BMHR N300 Diane Evans

Objectives  Define the term ‘strategic hrm’  Identify specific issues of shrm  Apply hr strategies to a case study

HR Management Challenges  Globalization of Business Outsourcing and increased competition The threat of terrorism  Economic and Technological Changes Occupational Shifts Workforce Availability and Quality Concerns Technological Shifts and the Internet © 2007 Thomson/South-Western. All rights reserved.1–3

Co-operation of HR with Operating Managers  HR Unit Develops legal, effective interviewing techniques Trains managers in conducting selection interviews Conducts interviews and testing Sends top three applicants to managers for final review Checks references Does final selection and hiring for certain job classifications  Managers Advise HR of job openings Decide whether to do own final interviewing Receive interview training from HR unit Do final interviewing and hiring where appropriate Review reference information Provide feedback to HR unit on hiring/rejection decisions © 2007 Thomson/South-Western. All rights reserved.1–4

FIGURE 1.2 Changing Roles of HR Management 1–5© 2007 Thomson/South-Western. All rights reserved.

FIGURE 1.3 Strategic HR Management Process 1–6© 2007 Thomson/South-Western. All rights reserved.

Nature of strategic HR management  Cost Leadership Competition on the basis of low price and high quality of product or service Relies on “building” employees to fit specialized needs Requires a longer HR planning horizon approach  Differentiation Competition on the basis of either offering distinctively different products or services or establishing an exclusive image for quality products and services Relies on hiring needed skills. Needs a shorter planning time frame in order to be responsive to dynamic environments © 2007 Thomson/South-Western. All rights reserved.1–7 Relationship of Organizational and HR Strategies

Nature of Strategic HR Management (cont’d)  Customer Service and Quality Products Linked to HR Strategies High quality products and services are the results of HR-enhancements to organizational performance.  Organizational Culture and Organizational Effectiveness Organizational culture—the shared values and beliefs in an organization ○ Strategy and culture must be compatible and aligned for the organization to be effective. ○ Culture affects recruitment and retention of employees. © 2007 Thomson/South-Western. All rights reserved.1–8

Human Resource Planning  Human Resource (HR) Planning The process of analyzing and identifying the need for and availability of human resources so that the organization can meet its objectives. © 2007 Thomson/South-Western. All rights reserved.1–9

FIGURE 1.4 HR Planning Process 1–10© 2007 Thomson/South-Western. All rights reserved.

Scanning the External Environment  Environmental Scanning The process of studying the environment of the organization to pinpoint opportunities and threats.  Environmental Changes Impacting HR Governmental influences Economic conditions Geographic and competition issues Workforce composition © 2007 Thomson/South-Western. All rights reserved.1–11

Assessing the Internal Workforce  Jobs and Skills Audit What jobs exist now? How many individuals are performing each job? What are the reporting relationships of jobs? How essential is each job? What jobs will be needed to implement future organizational strategies? What are the characteristics of anticipated jobs? © 2007 Thomson/South-Western. All rights reserved.1–12

Assessing the Internal Workforce (cont’d)  Organizational Capabilities Inventory HR databases—sources of information about employees’ knowledge, skills, and abilities (KSAs) Uses of KSA inventories ○ Recruiting ○ Selection ○ HR development ○ Capabilities of future workforce © 2007 Thomson/South-Western. All rights reserved.1–13

Forecasting HR Supply and Demand  Forecasting The use of information from the past and present to identify expected future conditions.  Forecasting Periods Short-range: six months to one year Intermediate-range: up to five years Long-range: more than five years © 2007 Thomson/South-Western. All rights reserved.1–14

HR Forecasting 1–15© 2007 Thomson/South-Western. All rights reserved.

Factors Affecting External HR Supply Net migration for an area Individuals entering and leaving the workforce Individuals graduating from schools and colleges Changing workforce composition and patterns Economic forecasts Technological developments and shifts Actions of competing employers Government regulations and pressures Other circumstances affecting the workforce © 2007 Thomson/South-Western. All rights reserved.1–16

Forecasting HR Supply and Demand (cont’d)  Forecasting Internal HR Supply Effects of promotions, lateral moves, and terminations  Succession Planning Long-term plan to replace key employees.  Managing an expatriate workforce © 2007 Thomson/South-Western. All rights reserved.1–17

Measuring HR Effectiveness (cont’d)  Measures of Strategic HR Effectiveness (cont’d) Return on Investment (ROI) ○ A calculation showing the value of expenditures for HR activities and how long it will take for the activities to pay for themselves. Economic Value Added (EVA) ○ A firm’s net operating profit after the cost of capital (the benchmark for minimum return) is deducted. HR and the Balanced Scorecard ○ Financial ○ Internal business processes ○ Customer ○ Learning and growth © 2007 Thomson/South-Western. All rights reserved.1–18

Measuring HR Effectiveness (cont’d)  HR Measurement and Benchmarking Benchmarking ○ Comparing specific measures of performance against data on those measures in other organizations.  HR Audit A formal research effort that evaluates the current state of HR management in an organization. Audit areas: ○ Staffing ○ Compensation ○ Health and Safety © 2007 Thomson/South-Western. All rights reserved.1–19

UAE HR Management Challenges  Global perspective and influence  Reliance on expatriate workers for skills/knowledge needed  Public v private employment  Cultural development – Arab/Islam v Western/secular

Apply SHRM to a case study Al Ain Water