Aligning human resources strategy with the business strategy has to do with controlling the cost of the company while increasing the profit, utilizing the employees. Strategic goals are the first thing to be achieved, unlike employee satisfaction. The Human Resources Managers are in charge in order to identify what the company aims to and what the goals of the company are. Although human resources normally take care of employees, in this case their part is to get from them as much as they can, so as the company to get closer to the goals. We can assume that the alignment of the human resources strategy with the business strategy misses the human resources initiatives and refers to a business environment with no special interest about employees satisfaction and respect. (Armstrong and Baron, 2002 )

In order to examine the issue extensively we should first identify the key issues in strategic human resources management:

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Personnel Planning and Recruiting has to do with deciding the positions that have to be filled and forecasting what the needs of the company will be. Moreover deals with recruiting candidates from inside and outside the company and using selection techniques, allowing the most qualified employees to distinguish. 'A study by mark Huselid shows that a standard deviation increase in high performance talent-management practices is associated with enormous economic returns.. Also, proper planning and recruiting the right profiles can lead to long term success as optimal skills can be set to deliver to the company the coveted mission. (J. Stephen Heinen and Collen O'Neil, 2004)

Employee Testing and Selection

The company's performance is strictly depended on the employees. As a result, testing the candidates is very important in the selection process. However, recruiting is very costly , so choosing the right people as soon as possible, is crucial. As mentioned before having the most qualified people working in your company gives a competitive advantage that can lead to maximized performance and long term run. Some kinds of pre- hiring test are personality test, intelligence test and job knowledge tests. Research has shown that those employees that had the highest scores could provide more sales per hour to the company.



Interviewing Candidates

The human resources managers are in charge for obtaining the necessary information from every candidate. Basically, the manager should be able to identify whether the candidate is qualified for the job and can match with the climate of the company or not. The choices of the managers reflect their skills, so they should choose wise. The interview could take a structured or unstructured form, case -based interview (how would the candidate react in potential cases) or any other kind the manager thinks that can disclose the candidate qualifications. Planning and recruiting personnel, employee testing and selection and interviewing candidates are strictly connected in order to choose the right people for the appropriate jobs. Having the most qualified employee at the most suitable job can lead a company in maximizing performance and achieving success in the long run as mentioned above. (Volberda, 1998)

Training and Developing Employees

Training an employee is like welcoming him in the company. Training makes employees understand what their responsibilities are and what the company wants from them. This procedure, makes employees feel more comfortable and fitted in the environment. Developing employees can make a great difference between companies. The growth of a company can be aligned with the education of the employees which aims to provide more skills and knowledge. Developing the employees can succeed in keeping them as they feel that the company cares about them and they practically become an essential part. Having and retaining the best employees can provide a company a serious competitive advantage and lead to maximizing performance and long term success. (Grieves Jim,2003).


Appraisal is a process where employees are being assessed about their work. The company basically checks what the levels of performance should be and what they actually are. Appraisal could be a very stressful procedure for the employee but very useful for the organization. It's directly connected with training and developing employees, because those employees who succeed the appraisal are those who are being developed and those who fail are being retained or redundant. Appraisal helps organizations realize their mistakes and their position. So, despite the stress, revaluating your position, could be a mean that leads in maximizing performance and long term run.(Kindall and Gatza,2010)

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Managing Careers

Managing careers is a part of the process of developing employees. Managing careers enables employees to increase their skills and use them in order to get a higher position in the company. As already mentioned, developing employees makes them feel more useful and fulfilled and this can provide a great advantage to the company that might even lead to maximizing profits and long term run. (Baruch, 2004)

Ethics and Justice

Ethics refer to the principles of groups (these groups could be entire nations, social groups or, in the case we examine, a company). Although, everyone should submit to the rules of the nations, each company has a different policy and principles that should be followed from all the employees. Justice and fair treatment of employees makes them feel that the company cares about them and everyone is equal. Equal treatment builds a more harmonious environment and helps employees develop their skills, as they feel that their effort is recognized. These conditions enable a company to achieve a proper functioning that could lead to more profits and conservation.(Cohen and Spector , 2000, 'The Role of Justice in Organizations: A Meta-Analysis') On the other hand, these principals differ from a company to another. Some companies for example have a strict policy governance and do not allow any flexibility. Corporate governance also has to do with the relations of the shareholders and the relation of the company with the community. Strict corporation could lead to dissatisfaction in the company's environment or could lead to the growth of the organization because everything is carried out as planned. As a result, cannot be concluded if corporate governance influences profits and long term success. (Monks and Minow, 1995)

Diversity management

Diversity management actually attempts to make employees comfortable with the idea that not everyone can be treated the same. The reason for this is that every employee has a different background. Race, gender and orientation could be total different for every employee and that leads to total different aspects of view. Diversity management is partly the opposite of ethics and justice as the first thing that provides is not equal treatment. Although this seems paradoxical, it's up to each company what strategy to use. Diversity management could make some employees feel aggrieved and have very bad influence on the company, or could lead to rise and growth of the company as everyone would be treated as befits. (Reichenberg, 2001, 'Best practices in diversity management' ).

Although most of the human resources issues seem to be aligned with maximizing performance and long run, there are environmental situations that could change everything.

Economic crisis

Economic recession , has a major affect on work environment. Many companies all over the world are forced to dismiss employees in order to minimize their cost and succeed to survive. In situations like these, is very difficult to talk about managing careers or spend a lot of money recruiting and developing employees. In addition, employees requirements are neglected, dissatisfied employees are ''created'' and that dissatisfaction ultimately affects performance and organization's success.(Foulkes, 2009, 'Long-Term Fundamentals of the 2008 Economic Crisis')


Nowadays, as economic recession has changed the working environment, as stated earlier, flexicurity could be a solution that would lead to the creating of more job positions . Flexicurity is about balancing different jobs with secure transitions, working flexible hours , or even working at home, something that would give the employee the opportunity to combine his job with other responsibilities or perhaps with a second job. provides employees the appropriate training in order to gain the necessary knowledge and skills for the job ensures them that they won't lose their job if something unexpected occurs. (Brown , Bimrose & Barnes,2010, 'Changing patterns of working, learning and career development across Europe', page 48)


Summarizing our research, we can conclude that strategic human resources offers organizations the basis for maximizing performance and achieving success in the long run. This hypothesis was supported by Hofer and Schendel in 1978, when they argued that strategic human resources can avoid threats within a company and can combine a competitive advantage. Potter in 1987 argued that strategic human resources can lower cost and increase source of products and product differentiation. Jackson and Schuler, more recently, in 1995, have studied the strategic role of a firms human resource management. Barney et al in 1992 connected in their research strategic human resources with the firm's performance. Last but not least, compensation systems, as a way to deploy human resources systems strategically, were studied by Gerhart and Milkovich in 1992. (Mirvis , 1997, ' Human resource management: Leaders, laggards and followers', Lengick, Lengick, 1988, 'Human Resources Management: A Review of the Literature and a Proposed Typology' )

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