To what extent does the approach being taken by Macquarie Bank demonstrate features of SHRM? (10 marks)
There are 3 models of Strategic Human Resource Management (SHRM) being taken by Macquarie Bank – the best practice view, the best fit view and the resources-based approach. Each approach is capable to make impact in an organizational performance, usually through increased competitive advantage and added value.
The meaning of SHRM can only really be understood in the context of something else, namely organizational performance, whether that be in terms of economic value added and increased shareholder value, customer value added and increased market share, or people added value through increased employee commitment and reservoirs of employee skills and knowledge (Ian Beardwell, et al, 2004).
The best practice view starts from the promise that a single set or ‘bundle’ of Human Resource (HR) policies and practices will lead to better organizational performance, sustained over a lengthy period, whatever the prevailing business circumstances (John Leopold, et al, 2009). In best practice view of Macquarie Bank, it is talking about long-term plan, strategy or policies. The priority areas in Macquarie Bank human resources practice were recruitment and selection, performance appraisal, rewards and compensation and organization and development.
They are strict in recruitment and selection because they believe corporate image as an employer is important. One of the way for them to recruit and select good employees is by using psychological tests, and another key strategy is the policy of ‘growing our own’ from graduate trainees. Performance appraisal is their essential mechanism for tracking goal achievement and help in determining rewards.
Macquarie Bank pays well for their employee through rewards and compensation.
“At Macquarie, you are recognized and rewarded for your hard work. Managers care about their staff, and are not full of empty promises.” Kelly-Marie, Macquarie Bank Funds Management Group Manager (2009) said.
They are firm in what they are stand for, “Macquarie aspires to be a pre-eminent provider of financial services over the long haul.” (From Macquarie Bank homepage, 2009)
Macquarie Bank recognizes that, however our achievements date are judged, the quest for improvement is never ending. They are always looking forward for improvement which is why it has an attractive reputation that being innovative, hard working and willing to strive for excellence in anything it does.
The best fit school of SHRM explores the close link between strategic management and HRM, by assessing the extent to which there is vertical integration between an organization’s business strategy and its HRM policies and practices (Ian Beardwell, et al, 2004). Two integration involved in this model which is vertical integration (between internal people processes and policies and the external market or business strategy,) and horizontal integration (between HR policies and with line managers).
Due to the turbulent external market, they prefer decisive leadership. However, bank provides a flexible organizational environment which people can achieve. They recruit the best from universities and graduate schools; train on the job and pay top money. All the policies are well suited to a flat organizational structure where specialist skills can be developed within small work teams, closely related to the product-market interface.
In the resource-based view of SHRM, it is focusing on the internal resources of the organization instead of analyzing performance in terms of the external context. It is a way to exploit or enhance the available resources. Advocates of the resources-based view of SHRM help us to understand the conditions under which human resource become a scare, valuable, organization-specific, difficult-to-imitate resources, in other words key ‘strategic assets’ (Barney and Wright, 1998; Mueller,...