1. STRATEGIC HUMAN RESOURCE MANAGEMENT
By : Prof. V.P.KAKKAR

2. TRADITIONAL HR Vs STRATEGIC HR
TRADIONAL HR STRATEGIC HR
RESPONSIBILITY HR STAFF LINE MANAGERS
FOCUS EMPLOYMENT RELATIONSHIP PARTNERSHIP WITH INTERNAL
& COMPLIANCE WITH LAW & EXTERNAL CUSTOMERS
ROLE OF HR REACTIVE & TRANSACTIONAL PROACTIVE & TRANSFORMATIONAL
INITIATIVES SLOW & FRAGMENTED FAST,FLEXIBLE & INTEGRATED
TIME HORIZON SHORT TERM SHORT, MEDIUM & LONG TERM
CONTROL BUREAUCRATIC ORGANIC
( RULES,POLICIES, PROCEDURES) ( FLEXIBILITY,FEW RESTRICTIONS)
JOB DESIGN FOCUS ON SCIENTIFIC MGMT BROAD JOB DESIGN,GROUPS
DIVISION OF LABOUR & TEAMS, CROSS FUNCTIONAL TRG
KEY INVESTMENTS PRODUCTS, TECHNOLOGY PEOPLE
(KNOWLEDGE, SKILLS, ABILITIES
ACCOUNTABILITY COST CENTRE INVESTMENT CENTRE

3. EVOLUTION OF SHRM HRM SHRM . CONVERGENCE BETWEEN PERSONNEL MGMT
. PART OF ORGANIC ORG
. CROSS HIERARICAL &
CROSS FUNCTIONAL TEAMS
. DECENTRALISATION
. LOW FORMALISATION
. FLEXIBLE.
. CONVERGENCE BETWEEN
HRM & BUSINESS STRATEGY
. PROACTIVE HRM
. CONCERNED WITH
ORGANISATIONAL EFFECTIVENESS &
PERFORMANCE
. MECHANISTIC
. BUREAUCRATIC
. HIGH CENTRALISATION
. HIGH FORMALISATION
. LOW FLEXIBILITY

4. INVESTMENT PERSPECTIVE OF HR (How best to invest in its people )
RESOURCE BASED VIEW ( VRIO FRAMEWORK )
value , rareness , limitability & organization
ENHANCING HUMAN CAPITAL
collective skills, knowledge & capabilities
TRADITIONAL COST VIEW : HR related budget ( salaries, training etc.. )
STATEGIC VIEW : Employees as valuable investments
In knowledge economy : Knowledge is important (not goods, services or
technology ) for all economic activities.
INVESTMENT IN HUMAN RESOURCES IMPORTANT for getting
competitive advantage to keep pace with changing technologies & processes
COST OF TRG & OTHER INVESTMENTS TO BE CONSTANTLY REVIEWED
AGAINST BENEFITS.
RISKS INVOLVED : Enhanced employability of employees that makes them more desirables to competitors.

5. BARRIERS TO STRATEGIC HR
SHORT TEM MENTALITY/ FOCUS ON CURRENT PERFORMANCE
Reason: No Long term view of investments. More focus on performance evaluation
and compensation based on sort term.
INABILITY OF HR TO THINK STRATEGICALLY
Reason: insufficient management training and segmented understanding of entire business
LACK OF APPRECIATION OF WHAT HR CAN CONTRIBUTE FROM STRATEGIC PERSPECTIVE
Reason : Seeing HR function as providing unnecessary bureaucracy
FUNCTIONAL MANAGERS SEEING THEMSELVES AS HR MANAGERS
Reason : Concerned more with technical aspects of their areas than huma aspects.
DIFFICULTY IN QUANTIFYING MANY HR OUTCOMES
REASON: Tendency towards programs that are quantifiable rather than
developmental programs.
PERCEPTION OF HR ASSETS AS HIGH RISK INVESTMENTS THAN CAPITAL ASSETS.
REASON: HR assets not owned by organizations. More investment in technology & information
DISINCENTIVES FOR CHANGE
REASON: Strategic approach may call for drastic changes in system. Natural resistance is there to change initiatives. So Risk is involved as these changes might fail
MOST OF ABOVE BARRIERS ARE ROOTED IN CULTURE OF AN ORGANISATION
( Organizations history, values and management practices act as act as barriers to change initiatives. Overcoming these barriers is the real challenge of STRATEGIC HRM )

6. RELATIONSHIP BETWEEN BUSINESS AND HR STRATEGIES
THREE TYPES OF BUSINESS STRATEGIES ARE ADOPTED BY ORGANISATIONS: COST LEADERSHIP & DIFFERENTIATION
HR STRATEGIES ARE OUTCOME OF GENERAL SHRM APPROACH
FOR WINNING A SUSTAINABLE GLOBAL COMPETITIVE ADVANTAGE, A PERFECT STRATEGIC FIT IS REQUIRED TO BE CREATED BETWEEN BUSINESS STRATEGIES AND HR STRATEGIES
Following 5 types of strategic fits are generally adopted:
BEST FIT APPROACH: Also called external fit or vertical integration with business strategies. HR strategies should match stages of development of firm ie need for different types of people as well as diverse approaches towards investment in HUMAN CAPITAL.
FIT AS CONTIGENCY : HR approaches to ensure that internal practices of
organization respond to external factors : market, skill availability etc.
FIT AS AN IDEAL SET OF PRACTICES( BEST PRACTICE APPROACH)
Identifying any organization as benchmark which has reputation for excellence and copying its practices.
FIT AS GESTALT : Emphasizes the importance of finding an appropriate combination
of HR practices wrt business strategies.
FIT AS BUNDLES (Configuration Approach) : Development and implementation of several HR practices together so that they are interrelated and internally consistent. Each HR practice reinforces and complements the other. Also termed as internal fit oe Horizontal integration.

7. COMPETING APPROACHES AND MODELS
SHRM
FIT
PERSPECTIVE
TYPOLOGICAL
PERSPECTIVE
FUNCTIONAL
PERSPECTIVE
ECONOMIC
PERSPECTIVE
Each functional
area optimize
performance wrt
Business Strategy
To use Human
Resources
as distinguishable
Source of competitive
advantage
Human resources to be
Integrated with
Strategic plg
Use of 3 distinct
HR Strategies
. Inducement
. Investment
. Involvement

8. MACKENZIE’S 7S MODEL STRUCTURE STRATEGY SYSTEMS SHARED VISION STYLE
SKILLS
STAFF