Business Through Effective Human Resource Strategies Business Essay

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One of the most important tasks that involve the personnel department in an organisation is human resources management. An organisation is only likely to achieve its objectives if their employees are used effectively. Planning how best to use human resources will help an organisation to achieve its goals and objectives. Human resources management has strategic implications. It means constantly looking for better ways of using employees to benefit the organisation. According to Michael Armstrong (2003), strategic human resource management (SHRM) can be defined as an approach to making decisions on the intentions and plans of the organisation concerning the employment relationship and its recruitment, training, development, performance management, reward and employee relations strategies, policies and practices. It's an approach to human resource management that has the goal of using people most wisely with respect to the strategic needs of the organisation. It is strategic approach to the management of an organisation's most valued assets: the people working there who individually and collectively contribute to the achievement of its objectives. There are several models and theories of strategic human resource management. Among these are best practice model and contingency model identified by Hope-Hailey et al (1998). According to Michael Armstrong in his book titled 'A handbook of Human Resource Management Practice'. Best practice model of strategic human resource management otherwise known as outcome model is a model that emphasise commitment rather than compliance and advocates processes of culture management to achieve cultural control of an organisation. It is universalist approach. This model explains that all organisations will record achievements in organisations performance provided they identify, gain commitment to and put in place a set of human resource management practice e.g. reward practice. (Guest, 1997) said and I quote, 'In this model, 'high commitment' concept links with human capital, as it must have a high level of commitment, enforced by the 'ideal set of practices''. This means that the best set of human resource practices have to be put in place for the improvement of the productivity and effectiveness of human capital, place priority on how human capital can be motivated, and an idea to accomplish the organisation's goals while contingency model concentrates on the achievement of fit between organisations/businesses and human resource strategies. It is a situation where definition of organisations aims, policies and strategies, lists of activities, and analyses of the role of the HR department are valid only if they are related to the circumstances of the organisation. It is essentially about the need to achieve fit between what the organisation is and wants to become (its strategy, culture, goals, technology, the people it employs and its external environment) and what the organisation does (how it is structured, and the processes procedures, and practices it puts into effect).

Human resource management entails developing an organisation that caters for all the activities it requires. The figure below describes generic functions that are performed by human resource managers in all organisations.

Human Resource Circle

The major reason for human resource management in an organisation is to contribute to the organisational effectiveness and productivity so that its objectives can be achieved. The following listed strategies must be looked into by human resource personnel to meet the organisational goals and objectives - employment relationship; resourcing; performance management; human resource development; reward management; employee relations; health and safety etc. Organisations have renewed interest in management of human capital in recent years and have come to realise the importance of employees and their knowledge and skills as an asset of organisation. Every employee is important to the management of any organisation most especially at the point when an organisation needs to take decisions which are normally used as an 'agenda for change' in the organisation. This does place greater emphasis on motivation, customer care and training. It helps any organisation to seek for the right set of people to fill the vacant positions - the quality, type and number of people to be employed. The reason for this can be illustrated by the following example which explains a situation where changes in employees' selection process contributed to improved organisation success. This is a company that try as much as possible to look for best employees when it comes to recruitment although, the company do recruit student to work for this particular job role. This created problem for the organisation. The job role required the employee to stand in the warehouse for hours in a day inspecting the quality of the goods in the warehouse. The working environment is not conducive in term of dirt. Employees do quite within shortest time of starting the work. The simplest way a newly employed HR manager handled this situation is by assigning the job to individuals that are not aiming high in term of career wise and other expectations as such. He also suggested rotating the job assignment between lots of employees within shorter working hours.

Human resource management framework of Harvard is based on the belief that the problems of historical personnel management can only be solved when general managers develop a viewpoint of how they wish to see employees involved in and developed by the organisation, and of what HRM policies and practices may achieve those goals. Without either a central philosophy or a strategic vision - which can be provided only by general managers, human resource manager is likely to remain a set of independent activities, each guided by its own practice tradition. It is believed that many pressures are demanding a broader, more comprehensive and more strategic perspective with regard to the organisation's human resources. These pressures have created a need for a longer term perspective in managing people and consideration of people as potential assets rather than merely a variable cost. They were the first to underline the HRM tenet that HRM belongs to line managers. They also stated that HRM involves all management decisions and actions that affect the nature of the organisation and its employees-Its human resources. Harvard suggested that HRM had two properties. First, line managers accept more responsibility for ensuring the alignment of competitive strategy and personnel policies and secondly, personnel has the mission of setting policies govern how personnel activities are developed and implemented in ways that make them more mutually reinforcing.

Stakeholder Interest



employee; etc

Long -term consequences:

individual well being;

organisational effectiveness; etc

HR outcomes



cost effectiveness; etc

Situational Factor:

work force characteristic;

labour market; etc

HRM policy choice

employee influence;

human resource flow; etc

Harvard Framework for Human Resource Management

The process of human resource management started when personnel management was in charge of employee needs and wants, how employees are paid, monitoring and ensuring they were motivated. This changed with the introduction of HRM in the early 1990s and it has become the most widely used approach to the management of people in all organisations. HRM processes that contribute to or underpin the activities of any organisation are as follows - HR planning, recruitment, selection, directing, training and development, and performance appraisal. Above listed stages has to be in place for effective human resource management functions to be observed in an organisation. The development of strategy can be defined as a process for forming and defining a sense of direction. It has been described as a logical, step-by-step affair, the outcome of which is a formal written statement that provides a definitive guide to the organisation's long term intentions. Strategy is a systematic process: first we think, then we act; we formulate then we implement. But we also 'act in order to think'. In practice, 'a realised strategy can emerge in response to an evolving situation' and the strategic planner is often 'a pattern organiser, a learner if you like, who manages a process in which strategies and visions can emerge as well as be deliberately conceived.'

All organisations exist to achieve a purpose. Strategic HRM practices are important for meeting the organisational objectives. The focus of the HR policies and processes remain on the assessment of the roles and responsibilities, which are essential to be aligned for performing the duties optimally. It fosters the degree of transfer of knowledge among the diverse team members. When considering the roles of strategic HRM, it is necessary to address the extent to which HR strategy should take into account the interest of all the stakeholders in the organisation, employees in general as well as owners and management. HR planning should aim to meet the needs of the key stakeholders group involved in people management in an organisation. soft strategic HRM will place greater emphasis on the human relations aspect of people management, stressing security of employment, continuous development, communication, involvement, the quality of work-life balance. Hard strategic HRM on the other hand will emphasise the yield to be obtained by investing in human resources in the interest of the organisation. The roles of strategic HRM in achieving organisational objectives are described as follows: Organisational development is concern with the planning and implementation of programmes designed to enhance the effectiveness with which an organisation functions and responds to change. Overall, the aim is to adopt a planned and coherent approach to improving organisational effectiveness. Transformation is a change in the shape, structure, and nature of something. Organisational transformation is the process of ensuring that an organisation can develop and implement major change programmes that will ensure that it responds strategically to new demands and continues to function effectively in the dynamic environment in which it operates. Culture is managed by the leaders in the organisation, especially those who have shaped it in the past. Culture is learnt over a period of time. People identify with visionary leaders-how they behave and what they expect. They note what such leaders pay attention to and treat them as role models. It's also managed by important events from which lessons are learnt about desirable or undesirable behaviour. There is need for culture managers to mention effective working relationships among organisation members, and this establishes values and expectations. Finally, culture is influenced by the organisation's environment. The external environment may be relatively dynamic or unchanging. Knowledge management is any process or practice of creating, acquiring, capturing sharing and using knowledge, wherever it resides, to enhance learning and performance in organisations. Knowledge management is about storing and sharing the wisdom, understanding and expertise accumulated in an organisation about its processes, techniques and operations. It treats knowledge as a key resource. Knowledge management is concerned with both stocks and flows of knowledge. Stocks include expertise and encoded knowledge for example computer systems. Flows represent the ways in which knowledge is transferred from people to people or from people to a knowledge database. Reward is about formulation and implementation of strategies and policies that reward people fairly, equitable and consistently in accordance with their value to the organisation. It deals with the design, implementation and maintenance of rewards practices that are geared to the improvement of organisational, team and individual performance. Reward management is an integral part of an HRM approach to managing people. The overall strategic aim of reward management is to develop and implement the reward policies, processes and practices required to support the achievement of the organisation's goals by helping to ensure that it has the skilled, competent, well-motivated and committed people it needs. Talent management is the process of ensuring that the organisation attracts, retains, motivates and develops the talented people it needs. There is nothing new about the various processes that add up to talent management. What is different is the development of a more coherent view as to how these processes should mesh together with an overall objective-to acquire and nurture talent, wherever it is and wherever it is needed, by using a number of independent policies and practices. Everyone in an organisation has talent and talent management processes should not be limited to the favoured few, although they are likely to focus most on those with scarce skills and high potential.

This report is meant to describe the concept of HR strategies that could be implemented by British Airways and the application of these strategies on same organisation. Also, the report will analyse the impact of merger on strategic HRM at British Airways. At the end of this report, I would have assessed a range of HR strategies that may be implemented within British Airways and fully understand contemporary issues affecting strategic human resource management within the organisation. The following are the HR strategies that could be implemented by BA and its application.

Performance management strategy is a drive to develop performance culture in an organisation. The high performance working involves the development of a number of interrelated processes that together make an impact on the performance of the organisation through its employee in such areas as productivity, quality, and levels of customer service, growth, and profits and ultimately the delivery of increased shareholder value. This can be achieved by enhancing the skills and engaging the enthusiasm of employees. High performance management practices include rigorous recruitment and selection procedures, extensive and relevant training and management development activities, incentive pay systems and performance management processes. Progress must be measured constantly. The main drivers, support systems and culture for high performance management are the following: Decentralise and devolve decision making by those closest to the customer - this will enable the organisation to constantly renew and improve the offer to customers; Development of people capabilities through learning at all levels, with particular emphasis on self-management and team capabilities - to enable and support performance improvement and organisational potential; Performance, operational and people management processes must be aligned to organisational objectives - to build trust, enthusiasm and commitment to the direction taken by the organisation; Fair treatment for those who leave the organisation as it changes, and engagement with the needs of the community outside the organisation - this is an important component of trust and commitment-based relationships both within and outside the organisation. Study shows through the SWOT analysis carried out in respect of BA that at gathering in New York, none of the employee in the audience remembers the organisation's mission statement which is just a sentence. Simply put, there is no any point in BA mission's statement that any employee should not know. This proves how hard to get all the resources working together to achieve the organisation's mission and goals. So, it makes it more difficult to manage performance if they do not feel like owning the organisation's objective.

Another strategy that could be implemented by British Airways is employees' relation. Employee relations strategies set out how objectives can be achieved. The intention of the organisation about what needs to be done and what needs to be changed in the ways in which the organisation manages its relationships with employees and their trade unions is defined. For example, if the business strategy is to concentrate on achieving competitive edge through innovation and delivery of quality to its customer, the employee relations strategy may emphasise process of involvement and participation, including the implementation of programmes for continuous improvement and total quality management. Employee relations consist of the approaches and methods adopted by employers to deal with employees either collectively through the union within the organisation or individually. Like all other HR strategy, employee relations strategies will flow from the business strategy but will also aim to support it. British Airways aims to achieve high efficiency by improving the flexibility of employees. This came at a cost as the airline experience industrial disputes and employee unrest that dented its image. Many examples of strikes are visible with the details of reasons but most of them are related to changes in employment terms and conditions. Those issues are highly visible to the public as strikes usually hit passengers during peak season of the year. British Airways also aims to achieve high efficiency by reducing costs. Relentless cost- cutting and outsourcing are keys to cost reduction for British Airways. The merger between BA and Spanish airline Iberia was to reduce costs. Target reduction was set for this new company for certain period of time most especially from reduced labour cost.

Remuneration policy is another and important part of HR strategies. It is seen in a different way from human resource management. Effective remuneration policy does contribute towards achieving the goals of the organisation. This is done through ensuring that workers are motivated and are able to employ their skills and talents to the full. The workforce should be highly flexible and adaptable from HR perspective. Team working and ongoing training are likely features of an organisation adapting a HRM approach of remuneration strategy. Payment systems which contribute towards achieving this will therefore help contribution towards achieving the goals of the organisation. There are number of features of payment system that contributes to achievement of an organisation. Among these are - pay flexibility, job flexibility, training, team working, decision making, employee needs, recruitment and retention, and appraisal.

Recruitment, selection and HR planning is another important strategy BA has to consider due to the amount of changes they go through. BA has gone through major changes like the privatisation in 1987 and the strategic turn-around in 1997. Despite all this, BA keeps moving forward as they signed a merger agreement with Iberia and according to Chairman's statement in the 2009/2010 Annual Report which state that "all the signs are that we can win anti-trust immunity from the US Department of Transportation along with regulatory approval from the EU competition authorities, to operate a joint business with American Airlines and Iberia over the North Atlantic.". These changes are as a result of new strategy as resourcing and planning gets more international and decentralised than it was in the past.

Analyses of the impact of merger on strategic HRM at British Airways. The merger benefitted shareholders, employees and customers. The customers are provided with a larger combine network due to the merger of both airlines. Again, the merger is very important because it helped to create one of the world's leading global airlines in terms of equipment so that it will be able to challenge other airlines and allow them to participate in consolidation of future of the industry. Cost is expected to be saved with the merger at the end of the year. It is seen as an opportunity for the British Airline to cut costs because of the past tough years for the airline industry. Critically studying these two airlines, they have few overlapping routes thereby the airlines (BA and Iberia) have a very good match. The merger between these two airlines will enable them to compete well with other big airlines in their region.

However, the manager has tremendous favour in respect of British Airways while Iberia is not. Iberia jobs were slashed down from what it used to be before merger. Salaries and cutting services were reduced by some percentage. These and many more were the reasons why the employees of Iberia (pilot) were planning to go on legal challenges over that merger agreement which it claimed was much in favour of British Airways.


Hall. A; Jones A; Raffo. C and Anderton. A, (2008), Business Studies, Pearson Education, Edinburgh, 4th Edition.

Michael Armstrong, (2003), A Handbook of Human Resource Management, Aberystwyth, Wales, 9th edition. sited 12/2/2013 sited 24/2/2013 sited 24/2/2013