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CHAPTER 4: THE EVOLVING/ STRATEGIC ROLE OF HUMAN RESOURCE MANAGEMENT Copyright © 2005 South-Western. All rights reserved.

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  • CHAPTER 4:THE EVOLVING/ STRATEGIC ROLE OF HUMAN RESOURCE MANAGEMENTCopyright 2005 South-Western. All rights reserved.

  • Copyright 2005 South-Western. All rights reserved. 1*Strategic Human Resource ManagementInvolves development of consistent, aligned collection of practices, programs, and policies to facilitate achievement of strategic objectivesRequires abandoning mindset and practices of personnel management, and focusing on strategic issues, rather than solely on operational issuesIntegration of all HR programs within larger framework, facilitating mission and objectivesWriting down strategy facilitates involvement and buy-in of senior executives and other employees

    Copyright 2005 South-Western. All rights reserved.

  • Copyright 2005 South-Western. All rights reserved. 1*Exhibit 4-1 (Ulrich, 1997)Possible Roles Assumed by HR Function

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  • Copyright 2005 South-Western. All rights reserved. 1*HR Roles in Knowledge-Based EconomyHuman capital stewardCreates an environment and culture in which employees voluntarily contribute skills, ideas, and energyHuman capital is not owned by organizationKnowledge facilitatorProcures necessary employee knowledge and skill sets that allow information to be acquired, developed, and disseminatedProvides a competitive advantage Must be part of strategically designed employee development plan

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  • Copyright 2005 South-Western. All rights reserved. 1*HR Roles in Knowledge-Based EconomyRelationship builderDevelops structure, work practices, and culture that allow individuals to work togetherDevelops networks that focus on strategic objectivesRapid deployment specialistCreates fluid and adaptable structure and systemsGlobal, knowledge-based economy mandates flexibility and culture that embraces change

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  • Copyright 2005 South-Western. All rights reserved. 1*SHRM Critical CompetenciesHRs success as true strategic business partner dependent on five specific competencies:Strategic contribution - development of strategyBusiness knowledge - understanding nuts and bolts of organizationPersonal credibility - measurable value demonstrated in programs and policiesHR delivery - serving internal customers through effective and efficient programsHR technology - using technology to improve organizations management of people

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  • Copyright 2005 South-Western. All rights reserved. 1*Exhibit 4-4Lepak & Snells Employment Models

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  • Copyright 2005 South-Western. All rights reserved. 1*Exhibit 4-5Traditional HR Versus Strategic HR

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  • Copyright 2005 South-Western. All rights reserved. 1*Barriers to Strategic HRShort-term mentality/focus on current performanceInability of HR to think strategicallyLack of appreciation for what HR can contributeFailure to understand line managers role as an HR managerDifficulty in quantifying many HR outcomesPerception of human assets as higher-risk investments

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  • Copyright 2005 South-Western. All rights reserved. 1*Exhibit 4-7Outcomes of Strategic HR

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  • Copyright 2005 South-Western. All rights reserved. 1*Exhibit 4-8Model of Strategic HR Management

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  • Copyright 2005 South-Western. All rights reserved. 1*Reading 4.1 (Rodriguez & Ordonez de Pablos) Strategic HR as Organizational LearningStages of knowledge managementGenerating or capturing knowledgeStructuring and providing value to gathered knowledgeTransferring knowledgeEstablishing mechanisms for use and reuse of knowledge for individuals and groups

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  • Copyright 2005 South-Western. All rights reserved. 1*Figure 1Knowledge Management Cycle

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  • Copyright 2005 South-Western. All rights reserved. 1*Figure 2Knowledge Management

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  • Copyright 2005 South-Western. All rights reserved. 1*Reading 4.1 Strategic HR as Organizational LearningKnowledge creationSingle-loop learning: Comparing consequences of actions with desired outcomesModifying behaviorDouble-loop learning: Goes beyond detection and correction of errorsEntails examining actions and outcomes, as well as underlying assumptions

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  • Copyright 2005 South-Western. All rights reserved. 1*Reading 4.1 Strategic HR as Organizational LearningWithout purposeful analysis of underlying assumptions and systems, organizations may become victims of competency trapsOrganizational learning: Inherently rareInimitable Immobile

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  • Copyright 2005 South-Western. All rights reserved. 1*Reading 4.1 Strategic HR as Organizational LearningHow HR management systems can contribute to development of organizational knowledgeLabor markets can be exploited in order to attract and select individuals with high cognitive abilitiesInternal labor markets can contribute to development of firm specific assetsCross-functional and inter-organizational teams can be utilized

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  • Copyright 2005 South-Western. All rights reserved. 1*Reading 4.1 Strategic HR as Organizational LearningHow HR systems can support and enhance knowledge transferApprenticeship and mentoringCross-functional teamsStimulate and reward information sharingProvide free access to informationJob rotations

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  • Copyright 2005 South-Western. All rights reserved. 1*Reading 4.1 Knowledge InstitutionalizationWalsh and Ungsons five storage bins in which organizational memory can resideIndividuals (assumptions, beliefs, and cause maps)Culture (stories, myths, and symbols)Transformations (work design, processes, and routines)Structure (organizational design)Ecology (physical structure and information systems)Institutionalized knowledge tends to be firm specific, socially complex, and causally ambiguous

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  • Copyright 2005 South-Western. All rights reserved. 1*Figure 3Alternative Orientations of Fit in SHRM

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  • Copyright 2005 South-Western. All rights reserved. 1*Reading 4.2 (Bowen & Ostroff) Understanding HRM-Performance LinkagesScholars have often assumed two perspectivesSystems view considers overall configuration or aggregation of HRM practicesStrategic perspective examines fit between various HRM practices and organizations competitive strategyOverall set of HRM practices generally associated with firm performance and competitive advantage

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  • Copyright 2005 South-Western. All rights reserved. 1*Reading 4.2 Understanding HRM-Performance LinkagesPsychological climate:Experiential-based perception of what people see and report happening to them as they make sense of their environmentClimate:Critical mediating construct in exploring multilevel relationships between HRM and organizational performance

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  • Copyright 2005 South-Western. All rights reserved. 1*Reading 4.2 Understanding HRM-Performance LinkagesTwo interrelated features of HRM system:Content ProcessMust be integrated effectively

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  • Copyright 2005 South-Western. All rights reserved. 1*Reading 4.2 Understanding HRM-Performance LinkagesContentSet of practices adoptedIdeally driven by strategic goals and valuesNo single most appropriate set of practices for particular strategic objectiveDifferent sets of practices may be equally effective so long as they allow particular type of climate around some strategic objective to developProcessHow HRM system can be designed and administered effectively by defining meta-features of overall HRM system

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  • Copyright 2005 South-Western. All rights reserved. 1*To create strong situations with unambiguous messages about appropriate behavior, HRM systems should have:DistinctivenessConsistencyConsensusReading 4.2 Understanding HRM-Performance Linkages

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  • Copyright 2005 South-Western. All rights reserved. 1*Reading 4.2 Understanding HRM-Performance LinkagesDistinctivenessVisibilityDegree to which practices are salient and readily observableUnderstandability Lack of ambiguity and ease of comprehension of practice contentLegitimacy of authority Leads individuals to submit to performance expectations as formally sanctioned behaviorsRelevance Whether situation is defined so that individuals see it as relevant to important goal

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  • Copyright 2005 South-Western. All rights reserved. 1*Reading 4.2 Understanding HRM-Performance LinkagesConsistencyInstrumentality Unambiguous perceived cause-effect relationship between systems desired content-focused behaviors and associated employee consequencesValidity HRM practices must display consistency between what they purport to do and what they actually do

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  • Copyright 2005 South-Western. All rights reserved. 1*Reading 4.2 Understanding HRM-Performance LinkagesConsensusAgreement among message sendersFairness Composite of employees perceptions of whether practices adhere to three dimensions of justice: distributive, procedural, and interactional

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  • Copyright 2005 South-Western. All rights reserved. 1*Reading 4.3 (Greene) Organization Culture QuestionnaireTopics to be included in questionnaire:How is performance defined, measured and rewarded?How are information and resources allocated and managed?What is operational philosophy of organization with regard to risk-taking, leadership, and concern for overall results?Does organization regard human resources as costs or assets?

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  • Copyright 2005 South-Western. All rights reserved. 1*Reading 4.3 Interpreting Results & Formulating StrategiesTendency to try to identify an ideal cultureNot clear than any one culture will be effective for all organizationsStrategy consists of interrelated functional components that must be carefully integrated to form an effective whole:Selection and staffingOrganizational and human resource developmentRewards

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  • Copyright 2005 South-Western. All rights reserved. 1*Reading 4.3 Analyzing Dysfunctional CulturesWhich components of culture are misaligned?What priorities should be assigned to bridging gaps between what culture is and what people feel it should be?What resources are needed and how should they be used to change culture?How should change effort be managed, and who does what?What role should HR strategy play in signaling, making, and reinforcing necessary changes?

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