Theoretical perspectives of strategic human resource management : Theoretical perspectives of strategic human resource management Presented by: -
Navin Kumar Singh-45 Introduction : Introduction Definition-
strategic human resource management is the integration of human resource management and strategic management process.
In other words we can say that it is the alignment of Human Resource Management with the organization’s mission. Differences in between HRM & SHRM : Differences in between HRM & SHRM Structure
functioning HUMAN RESOURCE MANAGEMENT : HUMAN RESOURCE MANAGEMENT STRATEGIC HUMAN RESOURCE MANAGEMENT : STRATEGIC HUMAN RESOURCE MANAGEMENT Objectives of SHRM: - : Objectives of SHRM: - Assess how well human resources management is linked to agency mission accomplishment.
Explore the role played by the HR staff in agency strategic planning.
Determine how the HR service providers work with line managers to carry out agency strategic goals.
Identify best practices aligning HRM with the agency strategic plan and goals. Slide 7: 1.) Resource – Based View of the Firm
2.) Behavioral Perspective
3.) Cybernetic Systems
4.) Agency / Transaction Cost Theory STRATEGIC THEORIES Resource – Based View of the Firm : Resource – Based View of the Firm Defines Competitive Advantage as “ When a firm is implementing a value creating strategy not simultaneously being implemented by any current or potential competitors ”
Firm Resource Heterogeneity
Firm Resource Immobility Slide 9: Sustained Competitive Advantage exists only after efforts to replicate that advantage have ceased
Add positive value
Unique or Rare
Non - Substitutable HR as Sustained Competitive Advantage : HR as Sustained Competitive Advantage Provide Value to the Firm
Heterogeneous Demand for Labor
Heterogeneous Supply of Labor Slide 11: Rarity
HR with high ability levels are rare
Valid Selection Programs
Attractive Reward Systems Slide 12: Inimitable
Unique Historical Conditions
Social Complexity Slide 13: No Substitutes
Non substitutable HR
This theory demonstrates that Strategies are not universally implementable , but are contingent on having the human resource base necessary to implement them . Behavioral Perspective : Behavioral Perspective Focus on Employee Behavior as the mediator between Strategy and Firm performance .
Assumes that the purpose of various Employment practices is to elicit and control Employee Attitudes & Behaviors. INNOVATION as STRATEGY : INNOVATION as STRATEGY High Degree of Innovative Behaviour
Long – Term Focus
High Level of Co-operative Behaviour
Moderate Degree of Concern for Quality
Moderate Concern for Quantity
Greater Degree of Risk Taking COST REDUCTION STRATEGY : COST REDUCTION STRATEGY Reprtitive Behaviors
Short - Term Focus
High concern for Quantity
Moderate Concern for Quality
Low Risk Taking Slide 17: This theory is tested to Demonstrate
Different Strategies are associated with different levels of Firm Performance
Relationship between Strategies and Firm Performance is either mediated or moderated by HRM practices and Employee role Behaviors. CYBERNETIC SYSTEMS : CYBERNETIC SYSTEMS Open Systems Model
Inputs are Competencies ( Skills , Abilities) of Employees
Throughput Process is Behavior of Employees in the Organization .
Outputs consist of Performance ( Productivity ) and Affective Outcomes ( Job Satisfaction ) Slide 19: SHRM consists of
Behavior Management Competence Management : Competence Management Competence Acquisition
Competence Displacement Behavior Management : Behavior Management Behavioral Control
This theory has potential to examine how SHRM Practices change or need to change over time . Agency / Transaction Cost Theory : Agency / Transaction Cost Theory Transaction costs are the costs associated with negotiating , monitoring , evaluating , and enforcing exchanges between parties .
Agency costs are the costs associated with establishing efficient contracts between parties Slide 23: Bureaucratic costs refer to the transaction costs associated with managing human resources in a hierarchy ( when Authority Relationship exists )
This theory is popular for Diversification , Internalization , Restructuring . Non Strategic Models of HRM : Non Strategic Models of HRM Non strategic means determinants of HRM practices that are not the result of rational strategic decision making process, but rather derive from institutional and political forces in the firm. Non Strategic Theory of HRM : Non Strategic Theory of HRM Two theories:
Resource dependence Model.
Institutionalism. Slide 26: Resource dependence Model :It focus predominantly on power relationship within and among organization. It assumes that all organization depend on flow of valuable resources into the organization in order to continue functioning.
Its implications are numerous:
It change the focus from viewing SHRM in mechanistic terms where all HRM practices are rationally determined and are perfectly supportive of organizational strategies.
It demonstrates the potential for the HRM function to increase its role as a stategic partner in the firm. Institutionalism: : Institutionalism: It is viewed as the social process by which individuals come to accept a shared definition of social reality – conceptions whose validity is seen as independent of the actor’s own view or actions but is taken for granted as defining the way things are to be done. Institutional influences : Institutional influences It can be imposed coercively .
It can be authorized through an organization voluntarily seeking approval of a superordinate entity.
It can be induced through outside agents providing rewards to organization that conform with the wishes of the agent. Slide 29: iv) It can be acquired through one organizational modeling its practices based on practices of other organization as a means of appearing legitimate or up to date.
v) Imprinting pocess whereby the practices adopted at the beginning of the organization’s history remain embedded in the organization. THANK YOU : THANK YOU