Concept of Strategic Human Resource Management
Strategy in a nutshell refers to a plan/course of action organizations undertake to achieve its aims. Similar to this different functions of the Organization have their own strategies to achieve their goals, but goals of the Departments must be in line with the Organizational Goals. Strategic Human Resource Management is the utilization of Human Resource in a way that it serves as a stimulator and facilitator to attain organizational aims.
Rather than just focusing on the Management of Human Resource, better utilization is the key for a better performing business enterprise. The DHL revealed its "Strategy 2015" aimed at making company fit for the future. The aim is be a Stronger in Mail business through Quality and Customer Service. The HR Strategy that could very well stem out to achieve this aim and to implement the organizational strategy would be through a more creation of a more satisfied and learned work force, an environment where knowledge is shared and people take ownership of the work. Providing a better Work Environment, a Culture where people could belong, a workplace that has all the ingredient to keep people motivated to work, all are key to better customer service and enhanced organizational performance.
Strategic Role of Human Resource
Strategic role of HR could not be denied in the business world where Human Resource is being considered as an asset by majority of the CEO’s. Input of HR professionals is crucial in Business Strategy, as they could very well forecast potential threats to success that relates to the people, for instance organizational strategy is to have better quality service/products the HR professional are in a better position to divulge if People within the organization have the necessary skills to deliver the quality of service/product desired.
CEO who understand the value HR brings to the Organization successful implementation of their business strategy do provide them the necessary independence and take their input every now and then on issues critical to the people side of the business.
Highlighting the need for HR to be the part of firm’s Strategic unit, a study from University of Michigan found that high performing companies' HR Professionals should be a part of the business strategic planning executive team. These HR Professionals help identify the Human Issues that are key to the implementation of the Business Strategy plus aid in establishing and strategy execution. They are vital to the provision of alternative insights, Inputs that cover variety of angles. They help to make the organization more responsive through conceptualizing and executing organizational change.
Responsibility of the HR Managers
With the changing roles HR managers are entrusted with and assuming the responsibilities of strategic partners, there is a greater need for the HR professionals to acquire new HR skills, there are not the basic or middle level skills but more holistic skills relating to other functions and are more strategic in nature. HR manager in order to make their opinion count have to have an in-depth understanding on how organization create its value. They should know the answer to the following questions
- How does the Business make money?
- What activities and processes are critical to wealth creation?
- Who in the firm executes these activities?
Now as HR Professionals they must establish a link with Human Resource that works within the organization, and how Human resource directly and indirectly affects the wealth creation of the organization, What aspects of the Human Resource in the Organization could be improved to increase the money business generates, How can Human Resource be made more of an strategic advantage.
HR Strategy Execution Role
Strategy execution is traditionally at the heart of HR Managers strategic planning job. In Normal Practice HR Managers formulate the organizational strategies, then are formulated the functional strategies and policies. Companywide strategies dictate the functional strategies and set the broader limits on what can be done and what cannot be done, thus the Departmental Strategies stem out from the Organizational Strategies. In order to make the Functional Strategy more fruitful, HR Professionals shall constantly questions their strategies on their effect on the overall business strategy and its effect on other sections of the business plus importantly the people working for the business. HR Strategies must serve as a continuation to the business strategy as they would play a major role in shaping focus of the employees and in creating a unity of direction for business performance.
HR Strategy Formulation Role
HR aids the strategy formulation process in variety of ways. Strategic Plan for the business depends on variety of issues. It is off utmost importance that Business strikes a balance in the Internal Strength and Weaknesses and External Threats and Opportunities. Utilizing Strength to make use of the opportunities whereas countering weaknesses to minimize threats is a key strategic initiative for the business. HR holds a key position in supplying business with competitive external information. Labor Laws, employee Surveys, Market trends on Talent, Work force focus within and outside the organization, Potential pool of candidates that could be utilized for strategic gains, all this and more could be vital information for strategy formulation. For Instance, HR Professionals within the Organization have identified lack of Trained Professionals for a particular technological Advancements, this could be vital in strategy formulation, as Top management shall now refrain from taking a course of action where company would need Trained Professionals in the identified business function.
HR has always been questioned for the value it brings to the Business, Significance of HR Department could very well be highlighted if it works closely with the top management, this would help in demonstrating value of HR in more measureable terms.
Human Resource Management by Gary Dessler, 10th Edition (2005)