Strategic Human Resource Management: An Overview By Dr. Kitunzi Mutunzi.

Strategic Human Resource

Management:

An Overview

By Dr. Kitunzi Mutunzi

Session Objectives/Scope

To refresh & enhance participants’ capacities to appreciate and gainfully utilize:

• An overview of some core concepts & scope of HRM

• The meaning & Essence of SHRM– The concepts of strategy & strategic management

• Relationship between HR & Strategic management

• Basics/ essentials for establishing SHRM 04/21/23 2SHRM-Overview

SHRM-Overview 1-3

What is Human Resource Management?

• Planning, organizing, coordinating, & controlling the Utilization of individuals to achieve organizational objectives

• NB: All managers at every level must concern themselves with human resource management

–What are the primary (Five) functions of HRM?

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1

Human Resource

Management

Human Resource

Development

Com

pens

ation

Staffing

Employee and Labor

Relations

Safety and Health

Human Resource Management- Basic Functions

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What constitutes Staffing in HRM?

• Human Resource Planning• Job Analysis• Recruitment

• Selection

• Orientation/socialization

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What is involved in Human Resource Development?

• Training• Development

• Career Planning• Career Development

• Organizational Development• Performance Management

• Performance Appraisal

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What does Compensation entail in HRM?

• Direct Financial Compensation - Pay that person receives in form of wages, salaries, bonuses, and commissions.

• Indirect Financial Compensation (Benefits) - All financial rewards not included in direct compensation such as paid vacations, sick leave, holidays, and medical insurance.

• Nonfinancial Compensation - Satisfaction that person receives from job itself or from psychological and/or physical environment in which a person works.

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What Comprises Safety and Health in HRM?

• Safety - Involves protecting employees from injuries caused by work-related accidents

• Health - Refers to employees' freedom from illness and their general physical and mental well being

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What is Employee and Labor Relations about in HRM?

• Labor Union and Collective Bargaining• Organizations are required by law to recognize trade

unions and bargain with them in good faith if their employees want the unions to represent them – Human resource activity is often referred to as industrial

relations • NB: Most firms today would rather have a union-

free environment • Private-sector union membership has fallen from 39 percent in 1958

to 7.8 percent in 2005.

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Interrelationships of HRM Functions

• All HRM functions are interrelated

• Each function affects other areas

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Environment of Strategic Human Resource Management

EXTERNAL ENVIRONMENTINTERNAL ENVIRONMENT

1

Human Resource

Management

Other Functional

Areas

OperationsMarketing

Finance

Lega

l Con

side

ratio

ns E

cono

my

Technology

Society

Shareholders

Unions

Customers Competition Labor Market

Human Resource

Development

Com

pens

ation

Staffing

Employee and Labor

Relations

Safety and Health

Unanticipated Events

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HR’s Changing Role: Questions That Are Being Asked

• Can some HR tasks be performed more efficiently by line managers or outside vendors?

• Can some HR tasks be centralized or eliminated altogether?

• Can technology perform tasks that were previously done by HR /personnel?

• Many HR departments continue to get smaller

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HR’s Changing Role:Who Performs Human

Resource Management Tasks?

• Human Resource Managers• HR Outsourcing

• HR Shared Service Centers• Professional Employer Organization

(Employee Leasing) • Line Managers

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HR as a Strategic Partner

• HR executives must understand complex organizational design

• Sharp deviation from what has traditionally been an administrative type role for HR

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Human Resource Designations: Executives, Generalists, and Specialists

Vice President, Human

Resources

Vice President, Industrial Relations

Manager, Compensation

Manager, Staffing

Manager, Training and Development

Benefits Analyst

Executive: Generalist: Specialist:

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Traditional Human Resource Functions in a Large Firm

President and CEO

Vice President, Marketing

Vice President, Operations

Vice President, Finance

Vice President, Human

Resources

Manager, Training and Development

Manager, Compensation

Manager, Staffing

Manager, Safety and

Health

Manager, Labor

Relations

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The Evolving HR Organization

• HR Outsourcing• HR Shared Service

Centers • Professional Employer

Organization

• Line Manager

• Evolve to make HR more strategic

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A Possible Evolving HR Organization Example

President and CEO

Vice President, Operations

Vice President, Strategic Human

Resources

Vice President,

Finance

Director of Safety and

Health

Training & Development (Outsourced)

Compensation (Shared Service

Centers)

Staffing (Line Managers, Use of Applicant

Tracking Systems)

Vice President, Marketing

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What is Strategic Human Resource Management (SHRM)?

• Various Definitions:• SHRM is an approach to making decisions on the

intentions of the organization concerning people-essential components of the organization`s business strategy. – It is about the relationship between HRM and Strategic

management in the organization.

• SHRM refers to the overall direction the organization wishes to pursue in achieving its objectives through people.04/21/23 SHRM-Overview 23

Definition of SHRM cont’d

• SHRM can be regarded as an approach to dealing with longer-term people issues as part of the strategic management thrust of the business. – It covers macro-organisational concerns relating

to structure and culture, organizational effectiveness & performance, matching resources to future business requirements, & the management of change.

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Meaning of SHRM cont…• SHRM deals with `those HR activities used to

support the firms competitive strategy (Wright & Snell, 1989).

• SHRM encompasses those decisions & actions which concern the management of employees at all levels in the business & which are directed towards creating & sustaining competitive advantage (Miller, 1989).

• SHRM is the means of aligning the management of human resources with the strategic content of the business (Walker, 1992).


Meaning of SHRM cont…According to Hendry & Pettigrew (1986), SHRM has the following four meanings:I.The use of planningII.A coherent approach to the design & management of personnel systems based on an employment policy & manpower strategy & often underpinned by a philosophy.III.Matching HRM activities and policies,IV.Seeing the people of the organization as a strategic resource for the achievement of competitive advantage.

04/21/23 28SHRM-Overview


What is a Strategy?

• A strategy is a process (or approach/ methodology /plan/ measures/ means) through which the basic mission and objectives of an entity are set, and a process through which the entity/ organization uses its resources to achieve its objectives.

• Strategy = channel/ plan





Salient Fact to Note:Human Resources are increasingly a strategic issue

because of the following empirical observations:– There is an overall corporate purpose and that the

human resource dimensions of that purpose are evident.– A process of developing strategy within the organization

exists and is understood, and that there is explicit consideration of human resource dimensions.

– The organization at all levels establishes responsibility and accountability for human resource management.

• It includes the responsibility to identify and interact in the social, political, technological and economic environments in which the organization is and will be doing business.



What are the Basic Requirements for establishing Effective SHRM?

Entities that effectively observe SHRM often have the following characteristics:

• Strong, visionary and often charismatic leadership from the top.

• Well articulated vision, mission, objectives and values.• A clearly expressed business strategy which had been

implemented successfully• A positive focus on well understood critical success

factors


Prerequisites for Good SHRM cont’d

• A closely related range of products or services offered by the organization to its customers/clients.

• A cohesive top management team.• A personnel/HR director who plays an active

part in discussing corporate/business issues as well as making an effective & corporate/ business-oriented contribution on HR matters.


What are Basic Functions of Strategic Human Resource Managers?

• General Management of the HR Department• Knowledge of Laws• Interaction with Executive Leadership• Employee Relations

– Collaboration

• Commitment Building• Building Capacity


End of Session

• Thank you for your attention/participation

• Questions, issues, concerns, etc are yet welcome


Group Work/ExercisesRead the handout given and undertake the following

tasks (as prep for subsequent lectures):Tasks:a) Describe the major activities/tasks undertaken in coming

up with a good strategic Human resources plan? (pp-15-16)

b) Identify the Human Resources Strategic Planning Pitfalls that ought to be avoided? (pp16)

c) Expound the Key Challenges with Human Resource Planning (pp-20)

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Group Work/Exercises- cont…

• More Tasks:• A typical strategic human resource planning

model comprises six specific steps in developing a Human Resource Strategy. Which are these six steps? (pp22)

• Read pages 26- to 40 of the notes given for further discussion.



Strategic Human Resource Management: An Overview By Dr. Kitunzi Mutunzi.

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