The Strategic Role of Hrm

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1. The Strategic Role of HRM
(i) Strategic HRM covers eight HR practices- organisation design and work system; human resource planning ; recruitment; selection; training and development; compensation; performance management; employment relations. Each one of these HR practices reflects organization performance. Now HR is involved in long term company strategy. The HR managers sit down on the table with the company when the strategy is designed and advice the company how it can be done from HR prospective. When a company makes a long term strategy it has to look at ’big picture’. Where the company goes?

(ii) HR function during economic recession is very important. In this occasion HR managers must have a strong voice of the top of organization. Because even on time of recession, organization still has to be attractive place to work. Company has to have policy for redundancy. What kind of selection they are going to use- first in/ first out or selection depends on the performance? What redundancy package organization will offer? What cut cost has to make? What types of skills organization needs from workforce? Work force planning is very important for organizations that make long term strategy. Can organization hire new staff in time of recession? Can company hire new graduate because they have new skills and new ideas? All these decisions have been made from HR prospective.

When recruiting resources are cut back, it’s even more important than ever to focus on limited resources on the jobs that have the most impact on corporate revenue. This means that HR manager must focus whatever resources it has on high-impact individuals (recruiting innovators, top performers) and filling high-impact positions (mission-critical, revenue generating, and revenue-impact positions). During tough economic times, it’s important to be able to rapidly cut costs by reducing labor costs. This often means “releasing” employees and as a result, it’s important to increase the percentage of your workers who can be more easily “released” because they are contingent workers. This means replacing some vacancies with contingent workers and converting some traditional “permanent” jobs to a contract basis. Within recruiting, this contingency emphasis might also mean relying more heavily on contract recruiters and third-party vendors for peak hiring periods. Whenever budgets are about to be cut, it’s critical for any function to look its very best and to maximize its immediate results. In recruiting, that means a shift away from long-term projects and toward activities that can produce immediate measurable business impacts. Actions that are most likely to produce immediate low-cost results include updating the employer referral program, targeting boomerangs (former employees), increasing recruiting at professional events, and targeting individual candidates who would be considered to be a superstar or magnet hires by senior management. Redesigning your recruiting and HR processes so that they fit a customer relationship management model in order to improve both the candidate and the employee experience would also be an excellent use of HR resources.

(iii) HR managers have very important position in the company during recession. HR is involved when company makes long term strategy and tries to cutting the cost. In the same time keep high skills and more productive employees. Because increasing productivity and getting more out of your current resources are always key issues during tough economic times, an obvious area for an action plan is increasing employee productivity. These efforts might include increasing the percentage of pay that is based on performance; increasing non-monetary motivators, improving management and supervisory training, or even improving “best practice sharing” processes to speed up the adoption of productivity improvement practice across the firm. Most employees might choose job security over the short-term need for an...
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