Strategic human resource management ch03

1 Strategic Human Resource Management Chapter# Management Planning Fundamentals The Planning Process  Set objectives  Make forecasts  Determine your alternatives  Evaluate alternatives  Implement and evaluate plan Business Plan Comprehensive view of the firms situation today and company wide and departmental plan for the next to years Marketing Plan, Financial Plan, HR Plan, Production Operation Plan Management Planning Fundamentals cont Setting objectives  SMART  MBO Using MBO  set organizational goals     set departmental goals discuss departmental goals set individual goals give feedback The Strategic Management Process • Strategy  A chosen course of action • Strategic Management  Policies and procedures that deal with the long range performance of an organization  The process of identifying and executing the organization’s mission by matching its capabilities with the demands of its environment FIGURE 3–1 The Strategic Management Process Strategic Management • Vision  A general statement of an organization’s intended direction that evokes emotional feelings in organization members • Mission  Spells out who the company is, what it does, and where it’s headed FIGURE 3–2 A SWOT Chart FIGURE 3–3 Strategies in a Nutshell FIGURE 3–4 Relationships Among Strategies in Multiple-Business Firms Types of Strategies CorporateLevel Strategies Concentratio n Strategy Vertical Integration Strategy Diversificatio n Strategy Geographic Expansion Strategy Consolidatio n Strategy Basic Model of How to Align HR Strategy and Actions with Business Strategy “ Strategic HR in Action improving Mergers and Acquisitions Due Diligence Stage(before finalizing the deal) Reviewing organizational culture, employee compensation, labor relations, pending employee litigations, HR policies and procedures Integration Stage(first few months) Choosing top management, communicating changes, aliening cultures, ensuring top management leadership Using HR consultants Percent of Successful Mergers in Which HR Manager Was Involved FIGURE 3–A1 The Basic HR Scorecard Relationships HR Activities Emergent Employee Behaviors Strategically Relevant Organizational Outcomes Organizational Performance Achieve Strategic Goals Creating an HR Scorecard The 10-Step HR Scorecard Process Define the business strategy Identify required HR policies and activities Outline value chain activities Create HR Scorecard Outline a strategy map Choose HR Scorecard measures Identify strategically required outcomes Summarize Scorecard measures on digital dashboard Identify required workforce competencies and behaviors 10 Monitor, predict, evaluate Step 1: Define the business strategy • Medical company: have a strategy of becoming a comprehensive healthcare network • By the end of this step, management translates its broad strategic plans into specific, actionable strategic goals Step 2: Outline the company’s value chain • Value chain: identifies the primary activities that create value for customers and related support activities • It is a tool for identifying, isolating, visualizing and analyzing the firm’s most important activities and strategic costs • Outlining and analyzing the company’s value chain help the HR manager formulate the policies and practices that make sense in terms of firm’s strategy FIGURE 3–A3 Simple Value Chain for “The Hotel Paris” Step 3: Outline a strategy map • It is a diagram that summarizes the chain of major interrelated activities that contribute to a company’s success • It shows a “big picture” of how each department/team performance contributes to achieving the company’s overall strategic goal FIGURE 3–A4 Strategy Map for Southwest Airlines Step 4: Identify strategically required organizational outcomes • Dell: receiving quick, competent and courteous technical advice by phone is one such outcome • This step identifies and specifies firm’s strategically relevant outcomes Step 5: Identify the required workforce competencies and behaviors • Medical company: employees have to take personal accountability for the results, willing to work proactively (be “generative”) to find new and novel solutions Step 6: Identify the required HR system, policies and activities • Medical company: new training and pay plans • In this step one should be specific  We need new training programs  Exactly what sort of new training programs we need Step 7: Choose HR scorecard measures • How to measure HR policies and activities • Improve company's disciplinary system  How to manage such improvements  Solution: Number of grievances • HR score card contains a balance of financial and non financial, short and long-term, external and internal goals • Example: Southwest might measure turnaround time in terms of “ improve turnaround time from an average of 30-mins per plane to 26-mins per plane and then measure customer satisfaction with periodic year Step 8: Summarize the scorecard measure in a digital dashboard • “A picture is worth thousand words” • It presents HRM function, core measures from HR scorecard Via a PC desktop screen • Example: A manager’s dashboard for Southwest Airline might display daily trends for activities such as fast turnaround, attracting and keeping customers, on time flights and employee morale • Gives manager time to take corrective actions ... resources—supplementing what you have and doing more with what you have—can be more important than just fitting the strategic plan to current resources Competitive Advantage Strategic Human Resource. .. current resources Competitive Advantage Strategic Human Resource Management • Strategic Human Resource Management  The linking of HRM with strategic goals and objectives in order to improve business... achieve its strategic aims Three Main Strategic Human Resource System Components Characteristics of HPWS • multi-skilled work teams • empowered front-line workers • extensive training • labor-management