In Human Resources (HR) and management circles today there is a lot of talk about Strategic Human Resource Management and many expensive books can be seen on the shelves of bookstores. But what exactly is SHRM (Strategic Human Resource Development), what are its key features and how does it differ from traditional human resource management?
SHRM or strategic human resource management is a branch of human resource management or HRM. It is a fairly new field, which has emerged from the core discipline of human resource management. Much of the old or traditional human resource management literature treated the notion of strategy superficially, rather as a purely operational question, the results of which cascade throughout the organization. There was a kind of unexpressed division of territory between people-centered HR values and the tougher business values to which corporate strategies really belonged. HR professionals were uncomfortable in the war cabinet-like atmosphere where corporate strategies were formulated.
Definition of SHRM
Strategic human resource management can be defined as linking human resources with strategic goals and objectives to improve business performance and develop an organizational culture that fosters innovation, flexibility, and competitive advantage. In an organization, SHRM means accepting and involving the HR function as a strategic partner in the formulation and implementation of company strategies through HR activities such as recruitment, selection, training and reward of personnel.
How is SHRM different from HRM?
In the last two decades there has been a growing awareness that HR functions were like an island unto themselves with softer, people-centered values, away from the harsh world of real business. To justify their very existence, HR functions had to be more closely connected to the strategy and day-to-day operations of the business side of the company. Many writers, in the late 1980s, began to clamor for a more strategic approach to people management than the standard practices of traditional people management or industrial relations models. Strategic human resource management focuses on human resource programs with long-term goals. Rather than focusing on internal HR issues, the focus is on addressing and resolving issues that affect people management programs long-term and often globally. Therefore, the primary goal of strategic human resources is to increase employee productivity by targeting business obstacles that occur outside of human resources. The primary actions of a strategic HR manager are to identify key HR areas where long-term strategies can be implemented to improve motivation and overall productivity of employees. Communication between HR and the top management of the company is vital, since without active participation cooperation is not possible.
Key Features of Strategic Human Resource Management
The key features of SHRM are
- There is an explicit link between human resource policies and practices and overall organizational strategic objectives and the organizational environment.
- There is an organizational scheme that links individual HR interventions to mutually support each other
- Much of the responsibility for human resource management is delegated in the future.
Trends in strategic human resource management
Human Resource Management professionals are increasingly faced with the issues of employee engagement, human resource flow, performance management, reward systems, and high-engagement work systems in the context of the globalization. Older solutions and recipes that worked in a local context do not work in an international context. Cross-cultural issues play an important role here. Here are some of the major issues HR professionals and senior management involved in SHRM faced in the first decade of the 21st century:
- Internationalization of market integration.
- Increased competition, which may not be local or even national through free market ideology.
- Rapid technological change.
- New concepts of general and line management.
- Constant change of ownership and resulting corporate climates.
- Cross-cultural issues
- The economic gravity shifting from ‘developed’ to ‘developing’ countries
SHRM also reflects some of the major contemporary challenges facing Human Resource Management: Aligning HR with core business strategy, demographic trends in employment and the labor market, integrating soft skills into HR and, finally, Knowledge Management.
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