1. HUMAN RESOURCE STRATEGY

2. Goals Understand how HR contributes to bottom line of organization
Understand that organizations could have same policies with very different results based upon its culture

3. HR MODELS CLERICAL LEGAL FINANCIAL HUMANISTIC BEHAVIORAL SCIENCE
STRATEGIC

4. Strategic Model (SHRM)
Historically, HR focused on employee
SHRM focuses on organizational effectiveness
How can HR can help company become more profitable?
System approach
HR is part of the production process that can increase value of good or service

5. Strategy plan of what business to we want to compete in
developing goals
what are we best at
what can’t we do

6. ALTERNATIVE STRATEGIC APPROACHES
BEST PRACTICES-there are practices that are just good for everyone
RESOURCE BASED VIEW
focuses on how employees can add value to the firm for sustained competitive advantage
resources that are difficult to copy
resources that add value
CONTIGENCY THEORY
Contends that best HR practices will depend upon firm strategy
Argues for multiple ways to achieve goals
Do HR practices fit with firm’s strategy

7. Resource Based View How are we different from competitors
Sustained Competitive Advantage
Perceived customer value
technology
specialization
economies of scale
financing
Employees
How are we different from competitors
Provides economic benefits
Cannot be duplicated
management is particularly difficult to duplicate

8. Contingency Perspective
Firms that match business strategy and HR practices will have the highest performance

9. Strategic Objectives
Cost
Quality
Innovation
Growth
Focus

10. HR Needs in Strategy Formulation
HR Role
Innovation
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
long-run
results-oriented
Allows for mistakes
- efficiency
- specific & repetitive
- specific/short-term
skills
- promote internally
- internal pay equity
- behavior-oriented
IRWIN
a Times Mirror Higher Education Group, Inc., company, 1997

11. HR & Strategy Formulation
Administrative
Linkage
Strategic
Planning 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):

12. HR & Strategy Formulation
Administrative
Linkage
One-Way
Linkage
Strategic
Planning
Strategic
Planning 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):

13. HR & Strategy Formulation
Administrative
Linkage
One-Way
Linkage
Two-Way
Linkage
Strategic
Planning
Strategic
Planning
Strategic
Planning 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):

14. How is HR Strategy Formulated?
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):

15. Role of Culture
Having HR policies not enough, need to know whether these policies are interpreted, understood, and believed by employees
Strong climates – “the organization means it”

16. Factors that contribute to a strong culture
Visibility – do people know what the policies and expectations are?
Understandability JetBlue
Legitimacy of authority – does management mean it?
Relevance – what difference does it make? Do I care?
Consistency- helps reinforce the above
Consensus – do we have buy in across employees? Are the policies fair?
Strong cultures lend meaning to the policies

17. Strategy Summary
HR strategy is about managing employees effectively to improve organizational performance
Best practice view
good practices that will benefit all
difficult to copy & add value
Strategic HRM
contingency view - good practices depend on business strategy
Resource based view
HR policies and practices can lend strategic advantage