human resource management - introduction
What is HRM?
Human Resource Management ("HRM") is a way of management that links people-related activities to the strategy of a business or organisation. HRM is often referred to as "strategic HRM". It has several goals:
- To meet the needs of the business and management (rather than just serve the interests of employees);
- To link human resource strategies / policies to the business goals and objectives;
- To find ways for human resources to "add value" to a business;
- To help a business gain the commitment of employees to its values, goals and objectives
The link between Human Resources and Business Strategy
All elements of the business strategy have implications for human resources, as illustrated in the table below. The challenge for management is to identify and respond to these HR challenges:
Examples of Key Strategy Issues |
Possible Human Resource Implications |
What markets should the business compete in? |
What expertise is required in these markets? Do existing
management and employees have the right experience and skills |
Where should the business be located
to compete optimally? |
Where do we need our people? How many do we need? |
How can we achieve improvements in our unit production
costs to remain competitive? |
How productive is the workforce currently? How does
this compare with competitors? What investment in the workforce (e.g. training,
recruitment) and their equipment is required to achieve the desired improvement
in productivity? |
How can the business effect cultural change? |
What are the current values of the workforce. How
can the prevailing culture be influenced/changed to help implement a change
programme? |
How can the business respond to rapid technological
change in its markets? |
What technological skills does the business currently
possess? What additional skills are needed to respond to technological
change? Can these skills be acquired through training or do they need to
be recruited? |
An important part of HRM is the Human Resources Plan. The purpose of this plan is to analyse the strategic requirements of the business in terms of manpower - and then to find a way of meeting the required demand for labour. This is the subject of a separate revision note.
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