Importance of Strategic Human Resource Management - Case Study Example

Strategic Human Resource Management Student’s name Institution of Learning Instructor’s Name Course Name Strategic Human Resource Management (SHRM) Introduction Increased competition for the global market share amongst firms and the desire to achieve a work life balance for employees are some of the emerging issues that an organization should address in order to stay competitive. Researchers in business dynamics have revealed that the best way for addressing these issues is by adopting a managerial process that endeavors to align the human resource management (HRM) policies and practices with the strategic objectives of the organization. This approach to HRM is what has today termed as strategic human resource management (SHRM). Generally, SHRM is viewed as a process undertaken by the upper echelon of the organization in order to accomplish performance goals. Wheelen and Hunger (1995) define strategic management as ‘that set of managerial decisions and actions that determines the long-run performance of a corporation’. Hill and Jones (2001) also agree with this view when they define strategic SHRM as ‘an action a company takes to attain superior performance’. SHRM enhances productivity and the effectiveness of an organization. Personnel practices such as internal career ladders, formal training systems, results oriented performance appraisal, employment security, employee voice/participation, broadly defined jobs, and performance-based compensation, it is more able to achieve its goals and objectives. Strategic management is considered to be a continuous activity that requires a constant adjustment of three major interdependent poles: the values of senior management, the environment, and the resources available. Strategic management as a continuous process requires that activities be undertaken in a cycle format. The process is broadly broken down into five processes : mission and goals, environmental analysis, strategic formulation, strategy implementation and strategy evaluation. This essay explores articles by different SHRM Researchers in order to come up with a comprehensive report on the global challenges facing the contemporary businesses and hence the role of SHRM in enhancing organization profitability, work-life balance and increased global competition. Importance of strategic human resource management (SHRM) SHRM when adopted by an organization provides the required consultancy services that an organization’s top management require in order to be able to effective manage the employees. The strategic approach to human resource management departs from the traditional style of managing employees where emphasis is hitched on delivering the goals of the organization at all costs. In the traditional HRM, very little attention is paid to the welfare of the employees once he/she signs the contract with the organization. SHRM identifies the need for investing in an employee’s work-life balance in order to enable the employee to appreciate working for the organization. This way, the employee’s output increases and so is the quality of his/ her work since he/she offers the organization his level best services since he/she is an all round satisfied person (Goodman, 2004). SHRM ensures that employees of an organization participate in the formulation of the organization’s strategic plan. The employees are usually the executors of the formulated strategic plan; their inclusion in the planning process therefore gives them more trust for the leadership of the organization while at the same time enhancing their knowledge of the objectives of the organization as well as what they have to do as employees in order for the objectives to be achieved. This way, employees individually set their own goals and dedicate themselves to achieving their set goals which are always in line with those of the organization. This style of operation makes appraisal of employees very easy and similarly, the goals of the organization are easily achieved (Monks & McMackin, 2001). Talent management and development becomes easy when an organization choose to adopt SHRM. SHRM lays out the basic guidelines that enable the HR department to acquire and maintain very competitive individuals in an organization. Competitive employees are critical in the success of an organization; these are people who are willing to work under minimum supervision. They are always willing to assist each other in different ways for the good of the organization as well as their own. Talent management is not an easily achieved activity, it calls for tolerance and institution of relevant trainining workshops to ensure that an individual works in an area he/ she enjoys most; it goes beyond acquiring individuals with the right skills and knowledge for the available openings in the organizations (Trevor, 2002). Global challenges among businesses today and how SHRM can be applied in solving them. Lose of trust It is no longer that the top management of most of the organizations no longer enjoys trust and confidence of the stakeholders, especially the employees. This is a serious problem that requires drastic measures to be taken in order to prevent organization from collapsing. Once the employees lose their trust and confidence in their employer, their motivation towards work also eludes them. This is such a terrible situation that an organization should not let itself into. However, research shows that trust, especially in corporate organizations has diminished seriously as most of the employees have a feeling that these organizations only use them in order to make profits. A good example of this scenario was witnessed at Hewlett Packard during the time Carly Fiorina served as the CEO. She had developed a strategy but she simply could not win the trust of the stakeholders and had to be fired in 2005 amid losses for the company (Christen et al. 2005). SHRM requires that organizations adopt leadership styles that not only lead to immediate results but rather one that seeks to achieve both the objectives of the organization while at the same time fulfilling the needs and requirements of employments. When an organization eventually gets to adopt such a leadership style, the employees and other stakeholders of the organization will be able to have trust and confidence in the top management. This trust is important since the employees support for the organization’s objectives is crucial in realizing them. This was especially witnessed at Hewlett-Packard. The founders of this company related well with the employees and so were the leadership before Carly Fiorina took over. She failed because she chose to distance herself from the employees and the stakeholders. This situation changed with the management that followed after Fiorina was fired (Christen et al. 2005). Exclusion of executors of strategic plans in development of the plans Top executives of organizations exclusively hold boardroom meetings and through them formulate the strategic plan for the organization. They do not take their time to gather the views of the employees of the organization. In so doing, the employees are left out of this crucial process. This is a major issue that today haunts most of the organizations since the employees who are charged with the execution of the strategic plan are not aware of what is expected of them; they do not have the objectives of the organizations in their mind. This is an issue that has been crippling most of the global corporations (Graves, Suzanne & Moran, 1994). Lack of employee motivation Most of the global organizations employ complex appraisal styles. Employees find it had to understand how the reward systems in their organizations operate. This was a key complain from the employees at Hewlett-Packard during Fiorina’s tenure as the company’s CEO. The same was witnessed at Xerox in 2000, the year the company recorded its first quarterly loss in sixteen years. An employee who is not motivated is not able to produce even half of her best no matter how strict the manager is (Goodman, 2004). An organization that adopts SHRM has a good relationship between the top management team and the junior staff members. This enables all employees to come up with the best means through which their welfare can be checked; this includes the complicated issue of rewarding employees. SHRM enables this issue to be effectively addressed and hence eliminating the challenge of unsatisfied employees. Ethical issues in the global business environment Corporate organizations have been seen to taking away a lot more than they are willing to give. This has led to introduction of stringent measures to ensure that these organizations duly comply with the Corporate Social Responsibility (CSR) requirements. Many organizations are still unable to think of better ways of attaining better profits while at the same time fulfilling the expectations of the communities in which they operate. This particular aspect has given American companies a bad reputation in the global business world. People are of the notion that American corporations do not care about the local people working employed by these corporate organizations. This is a serious issue that affects the competitiveness of the products of the companies in the world market and should be effectively addressed (Goodman, 2004). Once an organization is able to appreciate the importance of its employees in its achieving of the set objectives. This makes it easy for the organization to have a new look at CSR. It stops looking at CSR as an additional burden but rather as an activity that it should undertake in order to make the community and its environment a better place to be. In so doing, the organization discovers that it increases the size of its market and hence the profits in the long run (Purcell, 2001). Work –life balance The clamor for the recognition of an employee’s possession of life, in addition to having a job by the employer is a real issue that should be addressed in today’s global business environment. Unfortunately, even as the demand for work-life solutions has skyrocketed, many work-life efforts have fallen short of their promise and potential to deliver the desired results for the individual and the organization. Researchers in work-life balance indicate that in the past, all attempts in establishing this balance have focused on organizational strategy. In this strategy, the interests of the organizations are the one that the balance seeks to fulfill. Time has come for focus to include the employee strategy as embedded in the SHRM (Bird, 2006). Work-life balance should be effectively addressed; otherwise, organizations will continue to experience lower production than the workforce’s capability as well as losing important employees of the organization. SHRM pays a lot of attention on the work-life of employees. It ensures that an organization takes into consideration in its strategic plan all aspects of the work place that not only lower an employee’s performance but also those that are likely to affect an employee’s family life. Strategic HR managers carry out frequent employee work-life balance training which impacts positively to both the organization in terms of the employee’s performance while also enabling the employee to have a better family relationship (Bird, 2006). Increased global competition Technology has reduced the world into a global village where consumers have a wide range of competing products and services to choose from. The implication of this is the tough competition that exists among different business organizations. Many organizations have been unable to march this kind of competition and have been forced to close down as a result of continued losses. Management strategies adopted are critical in the success of an organization in such an environment. SHRM ensures that an organization is well furnished with competitive talent that ensures the organization’s provides outstanding products and services. The high quality products and services go a long way in giving a company a positive image to the consumers who eventually grow to identify themselves with the products of the company. This is the typical scenario at PepsiCo. This company has paid attention to SHRM through developing and carefully managing its talent. This ensures that it provides uncompromised products and services to its consumers all the time (Trevor, 2002). SHRM further ensures that there is proper coordination among various departments of an organization. This coordination ensures that internal wrangles within an organization are eliminated and hence no time is wasted on solving internal wrangles. This provides sufficient time for the implementation and evaluation of the strategic plan. This enables the organization to check its weaknesses and hence stay competitive in the global market (Monks & McMackin, 2001). Decreasing profits In order to stay in the increasing competitive market, organizations have been adopting different marketing strategies. The strategies have ranged from increasing an organization’s budgetary allocations on product promotion, routine change of marketing executives and even reducing the number of employees in order to cut down expenses. Despite all of these, so many companies are still rushing to file for bankruptcy. This has caused different researchers sleepless nights in their attempt to come up with what can be done in order to put this scenario to a stop. Research shows that there is a need for the various departments of an organization to work hand in hand with the HR department if at all they expect to achieve their goals and objectives. SHRM sets out a framework that enhances coordination of all departments within an organization. It enhances team work within an organization and hence putting in place processes and systems. This way, the organization establishes Total Quality Management Systems (TQMS); this is important in assuring the consumers and all other stakeholders on the direction of the company and the worth of its products. This is important in establishing a brand name which is important in winning a large market share in the competitive global market. This enables a company to increase its profit margin without indulging in price wars or even expensive sales promotion activities which at the end of the day increases the expenses without leading to a corresponding increase in sales volume (Monks & McMackin, 2001). Conclusion Strategic human resource management (SHRM) has become an essential component of building a successful organization; an organization that is able to withstand the increased global market competition. It addresses different issues that revolve around an employee both at work and out of the work place. It does so from the understanding that a satisfied employee is more productive under minimum supervision than a disgruntled one under the watchful eye of the boss. By addressing the interests of the employees and ensuring that all employees are equally treated as an essential constituent of the organization, the output of the employees as well as the quality of their work improves significantly hence increasing the organization’s profitability. Strategic human resource planning helps in concentrating individual effort into a team effort. This way, it assists in establishing total quality management systems (TQMS) and objective-based performance appraisal systems. This encourages build-up of individual accountability in an organization. In so doing, the process transforms perception away from separate and distinct projects and towards and towards systemic viewpoints. This is useful in an organization as it enables the organization to cut down on managerial costs since it is easy to manage processes and systems than individuals. SHRM provides a space for employee growth through practices such as internal career ladders, formal training systems, results oriented-performance appraisal among other employee development enhancing practices. This makes an employee to be proud of the organization and hence ready to undertake whatever it takes to see the organization moving to the next level. Bibliography Christensen, CM., Scott D.A., & Erik A R 2005, Seeing What's Next: Using the Theories of Innovation to Predict Industry Change. Boston, MA: Harvard Business School Press. 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