1. Strategic Human Resource Management and the HR Scorecard
Part 1 | Introduction
Chapter 3
Strategic Human Resource Management and the HR Scorecard

2. After studying this chapter, you should be able to:
Outline the steps in the strategic management process.
Explain and give examples of each type of companywide and competitive strategy.
Explain what a strategy-oriented human resource management system is and why it is important.
Illustrate and explain each of the seven steps in the HR Scorecard approach to creating human resource management systems.

3. “JUSTIFY YOUR POSITION….”
“Okay!”

4. The Hierarchy of Goals
“…in well-run companies, the goals from the very top of the organization down to where you’re working should form a more-or-less unbroken chain (or “hierarchy”) of goals. These goals, in turn, should be guiding what you do.” The Managers role in Strategic Human Resource Management..Ch. 3, p. 72

5. The following strategic outline contains some of the actual documents that were used during a 1 ½ year period of strategic planning and implementation to merge two medical programs into one and develop a new RNA program for San Joaquin Valley College in Fresno California in 1997.

6. The Strategic Management Process
The process of identifying and executing the organization’s mission by matching its capabilities with the demands of its environment.
Strategy - “How do we get from here to there?”
A chosen “course of action.”
Strategic Plan – SWOT!
How an organization intends to balance its internal strengths and weaknesses with its external opportunities and threats to maintain a competitive advantage over the long-term.

7. Business Vision and Mission
A general statement of an organization’s intended direction that evokes emotional feelings in organization members.
Mission
Spells out:
*Who the company is
What it does, and
Where it’s headed.
*Under the US Constitution, companies are looked upon as entities.

8. FIGURE 3–1 The Strategic Management Process

9. Strategies can be applied to any project:
What is it we are trying to accomplish?
What issues do we need to consider?
What logical path do we need to take in order to achieve our goals?
What budgets are we working with? Funding? Etc.
What is the forecast loss/gain?
What personnel do we need to implement our goal?
How much time will our critical path take?

10. FIGURE 3–2 A SWOT Chart

11. S.W.O.T.
Opportunities:
We can combine two classes into one of the larger LGI rooms and section off them off.
We have a team of people who are willing to corporate in working long overtime hours.
Upper management is willing to give us the materials and time we need to get this done.
Threats:
We have other colleges who are gearing up to offer the same programs quicker.
Our cost is much more.
Strength:
Already have much of the personnel in place to carry out the changes we need to make.
Weaknesses:
We don’t have enough classrooms at this time in order to accommodate X amount of students at critical mass.
We need to hire part time instructors during critical mass time or authorize overtime.

13. Profit and Loss Sample Turn to page 75 of your text
– Let’s look at Figure 3-3
“Pro Forma Profit and Loss Income Statement”
Example

17. FIGURE 3–3 Strategies in a Nutshell
Source: Arit Gadiesh and James Gilbert, “Frontline Action,” Harvard Business Review, May 2001, p. 74.

18. Types of Strategies Corporate-Level Strategies
Diversification Strategy
Geographic Expansion Strategy
Vertical Integration Strategy
Corporate-Level Strategies
Consolidation Strategy

19. FIGURE 3–5 The Southwest Airlines’ Activity System
Note: Companies like Southwest tailor all of their activities so that they fit and contribute to making their strategies a reality.
Source: Michael E. Porter, “What Is Strategy?” Harvard Business Review, November–December Reprinted with permission.

20. Achieving Strategic Fit
The “Fit” Point of View (Porter)
All of the firm’s activities must be tailored to or fit the chosen strategy such that the firm’s functional strategies support its corporate and competitive strategies.
Leveraging (Hamel and Prahalad)
“Stretch” in leveraging resources—supplementing what you have and doing more with what you have—can be more important than just fitting the strategic plan to current resources.

21. Strategic Human Resource Management
The linking of HRM with strategic goals and objectives in order to improve business performance and develop organizational cultures that foster innovation and flexibility.
Involves formulating and executing HR systems—HR policies and activities—that produce the employee competencies and behaviors that the company needs to achieve its strategic aims.

22. FIGURE 3–9 Basic Model of How to Align HR Strategy and Actions with Business Strategy
Source: Adapted from Garrett Walker and J. Randal MacDonald, “Designing and Implementing an HR Scorecard,” Human Resources Management 40, no. 4 (2001), p. 370.

23. The Seven Steps in the HR Scorecard Approach to Formulating HR Policies, Activities, and Strategies
Source: © Gary Dessler, Ph.D., 2007.

24. FIGURE 3–A3 Simple Value Chain for “The Hotel Paris”
Source: © Gary Dessler, Ph.D., 2007.

25. Courtesy of Drawpack.com

26. Courtesy of Drawpack.com

28. Creating an HR Scorecard
The 10-Step HR Scorecard Process 1 6 3 2 8
Define the business strategy 7
Identify required HR policies and activities 4 9
Outline value chain activities
Create HR Scorecard 5 10
Outline a strategy map
Choose HR Scorecard measures
Identify strategically required outcomes
Summarize Scorecard measures on digital dashboard
Identify required workforce competencies and behaviors
Monitor, predict, evaluate

29. Evaluate the results… Did we accomplish our goal and objective?
Did we achieve customer satisfaction?
Are we happy with the results? Why? Why not?
Where and What can we do to improve?
What should be focused on?
Did we stay within budget?
Did we meet all company objectives? Why or why not?
What is the next step?

31. Reporting on those results…
Giving Feedback to management.
Giving Statistical analysis and Documented proven results
Identifying SWOT and areas for Improvement
Managing the Next Steps and giving Feedback, Input and Direction.
Allowing for Q&A

32. K E Y T E R M S strategic plan strategic management vision mission
SWOT analysis
strategy
strategic control
competitive advantage
leveraging
strategic human resource management
HR Scorecard
metrics
value chain analysis