Table of Contents

Definition of HRM.................................................................................................................1

LO1. Understand the role and importance of human resource management in achieving organizational effectiveness

1.1 Define strategic human resource management Management is one of the most important human activities. Since the time people started to form social organizations to achieve the objectives as individuals, they cannot be completed management is essential in order to ensure that to coordinate the efforts of the individual, although the company is supporting the group great efforts, has become a large number of organizations, the tas manager !ncrease in size and comple"ity. #o$, the management Managers manage comple" organizational theory has become essential. %entral thesis of this article is that some managers in different parts of &he $orld has basic management been successful, if not 'no$ledge management theory, should be clearly stated Managers $ho co(management theory in their day to day !t is easier to manage in the practice of their organization effectively achieve personal and organizational )bjectives. &herefore, managers are contemporary organizations Due to the important role they play in their organizations, if they &o achieve objectives. Secondly, it is necessary, in order to promote e"cellence *eople in the organization, especially the managers themselves. Definition of HRM Management is an art or a science, the realization by people. +ecause ,eaders also control management can be interpreted literally means -.ie$s/ ( that is to ensure that people do $hat

they are supposed to do. &he leaders are e"pected to increase productivity, or $ith the support of the current jargon, the /continuous improvement/. More generally, the management is the process of designing and maintaining environment in $hich individuals, group $or , effectively to achieve the chosen goals 0'oontz and 1eihrich 1223, p. 45. 6"panded form, this basic definition means different things. 7irst, as leaders, people perform ,eadership positions in planning, organizing, staffing, and to manage. Second, the management of all types of organizations. &hird Management leaders at all levels of the organization. 7ourth, to all leaders is the same to create a surplus. 7inally, the *resident is concerned about the productivity ( $hich means efficiency and efficacy

1.2 E plain the importance of human resource management in organisations HRM started to become an integral part of business, $here *M had been reactive HRM became proactive and $as involved in decision ma ing. &hey are also involved $ith management up to board level and contribute to the bottom line of the business 0profit5. HRM is no$ responsible for the hard strategic planning, structure, systems and service internal8e"ternal. HRM still includes the soft S9s and these are no$ much less involved because HRM is about planning ahead and ma ing provisions for retirements, temporary cover for busy periods and other foreseeable and unforeseeable problems ahead. HRM staff no$ $or closely $ith unions, $ith a close relationship both parties are no$ far better at avoiding union action and problems can generally be sorted :uic ly $ith little fuss. &here is still a great debate bet$een academics as to $hether HRM is a $hole ne$ concept or just a repac aging of *M. Some e"perts, for e"ample ,egge 122; and Storey 12<2= 122; suggest that the message itself is not the important part, but that the messenger is of much more significance. >ccording to +ratton ? @old ? A33B pge1; Mill$ood et al sho$ that HRM can today be bro en do$n into eight basic functionsC D *lanning D Staffing D Developing

D Motivating D Maintaining D Managing relationships D Managing change D 6valuating EHRM represents the discovery of human capitals potential by senior management.9 Senior managers in business corporations realised the need to treat employees as more than just numbers. !n order to gain greater employee commitment and organisational performance businesses became more employee friendly. &o gain the full potential of their employees and respond to advances in technology and global mar ets big businesses realised that they needed to be more fle"ible in their approach to employment. &here $as suddenly a need to have a $or home life balance and schemes such as fle"i time $ere introduced, this allo$ed employees to build up a ban of time in order to for e"ample have an afternoon off and go to a son9s sports day. Staff no$ also have much more control over E$or patterns, $or locations and $or times9 in other $ords there is not a need for them to be in the office all day every day, they have the fle"ibility and technology to $or from virtually any location 0Human resource management theory and practice Brd edition A33B5. 1.! "nal#se the frame$or% of strategic human resource management 0SHRM5 is a field of en:uiry that has evolved over time to be classed as a disciplinary field in its o$n right. SHRM differs from previous human resource management 0HRM5, and earlier Epersonnel management9 through placing the role of HR in such a place in the organisation that the policies contribute to, and even drive, the strategic direction of the organisation. &raditional personnel management centred on the individual and involved policies focussed on recruitment, pay and performance and administrative, maintenance, activities. SHRM centres itself on strategies that Efit9 the organisations9 mission and goals. >lignment of policies and strategies $ith the abilities, motivations and strengths etc of employees $ith the demographics of the organisation is crucial if HR activities are to be facilitative and strategic, rather than orthodo". 7inally, to be truly strategic, HRM must influence, or shape, an organisation9s strategy F as $ell as be shaped by it 0*urcell, A3315.

6ach of these models is to be delivered by HR strategy. &he appeal of the universalist approach is the assumption of a best practice model of operations 0Millmore et al., A33G, p4G5. 1alton 012<;5 and *feffer 0122<5 provide a list of policies $hich, if successfully implemented, $ill lead to motivated employees $ho e"cel at their $or . Many characteristics of their differing approaches involve policies that $ould be implemented in any successful organisation includingC re$ard for performance, e"pectations of achievement, providing employee voice through a variety of fora, and job security. &he approach is appealing to human nature generally F that of a list of practices $hich, if follo$ed, $ill result in a happy and re$arding life. Hnfortunately, life is comple" and cannot be prescribed. >n organisation, consisting of individuals, is even less li ely to fit to a list of best practices. So this approach is both useful as a type of template of best practices, and too simplistic.

LO2. Understand the formulation and implementation of human resource strategies &ormulating and implementing HR 'trategies &here is typically no HR strategy in a firm, although research conducted sho$ed that a number of the firms $e contacted did have an overall strategic approach $ithin $hich there $ere specific HR strategies. +usiness strategy maybe an important influence on HR strategy but it is only one of the several factors and the relationship is not unilinear. !mplicit in the mi" of factors that influence the shape of HR strategies is a set of historical compromises and trade(offs from shareholders. HR strategy can influence as $ell as can be influenced by business strategy. !n reality ho$ever HR strategies are more li ely to flo$ from business strategies that $ill be dominated by product8mar et and financial considerations. +ut there is still room for HR to ma e a useful, essential contribution at the stage $hen business strategies are conceived, for e"ample, by focusing on resource issues. 2.1 "nal#se the strategic human resource process (he Development )rocess &he process of developing HR strategies involves generating strategic HRM options and then ma ing appropriate strategic choices. &hese choices should relate to but also anticipate the needs of the business 1. +e congruent $ith the present or desired culture of the organization A.Have the capacity to change the character and direction of the business B.6:uip the organization to deal effectively $ith the e"ternal pressures and demands affecting it

4. 7ocuses on areas of critical needs ;. 7ocus on fundamental :uestions as /1hat is constraining usI/ or /1hat is stopping us from delivering business resultsI/ J. +e founded on detailed analysis and study and not just $ishful thin ing G.!ncorporate the e"perienced and collective judgement of top management <. >nticipate the problems of implementation if managers are not committed to the strategy and or lac the s ills to play their part. 2. >nticipate any problems that might arise because of the hostility or interference of employees or trade unions 13. 6nsure that the organization has the resources re:uired to implement the strategy 11. *rovide for the ac:uisition and development of people $ith the s ills needed to manage and sustain the organization in the future to meet organizational objectives 1A. %onsist of components that fit $ith and support each other 1B. +e capable of being turned into actionable programmes 2.2 "ssess the roles in strategic human resource management 'trategic &rame$or%s &he formulation of coherent HR strategies is more li ely if the overall approaches the organization intends to adapt to managing its human resources are understood. &he most common approaches are follo$ing. 1. &he development of resource capability A. High(commitment management B. High performance management 4. +est practice Resource *apa+ilit# this approach regards the firm as a bundle of tangible and intangible resources and capabilities re:uired for product8mar et competition. Human Resources are seen as a major source of competitive advantage. 1ithin this frame$or , firms attempt to gain competitive advantage using human resources through developing distinctive capabilities 0competencies5 that arise from the nature of the firmK relationship $ith its suppliers, customers and its employees. !t is concerned $ith the development and retention of human or intellectual capital. (he high commitment management approach !t is based on the assumption that higher levels of performance from people and a belief that the organization is $orth $or ing for, are more li ely $hen employees are not tightly

controlled. !nstead they should be given broader responsibilities, encouraged to contribute and helped to achieve satisfaction in their $or . &his approach involves treating employees as partners in the enterprise, $hose interests are respected, $ho have a voice on matters that concern them and $hose opinions are sought and listened to. !t is concerned $ith communication and involvement. (he high,performance management approach it aims to raise the performance of the organization through its people. High performance management practices involve the development of resourcing, employee development, performance management and re$ard processes that focus on the delivery of added value. -est practice approach it is based on the assumption that there is a set of best practices and that adopting them $ill inevitably lead to superior organizational performance. "nal#se the development and implementation of human resource strategies Resource Development 0HRD5 as -a process of developing and unleashing human e"pertise through training and development and organization development for the purpose of improving performanceL. &he follo$ing section shall provide an overvie$ of Human Resource 0HR5 practices. )rganisation must continue to offer more specific programs li e training and developmental feedbac to help employees learn s ills $hich eventually improve the $hole organisational development and increase productivity. > common strategy $ill align the operations to$ards common goals and purposes 0+arlett and @hoshal, 12<G5 )rganisational success cannot be achieved even if firm had hired the right person alone. 0%arrig and 1right, A33J5.

LO!. -e a+le to assess a range of HR strategies that ma# +e implemented $ithin an organisation !.1 .dentif# a range of HR strategies for an organisation 1.1 'ocial *ognitive *areer (heor# /'**(0 &he Social %ognitive %areer &heory 0S%%&5 as described by ,ent, +ro$n and Hac ett 0A33<5 provides a frame$or of ho$ people form career interests, ma e choices and achieve educational and occupational pursuits. &he focus on several cognitive person variables, the interaction $ith other aspects of the person and the larger environment all correlate $ith self( efficacy, outcome e"pectations and goal(setting behaviour that individuals e"ercise $ithin their o$n career development. Recent career trends emphasises the role of these conte"tual factors in determining an individual9s career goals and actions. 1.2 *onstructivist '#stems (heor# &rame$or% /'(&0 !n recent times, constructivism has assumed a more central role in career theory 0McMahon and 1atson, A33<5. !nherent to constructivism is the recognition that individuals are ta ing a more active role in their career development. &he Systems &heory 7rame$or 0S&75 contains the content influences and the process influences on an individual9s career development. McMahon and 1atson 0A33<5 describes the content influences as the personal :ualities and characteristics intrinsic to individuals and the influences of their environment, such as the people and organisations they interact $ith and the surrounding society and environment. 1.! 1lo+alisation2 .nternational 3or% and E patriates 1ith contemporary trends, organisations have become increasingly subject to globalisation. Some multinational private and public sectors, re:uire an increasing need for employees to $or abroad and8or fre:uently at home $ith international responsibilities 0dealing $ith

foreign customers and suppliers, overseeing overseas operations, developing business or net$or s abroad5. )rganisations need employees, $ho are receptive to careers in international $or , but many refuse to become e"patriates, often because of family reasons and hence suitably s illed employees are hard to find 0Hiltrop, ?enster and Martens, A3315. 1.4 3omen in the 3or%place %hanging trends in the macro socio(cultural environment suggests that men have become more reluctant to $or abroad due to dual(career and family constraints, limiting their readiness to trade(off $or for family 0Hard, A3345, thus the increase in $omen ta ing e"patriate roles. Hard 0A3335 further defines @iddens9 -&heory of StructurationL as a dynamic interaction bet$een e"ternal and internal career and vie$s career as an individual process and social structuration process $ith a reflection on culture. %ulture has a significant impact on career dynamics in modern society $here, $omen influenced by factors outside their personal influence 0cross(culturalisation, 1.5 3or%6Life -alance >ccording to 'irby 0A33;5, more than A;3 $or ing patterns including compressed $or ing $ee , job(share and fle"ible hours, encompass the fle"ible $or ing initiatives that organisations are using to increase recruitment and improve retention in times $here individuals strive for $or 8life balance. +alancing $or and family has overta en benefits and compensation as a ey aspect of employee satisfaction as the family unit ta es priority. !t is believed that employees $ill not give their best if they are tired or stressed due the demands of day(to(day life and hence, a $or 8life balance enables individuals to promote a healthier general lifestyle that transcends bac into the $or place through improved job satisfaction. 1.7 *hange in the La+our Mar%et >s career trends change, the demographics of the labour force also changes as mentioned earlier. %obert 0A33;, B;5 defines the >merican labour mar et as four generationsC @eneration M 0aged AA(BB5= +aby +oom 0aged B4(;A5= S$ing 0aged ;B(J;5 and 1orld 1ar !! 0aged JJ and over5 F the global brea do$n $ould not be too different to this. 6ach generation re:uire different education and training, and presents different cultures, $or values and e"pectations to the labour force. &he old social contract bet$een employers and employees no longer e"ists and the traditional model in $hich individuals $or ed their $ay up the corporate ladder in a single organisation is becoming rarer as mentioned before. !.2 "ssess HR strategies and their application in an organisation

(he 'trategic role of human resource management &he role of human resource management has al$ays faced a battle to justify its position in organizations. !n good times, $hen there is a sufficient budget, companies can easily justify the cost of training, staff, re$ard systems and employee participation, but facing financial difficulties such HR systems get the first cuts. &he advent of the sub(area of Strategic Human Resource Management 0SHRM5, dedicated to the e"ploration of the role of HR in supporting corporate strategy, $as the opportunity to demonstrate their value to the business. !n other $ords, the strategic management of human resources is /lin ages and integration bet$een the overall strategic business objectives and implementation strategy and human resources. !nitially, processes and people $ithin the company managed in order to promote the objectives of the business strategy and create an integrated management of various HR functions such as resource selection approach, training and re$ard so that they complement each other. Strategic human resource management may bring a number of benefits to the organization. %ontributing to the goal accomplishment and the survival of the company, Supporting and successfully implementing business strategies of the company, %reating and maintaining a competitive advantage for the company, !mproving the responsiveness and innovation potential of the company, !ncreasing the number of feasible strategic options available to the company, *articipating in strategic planning and influencing the strategic direction of the company as an e:ually entitled member of top management, !mproving cooperation bet$een the HRM department and line managers.

LO4. Understand contemporar# issues affecting strategic human resource 4.1 .dentif# contemporar# issues affecting strategic human resource management

"lignment of 'HRM +et$een Head8uarter and 'u+sidiaries )n the basis of +aird and Meshoulam9s 012<<5 &$o 7it &heory, Milliman et al 012215 has e"panded the fit theory specific to !HRM, named 7our 7its of Strategic !HRM. !t is demonstrated as follo$s. 'u+sidiaries &it to Head8uarter .HRM9 " )ol#centric :ie$ *olycentrism assumes that host country9s employees have different values and cultures that head:uarter personnel are difficult to understand, so human resource tactics such as training, motivation, re$arding and assessment should be adjusted according to host country needs 0*erlmutter, 12J;5. &he follo$ing table sho$s characteristics of polycentrism. *erlmutter 012J25 compared a polycentric firm to confederation $here head:uarter has loose connection $ith subsidiaries. "lignment )ro+lem +ehind )ol#centrism *olycentrism can generate both pain and pleasure for a global company 0Hoec lin, 122;5. *leasure comes from the benefit of cost effectiveness $hile pain may mean t$o levels of alignment problems. &he superficial level means the coordination problem bet$een head:uarter and subsidiaries. Since managers are locally recruited, communication might be reduced due to language and mar et differences. ,ocal managers sometimes even complain head:uarter never tells them anything 0*erlmutter, 12JA5. 'olution to the "lignment )ro+lem !n the conte"t of diversity discussed above, to align the head:uarter HRM $ith subsidiary

re:uires not only coordination but also reconciliation. %ompatibility can be one ey factor to achieve coordination, $hile &rompenaars9s 0122B5 Eprocess of reconciliation9 $ill be helpful in directing reconciliation. Resourcing )lan &his part $ill focus on the topic of resourcing $ith reference to the polycentric policy discussed above. >rmstrong9s 0A33J5 human resource planning process $ill be applied. &$o stages of resourcing plan including business strategy and resourcing strategy derived from the process $ill be analyzed. 'tage 19 -usiness 'trategic )lan !n this stage, company should define future activity levels 0>rmstrong, A33J, p.BJ25. %orporate strategy directs the company to start $ith hypermar ets follo$ed by convenience stores and discount stores. >s the establishment of hypermar ets $ould help build relationship $ith the local suppliers, distribution and mar eting partners, it $ill be the format ta en at the early stage of the penetration. 1hen the mar et is mature, hard discount store and convenience stores $ill be set up 0Nenttes et al, A33G5. 'tage 29 Resourcing strateg# !n accordance $ith business strategy, HRM endeavours to build a high(commitment, intrinsic motivation culture among the employees. &herefore, it $ill apply the soft resourcing strategy to ensure employing staff $ith the right attitude and motivation. &he Esoft9 resourcing strategy $ill base on people9s attitudes and commitment to $or instead of number and techni:ues $ith the aim to enhance engagement, team$or and coherence 0>rmstrong, A33J5.. Demand6 'uppl# &orecasting 7orecasting is a process to estimate the future demand for $or ers and provide a human resource budget for it. !n this process, scenario planning could be helpful in opening minds to predict the possibilities the company have to confront 0Reilly, 12225. Demand &orecasting %ompany forecasting analysis $ill base on the company strategy and corporate each subsidiary has a central control office in charge of the host country business. 6ach department manager position $ill be filled $ith H%#. &his is for the concern that host government re:uires employing local people 0Do$ling et al, 12225. 1hat is more, most countries legally limit the e"patriate numbers to ma"imize local employment $ithin a foreign o$ned subsidiary 0.o, A3325. )ne e"patriate from head:uarter $ill fill the position of finance manager and central management at the same time. &le i+le Emplo#ment

Handy9s 012<25 Shamroc Model suggests a concept for core and complementary employment design. &he three shamroc leaves stand for distinct groupsC the professional core consists of specialists and managers, the contractual fringe $hich is responsible for the non(core activities, and the fle"ible labour force made up of part(time or temporary $or ers and consultants. He later develops the theory by including the customers as the fourth leaf( an informal and unpaid form of subcontracting by introducing some customer Eself(helping service9. .mpact on the U; -ase Since a polycentric vie$ is adopted in the overseas e"pansion= there $ould be no radical change in the H' base culture. Several reason counts for this. 7irstly, under the polycentric policy, host country practice is mostly applicable in the local subsidiary and it $ill not be carried out to other regions. Secondly, being a more integrated and successful economy, H' is more li ely to influence its overseas subsidiaries than being affected by them. Smith and Mei ins 0122;5 posited that home base $ith strong economy tend to Etransfer out9 rather than adopt practice from oversee subsidiaries

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