Free Business Dissertations - Strategic Human Resource Management And Development- Best Practice
Title: Strategic Human Resource Management and Development- Best Practice Approach
Executive Summary
It is change, continuing change, inevitable change that is the dominant factor in society today. No sensible decision can be made any longer without taking into account not only the world as it is, but the world as it will be. (Source: http://www.ft.com) This statement made by the redoubtable Isaac Asimov is the profound reality of the 21st Century global economy. The practices of managing a business also then need to evolve taking this reality into consideration.
Barclaycard became the latest company to move jobs to India after it announced plans to close a call centre in Manchester and move some employment offshore. This is just one of the many examples in the last decade illustrating how most Western companies are juggling with alternatives such as downsizing, reengineering, and delayering in order to survive and grow. There is a continuous overhaul in the way in which structures and relationships have existed traditionally within a business. It would be a fallacy to say that this business dynamics does not have any implications for the human resource management (HRM) function within an organization. The pace with which the competitive forces act on a present day business is the reason enough for re-evaluating the role of HRM within a business.
The debate on the need for human resource function to contribute effectively had started long back with Karen Legge (1978) questioning the objectives of what was then called personnel management. Her contention was that human resource management (HRM) needs to be driven by goals. This questioning has become more pronounced since the exponential growth of the high-technology businesses in the 1980’s. The developed economies have made a transition from primarily industrial in nature, which were driven by passive and reactive practices of personnel management, to knowledge-driven economies fuelled by creativity emanating from human mind. In this environment, capital, in the form of money, is relatively much easier to obtain, while expertise, which in form of employees, required for driving creativity and innovation, is much more challenging to source. What’s more, globalization is forcing businesses to develop action plans keeping local conditions in mind. The resulting implications for HRM are:
the realization of the fact that it is the human capital of the organization that can provide sustained competitive advantage
the emergence of the concept of intangible assets, in which human capital is seen as one of the key assets and not as a cost to the company
the belief, that for an organization to succeed, its human resource management needs to in alignment with the business strategy
It is in this context of business and economy that traditional, day-to-day practice of human resource function is evolving into a future-focussed, proactive discipline of strategic human resource management (SHRM).
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