropriate behaviors, skills and competencies, and levels of motivation to the organization. Defining what is appropriate, required and feasible for the organization is set in the context of the organization’s internal and external environments. A further challenge and complexity are that strategic human resource management is practiced in firms operating across several national borders. Thus, the practice of developing and implementing strategy, and consequently human resource practices and policies, in the multinational company (MNC) is considerably more complex and will be considered.
The aim of this module is to take a research-focused appraisal of the development and operation of strategic HRM. This will include:
The following issues are indicative of the scope of topics that will be covered over the semester:
1. Introduction to SHRM: The nature of contemporary HRM and the theories and practices of HRM. Strategic Choices and the process of Strategic Management. Strategy and the role of HRM and the various theoretical perspectives on HRM.
2. Corporate strategy, strategic HRM and Performance – human resource/human capital/organizational process advantage: Best Fit, Best Practice, the Resource-Based View/Application of RBV, an integrative model of HR strategy.
3. HRM in a global world. Globalization and the growth of MNEs. Models and processes of management across borders and divisions. Globalization of HRM – its extent and importance to the business. Culture. The impact of organizational culture and attitudes on management and control.
4. Employment relations and HRM in developing economies.
5. HRM and high-performance workplaces
6. The employment relationship and the management of employee voice; the role of leadership development and talent management, psychological contract, employee engagement
Each topic is presented as a starting point for further exploration by the student through individual reading and self-study, in order to develop a deeper understanding of each topic and to explore current examples of SHRM issues faced by organizations.
Given the immediacy of the impact of the national crisis related to Covid-19 with the closure of the college at the commencement of this module, the delivery of this module has now moved to distance learning. Albeit unplanned and uncharted territory for all, the academic nature of the module means that this learning approach is wholly doable, and we will need to work together to ensure the learning outcomes.
Matching Human Resource Practices to Competitive Strategies
Consider the following brief description of the business strategies of each company, all of which makes office furniture.
Benchill and Sons
Benchill makes a narrow range of basic office furniture: desks, chairs, cabinets, and the like. Their approach is to manufacture and sell their products as cheaply as possible and to keep profits high by selling in high volume. Benchill doesn’t pretend that their furniture is better than their rivals (it most certainly isn’t, though it usually meets a certain basic standard). However, by keeping the price down, they can undercut the competition, and as such are a favored supplier for bulk buyers for whom price and not quality is the primary concern.
However, other companies also adopt this strategy, so there is constant pressure to keep costs down in order to remain competitive. Furniture designs are kept simple so that there is no great sophistication in the manufacturing process and the cheapest raw materials are used. Very little effort is expended on designing new product ranges or improving existing products.
Speke Office Supplies
Speke manufactures a standard range of office furniture and equipment, and their focus is on the high-quality end of the market. They are proud of their reputation for the quality and durability of their products, though they don’t come cheap. Speke has become a byword for good quality office furniture, well made from the best materials, with very few defective products and faults detected. Companies know they can rely on their products and will pay that little bit extra.
Product quality is underpinned by high-quality customer service, prompt delivery, and after-sales service. Speke focuses on what they do well (it has served them well in the past), and they don’t spend a great deal of time or effort on designing new products: they concentrate on improving processes, systems, and service to keep high quality. They are not the only high-quality office suppliers around and competition is tough.
Thornhill Office Solutions
Thornhill makes specialist office equipment. Generally, this equipment is manufactured in small quantities to meet the needs of a particular customer, whose needs cannot be met by
mass producers such as Benchill or Speke. Often this involves visiting clients’ premises and designing and making products that solve a particular problem.
However, Thornhill is always looking to make things that no one else is making or has even thought about. They have a number of successes over the years with innovative products, which have attracted high-volume sales, simply because no one else was making them. Even though these often take about five years from the initial idea to the first sales- particularly as they usually involve designing new production systems, sourcing new materials, etc. – they have more than paid for the investment. On the other hand, one or two ideas have failed to take off, although Thornhill is philosophical about this – one great idea will pay for a dozen bad ones.
Thornhill is not the only specialist and innovative furniture company, and it is always a struggle to stay ahead of the competition.
As an HR consultant for these three companies, you have been asked to design an HR strategy appropriate for each company.
1. Firstly, consider how these three competitive strategies differ from each other, describing each strategy in turn and citing references and examples of other, similar companies, as you see fit.
2. Given the particular strategies of each company, consider the key organizational characteristics and human resource practices that are likely to support each of the three strategies.
3. Discuss whether this ‘matching approach’ is a sound approach to HR strategy development, justifying your answer.