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Building Human Capital. OS352 HRM Fisher August 28, 2003. Agenda. SAP update Review goals of HRM Why manage human resources? Linking HRM and strategy. SAP update. Everyone will be getting new log-on information Maintenance being done this week System will be available starting Monday
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Building Human Capital OS352 HRM Fisher August 28, 2003
Agenda • SAP update • Review goals of HRM • Why manage human resources? • Linking HRM and strategy
SAP update • Everyone will be getting new log-on information • Maintenance being done this week • System will be available starting Monday • Self-study materials will be available on my website • Tutorial next week • Form your groups for Exercise 1 accordingly!
Goals of HRM • Ensure the organization has the workforce required to create products/services • Establish and administer personnel policies • Ensure compliance with labor laws
Strategy and human capital • Overall, strategy involves developing and sustaining a competitive advantage • Source of value • Rare • Difficult to copy • Highly skilled, motivated employees can meet these resource characteristics • Human capital
Developing human capital • How do each of these systems contribute to the development of human capital? • Recruitment • Selection • Training • Performance management • Compensation • Retention is key
Human Resource Strategy • A firm’s deliberate use of human resources to help it gain or maintain an edge against its competitors in the marketplace.
HR can respond to strategy… • Three general business strategies • Operational excellence • Product leadership • Customer intimacy • How would HR respond to each strategy? Based on Beatty, R.W., Huselid, M.A., & Schneier, C.E. (2003). New HR Metrics: Scoring on the Business Scorecard. Organizational Dynamics, 32, 107-121.
….or inform strategy • Organization’s internal strengths and weaknesses often inform strategic decisions • Identify areas of competitive advantage • Core skill areas • Corporate culture • Labor/management relations • Use those to inform strategic decisions
HR responds to external forces • Labor market demands • Competitors’ actions • Regulatory environment • Industry best practices
But must also consider internal factors • Best practices may not be effective due to characteristics of the organization • Industry • Size • History • Culture • Need to tailor HR activities • HR activities must be aligned
Measuring Outcomes • How do we know if the HR function is operating effectively? • What kinds of outcomes could we measure?
For next class • Read Noe pages 49-55, 527-531 • How is IT affecting HR? • Enterprise resource planning systems (such as SAP) • Other types of technology