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What is ?
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SHRM

Jun 20, 2015

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Business

Kapil Kumar

Strategic Human Resource Management is key to utilize human resource of the organisation efficiently and effectively by formulating the strategy.
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Page 1: SHRM

What is

?

Page 2: SHRM

It is a plan of actions designed to achieve a long-term or overall aim of an organization.

Kurkure’s strategy was not only advertising.

Consumer’s trial. Kurkure’s first launch market was Chandigarh, where

the sales team launched an orange parade. All the three-wheelers carrying the product were painted orange. Almost the entire sales team had assembled in Chandigarh to ensure 100 per cent coverage of outlets in 10 days!!!

Its success led to it being repeated in other regions too.

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• A strategy should be :-• Unified :- Ties all enterprise together.• Comprehensive :- Covers all major aspects of

enterprise.• Integrated :- All parts of the plan are

compatible with each other and fit together.

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7 STEPS OF STRATEGIC PLANNING

Define the current business

Perform external and internal audits

Formulate a new direction

Translate a mission into a strategic goals

Formulate strategies to achieve the strategic goals

Implement strategies

Evaluate the performance

Strategic Planning

Strategic Execution

Strategic Evaluation

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• A strategic plan is the company s plan for how it will match its internal strengths and weaknesses with external opportunities and threats in order to maintain a competitive advantage. The essence of strategic planning is to ask, Where are we now as a business where do we want to be, and how should we get there?

• Strategic management is the process of identifying and executing the organization s strategic plan, by matching the company s capabilities with the demands of its environment.

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Generic Types of Strategy Corporate-Level

Strategy

Sales DepartmentFunctional

Strategy

Business 2 Competitive Strategy

Business 3 Competitive Strategy

Business 1Competitive Strategy

Production DepartmentFunctional

Strategy

HR DepartmentFunctional

Strategy

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Corporate-level Strategy“What business should we be in?”

Concentration (Single Business)

Diversification

Vertical Integration

Geographic Expansion

Consolidation

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Competitive Strategy“How will we compete ?”

Cost Leadership

Differentiation

Focuser

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Functional Strategy

Functional strategies identify the broad guidelines that each

department will follow in order to help the business accomplish its competitive goals.

Each department’s functional strategy should make sense in terms of the business/

competitive strategy.

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HR as a

Competitive Advantage

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• A competitive advantage enables a company to differentiate its product or service from those of its competitors.

• For GE, the workers skills and dedication are competitive advantages; they produce the quality and productivity that make GE an aerospace leader.

• Apple’s reputation for innovation reflects its competitive advantage in creative and brilliant engineers. Thus, the best competitive advantage is often human capital knowledgeable, skilled, engaged employees working hard and with self-discipline.

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SHRM

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“You may not realize it when you’re managing, but your company’s strategic plan is giving much of what you do.”

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• Practice of aligning business strategy with that of HR practices to achieve the strategic goals of the organization.

• End in itself as far as business objectives are concerned.

• IDEA:- COMPANIES MUST “FIT” THEIR HR STRATEGY WITHIN THE FRAMEWORK OF OVERALL BUSINESS OBJECTIVES

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STRATEGIC HUMAN RESOURSCE MANAGEMENT

PracticesPolicies

Behavior of EmployeesEmployee Competencies

Mold according to the origination's

objectives.

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In SHRM the policies are related to :-• What sorts of people you hire?• What you train them to do?• How you appraise and reward

them?

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How HRM can be supportive to the

firm’s strategic planning ?

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Company Strategy HR Strategy

Company’s Strategic Situation

Company’s Competitive Environment

Company’s Internal

Environment

Company’s Strategic Plan Should we expand Geographically? Cut cost ? Diversify?

Company s HR (and other functional)strategies

What are the basic policiesHR will pursue to ensure that the recruiting,selecting, training, appraising, andcompensation systems support thecompany s strategic plan?

Organizational Performance

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How can we achieve cost leadership through

SHRM ?

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LOW-COST LEADER

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Aim:- • To deliver convenient services on it’s route.• Limited passenger services (such as meals).• Short-Haul• Point-to-Point service between mostly mid-

size cities.• High aircraft utilization.• Lean highly productive ground crews.

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ACTIONS THEY NEED TO TAKE

• Southwest s ground crew department must get fast 15-minute turnarounds at the gate.

• Its purchasing and marketing departments shun frills like meals and premium classes of service.

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Practices

• High Compensation• Flexible Union Contracts• Employee Stock Ownership

High Pay Highly Productive Ground Crews Frequent Departures Low Cost

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The first company of the group, TVS & Sons, set up in 1911, has a strike-free record.

Treat employees like family. Put employees' interests ahead of the company's. Constantly communicate with employees to build trust. Always honor assurances given to employees. Involve employees while taking major decisions. Empower employees at work. Condone errors of judgment but punish dishonesty. Extend relationships with employees beyond work. Adopt an open-door policy. Do not pressure employees to engage in unethical acts.

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Examples of the Company’s Strong HR Department

• Global Financial Crisis of 2008, the management at TVS & Sons sought to temporarily reduce workers' wages, but left it to them to decide how much they would forgo. Far from protesting, employees agreed; while the management had expected a 5 per cent reduction proposal, the employees sprang a surprise by suggesting a 15 per cent cut. "The company has always stood by us. We saw this as an opportunity to help it tide over a temporary crisis," says S Ramasamy, manager, IT Systems, TVS & Sons.

• "I make it a point to directly interact with workers across all our factories at least three times a year. A frank interaction helps build enormous trust," says Suresh Krishna, Chairman and Managing Director at Sundram Fasteners.

• It started a provident fund scheme in the early 1940s, before it became mandatory for private companies, after the Provident Fund Act was passed in 1952.

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SHRM TOOLS

• STRATEGY MAP• THE HR SCORECARD• DIGITAL DASHBOARDS

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STRATEGY MAP

• How each department’s performance contributes to achieving the company s overall strategic goals?

• The strategy map helps each department (including HR) visualize what it needs to do to support organization's strategy.

• Managers can access their companies strategy maps while on the go.

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DIGITAL DASHBOARD

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• A digital dashboard presents the manager with desktop graphs and charts, showing a computerized picture of how he company is doing on all the metrics from the HR Scorecard process.

• Manager’s dashboard might display real-time trends for various strategy map activities.

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HR SCORECARD

It refers to a process for assigning financial and nonfinancial goals or metricsto the human resource management related chain of activities required for achievingthe company’s strategic aims. The computerized scorecard process helps the manager quantify the relationships

between:-

HR activities

Resulting employee behaviors

Resulting firm-wide strategic outcomes and performance

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HUMAN RESOURCE METRICS

• Benchmarking in Action• Strategy and Strategy-Based Metrics• Data Mining• HR Audits

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Significance• Only provides one way to look at how your company’s human resource

management system is performing.• Employers increasingly use workforce analytics (or talent analytics )

software applications to analyze their human resources data and to draw conclusions from it.

• The logical solution is to assess recruitment effectiveness, using measures or metrics. Metrics here might include quality of new hires and which recruitment sources produce the most new hires.

• In conducting the HR audit, managers often benchmark compare their results to those of comparable companies.

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HIGH PERFORMANCE HUMAN RESOURCE POLICIES AND

PRACTICES

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• Human Resource Metrics• Hire based on validated selection tests• Aspire to help workers to manage themselves.• Measurable Differences

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THANK YOU