1. CHAPTER 1 Human Resource Management: Gaining a Competitive Advantage
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2. History of HumanResource Management Practises
1910
1940
Scientific Management
- performance related
to working conditions
First personnel depts.
Hawthorne studies
World War II
- Selection tests
Now
Employee relations
- comply with laws
- reactive
- stand alone
Integration with
Business operations
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3. Human Resource Management
THE 21st CENTURY
What’s Next ?
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4. Dimensions of HR Practises
COMPETITIVENESS
Dimensions of HR Practises
Managing Internal & External Environment
Assessing Work & Work Outcomes
Acquiring HR
Developing HR
Rewarding HR
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5. External Challenges Facing Organizations
Legal
Globalization
Economic
Corporate
Competitiveness
Social / Cultural
Demographic
Technology
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6. Economic Political / Legal Technological Social-Cultural
The Organization
and the Environment
The General Environment
The general environment consists of the economic, political, social, and technological conditions that can affect the management of organizations. The extent of influence of the general environment is less direct than that of the specific environment but also difficult to predict. Some general environmental factors, such as a severe economic recession, can lead to far-reaching effects on the organization.
Economic
Political / Legal
Customer
Economic Conditions
Interest rates, inflation, changes in disposable income, stock market prices, and general business cycles all contribute to the general economic conditions. Recessions in one large industry can spread out to others as workers are laid off and consumers have less income to spend purchasing the products of other organizations.
Political Conditions
Political conditions include both the general stability of the countries in which the organization has operations and the attitudes that governments in those countries hold toward the role of business in their society.
Social Conditions
Each country and even area often has different social and cultural rules of conduct. Management must adapt its practices to the changing expectations of the society in which in operates. Areas of managerial decisions affected by changing social conditions includes not only the makeup of the products and services offered by the organization but its internal policies as well. In the United States, for example the changing demographics of the workforce are requiring organizations to recognize the needs of women and minority employees by adopting innovative management practices for to motivate and retain these important employee groups.
Technological Conditions
Innovations in technology are the most rapidly changing factor in the general environment. Technology dependent organizations can become obsolete almost overnight as innovations replace whole industries.
Organization
Labor
Market
Competitors
Suppliers
Technological
Social-Cultural

7. The Role of HR in Strategy Formulation
Administrative
Linkage
One-Way
Linkage
Two-Way
Linkage
Integrative
Linkage
Strategic
Planning
Strategic
Planning
Strategic
Planning
Strategic
Planning HR
Function HR
Function HR
Function HR
Function
SOURCE: Adapted from K. Golden and V. Ramanujam, “Between a Dream and a Nightmare: On the Integration of the Human
Resource Function and the Strategic Business Planning Process,” Human Resource Management 24 (1985):

8. Strategy Formulation External Analysis Mission Goals Strategic Choice
- opportunities
- threats
Mission
Goals
Strategic
Choice
- reason for
being
- what it
hopes to
achieve
- ways to
fulfill goals
and mission
Internal
Analysis
- strengths
- weaknesses
HR Input
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9. Strategic HR Management Strategic Choice HR Practices - recruitment
- training
- performance
management
- labor relations
- HR planning
- job analysis
- job design
- selection
- development
- pay structure
- incentives
- benefits
Strategic
Choice
HR Needs
Firm
Performance
- skills
- behaviors
- culture
- productivity
- quality
- profitability HR
Capability
HR Actions
- behaviors
- results
- skills
- abilities
- knowledge
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10. Product Life Cycle and Operating Strategies
Maturity
Growth
Formation
Sales
Porter
strategies
Differentiation
Cost Leadership

11. HR needs in Strategy Formulation
HR Role
Differentiation
Cost Leadership
Focus of firm
Employee role
Training
Staffing
Compensation
Performance
management
- creative, risk-taking
- broader tasks
creative risk-takers
- broad career paths
- recruit more from
outside
- external pay equity
- results-oriented
- efficiency
- specific & repetitive
- specific/short-term
skills
- promote internally
- internal pay equity
- behavior-oriented
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