1. The Future of HR Strategies
Steve Werner, Ph.D.
Department of Management
C.T. Bauer College of Business
University of Houston

2. Agenda The importance of formulating and implementing HRM strategies.
Chapter 1
Agenda
The importance of formulating and implementing HRM strategies.
The roles and responsibilities of HR professionals in formulating and implementing HRM strategies.
Understanding external environmental factors.
Understanding internal environmental factors.
Types of HRM strategies.
The process of formulating an HRM strategy.
Implementing an HRM strategy.
Conclusion

3. The Importance of HRM Strategy Formulation and Implementation
Formulation: the process of determining the best course of action to achieve competitive advantage
Implementation: putting the chosen strategic plans into action
External and organizational environments can influence a company’s HRM strategy, which then drives all of the HR activities that comprise its HRM system
Exhibit 1 highlights the importance of the many elements of an organization’s external and organizational environments to the formulation and implementation of an effective HRM strategy.

4. Human Resource Management Strategies
Chapter 1
Exhibit 1
Human Resource Management Strategies
in the Context of External and Organizational Environments
EXTERNAL
ENVIRONMENT
Economic Landscape
Demographic Landscape
Socio-Cultural Landscape
Political/Legal Landscape
Unions
Global
Landscape
Formulate
An HRM Strategy
Employee
Attitudes
and
Behaviors
SATISFACTION
OF STAKEHOLDERS
Owners and Investors
Organization Members
Customers
Society
Other Organizations
Implement the
HRM Strategy
ORGANIZATIONAL
ENVIRONMENT
Technology
Company Culture
Business Strategy
Other Resources
Design, Monitor and Revise an Integrated HRM System
Source: Jackson-Schuler-Werner, Managing Human Resources, 12th Edition, Oxford University Press..

5. HRM Strategy Formulation and Implementation
Formulation involves understanding a company’s environment and then developing an HRM strategy that “fits” that environment.
Elements of the external environment may be thought of as threats or opportunities.
Elements of the organizational environment may be thought of as the firm’s strengths and weaknesses.
Analyzing these Strengths, Weaknesses, Opportunities, and Threats is known as a SWOT analysis. A thorough SWOT analysis is required for development of an effective HRM strategy.
S W
O T

6. Roles and Responsibilities for Formulating and Implementing HRM Strategies
 LG 6
Consider how well the organization’s approaches to managing human resources fit with the current global and organizational environment.
Be proactive in learning about how leading companies are managing human resources, and what they’re learning from their experiences.
Stay informed of the latest technical principles for managing human resources.
Develop the skills and competencies needed to implement HRM strategies.
Work closely with line managers and employees to develop HR policies driven by the HRM strategy.
Help line managers engage in HR practices that are consistent with HR policies.
Work with employees to help them voice concerns effectively, and serve as their advocate when appropriate.

7. Understanding the External Environment
The economic landscape
The demographic landscape
The socio-cultural landscape
The political and legal landscape
Unions
The global landscape

8. The Economic Landscape
The economic landscape refers to the economic conditions in which firms compete.
The nature of the economy and its direction can be measured through a number of indicators including but not limited to:
interest rates
unemployment rates
inflation rates
consumer confidence index
productivity measures
gross national products
industry sales

9. The Demographic Landscape
The demographic landscape refers to characteristics of the people where the company does business.
These characteristics include the population’s
Age
Gender
Ethnicity
Income
Education
Demographic characteristics describe an organization’s consumers, community, and, most relevant to an HRM context, an organization’s labor market.

10. The Socio-Cultural Landscape
The socio-cultural landscape refers to the attitudes and values of society. These influence the external environment and stakeholders.
Attitudes and values of people in the workforce can vary substantially across nations and are also reflected in differences in national cultures .
In the U.S., changing attitudes about the following topics have implications for HRM:
Work-life balance
Diversity and inclusion
Family composition
Pay fairness
Benefits expectations

11. The Political Landscape
Government administrations’ philosophies and policies, i.e. tax policies, trade policies, and regulations, can have enormous consequences for businesses.
Also part of the political landscape:
Nongovernmental organizations (NGOs), whose concerns often include labor issues
Activist groups, which may be focused on issues such as:
Changing corporate practices in order to improve workers’ lives
Advocating for the environment
Changing the practices of specific companies (a.k.a. watchdogs)

12. Understanding the Internal Environment
Technology
Company culture
Business strategy
Other resources such as financial, organizational, reputation, and human

13. Internal Environment: Technology
Robotics
The replacement of human labor with automated systems is not new. However, the robots and automation of today are much more precise, flexible, and cost efficient than the past.
Information Technologies
IT has enabled a more empowered workforce, which must be learned and managed. IT makes it possible for an organization to employ a virtual, global workforce. Members often perform jobs anywhere and anytime, often “as-needed.”
Human Resource Information Systems (HRIS)
Low-level HRISs allow users to access general information using a company intranet. A sophisticated HRIS allows users to enter performance data, display and analyze it for trends, and use it for personal development as well as longer-term workforce and succession planning

14. Internal Environment:
Company Culture
Assumptions, values, and norms form the base of a culture, but they can’t be observed directly.
They can be inferred from a culture’s visible elements:
Socialization activities
Language
Symbols
Ceremonies
HR policies and practices contribute to the development of a strong company culture when they are aligned with and support a firm’s strategic direction

15. Four Types of Company Cultures Internal Organization
Exhibit 2
Four Types of Company Cultures
Formal Control Orientation
Focus of Attention
Internal Organization
External Environment
Flexible
CLAN CULTURE
Valued Behaviors:
Loyalty
Tradition
Self-management
Personal commitment
ENTREPRENEURIAL CULTURE
Taking risks
Creativity
Dynamism
Stable
BUREAUCRATIC CULTURE
Following rules
Respect for hierarchy
Formality
Predictability 
MARKET CULTURE
Goal achievement
Less concern for personal relationships
Suggesting how to improve financial performance

16. Internal Environment:
Business Strategies
Business strategies influence the types of employees who must be recruited, behaviors needed from them, conditions in which they are expected to work, etc.
Business strategies describe how the company plans to deliver goods or services that customers see as different and better than those offered by competitors.
Some common ways companies can differentiate themselves are by providing goods and services that are:
Higher quality
Lower cost
Excellent service
More innovative

17. Internal Environment:
Other Resources
Financial
Organizational
Reputation
Human

18. Types of HRM Strategies

19. Types of HRM Strategies
High Commitment
High Control
Customized
Customer Service
Innovation
High-quality
Future strategies?
High Flexibility
Knowledge-Intensive Teamwork
Network-building

20. High Commitment and High Control HRM strategies
Exhibit 3
High Commitment and High Control HRM strategies
 High Commitment
HRM Strategy
 High Control
Enhances organizational performance by improving employee capabilities, motivation, and performance.
Enhances organizational performance by improving employee efficiency, productivity, and compliance.
TYPICAL PRACTICES
General job descriptions
High skill requirements
Extensive training focused on performance 
Competitive wages
High pay for performance 
Generous benefits
Self-managed teams 
High levels of participation
High job security for good performers
TYPICAL PRACTICES 
Specific job descriptions
Low skill requirements
Limited training
Low wages
High pay for performance
Minimal benefits
Intense supervision
Low levels of participation 
Low job security

21. Future HRM Strategies
Future HRM strategies will be designed to balance multiple concerns. These include:
The need to perform one’s current job well while also imagining how their jobs could be done better or eliminated.
The need for employees strongly committed to the company that also have strong connections to other organizations.
The need for employees who take responsibility for doing their own jobs well while also being team players, who make sacrifices in order to helps others and achieve team goals.
The need to hold employees accountable for responsibilities prescribed by formal job descriptions as well as contributing to the organization’s long-term success by continuously learning and adapting to prepare for an uncertain future.

22. The Process of HRM Strategy Formulation

23. Process for Formulating a Company’s Business and HRM strategies
Exhibit 4
Process for Formulating a Company’s Business and HRM strategies
BUSINESS STRATEGY FORMULATION
HRM STRATEGY FORMULATION
SWOT Analysis
Scan and evaluate the external and organizational environments
Participate in scanning and evaluating the external and organizational environments
Specify strategic business objectives
Specify strategic HR objectives
Generate alternatives and choose best business strategy
Generate alternatives and choose best HRM strategy
Develop strategic plans to attain objectives following the chosen business strategy
Develop strategic HR plans to attain objectives following the chosen HRM strategy
Implement Strategy
Review and Revise
Source: Jackson-Schuler-Werner, Managing Human Resources, 12th, Oxford University Press..

24. HRM Strategy Formulation
The double-headed arrows show that close coordination and collaboration between line managers and HR professionals are desirable during strategy formulation.
To achieve alignment, HR professionals are now usually involved in many aspects of their organization’s business strategy formulation process, including:
Being involved in the development, alignment and communication of business goals.
Working closely with senior management in formulating and implementing business strategies.
Creating and implementing an HRM strategy to drive business results.

25. HRM Strategic Objectives
Should be specific and measurable.
Should be aligned to strategic business objectives.
Should be flexible and responsive to ongoing adjustments in strategic business objectives.
After strategic business objectives and strategic HR objectives have been established, specific means must be determined for how to achieve the objectives.

26. Achieving HRM Strategic Objectives
Developing HR plans and timetables requires close coordination between the HR professionals and the line managers involved in creating business plans.
Whatever time frame is adopted, HR planning should parallel the business planning process.
Building in deadlines and scheduling checkpoints keeps the process moving ahead. Deadlines that are challenging but achievable are most effective.

27. Implementing HRM Strategies

28. Managing Change Strategy implementation almost always involves change.
Responsibility for minimizing and managing employees’ resistance to change are among the most challenging responsibilities of HR professionals.
The various forms of resistance include
Immediate criticism
Malicious compliance
Sabotage
Insincere agreement
Silence
Deflection
In-your-face defiance

29. Reasons for Resisting Change
Fear
Misunderstanding
Cynicism
People resist change when they don’t understand its implications.

30. Overcoming Resistance
Organizations can overcome resistance to change by
Involving employees
Task forces, focus groups, surveys, hotlines, and informal conversations, etc.
Establishing accountability
New approaches to awarding incentive pay and bonuses, new performance management practices
Showing respect in difficult times
When employees must be let go the process by which jobs are eliminated can make a difference--for those who remain as well as for those who are terminated.

31. Review and Revise Strategies
The measures developed to track the progress of implementation define the criteria for evaluating whether a plan or initiative is successful or is in need of revision.
When investments are made for purposes of reducing turnover, of attracting new or different employees, or of improving team functioning (or all three), then data relevant to these objectives should be examined.
Based on what is learned, people can make informed decisions about whether to stay the course, or revisit and revise the original plan.

32. Chapter 1
Conclusion
The importance of formulating and implementing HRM strategies.
The roles and responsibilities of HR professionals in formulating and implementing HRM strategies.
Understanding external environmental factors.
Understanding internal environmental factors.
Types of HRM strategies.
The process of formulating an HRM strategy.
Implementing an HRM strategy.
Conclusion