1. Human Resource Management Strategy and Analysis3
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2. Human Resources Management 12e Gary Dessler
LEARNING OUTCOMES
Explain why strategic planning is important to all managers.
Explain with examples each of the seven steps in the strategic planning process.
List with examples the main generic types of corporate strategies and competitive strategies.
Define strategic human resource management and give an example of strategic human resource management in practice.
Briefly describe three important strategic human resource management tools.
Explain with examples why metrics are essential for managing human resources.  
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

3. Why Strategic Planning is Important to All Managers
Human Resources Management 12e Gary Dessler
Why Strategic Planning is Important to All Managers
The firm’s strategic plan guides much of what is done by all to accomplish organizational goals.
Decisions made by managers depend on the goals set at each organizational level in support of higher level goals.
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

4. Human Resources Management 12e Gary Dessler
The Management Planning Process
The Hierarchy of Goals
Policies and Procedures
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Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

5. Human Resources Management 12e Gary Dessler
FIGURE 3–1 Sample Hierarchy of Goals Diagram for a Company
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Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

6. The Strategic Management Process
Human Resources Management 12e Gary Dessler
The Strategic Management Process
Strategy
A course of action the organization intends to pursue to achieve its strategic aims.
Strategic Plan
How an organization intends to match its internal strengths and weaknesses with its external opportunities and threats to maintain a competitive advantage over the long term.
Strategic Management
The process of identifying and executing the organization’s mission by matching its capabilities with the demands of its environment.
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

7. Business Vision and Mission
Human Resources Management 12e Gary Dessler
Business Vision and Mission
Vision
A general statement of an organization’s intended direction that evokes emotional feelings in organization members.
Mission
Spells out who the firm is, what it does, and where it’s headed.
Serve as filters to separate what is important from what is not
Clearly state which markets will be served and how
Communicate a sense of intended direction to the entire organization
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

8. Human Resources Management 12e Gary Dessler
The Strategic Management Process
Step 1. Ask, Where Are We Now
Step 2. Size Up The Situation: Perform External and Internal Audits
Step 3. Create Strategic Options
Step 4. Review Strategic Options
Step 5. Make a Strategic Choice
Step 6. Translate into Goals
Step 7. Implement the Strategies
Step 8. Evaluate Performance
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

9. The Strategic Management Process
Step 1. Ask, Where Are We Now?
«Where are we now as a business?»
(Here the manager defines the company’s current business and mission.)
«What products do we sell, where do we sell them?»
«How do our products or services differ from our competitors’?»
© 2008 Prentice Hall, Inc. All rights reserved.

10. The Strategic Management Process
Step 2. Size Up The Situation:
SWOT analysis is a commonly used tool that identifies the company’s strengths and weaknesses, opportunities and threats.
© 2008 Prentice Hall, Inc. All rights reserved.

11. Human Resources Management 12e Gary Dessler
FIGURE 3–3 Worksheet for Environmental Scanning
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

12. Human Resources Management 12e Gary Dessler
FIGURE 3–4 SWOT Matrix, with Generic Examples
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

13. The Strategic Management Process
Step 3. Create Strategic Options:
The situation may require that management consider strategic options for the company.
Step 4. Review Strategic Options: .
Given the situation, which strategic option should we pursue? Here the manager compares his or her strategic options to see which are most consistent with the firm’s opportunities and threats, and its strengths and weaknesses.
© 2008 Prentice Hall, Inc. All rights reserved.

14. The Strategic Management Process
Step 5. Make a Strategic Choice:
Here the manager must finalize a strategic choice.
© 2008 Prentice Hall, Inc. All rights reserved.

15. The Strategic Management Process
Step 6. Translate into Goals:
Management translates the new desired direction into actionable strategic goals.
Step 7. Implement the Strategies:
Strategy execution means translating the strategies into action. This means actually hiring (or firing) people, building (or closing) plants, and adding (or eliminating) products and product lines.
Step 8. Evaluate Performance:
Assessing progress toward strategic goals and taking corrective action as needed.
© 2008 Prentice Hall, Inc. All rights reserved.

16. Review Importance of strategic planning Goal setting Steps
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17. Human Resources Management 12e Gary Dessler
FIGURE 3–8 Type of Strategy at Each Company Level
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

18. Types of Corporate Strategies
Human Resources Management 12e Gary Dessler
Types of Corporate Strategies
Concentration
Vertical integration
Diversification
Corporate Strategy Possibilities
Consolidation
Geographic expansion
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

19. Corporate-level strategies
Concentration (single business) strategy; the firm offers one product or product line, usually in one market.
Vertical integration strategy; the firm expands by, perhaps, producing its own raw materials, or selling its products direct
Diversification strategy; the firm will expand by adding new product lines
Consolidation strategy; reducing the company’s size
Geographic expansion; taking the business abroad
© 2008 Prentice Hall, Inc. All rights reserved.

20. Types of Competitive Strategies
Human Resources Management 12e Gary Dessler
Types of Competitive Strategies
Cost leadership
Differentiation
Business-Level Competitive Strategies
Focus/Niche
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

21. Business-level/competitive strategies
Cost leadership means the enterprise aims to become the low-cost leader in an industry.
Differentiation is a second example of a competitive strategy. In a differentiation strategy, a firm seek to be unique in its industry along dimensions that are widely valued by buyers.
Focusers carve out a market niche (like Ferrari), and compete by providing a product or service customers can get in no other way.
© 2008 Prentice Hall, Inc. All rights reserved.

22. Types of Strategies (cont’d)
Functional Strategy
Each individual business is composed of departments, such as manufacturing, sales, and human resource management.
Functional strategies identify the basic course of action that each department will pursue in order to help the business attain its competitive goals.
The firm’s functional strategies should make sense in terms of its business/competitive strategy.
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23. Managers’ Role in Strategic Planning
Human Resources Management 12e Gary Dessler
Managers’ Role in Strategic Planning
Devising a strategic plan is top management’s responsibility.
Top management must decide what businesses the company will be in and where, and on what basis it will compete.
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

24. Departmental Managers’ Strategic Planning Roles
Human Resources Management 12e Gary Dessler
Departmental Managers’ Strategic Planning Roles
Help devise the strategic plan
Formulate supporting, functional/ departmental strategies
Department Managers and Strategy Planning
Execute the strategic plans
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

25. Strategic Human Resource Management
Human Resources Management 12e Gary Dessler
Strategic Human Resource Management
Strategic Human Resource Management
The linking of HRM with strategic goals and objectives in order to improve business performance and develop organizational cultures that foster innovation and flexibility.
Involves formulating and executing HR systems—HR policies and activities—that produce the employee competencies and behaviors that the company needs to achieve its strategic aims.
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

26. Human Resources Management 12e Gary Dessler
FIGURE 3–10 Linking Company-Wide and HR Strategies
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

27. Human Resources Management 12e Gary Dessler
FIGURE 3–11 Basic Model of How to Align HR Strategy and Actions with Business Strategy
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

28. Mergers and Acquisitions
Due Diligence Stage
• Organizational culture and structure
• Compensation and benefits
• Labor relations
• Pending employee litigation
• Human resource policies and procedures
• Key employees
Integration Stage
• Choosing the top management team
• Ensuring top management leadership
• Communicating changes effectively to employees
• Retaining key talent
• Aligning cultures
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29. Human Resources Management 12e Gary Dessler
Strategic HRM Tools
Strategy map
HR scorecard
Strategic HRM Tools
Digital dashboard
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

30. Human Resources Management 12e Gary Dessler
FIGURE 3–15 Three Important Strategic HR Tools
HR Scorecard
Strategy Map
Digital Dashboard
A process for managing employee performance and for aligning all
employees with key objectives, by assigning financial and nonfinancial goals, monitoring and
assessing performance, and quickly taking corrective action.
A graphical tool that summarizes the chain of activities that contribute to a company's success,
and so shows employees the "big picture" of how their performance
contributes to achieving the company's overall strategic goals.
An information technology tool that presents the manager with desktop graphs and charts, so he or she gets a picture of where the company has been and where it's going, in terms of each activity in the strategy map.
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

31. FIGURE 3–8 Strategic Map for Southwest Airlines
Profitability
Strategic/Financial Results
Lower costs
Increased revenues
Most customers
Customer-Based Results
Low fares
On time fligths
Minimize meals
Internal Business Processes
Fly fewer planes
Minimize plane turnaround on ground
Organizational and Employee Capabilities
Highly engaged ground crews
Supportive, high performance HR practices

32. Building A High-Performance Work System
Human Resources Management 12e Gary Dessler
Building A High-Performance Work System
High-Performance Work System (HPWS)
A set of human resource management policies and practices that promote organizational effectiveness.
High-Performance Human Resource Policies and Practices
Emphasize the use of relevant HR metrics.
Set out the things that HR systems must do to become an HPWS.
Foster practices that encourage employee self-management.
Practice benchmarking to set goals and measure the notable performance differences required of an HPWS.
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

33. Human Resources Management 12e Gary Dessler
TABLE 3–1 Comparison of Selected Human Resource Practices in High-Performance and Low-Performance Companies
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

34. Human Resources Management 12e Gary Dessler
K E Y T E R M S
business plan
management by objectives (MBO)
strategic plan
strategy
strategic management
vision statement
mission statement
corporate-level strategy
competitive strategy
competitive advantage
functional strategies
offshoring
strategic human resource
management
strategy map
HR Scorecard
digital dashboard
high-performance work system
human resource metric
value chain
HR audit
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall