University of Dhaka

Faculty of Business Studies

Department of Marketing

Linking Corporate & HR Strategies

Submitted to

Prof. Dr. Serajul Hoque

Submitted by

Assignment on LINKING CORPORATE & HR STRATEGIES

NADEEM NAFIS - 4119044

INTRODUCTION
Human resource management (HRM, or simply HR) is the management of an organization's workforce, or human resources. It is responsible for the attraction, selection, training, assessment, and rewarding of employees, while also overseeing organizational leadership and culture, and ensuring compliance with employment and labor laws. In circumstances where employees desire and are legally authorized to hold a collective bargaining agreement, HR will typically also serve as the company's primary liaison with the employees' representatives (usually a labor union). HR is a product of the human relations movement of the early 20th century, when researchers began documenting ways of creating business value through the strategic management of the workforce. The function was initially dominated by transactional work such as payroll and benefits administration, but due to globalization, company consolidation, technological advancement, and further research, HR now focuses on strategic initiatives like mergers and acquisitions, talent management, succession planning, industrial and labor relations, and diversity and inclusion. Whereas in startup companies HR's duties may be performed by a handful of trained professionals or even by non-HR personnel, larger companies typically house an entire functional group dedicated to the discipline, with staff specializing in various HR tasks and functional leadership engaging in strategic decision making across the business. To train practitioners for the profession, institutions of higher education, professional associations, and companies themselves have created programs of study dedicated explicitly to the duties of the function. Academic and practitioner organizations likewise seek to engage and further the field of HR, as evidenced by several field-specific publications.

History
Antecedent theoretical developments
HR spawned from the human relations movement, which began in the early 20th century due to work by Frederick Taylor in lean manufacturing. Taylor explored what he termed "scientific management" (later referred to by others as "Taylorism"), striving to improve economic efficiency in manufacturing jobs. He eventually keyed in on one of the principal inputs into the manufacturing processlaborsparking inquiry into workforce productivity. The movement was formalized following the research of Elton Mayo, whose Hawthorne studies serendipitously documented how stimuli unrelated to financial compensation and working conditionsattention and engagementyielded more productive workers. Contemporaneous work by Abraham Maslow, Kurt Lewin, Max Weber, Frederick Herzberg, and David McClelland formed the basis for studies in organizational behavior and organizational theory, giving room for an applied discipline.

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Assignment on LINKING CORPORATE & HR STRATEGIES

Birth and evolution of the discipline

By the time enough theoretical evidence existed to make a business case for strategic workforce management, changes in the business landscape (a l Andrew Carnegie, John Rockefeller) and in public policy (a l Sidney and Beatrice Webb, Franklin D. Roosevelt and the New Deal) had transformed the employer-employee relationship, and the discipline was formalized as "industrial and labor relations". In 1913, one of the oldest known professional HR associationsthe Chartered Institute of Personnel and Developmentwas founded in England as the Welfare Workers' Association, then changed its name a decade later to the Institute of Industrial Welfare Workers, and again the next decade to Institute of Labour Management before settling upon its current name. Likewise in the United States, the world's first institution of higher education dedicated to workplace studiesthe School of Industrial and Labor Relationswas formed at Cornell University in 1945. During the latter half of the 20th century, union membership declined significantly, while workforce management continued to expand its influence within organizations. "Industrial and labor relations" began being used to refer specifically to issues concerning collective representation, and many companies began referring to the profession as "personnel administration". In 1948, what would later become the largest professional HR associationthe Society for Human Resource Management (SHRM)was founded as the American Society for Personnel Administration (ASPA). Nearing the 21st century, advances in transportation and communications greatly facilitated workforce mobility and collaboration. Corporations began viewing employees as assets rather than as cogs in machine. "Human resources management", consequently, became the dominant term for the functionthe ASPA even changing its name to SHRM in 1998. "Human capital management" is sometimes used synonymously with HR, although human capital typically refers to a more narrow view of human resources; i.e., the knowledge the individuals embody and can contribute to an organization. Likewise, other terms sometimes used to describe the field include "organizational management", "manpower management", "talent management", and simply "people management".
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In popular media
HR has been portrayed in several instances of popular media. On the U.S. television series of The Office, HR representative Toby Flenderson is sometimes seen as a nag because he constantly reminds coworkers of company policies and government regulations. Long-running American comic strip Dilbert also frequently portrays sadistic HR policies through character Catbert, the "evil director of human resources". An HR manager is also the title character in the 2010 Israeli film The Human Resources Manager.

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Assignment on LINKING CORPORATE & HR STRATEGIES

PRACTICE
Business function
HR's overarching mission has been compartmentalized by industry expert Dave Ulrich as fourfold: (1) aligning HR and business strategy (strategic partner), (2) re-engineering organization processes (administration expert), (3) listening and responding to employees (employee champion), and (4) managing transformation and change (change agent). In practice, HR is responsible for employee experience during the entire employment lifecycle. It is first charged with attracting the right employees through employer branding. It then must select the right employees through the recruitment process. HR then onboards new hires and oversees their training and development during their tenure with the organization. HR assesses talent through use of performance appraisals and then rewards them accordingly. In fulfillment of the latter, HR may sometimes administer payroll and employee benefits, although such activities are more and more being outsourced, with HR playing a more strategic role. At the macro-level, HR is in charge of overseeing organizational leadership and culture. HR also ensures compliance with employment and labor laws, which differ by geography, and often oversees health, safety, and security. In circumstances where employees desire and are legally authorized to hold a collective bargaining agreement, HR will typically also serve as the company's primary liaison with the employees' representatives (usually a labor union). Consequently, HR, usually through industry representatives, engages in lobbying efforts with governmental agencies (e.g., in the United States, the United States Department of Labor and the National Labor Relations Board) to further its priorities. The discipline may also engage in mobility management, especially pertaining to expatriates; and it is frequently involved in the merger and acquisition process. HR is generally viewed as a support function to the business, helping to minimize costs and reduce risk.

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Assignment on LINKING CORPORATE & HR STRATEGIES

IMPORTANCE OF HRM IN ORGANIZATIONAL SUCCESS

We have discussed the basic concept of HRM and the ways in which it helps the organization meet its goals. We will now discuss the reasons for organizations to have a HRM strategy as well as the business drivers that make the strategy imperative for organizational success. It is a fact that to thrive in the chaotic and turbulent business environment, firms need to constantly innovate and be ahead of the curve in terms of business practices and strategies. It is from this motivation to be at the top of the pack that HRM becomes a valuable tool for management to ensure success.

The Evolving Business Paradigm

One of the factors behind organizations giving a lot of attention to their people is the nature of the firms in the current business environment. Given the fact that there has been a steady movement towards an economy based on services, it becomes important for firms engaged in the service sector to keep their employees motivated and productive. Even in the manufacturing and the traditional sectors, the need to remain competitive has meant that firms in these sectors deploy strategies that make effective use of their resources. This changed business landscape has come about as a result of a paradigm shift in the way businesses and firms view their employees as more than just resources and instead adopt a people first approach.

Strategic Management and HRM

As discussed earlier on modern day HRM practices, there is a need to align organizational goals with that of the HR strategy to ensure that there is alignment of the people policies with that of the management objectives. This means that the HR department can no longer be viewed as an appendage of the firm but instead is a vital organ in ensuring organizational success. The aims of strategic management are to provide the organization with a sense of direction and a feeling of purpose. The days when the HR manager was concerned with administrative duties is over and the current HRM practices in many industries are taken as seriously as say, the marketing and production functions.

Importance of HRM for Organizational Success

The practice of HRM must be viewed through the prism of overall strategic goals for the organization instead of a standalone tint that takes a unit based or a micro approach. The idea here is to adopt a holistic perspective towards HRM that ensures that there are no piecemeal strategies and the HRM policy enmeshes itself fully with those of the organizational goals. For instance, if the training needs of the employees are simply met with perfunctory trainings on omnibus topics, the firm stands to lose not only from the time that the employees spend in training but also a loss of direction. Hence, the organization that takes its HRM policies seriously will ensure that training is based on focused and topical methods.

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Assignment on LINKING CORPORATE & HR STRATEGIES

In conclusion, the practice of HRM needs to be integrated with the overall strategy to ensure effective use of people and provide better returns to the organizations in terms of ROI (Return on Investment) for every rupee or dollar spent on them. Unless the HRM practice is designed in this way, the firms stand to lose from not utilizing people fully. And this does not bode well for the success of the organization.

STRATEGIC HUMAN RESOURCE MANAGEMANT

Strategic Human Resource Management is the practice of aligning business strategy with that of HR practices to achieve the strategic goals of the organization. The aim of SHRM (Strategic Human Resource Management) is to ensure that HR strategy is not a means but an end in itself as far as business objectives are concerned. The idea behind SHRM is that companies must fit their HR strategy within the framework of overall Business objectives and hence ensure that there is alignment between the HR practices and the strategic objectives of the organization.

Evolution of SHRM
With the advent of new economy industries like IT and the mushrooming of the service sector, organizations all over the world realized that human resources must be viewed as a source of competitive advantage as opposed to treating it much the same way in access to technology or capital is concerned. What this means is that the practice of HRM is being viewed as something that promotes the business objectives of the firms and not merely another factor in the way the firm is managed.

How does SHRM fit in with Strategy?

With the advent of todays economy where services account for a major share of the GDP and the fact that the service sector is essentially people centric, it is imperative that the people first approach be embraced by the organizations for sustainable business strategy. The practice of SHRM demands a proactive and hands on approach by the management as well as the HR department with regards to the entire gamut of activities ranging from staffing and training and development to mentoring and pay and performance management.

The Way SHRM works

If we take real world examples, many organizations in recent times have dedicated people managers whose sole function is to look after the enabling and fulfilling needs of the resources. This is a marked change from treating people as just resources to treating people as assets. For instance, Infosys states that people are its assets and the famous statement by Mr. Narayana Murthy, one of the founders of the company that the capital of Infosys walks in every morning and walks out every evening has to be taken in this context.

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Assignment on LINKING CORPORATE & HR STRATEGIES

Elaborating on this point, one finds that organizations tend to leverage upon the capabilities of the people employed there and ensuring that the human capital is nourished and nurtured as a source of competitive advantage. This translates into a dedicated HR department and people managers in every group dealing exclusively with employee issues as opposed to treating this as a line management function. The times when management could arbitrarily dictate terms to the employees and tread upon their rights is something that is not relevant anymore. With the ballooning of the white collar workforce, it becomes necessary for organizations to pay more attention to the needs of the employees more than ever. Finally, the fact that organizations derive their strategy from employees instead of imposing strategy upon them is the essence of SHRM.

ALIGNING HR WITH CORPORATE STRATEGY

When HR expands its traditional administrative role, it can have a significant impact on an organizations value creation. To properly align HR with an organizations strategy, it first needs to be organized so that it can play a role in the strategic planning of the organization. It is human capital that leverages all other areas of an organization. Therefore the HR department needs to ensure the human asset is effectively aligned with the strategy that is chosen by the organization. To capitalize on this leverage, organizations need to adopt a new perspective of HR. The first step in aligning HR with strategy is to recognize that the HR department and its duties are a strategic asset, instead of the traditional administrative function of being a cost center, focused on compliance. This administrative role works on efficiency and is therefore a commodity. If an organization fails to recognize this commodity, it misses the opportunity to allow HR to become strategic. This administrative mindset needs to evolve into a focus on value creation. In order to achieve this focus, HR must first recognize that it needs to play a strategic role, and top management must support HRs role by accepting HR into the strategic planning initiatives. The alignment between HR and the strategy of an organization begins with a strategy-focused professional. Secondly, the HR system needs to be created in alignment with the organizations strategy. HR needs to ensure that employees are strategically focused. Every element of the HR function, from hiring, compensation, reviews, training, etc., needs to be developed in order to enlarge the human capital in the organization.

Moving away from administrative duties and expanding into strategy

Becoming more strategic does not mean that HR can ignore its administrative duties. Rather, to become more strategic, HR must not only recognize its administrative role, but also expand its influence beyond administrative towards a strategic role. Efficient administrative work builds HRs creditability and remains the foundation upon which to build a strategic influence in the

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Assignment on LINKING CORPORATE & HR STRATEGIES

organization. To enable HR staffs to focus on more strategic initiatives many of the routine administrative duties can be automated or out-sourced. Obviously, HR cannot abandon its administrative duties, especially employee health benefits and personal legal issues; however instead HR needs to operate at both administrative and strategic levels. In order to be strategic, a longer view of HR resources is needed. Too often the perspective of HR is internally focused. For example, it is common for HR departments to measure their value to the organization by the amount of hires made, performance reviews completed, or training courses delivered. If HR is to work as an equal partner in the organizations strategic efforts, it must be able to successfully manage the administrative side of its duties, along with being able to talk at a strategic level to others in the organization about the HR responsibility in supporting strategic objectives.

Increasing HR personal competencies

Traditionally, HR personal is not considered to be a central strategic player in most organizations. HR has so much more to contribute towards the success of an organizations strategy and doing so requires an upgrade in personal. An organization needs to acknowledge that HR is important to its business success. In order for HR to achieve this recognition, it must have the right people in place to carry out a strategic initiative. HR needs to define the competencies and skills that it will need to be a strategic contributor. Outstanding HR personal will need to build their business knowledge, financial skills, as well as consulting skills. Furthermore, HR personal will need to become technologically oriented, so they can be free from routine administrative work, as well as leverage information about the workforce. Enabled by technology, HR will be able to play a more strategic managerial role. Equipped with the skills mentioned above, HR departments will derive their goals from the business objectives of the organization and become more strategically involved.

Measuring HR from a cost/benefit analysis

To overcome the resistance to HR having a say in organizational strategy, HR needs to measure and identify the benefit from being a part of the strategic process. Most organizations will agree that HR plays an important part in its success, but continue to prevent HR from being included in the true strategic objectives of an organization. Being able to describe the strategic benefit HR provides will help in being recognized as valuable contributor. HR needs to measure is its impact on organizational strategy and its efforts to build programs to better manage the development of an organizations human assets. Specifically, HR needs to measure the organizations competencies, leadership, culture, alignment, and learning. Measuring these issues provide a framework for describing the drivers of an organizations strategy. When assessing its value added to the organization, HR must look to these strategic drivers as their point of reference. In each measurement, HR will be accountable for the organizations readiness for each component of the strategy. Below is an example of a chart to assist in measuring these HR/organization issues.

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Assignment on LINKING CORPORATE & HR STRATEGIES

The measures listed in the table above will link the organizations strategy and HR strategy. With this type of measurement, HR has a means to discuss strategy with top management. These measures also highlight HRs challenges and contributions to the organizations strategy. Furthermore, the responses become a source of organizational alignment and allow HR to reposition their roles and become strategic partners in and organizations strategy.
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Achieving the link to the strategic plan

An emphasis on HR leads to understanding the role HR plays in strategically building a competitive advantage. There is a link between strategy and HR. The greater the congruence between strategy and HR, the more effective the organization will be. Different strategies require different skills. Thus, organizations pursuing different strategies will require different skills in personal and this is where HR needs to be aligned with strategy. The pattern of planned human resource deployments and activities intended to enable an organization to achieve its goals is strategic human resource management. In essence, an organizations competitive advantage is more easily obtained when its HR is effectively linked with its strategy. The need to match strategies and HR has implications for both the recruitment of personal and organizational performance . In other words, when HR is strategic and involved with and/or linked to organizational performance, it plays an important role in the success of an organization. By measuring the key HR contributors to strategy, execution the HR function is transformed into a source of value creation for the organization. Measuring the key HR issues in strategy provide the alignment between HR and business process and ultimately, what can be used to link to financial business outcomes.

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Assignment on LINKING CORPORATE & HR STRATEGIES

CONCLUSION
Aligning HR and corporate strategies is an important endeavor for every organization. Studies strongly support the alignment between strategies, HR, and performance and thus show the potential role HR can play in implementing strategy and developing an organizations competitive advantage. Alignment between HR activities and corporate strategy planning can be formed by HR. HR needs to expand beyond an administrative function and focus more on how it can support the organization in strategic planning and implementation. By increasing the competencies of HR personal, the department will increase its creditability and be integrated into a strategic role. When HR measures itself from a business perspective and by the value it brings an organization, top management will not ignore HR in the strategy process. Instead, top management will welcome HR input because it will have a clear understanding of how HR affects the bottom line from a business and/or strategic standpoint. By inter-locking HR measures with items concerning the ongoing business, HR becomes aligned with strategy through dependent tasks that are accounted for interdependently. In summary, an organizations people and their skills ultimately determine the effectiveness of strategic plans, and its implementation. In its purest form, HR is best suited for leveraging an organizations personal that implements the organizations strategic plans. In other words, HR resources are what drive an organizations strategic process.

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Assignment on LINKING CORPORATE & HR STRATEGIES

REFERECNCEs
Dessler G., Human Resource Management, 12e, Pearson education Inc.
http://www.management.com.ua/hrm/hrm017.html http://www.managementstudyguide.com/human-resource-management.htm

http://en.wikipedia.org/wiki/Human_resouces

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