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"Critically discuss how organisations can develop a human resource strategy"

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"Critically discuss how organisations can develop a human resource strategy" 1. Introduction This report aims to look at ways in which organisations can develop a human resource strategy. I will begin by attempting to define human resource strategy and assess the various approaches to strategy. Then I will suggest the steps an organisation may take to develop a human resource strategy. The report goes on to assesses whether strategy is contingent with the organisations strategy .The report also looks at contrasting strategies depending on the fit to the choices involved, this is illustrated using the case studies of McDonalds and Venture Pressings (see appendix). It continues by examining the strengths and limitations of human resource strategies. 2. What is Human Resource Strategy? This is a new subject area, a lot of literature on this topic has a different perspective, and therefore it is difficult to define human resource strategy. First of all I will define strategy and how it links to human resource management. Strategy is about getting from where we are now to where we want to be; it may be manifest or implicit in organisational behaviour. Therefore HR strategy is linked to organisational strategy. I will look at various definitions, Tyson (1997) made a comprehensive definition: " HR strategy can be defined as a set of ideas, policies and practices that management adopts in order to achieve a people management objective". ...read more.


Then these resources need to be changed or managed to meet the business strategy or the company's mission statement. If we take the example of McDonalds (see appendix) who are rebranding their food and undertaking a massive skills programme, called " Friendliness First". The aim is to train restaurant management in hospitality, and provide them with training material to use on the crewmembers. Although McDonalds has built its success on speed and value for money, what consumers now want is hospitality. McDonalds competitors have got better and now it is attempting to use its people to meet the company's strategy of rebranding and changing its image. 5. Strategy as contingent on organisation/management decisions There is a lot of research on the contingency approach to HR strategy( Ackermann, K.F). This is the relationship between the HR practices and the organisations strategy. However to give a clearer understanding of the link between HR and Strategy I will discuss the three theoretical perspectives which include contingency, universalistic, and configurational. The universalistic perspective suggests there is a " best practice" approach to HR strategy, with a set of HR policies to be identified which will improve performance. These " best practice" policies may be embodied in a variety of concrete and detailed HR techniques or practices. The configurational approach is concerned with "the pattern of planned human resource deployments and activities intended to enable an organisation to achieve its goals"(Wright &McMahon, 1992). ...read more.


In contrast, the Harvard model or " soft" HRM places an emphasis on " human" and is associated with the human relations school of Herzberg and McGregor (Storey, 1987). This model emphasises the importance of integrating HR policies with Business objectives, it focuses on treating employees as valued assets and a source of competitive advantage through their commitment, adaptability and high quality skill and performance. Employees are proactive rather than passive. 8. Conclusion Developing a HR strategy is imperative for organisations in today's competitive business environment. The various approaches to HRM strategy outlined in the report are not always practical as in reality it is very difficult to have a "one size fits all" HR theory, and this means that there can never really be a "one size fits all" HR strategy. In reality when organisations are developing a HR strategy they will fit somewhere between the "hard" and "soft" approach. Another point is that contingencies need to be considered, as HR, strategies need to be contingent with the organisations subcultures. The following concepts need to be considered if the HR strategy an organisation adopts is to be effective * Different human resource practices should be coherent and complement each other. * There should be a fit between the coherent sets of human resource practices and other systems within the organisation. * The human resource systems should be in line with the business or competitive strategy of the organisation. * The human resource system adopted by the organisation should be compatible with its operating environment. 1 ...read more.

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