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Describe the competitive environment of human resource management Identify three types of strategies and relate each to human resource management Discuss human resource strategy formulation and relevant organizational factors Discuss the processes through which human resource strategy is implemented Discuss how the human resource function in organizations can be evaluated

The Competitive Environment Organizations gain competitive advantage through management of human resources Human resource manager adds value to the organization by providing expertise concerning how to use firm’s human resources To accomplish its objectives and gain competitive advantage

4.1 Strategic Human Resource Management

The Competitive Environment Strategic perspective A firm gains a competitive advantage when it implements a strategy that its competitors are unable to implement Influence of organizational purpose and mission Describes the importance an organization places on its human resources

The Competitive Environment Influence of the top management team Sets the tone for the organization and plays a major role in shaping its culture Role of corporate governance Monitors the actions of the top management team to ensure that stockholders’ interests are protected

Types of Strategies Corporate strategy: Determines what businesses the corporation will operate Business strategy: Deals with how the firm will compete in each market where it conducts business Functional strategy: Deals with how the firm will manage each of its major functions

Corporate Level Strategies Pursued internally by opening additional locations or externally through mergers, joint ventures, or the acquisition of other businesses Growth strategy Occurs when an organization finds that its current operations are not effective, and major changes are needed to rectify the problem Retrenchment strategy Calls for maintaining status quo Stability strategy Used by companies that are adding new products, product lines, or businesses to their existing core products, product lines or businesses Diversification strategy

Business-Level Strategy Adaptation model: Managers in an organization should try to match the organization’s strategy with the basic conditions of its environment Defender strategy Prospector strategy Analyzer strategy

Other Competitive Strategies Attempts to develop an image or reputation for its product or service that sets the company apart from its competitors Differentiation strategy Focuses on minimizing the costs as much as possible Cost leadership strategy Undertaken when an organization tries to target a specific segment of the marketplace for its products or services Focus strategy

4.3 Human Resource Strategies

Components of HR Strategy Organizational design Corporate culture Unionization

Interpersonal Processes Overall set of expectations held by an individual with respect to what they will contribute to the organization and what the organization will provide to individual in return Psychological contract Relatively stable set of psychological attributes or traits that distinguish one person from another Personality Set of forces that causes people to behave in certain ways Motivation Person’s adaptive response to a stimulus that places excessive psychological or physical demands on that person Stress

Strategy Implementation Human resource managers help identify potential leadership qualities among existing employees To help structure procedures for developing and enhancing those qualities Communication is an interpersonal process directly related to the implementation of human resource strategy

4.1 Human Resource Management That May Lead to Improved Firm Performance

Organization gains competitive advantage through its management of human resources Key to strategic operations is developing and implementing effective strategies Interpersonal processes are important because of the role they play in affecting the performance effectiveness exhibited by each employee in a firm

Adaption model Business strategy Corporate strategy Cost leadership strategy Culture Differentiation strategy Diversification strategy Focus strategy Functional strategy Growth strategy Mission Motivation Organization design Personality Psychological contract Purpose Related diversification Retrenchment strategy

Stability strategy Stress Top management team Unrelated diversification