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Strategic Human Resources and Development
Unit – 1
Human resource Management (HRM) is the term used to describe formal system devised for the
management of people within an organization. It covers all levels (skilled, unskilled, technical,
professional, clerical, managerial) of employees.
# Need and significance of HRM
1. To help the organization reach its goals.

2. To employ the skills and abilities of the workforce efficiently.
3. To provide the organization with well trained and well-motivated employees.
4. To develop and maintain quality of work.
5. Facilitates professional growth.
6. Creates better relation between union & managt.
7. Development of both employees and organization.
8. Economic development
# HRM functions
They are categorized into three heads:-
A. Managerial functions
 Planning
 Organizing
 Staffing
 Directing
 Controlling
B. Operative functions
 Employment
 Development
 Compensation
 Maintenance (working conditions and welfare)
 Motivation
 Personal records
 Industrial relations
C. Advisory functions
 Advise to top management
 Advise to departmental heads
# Role of HR manager in an Organization

1. Recruitment – a. Attract Talent
b. Hire Resources
2. Training
3. Professional Development
4. Appraisals
5. Maintaining Work culture
6. Resolving Conflicts
7. Employee Relations
8. Rewards and Incentives
9. Legal Knowledge
10. Payroll Management
# Understanding Strategic Human Resource Management (SHRM)
Meaning
Strategic Human Resource Management (SHRM) is concerned with the development of HR strategies intended
to direct the employees’ efforts towards the business goals. In other words it is an alignment of strategic
business goals of the organization with human resources, so as to foster innovation and improve motivation,
satisfaction, productivity, and eventually overall performance. Strategic HRM is a relatively new term, which
differentiates itself from traditional HRM which was just merely an organizational function.
Importance of Strategic Human Resource Management (SHRM)

Since the last twenty years or so, there was an increasing fear of HR being secluded from business goals
and as a separate part of the organizations. There was an increasing need felt across sectors of HR playing
a vital role in improving productivity in organizations to achieve a competitive edge. So, strategic HRM
came into existence. The primary goal of strategic human resource management is to solve business
objectives or obstacles that may not occur within the direct purview of HRM. This has to be done through
effective HRM itself. So it is basically tuning of human resource management (HRM) to suit business
objectives.
Strategic Human Resource Management Process
1. Scanning the Environment: The process begins with the scanning of the environment, i.e. both the
external and internal factors of the organization. The external environment encompasses the political,
legal, technological, economic, social and cultural forces that have a great impact on the functioning of the
business. The internal factors include the organizational culture, hierarchy, business processes, SWOT
analysis, industrial relations, etc. that play a crucial role in performing the business operations.
The role of the HR department is to collect all the information about the immediate competitors – their
strategies, vision, mission, strengths, and weaknesses. This can be done through the resumes being sent by
the candidates working with the other rivalry firm. Through these, HR professionals can identify the
workforce, work culture, skills of the staff, compensation levels, reasons for exit and other relevant
information about the competing firm.
2. Identify Sources of Competitive Advantage: The next step in the strategic human resource management
process is to identify the parameters of competitive advantage that could stem from diverse sources as
product quality, price, customer service, brand positioning, delivery, etc. The HR department can help in
gaining the competitive advantage by conducting the efficient training programs designed to enrich the
skills of the staff.
3. Identify HRM Strategies: There are major four strategies undertaken by an organization to enrich the
employees capabilities:
a) Learning as Socialization: This strategy includes the techniques as training courses, coaching sessions,
education programs to ensure that the employees abide by the rules, value and beliefs of an organization and are
able to meet the performance targets.
b) Devolved Informal Learning: This strategy helps in making the employees aware of the learning
opportunities and the career development.
c) Engineering: This strategy focuses on creating and developing communities of practice and social networks
within and outside the organization.
d) Empowered Informal Learning: Through this strategy, the HR department focuses on developing the
learning environment such as knowledge about the new processes, designing of new work areas and the
provision of shared spaces.
4. Implementing HR Strategies: Once the strategy has been decided the next step is to put it into the action.
The HR strategy can be implemented by considering the HR policies, plans, actions and practices.
5. Monitor and Evaluation: The final step in the strategic human resource management process is to
compare the performance of the HR strategy against the pre-established standards.
At this stage, certain activities are performed to evaluate the outcomes of the strategic decision: establishing
the performance targets and tolerance levels, analyzing the deviations, executing the modifications.
Thus, to have an effective HR strategy the firm follow these steps systematically and ensures that the
purpose for which it is designed is fulfilled.
Elements of Strategic Human Resource Management (SHRM)

The pillars for SHRM are:
a) Humans are not just resources but they are an asset to an organization, which should provide a
competitive edge to the organization.
b) It’s the people within the organization who actually implement such change.
c) Every change is achievable only through a proper planning followed by execution with respect tpo the
organizational needs and objectives.
d) The main aim of strategic HRM is to concentrate on the ways through which the firm can take an edge
over its competitors.
e) According to Hendry and Pettigrew, SHRM has four different meanings, mainly:
- Making use of planning.
- Designing and managing people via a coherent approach.
- Developing systems which are based on employment policy and workforce strategy.
- Bringing out coordination between HR activities and other policies into developing business strategy.
- Considering people as resources and achieving competitive edge by making the best of them.
The above diagram shows the roles of SHRM

Objectives of Strategic Human Resource Management (SHRM)
The main aim of strategic HRM is to address issues related to organizational culture, structure,
effectiveness, resource matching, and performance. It involves developing the process capabilities as well
as managing the human capital effectively. The approaches used in strategic HRM can be categorized into
5 categories mainly:
1. Resource based Strategy: Addresses issues wherein the strategic capabilities of the firm can be
increased.
2. High Commitment Management: By enhancing the mutual commitment between the managers and their
employees.
3. High Involvement Management: Treating employees as their partners in the business.
4. High Performance Management: Improves the performance of the firm by focusing on improving the
productivity, growth and profitability rate of its people.
5. Achieving Strategic Fit: Integration of human capital and resources is necessary for smooth and
profitable operation of business.
Examples of Strategic Human Resource Management (SHRM)

1. Infosys Chairman Mr. Narayan Murthy has emphasized on human capital as one of Infosys’ critical
factors for growth. Thus, there has been a strategic Human resource dimension added to the organization in
the form of ‘People managers’, whose function is to look after the needs of employees. The company aims
to treats its employees as assets rather than just as resources. Nurturing and nourishing the resources
ensures competitive advantage for Infosys. Thus, a dedicated human resource department including people
managers in every group serves as a SHRM practice which fulfills the business objectives of the
organization.
2. Samson Enterprises through strategic HR initiatives started recruiting people with good communication
skills along with technological prowess, due to the increase in number of client calls, so that client
solutions could be effectively dealt with by the team.
Hence, this concludes the definition of Strategic Human Resource Management (SHRM) along with its
overview.

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Strategic Human Resources and Development

# Need and significance of HRM

1. To help the organization reach its goals.

# Role of HR manager in an Organization

Importance of Strategic Human Resource Management (SHRM)

Elements of Strategic Human Resource Management (SHRM)

The above diagram shows the roles of SHRM

Examples of Strategic Human Resource Management (SHRM)

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