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The most up market word in the present time in business and corporate world is Competitive Edge. All the organizations strive to achieve this based on their available resources like land, labour, capital, entrepreneur etc. In my opinion Human as a resource plays a vital role in achieving competitive edge.
In today's highly competitive world as a market place the significance of human resource management cannot be underestimated. Because with the flip of the time a business can become a market leader or at the same time can become a market joke and thus organizations have started giving heed to good management of human resource by not employing or hiring incompetent work force rather than employing qualified and experienced workers. It should also be kept in mind that the presence of human resource management is not just employing people or making organization policies rather make a competitive advantage out of them. This view helps in responding quickly to consumer's needs and different moves of competitors.
In today's ever more competitive worldwide environment, human resource management is known as a crucial factor for strategic human resource management (Armstrong and Long, 1994; Budhwar, 2000; Budhwar and Khatri, 2002; Budhwar and Sparrow, 1997; Cusworth et al., 2004; Sheehan, 2005). It is also practical that in the ordinary method of management in an organization, labour is considered as a commodity and at some places the role of Human Resource Management has been categorized as brittle, unbalanced and difficult to carry on (Whipp, 1992). Most of the research writing highlights only the strategic role of labour as a cost driver for businesses, especially in present competitive product markets, in spite of some evidence that a more practical role can be taken (Ritson, 1999).
IMPORTANCE OF STRATEGIC HUMAN RESOURCE MANAGEMENT
The terms "Human Resource Management" and "Human Resource" have substituted the concept of "personnel management" as a description of the process involved in people management in organizations (Armstrong, 2006). Human Resource Management (HRM) is a strategic and logical approach to the management of critically valued assets, and the people resources who individually and collectively contribute to the accomplishment of the goals of the business (Armstrong, 2006). In simple words, Human Resource Management means employing people, developing their capacities, utilizing, maintaining and compensating their services in tune with the job and organizational requirement.
In different types of organizations whether it is small or large, human resource is considered to have a major role in acquiring competitive advantage over the global competition. This proves that human resource is now playing a very essential role than compared to the history of the organizational hierarchy. Because if the human resource policy are implemented in a strategic way it can highly achieve the goals of the organization with the optimum use of high performance and quality workers which ultimately boosts the organization to perform competitively against the competitor's.
Nowadays the importance of strategic human resource management is been seen on the top level of many businesses. The word "strategic" itself means to keep an eye on the future or even so called bigger picture. Keeping in mind the long term goals of the business, strategic human resource management focuses on the human resource programs, instead of restricting to the issues like internal human resource problems and their solutions which are affecting the human resource management programs in the long term. Thus increasing the productivity of the employers working in a particular organization by identifying the hurdles located outside of human resource becomes the most primary goal of strategic human resource management.
What actually strategic human resource management means is applying different strategies which assist to create an atmosphere of creativity and flexibility among employees. One of the key roles is also to find the main areas in HR where the strategies can be rightly implemented so that in long run it helps to enhance employee productivity and motivation which ultimately benefits the organization.
The ability to gain and maintain an organization's growth and prosperity will depend on utilization of firms competitive strategies. Keeping the cost down, not maintaining quality and ignoring innovation is not the only way of achieving competitive strategies, rather linking competitive strategies with Human Resources Management practices is the key to success (Reginald, 1982). This approach is recognized since two decades approximately. There is a need to match the characteristics of top managers with the nature of the business (Reginald, 1982) mentioned this in his interview. Effectiveness of the firm can be increased by systematically developing human resource practices with the selected competitive strategy (Randall & Susan, 1987). This view is further supported by a research conducted in oil and chemical industry. The results of the study presented strong evidence that Human Resource strategies can be crucial to corporate strategy and not stand-alone aspects of the members of the personnel department. The study also stated that Human Resource Management was strategic only if relating to cost-cutting must be rejected (Ritson, 1999).
Largely strategic human resource management also helps to assess the organizations internal as well as external strengths and weaknesses. This plays a critical role for the company as the success ratio or the future which more or less depends upon the strengths and weaknesses, thus it can be seen that a direct or indirect impact on how the company would perform in the future will depend upon how the organization manages its human resources.
Now the question arises is how human resource manager implements different strategic plans to achieve competitive advantage. Human resource manager is a very important person in an organization in strategic human resource management, the reason behind this is they don't act as reactive administrators but also plays a practical role in formulation of policy. Thus after utilizing the full potential of the employees the human resource manager becomes a resource manager. In developing the overall strategy of the company HR managers becomes strategic partners.
WHAT IS STRATEGIC MANAGEMENT?
Strategic management is a managerial activity under setting goals and over tactics. As such it provides overall guidance to the firm. It is important to discuss about "strategic alignment" between the organization and its environment or "strategic consistency" in the context of business administration. Strategic management includes the Board of Directors and other stakeholders as well as the management team and is dependent on the organizational structure.
A research study indicated that linkages between corporate and Human Resource strategy is much more complex than assumed. It could potentially play a major role in corporate strategy formulation and not mere, or primarily, implementation. The study also cast a doubt on having a discrete Human Resource Management strategy as there seem to be a disadvantage of strategic separatism. The study talks of joint coordination with Human Resource strategic programs such as succession planning and management (Grundy, 1998). According to Miller (1989) 'strategic human resource management (SHRM) encompasses those decisions and actions which concern the management of employees at all levels in the business and which are directed towards creating and sustaining competitive advantage'. Increasing core competencies of the firm, in particular Human Resource is one of the key elements to success of the firm's performance and that Human Resource involvement in the development and implementation of business strategy leads to organizational effectiveness in the industry (Karami, Analoui, & Cusworth, 2004).The level of integration between Human Resource and business strategy was significant and stronger when top management viewed employees as a strategic resource (Karami, Analoui, & Cusworth, 2004).
Everybody in the organization and not just Human Resource department is encouraged to take responsibility for Human Resource Management as a consequence of Human Resource Management. This ascertains that Human Resource Management is assigned a much more significant position in decisions that are made at operational or strategic level and also reminds decision makers that investment in people is a critical organizational priority (Sheehan, 2005). A model suggested for Human Resource Management strategic integration by Sheehan (2005) talks of engagement of a certain set of symbols and ritualistic gestures. These symbolic changes however do not always result in desired strategic Human Resource Management outcomes rather symbolic adjustments must be accompanied by deeper levels of change both from within the Human Resource profession and from other stakeholders in the organization (Sheehan, 2005).Contingency theory posits that Human Resource Management should match the demand of the internal and external conditions (Delery & Doty, 1996; Schuler & Jackson, 1987). External fit links Human Resource systems to business strategy, whereas internal fit focuses on Human Resource Management practice configuration (Wright & Snell, 1991). Therefore, integrating Human Resource configuration with business strategy is conducive in enhancing organizational effectiveness (Chow, Huang, & Liu, 2008). Research results revealed that Human Resource configurations are significantly related to effect in predicting overall outcome performance and turnover, but not significantly related to effect on sales growth rates. Results also showed significant interactions effects between Human Resource configuration and business strategy in their effect on profit and sales growth. These further extended support for a contingency perspective in strategic Human Resource Management in Chinese context (Chow, Huang, & Liu, 2008).
This view is further supported by the work of Golden & Ramanujam (1985). Research points out that lack of integration between human resource management and strategic business planning (SBP) process is increasingly acknowledged as a major source of implementation failure. Four types of HRM-SBP linkages, namely administrative linkage, one-way linkage, two-way linkage and integrative linkage have been viewed as phases, although no chronological sequencing of any kind among them is implied in the study (Golden & Ramanujam, 1985). But it does emphasize the need for HRM-SBP linkages for the success of organization.
IMPACT OF CULTURE ON STRATEGIC HUMAN RESOURCE MANAGEMENT
The results of a research study showed that Indian managers working with British managers, tried to implement human resource management practices to corporate business strategy. The finding of research suggested that both managers varied in their implementation as well as use of strategies thus indicating cultural variation in implementation of human resource strategies (Budhwar & Sparrow, 2002). This also indicates that strategic human resource management would differ from one culture to other and specifically in western and Asian countries.
Another important aspect of Human Resource Management in application of corporate strategy can be derived in cross culture training. With increasing globalization of business activities there is a greater need for managers to undergo cross culture training. Li (1992) developed a framework for analyzing how the degree of Human Resource Management corporate strategy integration may possibly affect the approaches to methods of cross cultural training (Li, 1992). The enterprises led by younger CEOs, who have received higher education tended to have more articulate and comprehensive strategies informed by management theories, where as those led by older CEOs seem to have less focus on Human Resource Management (Cooke, 2008). Further study identifies the key success factors of the Chinese firms which appear to be associated with firm's growth through business diversification, development of internal market, strong emphasis on product innovation and quality enhancement, strategic marketing, product and corporate branding, entrepreneurship of owner managers/CEOs, reform of corporate governance and importantly strategic Human Resource Management. The study also revealed that top-performing Chinese private firms tend to adopt a high - commitment model of human resource management which emphasizes training and development, cultural development and management (Cooke, 2008). However their Human Resource Management configuration is largely of the paternalistic nature, with enterprise culture typical of Chinese values.
Hence, it can be seen from the above discussion that variations in age, sex and culture also have a decisive in implementation of strategic human resource policies.
BARRIERS TO IMPLEMENTATION OF STRATEGIC HUMAN RESOURCE MANAGEMENT
Although it has been stated that Strategic Human Resource Management is quiet crucial for achieving competitive advantage, implementation of the same can be a complicated procedure. It is also possible that if it is not implemented properly it can be less effective. The most common obstacle in implementation of strategic human resource management is résistance to change on the part of employees and résistance to change and implement new policies for the top level managers. It has been observed that often it becomes difficult for the management to communicate effectively the vision and mission of the company to its employees. Inter departmental conflict and lack of knowledge in implementing the HR policies also reduces the impact of strategic human resource management. Diverse work force, conflict among the employees about the issues of authority and fear of victimization can as well have an impact on implementation of Strategic Human Resource Management an organization. It is also observed that other institutions like labour unions, changing market scenario or change in organizational structure can create a pressure on effective implementation of strategic human resource management.
The Strategic Human Resource Management idea need that the drive and reason of Human Resource Strategy should be resolute while increasing the organizations overall strategy and should be included into the organization's strategic map (Armstrong & Long, 1994; Guest, 1991). Holbeche (2001) stated that through the addition of Human Resource Management with the organization's business or corporate strategy, to a certain extent than Human Resource Strategy being a separate set of precedence's, employees will be administered more efficiently and organizational performance will get better (Armstrong, 1994; Guest, 1991; Legge, 1995). It has been noted by Liberman et al, (1990) that after adopting Human Resource Methods Japan auto companies achieved a higher productivity. For successful addition of Human Resource Management with organizational strategic decision making procedure, it has been disputed that illustration at the senior committee level or board of directors is serious if Human Resource managers are to have suitable input into tactical choices (Poole & Jenkins, 1997; Shipton & Mcauley, 1993). The result of a investigated learning (Abang & Abang, 2009) point out that yet whereas HR strategies are in place, the level of promise and hold up from CEOs and the line management assure are important determinants of strategic integration of other factors such as business credibility of the Human Resource manager and Human Resource Management practice (Abang & Abang, 2009).
Thus it would be very important for the organization to have a proper procedure for effective implementation and utilization of Human Resource strategies in meeting with the organizational goals.
Employee flexibility generates a maintenance performance in process plans which can influence companies' share prices it is hardly a third order affair and represents the ultimate mission of all corporate strategy (Ritson, 1999). As stated in above researches management in general has in fact generated a Human Resource strategy based on cost cutting has casted a view and presents strong evidence that Human Resource strategies can be integral to corporate strategy and not stand - alone aspects owned by the personnel department or its members (Ritson, 1999). In general various practices in studies explained that the influence has common characteristics of Resource based view approach and high performance work system that gives importance to participatory decision making and which interpret employees and the Human Resource function not as a cost load but on the basis of competitive advantage, were vital predictors of successful and high strategic integration (Abang & Abang, 2009).
Thus it can be seen from the above researches that integration of Human Resource Management with Corporate Strategy at all the levels, especially the top level underpins the effectiveness in private and public, small and large firms in some of the big economies like U.K, China, India, Malaysia, Australia etc. Moreover, integration of business strategy and Human resource strategy will effect in focusing extra on the significance of Human Resource as the organizations priceless asset. This will ensure that Human resource matters are measured and known credit by the management at the managerial or strategic and operational level. While, by not considering Human Resource strategy with business / corporate strategy, imperative Human Resource would be missing.
Globalization means competition and competition means maintaining quality. And to achieve quality we need good internal and external fit and this can be achieved through effective strategic human resource planning and implementation.