What Is Human Resource Strategy

What is Human Resource Strategy HRS In your view is it a process an outcome or

"What is Human Resource Strategy (HRS)? In your view is it a process, an outcome or a set of activities?"

This essay will rely on a review of literature and may include:

A rationale for the: (i) emergence of HRS, (ii) the value of HRS, (iii) some discussion of differing approaches to HRS, (iv) some discussion of HRS strategy types (hard v soft), (v) the concept of fit and other issues which you wish to include based on your reading, (vi) including your conclusion, with your definition of HRS.

Introduction.

Schuler and Walker (1990) define Human Resource Strategy (HRS) as "a set of processes and activities jointly shared by human resources and line managers to solve business-related problems". I believe this definition assists on tackling the above question. However, Bamberger and Meshoulam "Conceptualise human resource strategy as an outcome: the pattern of decisions regarding the policies and practices associated with the HR system" (Bamberger & Meshoulam, 2000: p15). In my view, HRS is a set of 'processes and activities' that when implemented, result in an outcome.

In aim to justify this statement by discussing the topic of human resource strategy in relation to the sub-headings listed above. By examining the reasons or 'rationale' for the emergence of human resource strategies in the modern business environment, the value, various strategy approaches, types and the concept of fit, I believe I can underline the importance of a well devised HRS to any overall business strategy or plan.

(i) Emergence of Human Resource Strategies

Modern businesses and the economic environments in which they operate are very different from the organizations and economies examined by Chandler in his studies of 'managerial capitalism' (late 19th Century through to the 1970s). The development of technology, and the creation of global economies have resulted in a significant increase in efficient and effective competition within all industries operating in market economies. Firms con longer rely on competing aggressively simply on the reliable favorites of achieving economies of scale and creating 'barriers to entry' within their markets etc.

Firms have become more market orientated as opposed to production focused (as highlighted by our recent study of Waterford), and this is part of the growth of the tertiary sector in modern business.

The growth of tertiary sector activity in the global dynamic environment has resulted in people (staff) or human resources, as a factor of production, becoming the most important part of this 'production' process. However managing people or 'human resources' is much more complicated than managing equipment for example, however does allow for much more scope and varying ideologies and techniques.

It is for these reasons that organisations are focusing on human resources as "Companies everywhere are changing the way they manage in order to be competitive" (Walker, 1993: p1). These firms need to find a new competitive advantage, and the implementation of a HRS that is beneficial and supportive in achieving the overall strategic plan is a means of doing so, or put differently, achieving a desirable outcome through a set of processes and activities.

In this new business culture of 'strategic management', fitting every 'division's' strategy in to the overall strategy has become the norm. Human resource management has developed and 'integrated' its processes and activities in strategic management, 'through the new discipline' of strategic human resource management (Wright, McMahon, 1992: p49).

Associated to this point is Barney's assertion that "Managers must look inside their firms for valuable rare resources and exploit these resources through their organization" (Barney, 1995: p61).

The emergence of HR strategies can therefore be explained by the development of corporate strategies that firms began to implement as a means of gaining that desired competitive advantage, and creating a clear and effective plan in which to operate the business. In the current environment, good strategic management of human resources by developing a competent set of processes and activities will assist in formulating a desired outcome: a fit between HR strategy and the organisation's overall strategy.

(ii) The Value of Human Resource Strategies

A significant value of human resource strategies, as opposed to human resource management, is that a HRS ties in with the overall organizational strategy. Employees and all divisions of management must be aware of the firm's business strategy. Once the human resource departments are directed to devise a strategy to complement and 'fit' this overall plan, the lines of communication between staff and the HR department are opened up. The practices and activities implemented by the HR department are recognized by staff as part of a company goal and in effect these practices are given 'legitimacy' as the staff realize they part of the long-term goal, and presumably are accepted by top level management.

Miles and Snow refer to the importance of a HRS that fits with the overall organizational plan. They refer to the existence of a 'corporate human resources group' who "Should develop its ability to provide assistance to operating divisions to ensure that...these units have human resources programmes that fit their business strategies" (Miles & Snow, 1984: p50).

The lack of a HR strategy, whereby the HR department simply manages according to their specific goals and interpretations of the firms' needs can conflict with company's goal and possibly result in the workforce viewing the HR department as peripheral and a nuisance (or certainly as obstructing company objectives). Therefore no careful planning of the activities and processes undertaken by the department can result in an unwanted outcome.

Walker himself intimates this by stating "Only by addressing human resource issues in the context of overall strategic