Strategic HRM

Edited and adapted from Chapter 11 of Human Resource Management in a Business Context, 2nd edition. Copyright © 1997-2006 Alan Price 2004.

Rhetorical accounts paint a picture of HRM as being focused and managerial, unified and holistic, and driven by strategy. (...) But there is a considerable debate about what ‘strategic human resource management’ (SHRM) actually means. There are many definitions, including:

* 'A human resource system that is tailored to the demands of the business strategy' (Miles and Snow 1984).

* 'The pattern of planned human resource activities intended to enable an organization to achieve its goals' (Wright and McMahan 1992).

* ‘By strategic we mean that HR activities should be systematically designed and intentionally linked to an analysis of the business and its context’ (Schuler, Jackson and Storey, 2001, p.127).

Such definitions range from a portrayal of SHRM as a 'reactive' management field where human resource management is a tool with which to implement strategy, to a more proactive function in which HR activities can actually create and shape the business strategy (Sanz-Valle et al, 1998).

The range of activities and themes encompassed by SHRM is complex and goes beyond the responsibilities of personnel or HR managers into all aspects of managing people and focuses on ‘management decisions and behaviours used, consciously or unconsciously, to control, influence and motivate those who work for the organizations - the human resources’ (Purcell, 2001, p.64). For example, Mabey, Salaman and Storey (1998) look at the subject from four perspectives:

1. The social and economic context of SHRM - including the internal (corporate) and external environments that influence the developmentand implementation of HR strategies.

2. The relationship between SHRM and business performance, emphasizing the measurement of performance.

3. Management style and the development of new forms of organization.

4. The relationship between SHRM and the development of organizational capability, including knowledge management.

Other authors have attempted to provide more analytical frameworks for SHRM. Delery and Doty (1996), for example, make distinctions between three different theoretical frameworks:

* Universalistic where some HR practices are believed to be universally effective.

* Contingent with the effectiveness of HR practices supposed to be dependent on an organization's strategy.

* Configurational where there are believed to be synergistic effects between HR practices and strategy that are crucial for enhanced performance.

Wright and Snell's (1998) model of SHRM aims to achieve both fit and flexibility. They emphasize a distinction between HRM practices, skills and behaviour in their relation to strategy on the one hand, and the issue of tight and loose coupling of HR practices and strategy on the other.