The paper 'Integration of HR Strategy with Business Strategy Can Lead to Organizational Effectiveness' is a good example of a Management Essay. In the past, the majority of the organizations have been observing the Human Resources department to only perform only the administrative functions (Baker, 1999, p. 54). In so doing, HR has been ignoring other functions such as aligning human resource strategy with business strategy. The traditional role of HR has isolated the HR department with the rest of the organization. However, Darwish and Sing (2013, p. 675) stated that the new concept, SHRM has given HR departments more functions which entail flexible management and use of the human resources to realize the goals of the organization, and consequently assist it to gain a competitive edge.
Darwish and Singh (2013, p. 675) posited that SHRM is certainly one of the significant concepts in management and business today. They went further to argue that if HRM is to contribute to the effectiveness of organizations, it needs to be strategic, and HR strategy needs to be integrated with business strategy. Therefore, this essay will discuss how the integration of HR strategy with business strategy can lead to organizational effectiveness.
To put this discussion into perspective, the essay will define describe both the functions of HRM and SHRM and outline HR strategy and business strategy. The conventional functions of HRM have been covering an array of areas such as selection, recruitment, workforce planning, training and development, job analysis and design, benefits and compensation, and performance appraisal (Becker & Huselid, 2001). However, these are just normal functions of HR which if not managed properly, the organization might just remain the same.
The development of strategic human resource management has given HR a new life and calls for the integration of HR strategies with business strategies for organizational effectiveness. In SHRM, human resource managers are urged to act as strategy architect who views employees as “ strategic resources” which can be used to create competitive advantage (Werber & DeMarie, 2005, p. 249). This is the first step to aligning HR strategies with business strategies. The competition in the market requires the organization forges ahead as one entity and formidable force. The reasoning implies that no single department is isolated from the rest such as the way it has been happening with the human resources in the past. According to Robinson, Pearce, and Mital (2008, p. 63), business strategy is aimed at gaining competitive advantage; this means the company is better in terms of growth and management of environmental factors.
On the other hand, the HR strategy is the strategic management of people in the organization to achieve desired goals (Stone, 2013). An alignment of the HR strategy and business strategy, therefore, results in the effectiveness of the organization.
Most literature does not separate business strategies and HR strategies but rather provides general strategies such as growth, retrenchment, stability, a mixture of retrenchment, growth, and stability, and international strategies. These strategies look more on business strategies than HR strategies. Therefore, this essay provides that when HR resource functions are managed strategically, they can be used as HR strategies and be aligned with business strategies to attain organizational effectiveness (Fabi, Raymond & Lacoursiè re, 2009, p. 17). Therefore, in addition to other few HR strategies like manufacturing and marketing that have been determined, we can have strategic human resource planning, strategic training, strategic job analysis and design, strategic performance evaluation, and strategic compensation (Robinson, Pearce & Mital, 2008, p. 34).
Baker, D. (1999). Strategic human resource management: performance, alignment, management.
Librarian Career Development, 7 (5), 51 – 63.
Brauns, M. (2013). .Aligning Strategic Human Resource Management to Human Resources,
Performance and Reward. International Business & Economics Research Journal , 12(11), 1405-1410.
Becker, B., & Huselid, M. (2001). The Strategic Impact of HR. Harvard Business School.
Darwish, T.K., & Singh, S. (2013). Does strategic human resource involvement and
devolvement enhance organizational performance? International Journal of Manpower 34(6), 674-692.
Fabi, B., Raymond, L., & Lacoursière, R. (2009). Strategic alignment of HRM practices in
manufacturing SMEs: a Gestalts perspective. Journal of Small Business and Enterprise Development, 16(1), 7 – 25.
Hill, C & Jones, G. (2007). Strategic Management: An Integrated Approach. Oxford University
Robinson,R., Pearce,J., & Mital, A.(2008). Strategic Management: Formulation, Implementation
and Control. New Delhi; McGraw Hill Education.
Stone, R.J. (2013). Managing Human Resources (4th ed.). Milton, QLD: John Wiley & Sons (Australia), Ltd. ISBN 9780 730 30255 1.
Teena, B & Sanjay, S. (2014). SHRM: alignment of HR function with business strategy.
Strategic HR Review, 13(4/5).
Werber,J.,& DeMarie,S. (2005). Aligning Strategic HRM and Person-Environment Fit. Human
Resource Review 15, 247-267.