Business Strategy & HRM

1. Business Strategy & HRM

2. Corporate strategy “The direction and scope of an organisation over the long term, which achieves competitive advantage for the organisation through its configuration of resources within a changing environment and to fulfil stake holder expectations” Johnsons and Scholes

3. The three levels Corporate: relates to the over all scope of the organisation Competitive: how the organisation is to compete in the given market Operational: how the various sub units contribute to the higher level strategies

4. Whittington’s topology of strategy Processes Deliberate Classical Systemic Outcomes Profit Maximising Pluralistic Evolutionary Processual Emergent

5. Classical Strategy portrayed as a rational process of deliberate calculation and analysis, undertaken by senior managers

6. Evolutionary Strategy seen as a product of market forces in which the most efficient and productive organisations win through

7. Processual Strategies tend to evolve through the process of discussion and disagreements that involves managers at different levels in an organisation

8. Systemic Strategy is shaped by the social system in which it is embedded factors such as class, gender and legal environment and choices are influenced by interests of a broader society

9. Linking Strategy & HRM

10. Life cycle models MATURITY GROWTH DECLINE START UP

11. Life cycle models Flexibility necessary For growth and development and commitment to entrepreneurialism Emphasis on flexible working pattern Recruit and retain staff with the motivation to work long hours Employees encouraged to look forward to potential benefits START UP

12. Life cycle models Formal policies emerge to manage size and build on earlier success Retain expertise and ensure earlier levels of commitment are maintained Need for specialist becomes apparent HR policies formalised to avoid the danger of inability to address grievance and discipline A balance of informal and formal approach sought GROWTH

13. Life cycle models Surpluses level out Procedures formalised Control labour costs Reduced t&d activities Positive psychological contract challenging Focus on productivity and staff made to move around and out MATURITY

14. Life cycle models Business struggling to survive Emphasis shift to rationalisation and redundancy Policies and procedures reconsidered Specialist HR function disbanded Focus on re-skilling & outplacement Increasing tendency to contract out services DECLINE

15. Competitive advantage model STRATEGY PRACTICES Cost reduction Resources Learning & development Quality enhancement Reward management Innovation HR function

16. HRM & the resource based view • It is the range of resources including human, that gives each organisation it unique character and may lead to differences in competitive performance • Organisations obtain sustained competitive advantage by implementing strategies that exploit their internal strength and neutralise external threats

17. HRM& RBV • Potential for sustained competitive advantage requires four specific attributes • Value – resources adding value in some way • Rarity – shortage of these particular resources • Imperfect imitability – unable to imitate or copy • lack of substitutes – not easily substitutable

18. Finally Competitively advantageous equipment can be designed and continuously improved only if the workforce is highly skilled. Continuous education is attractive only if employees are willing to learn. Sending workers throughout the world to garner ideas is cost effective only if they are empowered to apply what they have learned to organisational problems.