It is the purpose of [the HR department] of an organisation to produce profit, not good HRM', Redman and Wilkinson (2001). Analyse and debate this question with regard to the relationship between HR strategy and business strategy.

manage and control the workforce in order to gain a competitive advantage. Whereas, the ‘soft’ version stresses on the human aspects of HRM as valued assets, by emphasising on communication, motivation and leadership. It is seen as a distinctive way of managing people, one which focuses on the value of employees as resources to be developed by the organisation. As in the case of ‘hard’ HRM, Guest (1999) comments: The drive to adopt HRM is… based on the business case of a need to respond to an external threat from increasing competition. It is a philosophy that appeals to managements who are striving to increase competitive advantage and appreciate that to do this they must invest in human resources as well as technology. He has also gone on to say that HRM ‘reflects a long-standing capitalist tradition in which the worker is regarded as a commodity’. The emphasis is one which has the interests of management focused on adopting a strategic approach which is closely integrated with business strategy. It has been observed by Truss (1999) that ‘even if the rhetoric of HRM is soft, the reality is often hard, with the interests of the organisation prevailing over those of the individual’. In an ideal organisation one would assume it to be well-balanced and integrated with all people sharing the organisational goals and working together as members of one team. On this very issue, research has been carried out by Gratton et al (1999) that there was a mixture of hard and soft HRM approaches. This concludes that the distinction between the two approaches was not and still is not a precise one. We can see the emphasis that the organisations may put upon ‘hard’ HRM and its popularity to use such an approach where it concentrates on staff numbers and their alignment to requirements. Whereas, ‘soft’ HRM with all its characteristics of rhetoric is more of a ‘talked’ about approach which is only rarely implemented in organisations. Management may want to implement and see the importance of integration of organisations needs and those of the individual, but some of which is only just talked about rather than putting the theory to use. This is very difficult because of other business priorities, lack of support from line managers, lack of resources, resistant to change and a climate in which employees do not trust management, etc. A classic indication and reflection to the above can be highlighted by a case study which was conducted on IBM. Here it was emphasised on the number of difficulties associated with the adoption of ‘soft’ HRM. When business is going well and steady with scope for continued growth, an organisation can afford to manage its people in a humane and considerate way. However, when things get difficult and a business starts to struggle where there is a need for change, in this case profitability becomes the prime consideration. This kind of pressure is put upon by other stakeholders and at this stage managers having little else option turn their efforts on adopting a ‘hard’ approach. In practice, it can be said that an organisations choice of adopting ‘soft’ or ‘hard’ approaches to HRM is much influenced by the changing market situation in order to settle and work around such factors. HR Strategy and Business Strategy The link or relationship between HR strategy is the basic belief of how an organisation sets out its purposes and objectives by being effective. The fit between the two enables HRM to play its part in achieving organisations objectives. Business strategy can be defined as those person(s) who run an organisation that find ways to position their business objectives by the use of manipulating the planning environment and to fully utilise the future use of the capital and human assets. Whereas HR strategy can be defined as the process of bringing together plans, programmes and intentions within an overall framework, designed to develop to meet an organisations objectives. Therefore to say that HR strategy must play a key role in developing the organisations competitive advantage and not just as a way to support the business strategy but also to develop it is a correct assumption to the extent of both going hand-in-hand to achieve the organisations main goals and targets. In relation to the above, Cooke (1990) says; ‘HR strategies exist to ensure that the culture, values, structure and processes of the organisation, and the quality, flexibility, motivation and commitment of its members to contribute fully to the achievement of its objectives… should match the business strategy. Of all the requirements referred to the above, HR strategy should be justified by business strategy. Without this, HR strategies will be seen by management as of little relevance to the real objectives of the business, and this will leave the HR function in a weak position, whereas it should have a central role in the delivery of the long-term plans of an organisation. All the decisions whether being HR or business should be integrated at a strategic level so that all aspects and requirements are met by creating new opportunities for what is deemed possible. Best Practice The basic definition of ‘best practice’ can be put down to what it actually is, literally speaking. This is something which the HR function of an organisation selects and chooses appropriate best practices from those which are known to be available from the policies and strategies being questioned. What this means is that the organisation will not just do and follow what others may be doing, rather by looking at ‘how deep’ it may be, in whatever situation it may be and then to analyse very carefully at what is needed, before the introduction and implementation of any new policies it may want to put in place. The ‘best practices’ view argues that high performance work practices will increase organisational performance irrespective of organisational, industrial, or national context. Contingency theorists argue that to be effective, an organisation’s HRM practices must be consistent with other aspects of the organisation such as business strategy. The configurational approach emphasises the need for HRM practices to fit with each other, as well as with other strategies and is sometimes referred to as ‘bundles’ theory. Pfeffer (1998) presents empirical evidence that strongly supports a direct relationship between a company’s financial success and its commitment to HRM practices that treat employees as ‘assets’. Pfeffer (1998) asserts that a greater use of: employment security, selective hiring, self managed teams/team working, incentive pay, training, information sharing and reduction of status differences results in higher productivity and profit across all types of organisations. Pfeffer (1998) states that whilst the HRM practices need to be ‘internally consistent’, they will universally positively impact performance across all strategies, if properly implemented by organisations. Conclusion By referring back to the question of ‘an organisation to produce profit, not good HRM’ is somewhat of a contradiction of how many organisation operate. We cannot consider for one instance that an organisation exists not to make a profit (except in the case of charities), which is of course a fundamental reason for its existence in the very nature for what it is meant to achieve – profit. To go on from this and say that its only purpose is to make profit and not to have in place, if not ‘good’ but at least some practice of HRM is undermining the principals of an effective organisation whose human resources are vital to its overall success – looking from a financial side of things. HRM is seen to utilise the use of people in their management by effective means. Together with the human resource strategies that are integral to the business strategies, and the whole business plan based on them, will see to effect the HR department interlinking their work to that with managers will be crucial to the success of both – profit and good HRM. There needs to be in place desired outcomes from which all concerned can plan and set out what needs to be included in order to gain a competitive advantage. For an organisation to choose particular techniques or policies which will produce the outcome, will depend on the organisations circumstances as a whole, its values and preferred way of working, the culture and style which will result in its achievement of long term goals. References: Armstrong, Michael (2003). A handbook of Human Resource Management Practice Armstrong, Michael (1992). 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