1. Strategic HRM
Dr. Ravinarayana K.S.

2. Strategy
• Strategy is about deciding where you want to go and how you mean to get
there.
• Strategies define longer-term goals but they are more concerned with how
those goals should be achieved.
• Strategy is the means to create value.
• A good strategy is one that works, one that guides purposeful action to
deliver the required result.

3. • Strategy is the determination of the basic long-term goals and objectives of
an enterprise, and the adoption of courses of action and the allocation of
resources necessary for carrying out these goals. - (Chandler, 1962)
• Business strategy is concerned with the match between the internal
capabilities of the company and its external environment. - (Kay, 1999)
• A strategy, whether it is an HR strategy or any other kind of management
strategy, must have two key elements: there must be strategic objectives, and
there must be a plan of action. - (Richardson and Thompson, 1999).

4. • The emphasis (in strategy) is on focused actions that differentiate the firm
from its competitors. - (Purcell, 1999).
• Strategy is a tactical course of action which is designed to achieve long term
objectives.
• It is an art and science of planning and marshalling resources for their most
efficient and effective use in a changing environment.

5. • Strategy of a business enterprise consists of what management decides
about the future direction and scope of the business.
• It entails managerial choice among alternative action programmes,
competitive moves and different business approaches to achieve enterprise
objectives.
• Strategy once formulated has long term implications. It is framed by top
management in an organization.
• In short, it may be called as the ‘game plan of management’.

6. Introduction
• Strategic HRM is an area that continues to evolve a lot of debates as to what
it actually embraces.
• Since the 1990s, there has been an increased focus on the strategic role of
human resource management (HRM).
• The strategic approach to HRM refers to the relationship between human
resource (HR) practices and the strategic objectives, that is the long term
goals of the organization.

7. • With the increasing recognition of the potential of human resources in providing
competitive advantage, organizations have begun to consider employees as valuable
‘assets’ or ‘investments’.
• This view has become more significant in today’s knowledge economy that depends
on the skill and knowledge of the workforce.
• From being a routine, administrative, and reactive function, the HR function today
has evolved to being proactive and strategic.

8. Human Resource Strategy
• Human resources – refers to the people who work in an organization
• Human Resource Management-the person, department or section of an
organization which deals with people. It involves the process of co-
ordinating all aspects of what needs to happen to and for people in an
organization – recruitment, training, monitoring and appraisal
• HRM ensures the most effective and efficient use of human talent for
accomplishing the goals of an organization.

9. • ONE TYPE DOES NOT FIT ALL
• Human Resource Management departments or sections vary from one organization
to another, depending upon :
• size of an organization
• the type of organizationthe
• age of an organization
• staff stability or high staff turnover

10. • HRM SUPPORTS THE WHOLE ORGANISATION
• The aim of a Human Resource Management section is to support the
strategic direction of an organization.
• In other words the HRM Department should plan for and recruit staff to:
-Enable the organization to function well now
-Enable the organization to function well in the future

11. • In order to successfully utilize and manage the human resources of an
organization to achieve organizational objectives, each organization needs to
develop a well-defined HR strategy.
• Chandler (1962) defined ‘strategy’ as the determination of the long term
goals and objectives of an organization, and the allocation of resources
necessary for carrying out these goals’

12. Human Resource Strategy
• Like strategy, HR strategy is concerned with two key elements:
1. Determining the strategic objectives (what goals is the strategy supposed to
achieve? For e.g., the goals may be high productivity, reduced accidents, etc)
2. Developing a plan of action (How will the human resources be organized
and allocated to accomplish the objectives of the organization?)Human
resource strategy , therefore, involves the planned and effective use of
human resources by an organization to help it to gain or maintain an edge
over its competitors.

13. • This definition indicates the central role that the people of the organization
play in the organizational pursuit is to gain competitive advantage.
• An organization is said to achieve competitive advantage when it is able to
gain and maintain an edge over its competitors by differentiating its products
or services from those of its competitors, thereby increasing its market share.

14. Strategic Human Resource Management
• Given the increasingly significant role of human resources in an
organization, HRM has become strategic in nature.
• Strategic human resource management (SHRM) is concerned with the
relationship between HRM and strategic management in an organization
• SHRM is an approach which relates to decisions about the nature of
employment relationship, recruitment, training, development, performance
management, reward and employee relations

15. • Strategic human resource management (strategic HRM) provides a
framework linking people management and development practices to
long-term business goals and outcomes.
• It focuses on longer-term resourcing issues within the context of an
organisation's goals and the evolving nature of work.

16. • Strategic Human Resource Management (SHRM) aims to ensure that you are
at least one step ahead of your competitors
• The organization aims to have a competitive advantage

17. Definition of Strategic HRM
• Wright and McMahan defined SHRM as ‘the pattern of planned human
resource deployment and activities intended to enable the firm to achieve its
goals’.
• ‘SHRM is a concept that integrates human resource management activities
within a firm’s overall planning and implementation’ (Dillip Kumar, 2006)

18. • ‘SHRM integrates human resource consideration with other physical,
financial, and technological resources in the setting of goals and solving
complex organizational problems’ (Legnick-Hall & Legnick-Hall,1988)
• ‘SHRM also emphasizes the implementation of a set of policies and
practices that will build employee pool of skills, knowledge, and abilities that
are relevant to organizational goals’ (Jackson & Schulerm, 1995)

19. The Meaning of Strategic HRM
• According to Hendry and Pettigrew (1986), strategic HRM has four meanings:
• 1. The use of planning
• 2. A coherent approach to the design and management of personnel systems based
on an employment policy and manpower strategy and often underpinned by a
‘philosophy’
• 3. Matching HRM activities and policies to some explicit business strategy
• 4. Seeing the people of the organization as a ‘strategic resource’ for the achievement
of ‘competitive advantage’.

20. • There is difference in definition between HRM and SHRM, HRM is a
considered a ‘reactive’ field, whereas SHRM become a tool to implement
strategy, a ‘proactive’ function in which human resource activities actually
create and shape business strategy