The paper 'Sustaining Competitive Advantage through the Strategic Management of Human Resources' is a wonderful example of a Management Essay. In the modern world, the economic environment is undergoing random changes, which majorly depend on the change in investor and customer demands, globalization, and of course the continuously increasing competition for products and markets. For effective competition and success therefore, an organization must find better ways of improving its performance. This improvement in performances majorly focuses on innovating products, reducing costs and improving quality, speed to market, and quality of products and processes.
It is in this context that the human resource management becomes of great significance since it is the most significant resource to the current firms. Currently, employees, and more specifically, how they are managed has proven to be a highly significant source of enhancing competitive success. Therefore, recognizing that the priorities of the basis of competitive advantage have changed is critical in coming up with a frame of reference in considering the pertinent issues around strategic human resource management. The Strategic Human Resource Management (SHRM) presents the new transformation in human resource management since it is more concerned with the role of HRM systems in the firm’ s performance and alignment of the human resources in attaining high competitive advantage.
SHRM has various approaches, which base on theories laid down by earlier scholars. Of consideration to this essay are two approaches, Best-practice approach to SHRM and Resource-Based view of the firm and SHRM. The essay thus looks at these two approaches in detail and after thorough scrutiny, comes up with the better choice of the two. This is made possible by looking at the tenets of each approach separately then coming up with empirical evidence in terms of benefits or appropriateness that each approach can bring to a firm. Key tenets of Best-practice approach The best-practice approach is also the universal approach and it is the simplest approach in analyzing human resource management strategies.
The basics of this approach are that there is an exact and specific set of practices that if adopted by the human resource, then the organization can attain high performance and competitive advantage. It is significant to note here that this approach focuses on advocating for those practices that are oriented in reinforcing the employees’ abilities (Caliskan, 2010).
According to the proponents of this approach, these practices include certain methods of recruitment and selection, variable compensation, performance appraisal, or comprehensive training. This approach thus asserts that there is a direct relationship between attaining competitive advantage and human resource practices, which generally apply to all industries and organizations despite their context. According to the proponents of this approach, seven practices are highly significant to all organizations in order to achieve a competitive advantage.
According to this framework, the proponents interpreted that sustained competitive advantage is attainable through the application of one particular employment practices. This framework thus places more emphasis on adopting high-skill and high-cost employment policies. Evidently, this is also regarded as a high commitment to human resource management. The outlined seven practices include; selective hiring, employment security, decentralized decision making and self-managed teams, extensive training, comparatively high compensation, low barriers, and status distinctions, and extensive sharing of performance and financial information (Lockwood, 2007). These practices thus put more focus on the people within the organization or firm as the basic required resources.
Therefore, the integration of people with human resource practices becomes paramount for an organization to attain a competitive advantage.
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