The Art of Formulating Effective HR Strategies 

  Let us talk about HR strategies and their purpose...

     HR strategies are “internally consistent bundles of HR practices” (Dyer and Reeves,1995)

The purpose of HR strategies is to articulate what an organization intends to do about its HRM policies and practices now and in the long term, bearing in mind that the business and manager should perform well in the present to succeed in the future.

The aim of SHCM enable strategic decisions to be made that have a major and long-term impact on the behavior and success of the organization by ensuring that the organization has the skilled committed and well-motivated employees it needs to achieve sustained competitive advantage. SHCM attempts to achieve a proper balance between the hard and soft elements of HRM.

Scholes, K., Johnson, G. and Whittington, R., 2002. Exploring corporate strategy. Hoboken, NJ, USA: Financial Times Prentice Hall.

Do you want to know how Business strategy shapes HR strategy? 

Gartner. (2023). HR Strategy. Retrieved from https://www.gartner.com/en/human-resources/topics/hr-strategy

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Direct Impact

For example, HR functions can have a direct impact on cost leadership as the business strategy. It can be achieved by:

·       Planning to avoid employee shortages and surpluses.

·       Obtain economies in advertisements for recruitment etc.

·       Alternative recruitment practices.

·       Sound management system of H & S.

     Indirect Impact

1.      HRM functions result in employee-centered outcomes.

2.      Employee-centered outcomes result in organization-centered outcomes.

3.      Organization-centered outcomes result in competitive advantage.

The competitive advantage gained from HRM is sustainable for two key reasons.

·       HRM practices are not visible to competitors.

·       Even when the practices are visible, their impact may not be as favorable when used by competitors.

An effective HR Strategy will:

·       Satisfy business needs.

·       Be founded on detailed analysis and study.

·       Be turned into actionable programs that anticipate implementation requirements and problems.

·       Be coherent and integrated with one another.

·       Take account of the needs of the line managers and employees generally as well as those of the organization and stakeholders.

We can apply these theories to our day today work life right away. But let’s be clearer!! Watch this!

Creating an effective Corporate Strategy is an art… Do you feel confident in that aspect?

 How to set an effective Corporate Strategy?

1.      Crafting a crystal-clear path - Vision and mission

·       SHRM is concerned with the people's implication of top management’s vision of the future of the organization and the mission it is there to fulfill.

·       HR strategies support the realization of the vision and mission and achievement of its goals.

2.      Building a strong foundation structure

Business opportunities cannot be fully maximized unless there is a proper management structure to create them.

3.      Synergy in Motion-Team work

The demolition of traditional hierarchies has had far-reaching effects on flexibility and performance and has contributed significantly to the achievement of better coordination.

4.      Elevating people-Performance

A performance strategy will be based on an analysis of the critical success factors and the performance levels reached in reaction to them. Steps can be agreed as to what needs to be done to improve performance by training, development, re-organization, the development of performance improvement and development and not reward.

5.      Excellence Beyond Expectations-Quality and customer care.

Quality means customer satisfaction is generally recognized today as the key achievement of competitive advantage. Quality is achieved through people and in accordance with the basic HRM principles, investment in people is a prerequisite for achieving high quality standards.

Conclusion

 HR strategies are essential for organizations to achieve sustained competitive advantage through skilled, committed, and motivated employees. The aim of SHCM is to balance the hard and soft elements of HRM to enable strategic decisions that have a major and long-term impact on the behavior and success of the organization. Effective HR strategies should satisfy business needs, be founded on detailed analysis and study, be coherent and integrated with one another, and take account of the needs of the line managers and employees generally as well as those of the organization and stakeholders. HR strategies support the realization of the organization's vision and mission and contribute to the achievement of its goals, including the demolition of traditional hierarchies and the achievement of better coordination. Finally, quality and customer care are critical to achieving sustained competitive advantage, and investment in people is a prerequisite for achieving high-quality standards.

 

Reference

·       Cantrell, S.M. and Smith, D., 2010. Workforce of one: Revolutionizing talent management through customization. Harvard Business Press.

·       Komal Sahi (2014). Ch2 Human Resource Policies and Strategies. [online] Available at: https://www.slideshare.net/sahikomal/ch2-human-resource-policies-and-strategies [Accessed 12 Apr. 2023].

·        epay-systems-admin (2020). Strategic Human Capital Management - Components, Values & Benefits. [online] Available at: https://www.epaysystems.com/strategic-human-capital-management/#:~:text=Strategic%20human%20capital%20management%20%28HCM%29%20is%20a%20people-focused [Accessed 12 Apr. 2023].

·       Haan, K. (2023). Strategic Human Resource Management Guide – Forbes Advisor. [online] Available at: https://www.forbes.com/advisor/business/strategic-human-resource-management/.