The Firm and Strategic Human Resource Management - Essay Example

Strategic Human Resource Management: Where have we come from and where should we be going? Organizational excellence begins with the performance ofpeople. It is what people do or do not do that ultimately determines what the organization can or cannot become. It is their dedication and commitment to organizational purposes that make the difference. Whether organizational goals can be achieved will depend on the willingness of people to make the necessary contributions. It is the performance of people that is the true benchmark of organizational performance. People constitute an organization’s most important and vital factor in its success or failure. In order to function efficiently and effectively, people must be managed well. Human resources management (HRM) is the art and science of dealing with people at work for the optimum achievement of individual, organization and society’s goals. While general management is the orchestration of all the resources, human resource management is limited to people management – their motivation, acquisition, maintenance and development. Strategic human resources management (SHRM) is defined by Boxall & Purcell (2003) as “concerned with explaining how HRM influences organisational performance. They also point out that strategy is not the same as strategic plans. Strategic planning is the formal process that takes place, usually in larger organisations, defining how things will be done. However strategy exists in all organisations even though it may not be written down and articulated. It defines the organisation’s behaviour and how it tries to cope with its environment.” Boxall & Purcell have been intrigued by theories and applications of SHRM that they have written several discourses on the subject including the article entitled Strategic Human Resource Management: Where have we come from and where should we be going? In this regard, this essay aims to present a brief synopsis of the paper to outline the content and to identify the nature of the discourse. A discussion of the results of the paper would be proffered in terms of stating the key claims of the findings and determining what it adds to the body of knowledge on SHRM. In addition, the findings from the article would be related sporadically with discussion from the literature in the course module. An assessment of the methods used by Boxall & Purcell would be touched on, as required. Likewise, an identification of the researchs practical implications would be determined; as well as an assessment of the strengths and weaknesses of the paper, as finale. Brief Synopsis Authors Boxall & Purcell proffered in the article the interrelationships and extent by which organizational goals are achieved and influenced by HRM. According to the authors, the purpose of the discourse is to present and analyze theoretical and research developments on SHRM as a field of contemporary endeavor. The article initially differentiated HRM from SHRM and proceeded with the discussion of the two models: the ‘best-fit’ and the ‘best-practices’ models. The authors further evaluated how resource based value (RBV) of the firm contributed to SHRM’s achievement of sustained competitive advantage. Key Claims of the Findings The authors initially differentiated HRM from SHRM. Accordingly, HRM was defined as including “anything and everything associated with management of employment relations in the firm” (Boxall & Purcell, 2000, 184). The theoretical basis for the inclusion of the word strategic to HRM was detailed using a review of various literatures from scholars on the subject. Boxall & Purcell finally averred at this definition of SHRM as “concerned with the strategic choices associated with the use of labour in firms and with explaining why some firms manage them more effectively than others” (2000, 185). Critical distinguishing information prior to an extensive discussion of the theoretical views and applications of SHRM are as follows: (1) the fact that HR strategies are unique and varied between and among firms, (2) firms have multi-products and multi-divisions which complicate the application of SHRM, and (3) more firms operate in international markets. The best-fit versus best practices models were clearly discussed to determine how firms make strategic choices in terms of management of labor (Boxall & Purcell, 2000, 186). The authors differentiated that the best fit model employs an HR strategy that “will be more effective when…integrated with its specific organizational and environmental context” (ibid., 186). Best-fit HR practices are basically driven by competitive strategy and should be incorporated therefore in a firm’s set of policies and procedures on HRM. Detractors of the best fit model argue that this approach fails to consider the following: (1) employee interests to be aligned with social norms or legal requirements, (2) a more comprehensive description of competitive strategy, and (3) a lack of information to dynamics. The authors concluded that the effectiveness of best fit models is measured in terms of fitting certain critical contingencies such as: sectoral choice, competitive strategy, suitable technology, structure and necessary levels of finance and human capital” (188). In contrast, the best practice model supports a universal approach “arguing that all firms will be better off if they identify and adopt ‘best practice’ in the way they manage people” (186). The findings on best practice approach state that those elements found to be most desirable to employees (employment security, selective hiring, self-managed teams, high pay based on performance, extensive training, among others) are not consistently cost effective in general. There is always the need to assess and incorporate factors such as economic, social, and political which affect and influence HR practices in employment among organizations. According to Joaquin (2003), the resource based value (RBV) concept is grounded in economics and sees organizations as diverse entities of physical and human resources with distinct capabilities that determine the effectiveness of performing its tasks and functions towards the achievement of goals. It posits that “the sources of value creation are resources and capabilities. To outperform industry norms, a company must create more value than its competitors” (Joaquin, 2003, 1). The following processes in relation to RBV were detailed and explained in the article: unique training and learning, social complexity, and casual ambiguity. The concept’s application to SHRM was expounded through a discussion of key concerns bordering on building human capital structure and fostering learning and organizational agility. The overemphasis on the concept of competitive strategy need to be further reviewed in the light of contemporary HR theories including organizational theory and employment relations. Analysis The authors used various methods in presenting the topics and arriving at findings on the issue of SHRM. They used literature reviews from diverse sources numbering about 100 in references. They cited some examples linking theories to applications also using previous descriptive research works. In fact, using this technique did not provide a conclusive evidence of the concept of RBV as the authors acknowledged that “the RBV of the firms does not provide a sufficient basis for the theory of SHRM “ but offers more areas for future research (199). Strengths and Weaknesses In this regard, in as much as the authors provided ample sources of previous research done on the topic of SHRM, they failed to arrive at new and innovative findings on the area using first hand research based on quantitative or qualitative research. The provided a good theoretical framework on SHRM bases on previous descriptive research methods conducted by various scholars, included them. However, the article needs more concrete and contemporary examples of SHRM in actual organizations to link these theories to practical applications and thereby strengthen the effectiveness of measuring HRM’s contribution to the achievement of organizational goals. As indicated by CIPD (2010) in their article on SHRM, “much emphasis has been put on the importance of ‘fit’. In other words it is argued that HR strategies much fit both with each other and with other organisational strategies for maximum impact. The main areas of practice which all the researchers agreed have an impact on performance are around job design and skills development” (par. 22). There is really a need to further come up with conclusive research on the areas of RBV in relation to SHRM. The limitations that the RBV concept has have not been indicated by Boxall & Purcell which could have affected their findings. Conclusion Boxall & Purcell were successful in achieving their defined objective which is to present and analyze theoretical and research developments on SHRM as a field of contemporary endeavor. It provided numerous sources of literature reviews that informed the readers on where we have come from but not so much on where we are going in terms of future prospects of SHRM. Except for opening new avenues for future research, the authors did not provide adequate amount of clear and actual examples that link theories to practice. More importantly, as the roles and functions of HRM become more diverse adapting to the demands of the times, the means to assess its effectiveness evolves into encompassing areas of employee development (employee behavior, attitudes and skills), competencies, performance, as these attributes all contribute to the achievement of organizational goals. As organizations become more specialized in their respective core competencies, the mission and vision that each explicitly stipulates does not necessarily focus on the bottom-line. More contemporary organizations include goals of social responsibility, service to the community, enhancement and encouragement of cultural diversity, among others. In this regard, the effectiveness of SHRM should be measured in terms of their success in achieving their well defined goals. References Boxall, P. and Purcell, J. (2003) Strategy and human resource management. Basingstoke: Palgrave Macmillan. Boxall, P. and Purcell, J. (June 2000). ”Strategic Human Resource Management: Where have we come from and where should we be going?” International Journal of Management Reviews,Volume 2, Issue 2, pp. 183 – 203. CIPD. (2010). Strategic Human Resource Management. Retrieved 23 March 2010. From < http://www.cipd.co.uk/subjects/corpstrtgy/general/strathrm.htm> Joaquin, B. (2003). The Resource Based View of the Firm. Retrieved 23 March 2010. From < http://www.ecofine.com/strategy/RBV%20of%20the%20firm.htm> Read More