Strategy and Human Resource Management - Assignment Example

Assume the position of a human resource consultant hired to assess the approach towards HR management taken by a client organization. What factors might you evaluate in determining whether an organization uses a traditional (transactional ) or strategic approach to managing its HR? Human assets are some of the most important functions in any business organization. Where the correct model of the directorate is conspicuously missing, there are observable variabilities with the organization that has employed the desirable approaches towards managing their human resource. My role as an HR consultant would be to evaluate the direction the client organization heads. I would assess the differences between the two approaches, traditional and strategic, and fro there examine the results that my client intends to achieve. Strategic human resource management (SHRM) entails carrying out all the activities of the Human Resource department like recruitment and selection of individuals to perform specific tasks. In this approach, the department links all its goals to the motto and the philosophy of the organization. The goals are long term, and this strategy focuses on the growth of the organization. The employees are thus trained to focus on what the organizational management has put in place, not only what the department heads have laid down. On the other hand, traditional (transactional) approach carries out all of the HR department's activities with a special inclination towards the goals of the department. The organization's philosophy goes unchecked. More often than not, the goals are short-term. Such a body tends to come up with goals to achieve within a given time-frame. As the consultant, I need to weigh several decisions made by the HR department. Factors I will put into consideration include; the relationship between the HR department and the goals of the organization. If the goals are in tandem, the conclusion is they use the SHRM while otherwise means they have employed the traditional approach. The periodicity of the objectives is another factor. The traditional approach has short-term goals while the SHRM has long term goals. I would evaluate the goals the department has laid down and the objectives they intend to achieve with it. If they wish to make profits in the short-term without considering the future of the organization, the approach is traditional and vice versa. The attitude towards employees is the third factor. The HR department needs to look at the workers as the most valuable of assets and not as a liability. If the employee's grievances and welfare fall on deaf ears, the success of the organization is short-lived as the employees might be tempted to look for environments where their welfare is minded. Organizations that employ the strategy of employees as liabilities are traditional while those that view them as assets are strategic. The stakeholders' contribution is another factor I will consider. Where the stakeholders insist on the organization adopting new policies and strategies that are in place, the institution most likely uses the traditional approach. Stakeholders' contributions and pressure may not hold water when the organization has adopted innovations to manage its departments, especially HR, on the other hand. Other factors I would put into consideration are job designs (teamwork), the flexibility of workforce and practices designed to improve quality. Positive results are the active SHRM while negative analysis shows traditional approach. References Jackson, Susan, E., Randall, S., and Kaifeng.,(2014) An Aspirational Framework for Strategic Human Resource Management. Academy of Management Annals 8. Chandra, A., (2014). Main differences between Traditional and Strategic human resource management. Journal. Armstrong, M., (2009) Armstrong’s Handbook of Human Resource Management Practice. 11th Edition. London Kogan. Why is a competitive advantage based on heavy investment in human assets more sustainable than investments in other types of assets? Many organizations employ different strategies and tools to compete for the ever-elusive market. Some will prefer to use their human resource to better their results and become active while others opt to invest heavily on other tools to compete. Human resource is more sustainable than any other investment, and the performance from the latter are less appealing than the former. Upcoming entrepreneurs use price, product, promotion, and place as means to achieve their goals. However, to compete effectively, it is important to come up with advantageous methods to conquer the market. In as much as marketing strategies are also necessary, there is need to come up with more ways to win the market, irrespective of where the market is. The greatest aspect is the Human Resource strategy and the human asset as capital. The win situation requires teamwork. Human resources go a long way in enhancing the organization's competitive advantage. Case study, company X decides to compete by pricing their products at a low price. So as to transact products at the lowest price compared to others business enterprises, the operating costs must be equally low to maximize the output while minimizing input. Company X may opt to get the human resources offshore. This way, the company will reduce the human capital. This method, when complemented with other strategies, may help company X accrue significant amounts of profit. Employing highly skilled individuals may seem a misplaced way of gaining competitive advantage. However, efficient operation produces a desirable product that can sell at a premium. Premium pricing offers the product at higher prices than the standard products would fetch. The profit accrued pays the labor, and the rest is retained to run the business. In a bid to be better competitors, it is important to have fresh ideas on innovations to improve the products offered. Though there could be many sources of such information, human capital is the best avenue. Employees, advisory board members, and equity partners are vast reservoirs of innovation that makes the product better regarding branding, marketing or even strategies employed in designing the product. Employees design, produce and sell the final products. As such, human beings are indispensable and. Taking care of the human capital improves their productivity. Complementing the workers boosts their morale, and they work more efficiently. The more productive human labor becomes, the better the results and eventually the better the competition. Value creation is the primary role of human resource and placing them on the assets part rather than as liabilities would help the organization to gain immense value for their investment. From the points above, it's clear that though other strategies are equally important, human assets are more sustainable. Akintoye, I., Adidu, F.,(2008) Optimising National Growth Through Human Resources Investments. [Google Scholar] Sidorkin, M., (2007). Human Capital and the Labor of Learning: A Case of Mistaken Identity. Educational Theory The IT firm and the performance appraisal system (module 5) There are several pieces of evidence to show the results of high commitment HR practices on the attitudes and behaviors of employees/staff. Wright and Nishii (2013) model on Human Resource Performance model is a multiple level of strategic human resource management showing how the attitudes and behaviors of human capital affect the outcomes/results of the organization. The model further stipulates that the employees' view of Human Resource practices goes a long way to affect their work and eventually the performance of the team. In our model of the innovative IT service business, the staff is on individual contracts. Before the performance appraisal system came into place, the company was performing well, and their employee forecasting was at 42.86% (from 700 to 1000). Their projection would only be a reality if the historical trends persisted. The fact that the HR department policies were not changing with the growth of the organization is a clear indication that the policies were doing quite well. Glenys, the new HR manager, comes up with new HR policies and systems that are admirable, even to the face of the employees. The management commits the first crime when they fail to involve some junior employees in the formulation of the performance appraisal system. They have their expectations and objectives which may not match the capabilities of the employees. The company CEO, Angus, does not involve himself in the formulation of the system. He has been running the business, and so he knows its needs. Leaving such crucial decisions to new entrants is another grave mistake. The employees were not involved in the training on what they were supposed to do to get the set objectives. In as much as the motive was good, the paid consultants took two days training managers and then left. The training could not have achieved the desirable quality within such a short period. The difficulties experienced at the goal-setting stage were indicators of employees' attitudes ignored by the partners. What the performance appraisal system did from the onset is psyching up the staff on positive things to come. Failure on the managerial side to implement good strategies in training, reward management, and talent improvement has brought up the apparent confusion and resentment from the staff. What of the laborious processes? The training was wanting regarding quality. The way the interviews went on shows there was bias especially in Division X where 60% of the staff are "outstanding." If the company fails to reward the employees according to the terms on the appraisal, then they will continue moving to greener pastures, as is the case already. The company has been doing well, until recently. Evidently, there was a shift in perceptions and attitudes from the junior staff to the managerial staff. The evidence lies in the comments they are making about the appraisal system. Now that the CEO has to personally approve pay increases, which is difficult in the face of the deterioration of business, employee loyalty will decrease. There is weak support on the managerial side, for instance, why does Angus allow Glenys to carry out the crucial tasks alone? What are the Division X managers up to? The lack of cohesion that shows openly to the staff is a critical case of lack of employee satisfaction that will bring the business down. References Guest, D., and Bos-Nehles, A. (2013). HRM and performance: the role of effective implementation;,iPaauwe, J., Guest, D., and Wright, P., (Eds), HRM and Performance: Achievements and Challenges, Wiley, Chichester Smith, A., Plowman, D.A., and Duchon, D.,(2010). Everyday sense giving: a closer look at successful plant managers. Journal of Applied Behavioral Science, Vol. 46 No. 2, pp. 220-244. Oreg, S., and Berson, Y., (2011). Leadership and employees’ reactions to change: the role of leaders’ personal attributes and transformational leadership style. Personnel Psychology, Vol. 64 No. 3, pp. 627-659. Alfes, K., Shantz, A., Truss, C., and Soane, E.C, (2013).The link between perceived human resource management practices, engagement and employee behavior: a moderated mediation model.International Journal of Human Resource Management. Sue upsets the applecart (module 6) The Universalist and the contingent perspectives of Human Resource management are different approaches aimed towards managing the human resource. The best practice (Universalist) approach argues that sets of Human Resource Management practices relate with increased organization performances and eventually for all staff types. On the other hand, the Contingency/best-fit approach asserts that the outcomes of the group are at their best if the human capital is in tandem with the organization's business policies/strategies. The two approaches assume that human capital policies are taken up as documented and that they have more or less the same implications on the entire employee list in the organization. Though there is no universal agreement on which is the best management approach, some factors are put into consideration when running a business organization. Sue upsets the applecart is a typical case study of conflict of interests between the two approaches of relationship. While the new HR manager, Sue, believes that the company should do better regarding rewarding their employees, the partners believe that they are already doing enough for their staff. If anything, they have not had any complaints before Sue joining their organization. The approach they employed since the onset of their group has brought their success this far. The best practice approach, as Sue proposes, offers job security, selective hiring (as is the case with hiring first class degree holders only), reduced gaps in status and also training. This, she believes, will bring more success to the organization. On the other hand, the partners propose the best-fit approach that offers a close relationship between the organization's policies and various systems it puts in place goes a long way in improving efficiency. The last system implies that the size of the organization, its location sector, strategy and nature of work determines what terms to use in HR. As it is, the two departments are in conflict. The HR department, headed by Sue, accuses the managerial team of employing improper tactics to run the business. Sue should have approached the management team before talking to the employees, to hear why they use such means. Instead of accusing the group of downplaying the workers, albeit to the employees themselves, she should have thought out the practices and like the human resource specialist she is, analyze the reasons why they could have chosen that. The finality of which she states her stand only means her way is the best. She should be flexible. The partners, on the other hand, are not right either. The approach they are using is justifiable given the size of their company, as opposed to the private sector where Sue worked before. However, they ought not to be that rigid. They should be willing to blend the two approaches and reconcile them to the needs of the business. In strategic human resource management, they ought to know that they need the staff and without giving them good terms, in as much as there are good alignment and communication, it will be at their expense. References Boxall, P. & Purcell, J. (2016). Strategy and human resource management (4th ed.). Hampshire UK: Palgrave Macmillan. Boxall, P. & Purcell, J. (2011). Strategy and human resource management (3rd ed.). Hampshire, UK: Palgrave Macmillan. Clinton, M. & Guest, D., (2013). Testing universalistic and contingency HRM assumptions, across job levels. Personnel Review. Read More