COURSEWORK ASSESSMENT

BY: MARCH 2013

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TABLE OF CONTENTS CONTENTS PAGE NO.

1 - The Role & Importance of Strategic Human Resource Management 1.1 - Strategic Human Resource Management 1.2 - Importance of Human Resources Management 1.3 - Framework of Strategic Human Resource Management 2 Strategic Management Process 2.1 Analyse Strategic Management Process 2.2 The Role & Importance of Strategic Human Resource 3 Strategies for Organisation 3.1 Human Strategic for Organisation 3.2 Assess Human Resource Strategy & Application 4 Contemporary Issues Affecting SHRM 4.1 Identification of Contemporary Issues 3.2 Assess Human Resource Strategy & Application 5 Conclusion

3 3 3 4 4 4 5 6 6 8 9 9 9 10

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The Role & Importance of Strategic Human Resource Management

1.1 - Strategic Human Resource Management: Strategic human resource management is the process of linking the human resource function with the strategic objectives of the organization in order to improve performance. The linking of HR policies and practices with the strategic management process of the organization. The internalization of the importance of HR on the part of line managers. The integration of the workforce into the organization to foster commitment or an identity of interest with the strategic goals. Human resource managers are well positioned to play an instrumental role in helping their organization achieve its goals of becoming a socially and environmentally responsible firm one which reduces its negative and enhances its positive impacts on society and the environment. Further, human resource (HR) professionals in organizations that perceive successful corporate social responsibility (CSR) as a key driver of their financial performance can be influential in realizing on that objective.

1.2 Importance of Human Resources Management: HR management is key in developing not only the employees, but the whole organization itself. An expanding company dependent on its current success can maintain and further

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develop its business starting with the right staffing. As demands for the product or services increase, additional manpower is needed to comply with them. The current manpower should be checked but not simply if they can comply with the demands, but it has to ensure that it can still keep its quality and standards. 1.3 Framework of Strategic Human Resource Management: Strategic management is considered to be a continuous activity Strategic management appears as a cycle in which several activities follow and feed upon one another. The strategic management process is typically broken down into ve steps: 1. Mission and goals 2. Environmental analysis 3. Strategic formulation 4. Strategy implementation 5. Strategy evaluation 2 Strategic Management Process 2.1 Analyse Strategic Management Process: The rst step in the strategic management model begins with senior managers evaluating their position in relation to the organizations current mission and goals. The mission describes the organizations values and aspirations; it is the organizations indicates the direction in which senior management is going. Goals are the desired ends sought through the actual operating procedures of the organization and typically describe short-term measurable outcomes.

Environmental analysis looks at the internal organizational strengths and weaknesses and the external environment for opportunities and threats. The factors that are most important to the organizations future are referred to as strategic factors and can be summarized by the acronym SWOT Strengths, Weaknesses, Opportunities and Threats.

Strategic formulation involves senior managers evaluating the interaction between strategic factors and making strategic choices that guide managers to meet the organizations goals.

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Some strategies are formulated at the corporate, business and specic functional levels. The notion of strategic choice also draws attention to strategic management as a political process whereby decisions and actions on issues are taken by a power-dominant group of managers within the organization.

Strategy implementation is an area of activity that focuses on the techniques used by managers to implement their strategies. In particular, it refers to activities that deal with leadership style, the structure of the organization, the information and control systems, and the management of human resources. The most important and difficult part of the strategic implementation process.

Strategy evaluation is an activity that determines to what extent the actual change and performance match the desired change and performance. The strategic management model depicts the ve major activities as forming a rational and linear process. It is, however, important to note that it is a normative model, that is, it shows how strategic management should be done rather than describing what is actually done by senior managers. 2.2 The Role & Importance of Strategic Human Resource: In todays businesses, the right approach and management of the companys employees can greatly affect the companys overall performance. A strategic approach in Human Resource Management is vital especially in growing companies. Start from right staffing to maintaining performing employees.

The current manpower should be checked but not simply if they can comply with the demands, but it has to ensure that it can still keep its quality and standards. Mass production or bulk orders should not be an excuse in decreasing quality, hence, increased customer dissatisfaction and decreased sales. For a company that is already recognized in the industry and is eyeing on expansion, their status and reliability should be maintained.

The leaders of the company can now focus on the products itself and expansion, and let the HR Department handle the development of the organization. Keeping an eye on the companys log-term goals, mission and vision, the development of performance standards is essential to identify potential problems, non-performing employees and compliance to tasks and standards. Minor employee and performance problems should be seen immediately to

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avoid any future inconvenience and potential problems to the customers and thus become a liability to the company.

However, Human Resources Management can amend this and become a bridge in establishing what the management wants from employees and vice-versa. In its continuous development, it is but imperative that the management or its owner be prepared for more arduous tasks in operations and leading the rest of the team towards continued success.

Management should be equipped with the right skills in planning, leading, organizing and establishing standards. As they are the ones who will eventually be focused in developing the company instead of the operations and technical aspects, a higher understanding of this responsibility is essential, and this also plays a significant part once competition is put into the picture. Companies fail because of a number of reasons, and mismanagement can be one of them.

Operations may spin out of control if personal agendas and politics are placed, and in growing companies, this should be monitored and prevented. Developing not only management but also its employees is significant. To keep up with competition, employees should be given with a number of reasons to stay with the company, and do their jobs exemplary well. Their continuous growth, the right compensation and benefits, and work-life balance are just some of the things that motivate employees to perform better, producing better results for the customers and ultimately, the company. 3 Strategies for Organisation 3.1 - Human Strategic for Organisation: Another aspect of strategic management in the multidivisional business organization concerns the level to which strategic issues apply. Different levels of strategies are: 1. Corporate 2. Business 3. Functional

Corporate-level strategy Corporate-level strategy describes a corporations overall direction in terms of its general philosophy towards the growth and the management of its various business units. Such

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strategies determine the types of business a corporation wants to be involved in and what business units should be acquired, modied or sold. This strategy addresses the question, What business are we in? Devising a strategy for a multidivisional company involves at least four types of initiative:

i.

Establishing investment priorities and steering corporate resources into the most attractive business units.

ii.

Initiating actions to improve the combined performance of those business units with which the corporation rst became involved.

iii.

Finding ways to improve the synergy between related business units in order to increase performance. Making decisions dealing with diversication.

iv.

Business-Level Strategy Business-level strategy deals with decisions and actions pertaining to each business unit, the main objective of a business-level strategy being to make the unit more competitive in its marketplace. This level of strategy addresses the question, how do we compete? Although business-level strategy is guided by upstream, corporate-level strategy, business unit management must craft a strategy that is appropriate for its own operating situation. Business strategy by formulating a framework that described three competitive strategies: cost leadership, differentiation and focus. The low-cost leadership strategy attempts to increase the organizations market share by having the lowest unit cost and price compared with competitors. The simple alternative to cost leadership is differentiation strategy. This assumes that managers distinguish their services and products from those of their competitors in the same industry by providing distinctive levels of service, product or high quality such that the customer is prepared to pay a premium price. With the focus strategy, managers focus on a specic buyer group or regional market. A market strategy can be narrow or broad, as in the notion of niche markets being very narrow or focused. This allows the rm to choose from four generic business-level strategies low-cost leadership, differentiation, focused differentiation and focused low-cost leadership in order to establish and exploit a competitive advantage within a particular competitive scope.

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Commitment to this cost orientation makes senior managers unlikely to explore new areas. Prospectors are companies with fairly broad product lines that focus on product innovation and market opportunities. This sale orientation makes senior managers emphasize creativity over efficiency. Analysers are companies that operate in at least two different product market areas, one stable and one variable. In this situation, senior managers emphasize efficiency in the stable areas and innovation in the variable areas. Reactors are companies that lack a consistent strategystructureculture relationship. In this reactive orientation, senior managements responses to environmental changes and pressures thus tend to be piecemeal strategic adjustments. Competing companies within a single industry can choose any one of these four types of strategy and adopt a corresponding combination of structure, culture and processes consistent with that strategy in response to the environment.

Functional-Level Strategy Functional-level strategy pertains to the major functional operations within the business unit, including research and development, marketing, manufacturing, nance and HR. This strategy level is typically primarily concerned with maximizing resource productivity and addresses the question, How do we support the business-level competitive strategy? Consistent with this, at the functional level, HRM policies and practices support the business strategy goals. 3.2 Assess Human Resource Strategy & Application: These three levels of strategy corporate, business and functional form a hierarchy of strategy within large multidivisional corporations. In different corporations, the specic operation of the hierarchy of strategy might vary between top-down and bottom-up strategic planning. The top-down approach resembles a cascade in which the downstream strategic decisions are dependent on higher upstream strategic decisions. The bottom-up approach to strategy making recognizes that individuals deep within the organization might contribute to strategic planning. Strategic management literature emphasizes that the strategies at different levels must be fully integrated. Thus: strategies at different levels need to inter-relate. The strategy at corporate level must build upon the strategies at the lower levels in the hierarchy.

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However, at the same time, all parts of the business have to work to accommodate the overriding corporate goals. The need to integrate business strategy and HRM strategy has received much attention from the HR academic community, and it is to this discourse that we now turn. 4 Contemporary Issues Affecting SHRM 4.1 Identification of Contemporary Issues: Human resources rarely has a direct effect on firm performance. This is particularly true when the business logic of HRs effect requires that human resources drive firm performance through its contribution to effective strategy execution. HR professionals (and line managers) need to recognize that effective strategy execution is the basis of shareholder value and that effective strategy execution is a system of intermediate outcomes. Strategy manager means recognizing the importance of the causal relationships between HR decisions and these intermediate outcomes that ultimately drive strategic success in organization.

4.2 - Analysis Contemporary Issues Affecting SHRM HR strategy should be justified by business strategy. Without this, top management and line

managers as of little relevance to the real priorities of the business will see HR strategies, and the credibility of the HR function will be in doubt. It is therefore; instructive to consider the views of senior executives on how they rank HR issues among the key business issues that their organizations face. Todays business environment provides a stark backdrop for the ongoing disconnect between corporate performance and individual compensation.

Ensuring that is true pay for performance strategy that can deliver tangible business results. There are no companywide common denominators for compensation practices.

The role of the HR manager must parallel the needs of the changing organization. Successful organizations are becoming more adaptable, resilient, quick to change directions, and custom er-centered. Within this environment, the HR professional must learn how to manage effectively through planning, organizing, leading and controlling the human resource and be knowledgeable of emerging trends in training and employee development.

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5 - Conclusion The economy has just started to recover. The recession is finally over. Despite improving figures, some scientists predict it is going to be a long process before things will come back to their former places.

Economic crisis have also made business leaders to look at and re-assess their approach to people management. Today's managers have even greater responsibility to bring about the changes in the way people work. The corporate approach is slowly being pushed out by a more inclusive style of management as employers accept the benefits of building an engaged workforce and working across many partners.

The role of strategic HR will become more and more important in the years to come. This conclusion can be made by looking at the companies which have already successfully adopted the strategic human resource management models and with their aid have secured the secure position in today's competitive market. Other companies will have to follow this trend in order to gain some competitive advantage.

Today's modern business environment demands more from their employees, they have to have as many relevant skills and experience as possible in order to get a job. On the other hand, these employees are or will be more demanding to the businesses in terms of reward system, good working conditions, environment and motivation.

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References:
Clark, T., Grant, D. & Heijltjes, M. (2000). Researching comparative and international human resource management. International Studies of Management, 29(4), 623.

Scullion, H. (2001). International human resource management. In J. Storey (ed.), Human resource management: A critical text (pp. 288313). London: Thompson Learning.

Heathfield, Susan M.. "Human Resources ." About.com. 2013. 14 April 2013 <http://humanresources.about.com/>.

Price, Alan. "Employee Involvement, Employee-Centred Management and Empowerment." Human Resource Management in a Business Context 3rd edition 2007 26 July 2007 <http://www.bestbooks.biz/hrm/employee_involvement2.htm>.

Society for Human Resource Management (SHRM). (2007). 2007 Corporate Social Responsibility: United States, Australia, India, China, Canada, Mexico and Brazil: A Pilot Study. Virginia, US: Author.

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