In HR and management circles today there is a lot of talk about Strategic Human Resource Management and you can see many expensive books on bookstore shelves. But what exactly is SHRM (Strategic Human Resource Development), what are its key features, and how is it different from traditional human resource management?
SHRM or Strategic Human Resource Management is a branch of Human Resource Management or HRM. It is a fairly new field, having grown out of the parent discipline of human resource management. Much of the early or traditional HRM literature treated the notion of strategy superficially, rather as a purely operational matter, the results of which cascade throughout the organization. There was a kind of unspoken division of territory between the people-focused HR values and the harder business values where corporate strategies really belonged. Human resource professionals felt uncomfortable in the war cabinet atmosphere where corporate strategies were formulated.
Definition of ‘SHRM’
Strategic human resource management can be defined as linking human resources to strategic goals and objectives to improve business performance and develop an organizational culture that fosters innovation, flexibility, and competitive advantage. In an organization, SHRM means accepting and involving the HR function as a strategic partner in formulating and implementing the company’s strategies through HR activities such as recruiting, selecting, training and rewarding staff.
How SHRM differs from HRM
In the past two decades there has been a growing awareness that HR functions were like an island unto themselves with softer, people-focused values, far removed from the harsh world of real business. To justify its very existence, HR functions needed to become more closely connected to the strategy and day-to-day running of the business side of the company. Many writers in the late 1980s began to call for a more strategic approach to people management than the standard traditional people management practices or industrial relations models. Strategic human resource management focuses on human resource programs with long-term goals. Instead of focusing on internal HR issues, the focus is on addressing and resolving issues that affect people management programs long-term and often globally. Therefore, the main goal of strategic HR is to increase employee productivity by focusing on business obstacles that occur outside of HR. The primary actions of a strategic HR manager are to identify key HR areas where long-term strategies can be implemented to improve overall employee motivation and productivity. Communication between HR and the company’s senior management is vital, since cooperation is not possible without active participation.
Key Features of Strategic Human Resource Management
The key features of SHRM are
- There is an explicit link between HR policy and practices and the overall strategic objectives of the organization and the organization’s environment.
- Is there some organizational scheme that links the individual HR interventions so that they are mutually supportive.
- Much of the responsibility for human resource management is delegated later
Trends in the Strategic Management of Human Resources
Human resource management professionals are increasingly faced with the issues of employee engagement, human resource flow, performance management, reward systems, and high-commitment work systems in the context of the globalization. Older solutions and recipes that worked in a local context do not work in an international context. Intercultural issues play an important role here. Here are some of the major issues facing HR professionals and senior management involved in SHRM in the first decade of the 21st century:
- Internationalization of market integration.
- Increased competition, which may not be local or even national through free market ideology.
- Rapid technological change.
- New concepts of general and line management.
- Constant change of ownership and resulting corporate climates.
- intercultural issues
- The shift in economic gravity from ‘developed’ to ‘developing’ countries
SHRM also reflects some of the major contemporary challenges facing HR management: aligning HR with core business strategy, demographic trends in employment and the labor market, integrating soft skills into HRD, and finally, knowledge management.
References
- Armstrong, M (ed.) 192a) Strategies for human resource management: a total business approach. London: Kogan Page
- Beer, M & Spector, B (eds) (1985) Readings in Human Resource Management. New York: Free Press
- Boxall, P (1992)’Strategic Management of Human Resources: Beginnings of a New Theoretical Sophistication?’ Human Resources Management Magazine, Vol.2 No.3 Spring.
- Fombrun, CJ, Tichy, N, M and Devanna, MA (1984) Strategic Management of Human Resources. New York: Wiley
- Mintzberg, H, Quinn, JB, Ghoshal, S (198) The strategy process Prentice Hall.
- Truss, C and Gratton, L (1994)’Strategic Management of Human Resources: A Conceptual Approach’International Journal of Human Resource Management, Vol.5 No.3