Why Does Design and Implementation of Sets of Strategic HR Practices Continue Lack Coherence - Literature review Example

Running Head: HUMAN RESOURCE MANAGEMENT The Design and Implementation of Sets of ‘Strategic’ Human Resource Practices Continues To Lack Coherence and Consistency, Primarily Because The Concept of ‘Fit’ Is Still So Little Understood. Name Institution Date The design and implementation of sets of ‘strategic’ human resource practices continues to lack coherence and consistency, primarily because the concept of ‘fit’ is still so little understood. To this moment, there is no consensus in defining strategic human resource management. However, there is an agreement on the basic functions of strategic human resource management which involve designing and implementing practices and policies that are consistent with the aim of ensuring that human capital in any organization contributes to the achievement of its set business goals. According to Atkinson and Lucas (2011)Human Resource Management is the process of applying, developing and evaluating policies, procedures and programs relating to an individual in the organization. This includes Planning, recruiting, training, selection, and developing employees. It contributes to customer satisfaction, productivity and developing a reputation of the firm in the industry. It also involves employing people, developing, utilizing and maintaining their capacities and finally compensating their services (Delery, 1998). When an organization puts people’s welfare as their key issue, it gets the best performance from its workers. Fit in accordance to (Chan et al, 2004) includes all planned human resource activities and deployments whose key intention is to help the organization achieve its goal. It is viewed as a step towards attaining organizational goals through applying some human resource activities that align with the firm’s objectives. Designing and implementing strategic Human resource is the process of coming up with strategic plan in an organization and putting the plan into action (Chan et al, 2004). Coherence and consistency is the connection and agreeing of the strategies and the human resource activities. Strategic human resource management designs and implements human resource practices which are aimed at enhancing strategic effectiveness in the firm. Fit is a very important feature of strategic human resource management (SHRM) as it reflects the relationship between organisational strategy and the interactive roles of HRM practices. There are two types of fit namely vertical and horizontal fit. Though understanding “fit concept” is of great value, I disagree with the statement that the design and implementation of sets of ‘strategic’ human resource practices continues to lack coherence and consistency, primarily because the concept of ‘fit’ is still so little understood. Contrary to this statement, the design and implementation of ‘strategic’ human resource practices continues to lack coherence and consistency due to underlying factors that influence fit. For instance, despite a clear understanding of the fit concept, human resource functions may influence fit hence resulting to inconsistency in the implementation of strategic human resource practices. These functions include budget set for HRM, available options for human resource practices and existing human resource policy (Purcell, 1999). Any policy that emphasises on the compatibility of various HR practices result to successful implementation of HR practices. If the policy places more emphasis and results to a consideration of some HR practices as less important, the result is that less amount of money allocated for such function in the budget. This means that such functions are likely to be less effective or poorly operated resulting to inconsistency in implementation of strategic human resource practices. For instance, policies emphasizing on some HR practice aspects such as compensation or training and discriminates aspects such as high quality selection in the recruitment process will result poor exercise of overall fit (Purcell, 1999). In this regard, the inconsistency in implementation of human resource practices is not as a result of poor understanding of the fit concept but rather due to poor HR policies. It is therefore necessary that that policies are set in such a way that they emphasis on the importance of a balance of various HR practices. In other incidences, the fit concept may be clearly understood but there be limited options of HR practices available for implementation by the firm’s HR department. In a case where there exist a variety of practical activities options in human resource management, human resource managers have the freedom to choose the most optimal ones. Though those in human resource department may understand the importance of applying human resource practices that are in line with the organizational strategy, risks and uncertainties associated with HR practices are a threat due to limited options of activities to select from. In managing these uncertainties, having a large scope of options is necessary as it would result to realization of horizontal fit and hence congruence and consistency in implementation of human resource practices. According to Chan et al (2004), budget allocated for the human resource department greatly determines the effectiveness in the implementation of strategic human resource practices. An organisation may employ human resource managers who are qualified for the position and who clearly understand the fit concept. However, their ability to execute set policies and implement strategic human resource activities is dependent on the budget at their disposal. Where the budget is limited, implementation of some human resource practices is made impossible hence resulting to inconsistency in implementation of strategic human resource practices. In this case, the design and implementation of sets of ‘strategic’ human resource practices continues to lack coherence and consistency not because the concept of ‘fit’ is still so little understood, but rather because there are limited funds to support the implementation of these practices. This means that though a clear understanding of fit concept is important, it is not the primary cause of incongruence or inconsistency in the implementation of strategic human resource practices. Resources available for the HR department to design or implement strategic human resource practices in this case becomes the primary determinant of consistency in implementing human resource practices which are of high quality and in a consistent manner (Chan et al, 2004). For instance, a higher budget is required where reforms and experimentation to enhance the establishment of efficient HR systems or where external experts must be involved is necessary. Limited funds affect such activities and may in some circumstances result to important activities being skipped despite a clear understanding of the fit concept. In organization where adequate training is offered to develop human capital, the concept of fit is likely to be clearly understood especially by qualified human resource managers. However, there may still exists inconsistency in the implementation of strategic human resource practices due to inadequate understanding of the organizations business needs, existence of irrelevant and ill-conceived initiatives based on personal benefits rather than organizational success and inadequate assessment of cultural and environmental factors affecting the implementation of such practices (Chan et al, 2004). Large companies especially in the African continent have collapsed where human resource managers have acted in relation to perceived personal benefit. For instance, corrupt deals result to wastage of organizational fund hence affecting the ability to execute planned activities. Lack of funds may mean reduction in the number of activities to be undertaken. This does not necessarily happen because human resource managers do not have a clear understanding of the fit concept but rather because of greed. In this regard, the characteristics and competency level of human resource managers affect implementation of strategic human resource practices in a greater manner as compared to these managers’ understanding of the fit concept. Companies with histories of successes use different strategic management tools to shape their company’s culture to fit their strategy. In these organizations, understanding the concept of fit is not necessarily the cause of the success. One of the tools used to reinforce ideas and values is by means of strategic human resource activities like; appraisal rewards, training, development, selection and placements (Atkinson and Lucas, 2011). Indian Oil Corporation, with an annual turnover of $59.22 billion, is one the highest ranked Indian companies. It has come up with several strategic human resource management schemes to convert its employees into a reliable source of competitive advantage. In 2005 – 06 it was honoured with the Scope Gold Trophy for having the best human resource management. However, its success is not attached to the level of understanding of the fit concept but rather to the ability of human resource managers to created address issues likely to affect the implementation of strategic human resource practices and a high level of motivation among employees. IOC has a commitment to enrich its employees though training and team work. It has established the Institute of petroleum management which organizes global international business management programmes to its employees. The main aim of starting this institute was to align it human resources with the goals and help attain its goals. In addition to this, IOC is prepared to face any corporate challenges be it present or future because it has specialists in human resource, general management, information technology and operations. Though the fit concept may not be clearly understood in this organization, success has been achieved due to accurate identification of organizational need, possible threats to its operation and the role of employee empowerment (Monks and McMackin, 2001). Institute of petroleum management has several awards because of its initiatives which are path-breaking; first, the Golden Peacock national award for innovative training practices for five times and Training Practices award. In all these organization, success cannot be associated to clear understanding of the fit concept in relation to strategic human resources. Change is not only inevitable but also necessary in the execution of certain strategic human resource practices. Understanding the fit concept is not enough for the managers and other employees to adopt behavioural changes which are necessary in ensuring successful implementation of given strategic practices. Changing an organizations’ culture would involves changing people’s attitudes and behaviours. For every individual to accept, adopt and support the fit concept, his or her attitude must be changed in a way that they perceive the importance of that change. According to Gagne & Deci (2005), change is easily adopted where cooperation and team work is upheld. This means that even those in the managerial levels must recognize the importance of every employee and involve them in the decision making process to win their support. Where team work exists, employees are well motivated and communicating any change is made easier. Resistance to change by employees can result to inconsistency in the implementation of strategic human resource practices. This means that human resource managers must recognize the importance of other workers in smooth running of the organization. Where team work exists, consistency and congruency in implementing strategic HR practices is possible and workers are easily influence to act in such a way that they support the fit concept (Monks & McMackin, 2001). This means that little understanding of the fit concept is not a primary reason why there lacks consistency and congruency in the implementation of strategic human resource practices. In conclusion, a clear understanding of the fit concept is very important in any organisation. However, it is not the primary reason for lack of consistency in implementation of strategic human resource practices. The underlying factor which affect both horizontal and vertical fit in strategic management form the basic reasons for lack of this consistency and congruency. These factors include existing human resource policies, availability of resources or allocated budget, availability of a variety option of human resource activities from which to select from, human resource managers’ personal characteristics and competency level, existence of team work and the competency level of all employees in general. Little understanding of the fit concept is hence a secondary explanation of the lack of congruency and consistency in the implementation of strategic human resource practices. The factors affecting fit affect this consistency. I therefore disagree with the statement that ‘strategic’ human resource practices continues to lack coherence and consistency, primarily because the concept of ‘fit’ is still so little understood. References Atkinson, C. and Lucas, R, (2011). Performance and reward in the employment relationship, Employee relations. Chan, L.L.M., Shaffer, M.A., & Snape, E, (2004). In search of sustained competitive advantage: The impact of organisational culture, competitive strategy and human resource management practices on firm performance. International Journal of Human Resource Management, 15(1), 17-35. Delery, J.E. 1998. Issues of fit in strategic human resource management: Implications for research. Human Resource Management Review. Vol 8 (3), 289-309 Gagne, M. and Deci, E, (2005). Self-determination theory and work motivation, Journal of organizational behaviour; vol. 26 issue 4. Monks, K. and McMackin, J, (2001). Designing and aligning an HR system. Human Resource Management, 11(2), pp. 57–72. Purcell, J. (1999) Best practice and best fit: chimera or cul-de-sac? Human Resource Management Journal, 9 (3), p. 26-41. Read More