HRM Strategy
Human
Resource
Strategy
Chris Jarvis
1
HRM Strategy
The Idea of Strategic HRM






Chris Jarvis
No definitive, robust theory.
No agreement on meaning, factors, outcomes.
how is SHRM linked with organisational performance? difficult
to establish firm relationships given intervening factors:
structure, culture & wider environment
various typologies of business and associated HR strategies
Empirical studies tend to use


large-scale questionnaire surveys (Storey)
case-studies on SHRM.
Theoretical &empirical gaps between rhetoric and real
experience - downsizing and redundancies etc.
2
HRM Strategy
Stages in a Corporate Strategy Process
Organisation
Mission and Goals
(Define the business)
Strategic Analysis
(current situation, programmes and performance)
Rational, logical
versus
interpreted & political
Strategic Choice
(bounded rationality, shaping the environment)
Strategy Implementation
(programmes, resources & responsibilities)
Chris Jarvis
3
HRM Strategy
Planning Levels
CEO
Corporate
Level
Business
Level
Functional
Level
Corporate HQ
Aviation
Heating
Trucks
Manufacturing
Marketing
Chris Jarvis
Plastics Consultancy
Accounting
R&D
4
HRM Strategy
Strategy Formulation
 Managers analyse the situation & develop
strategies to achieve the mission.
 SWOT analysis: planning to identify 
Long-term - 5+ yrs
Intermediate-term 1- 5 yrs.

Organizational
 Corporate & business plans
 Strengths: manufacturing ability,
 Short-term - less than 1 yr.
marketing skills
 Functional plans?
cycle - amend plans
 Weaknesses: high labor turnover, weak  Rolling
constantly?
financials.
Environmental
 Opportunities: new markets
 Threats: economic recession, competitors
Chris Jarvis
5
HRM Strategy
Standard Corporate Planning Picture
SWOT + STEEPLE
Internal & external
analysis
•
•
•
•
•
•
Chris Jarvis
Concentrate
Diversify
Globalize
Vertically Integrate
Down-size
Flexible firm
Corporate strategy
develop a plan of
policies, allocations,
programmes to maximise
long-run value
•
•
•
•
Grow
Stabilize
Retrench
React/Panic
6
HRM Strategy
Manifestation of Strategy and Policy
 Maintenance
 Standing plans (programmed decisions)
 policies, rules, and standard operating procedures (SOP).
general and specific guides to action.
 Programme arrangements and allocations.
Innovations
 New initiatives, programmes and projects


Chris Jarvis
7
HRM Strategy
Schools of Strategy
 Prescriptive



Design School
 Strategy (formation as a process of conception)
Planning (formal process)
Positioning (analytical process and techniques)
 Descriptive Schools (metaphors)







Chris Jarvis
Source: Mintzberg, Ahlstrand, Lampel,
Enterpreneurial (visionary)
1998, Strategy Safari, Prentice Hall
Cognitive (mental)
Learning (emergent, adaptation, incremental)
Power (a process of negotiation between interests)
Cultural (collective values, beliefs and behaviours)
Environmental (reactive, contingent)
Configuration (process of transformation from one state to
another - management of change)
8
HRM Strategy
Michael Porter -- Value-Added Chain Analysis
Support
Activities
Primary
Inbound
Activities logistics
Technology development
Procurement
Operations Outbound
logistics
Marketing
and sales
After
sales
service
Employee management
Support
Activities
Chris Jarvis
Firm’s infrastructure
9
HRM Strategy
Mintzberg on Strategy
 Plan (intended)
 direction, guide, a course of action.
 Pattern (realised)

consistency in behaviour over time e.g. high end, low risk,
patterns evolved out of the past. What plan have we actually
pursued over the last 5 years?
 Position

Locating our HRM in a position, unique and valuable, involving
a set of activities, X marks the spot.
 Perspective

look inwards and upwards to a grand vision of the enterprise.
The “theory” (mind-set) of the business. Less easy to change
than position e.g. from bureaucracy to innovation.
 Ploy (specific manoeuvres)
Chris Jarvis
10
HRM Strategy
Deliberate and emergent strategies
Unrealised
Strategy
Emergent
Chris Jarvis
Source: Mintzberg, Ahlstrand, Lampel, 1998,
Strategy Safari, Prentice Hall
11
HRM Strategy
Form and Formation

Strategies have a form
and they are formulated


Chris Jarvis
So what is the form of
HRM strategy of
organisation X?
Steerage and Umbrellas

Deliberate broad
outlines with details
emerging en-route
Set direction
but unknown waters, move
quickly or slowly?
Focuses effort
unity vs group-think &
peripheral vision
Defines the organisation
a shorthand but slogans may
override complexity & distort
reality
Provides consistency
Provide order, a cognitive
structure to simplify, explain &
facilitate action but creativity
thrives on “loose” order
12
HRM Strategy
CEO and HR Director as strategists




Conceive the big idea?
Let everyone else get on
with the details?
But the job is not like this
Mintzberg on managerial
roles
Interpersonal
figurehead
leader
Information Processing
liaison
monitor
disseminator
Spokesperson
Decision-making
initiator/changer
resource allocator
disturbance handler
negotiator










(after H Mintzberg)
Chris Jarvis
13
HRM Strategy
Corporate-Level Strategies



Stick to the knitting - focus on core business
Diversification


No declared strategy?





Chris Jarvis
Related : similar areas - build upon existing divisions
 synergy & core competencies
Unrelated - portfolio business in new areas
Corporate failure? Implicit strategy?
Avoid resource-consuming activity
Disdain for formal planning but reliance on consistency of
behaviour at all levels.
No frills, non-bureaucratic organisation
 No recipe to decrease flexibility, block learning &
adaptation
Tension between control and discretionary freedom.
14
HRM Strategy
International HRM Strategy
 Global: HRM diversity for different conditions
 single, standard scheme across all countries?
 adaptation &acceptance of national differences?
 values, ethics in decision-making
 Domestic:
 Common national schemes?
 public sector institutions?
 Common professions/occupations
 personnel system discretion for semi-autonomous
divisions to take advantage of local circumstances?
Chris Jarvis
15
HRM Strategy
HRM Services and the Product Life Cycle
Maturity
Growth
Profit
Loss
Develop
or decline
Start-up
£/volume
Implications for
Time
Chris Jarvis
•
•
•
•
•
Recruitment?
Rewards?
Training & Development?
Employee Relations?
Organisational development?
16
HRM Strategy
Analysis of HR Services
 Deliverables: capacity and capability
 Can we deliver? What do we deliver and how well?
 Efficiency



How well is the process offered, managed and controlled?
What are the transformation indicators and service quality ratios?
cost/unit, cost/recruit, performance/employee, cost/HR
intervention?
 Adaptability
 short + long term responses to pressure and change
 Benchmarking
 efficiencies, processes & outputs
 investment - £, technical and human
 quality, systems, research and intelligence
Chris Jarvis
17
HRM Strategy
Common-sense propositions on quality
 No focus on quality - lose market share and reputation.
 Good reputation is easier to lose than regain.
 People trust and become accustomed to favourites
 They remember the bad. "I'll never go there again".
 New loyalties with substitute suppliers.
 Complacency breeds neglect.
 It takes a major operational and psychological effort to


maintain quality vigilance (entropy).
regain a lost reputation.
 Common-sense either forgotten or only realised post hoc
Chris Jarvis
18
HRM Strategy
What is Quality?
....... a perception of class, excellence, a type of "referential" standard or
(in definition) reflecting needs and expectations of customer.
Guru definitions :
product or service, nature or features reflecting capacity to satisfy
express or implied statements of need (Deming)
conformance to requirements (Crosby)
fitness for purpose or use (Juran)
product/service characteristics as offered by design, marketing,
manufacture, maintenance and service that meet customer
expectations (Feigenbaum)
Oakland (1995) - perceivable, measurable move from mere
satisfaction to "delight and reputation for excellence".
Reliability. “Next door swears by her 8-year old Zanussi!”






Chris Jarvis
19
HRM Strategy
Elements of a Quality Policy
 organisation structure for quality: roles, responsibilities
 how client/customer needs and perceptions will be identified
 technical/economic resource allocation
 QMS scheme & operation
 how suppliers & supplies will be required to meet standards
 prevention & zero defects/CQI approach vs. "inspect-out"
 communication, knowledge, information & staff development
 audit of QMS in operation
 Partnership with staff, customers and suppliers.
 Physical manifestation not just conceptual
Chris Jarvis
20
HRM Strategy
TQM - a Strategy and Discourse
 an approach to improving the competitiveness, effectiveness
and flexibility of a whole organisation..... a way of planning,
organising and understanding each activity and it depends on
each individual at each level. TQM is a way of ...... bringing
everyone into the processes of improvement
Oakland 1995

 a TQM programme requires re-evaluation of how
organisational members address the quality of their work and
the service processes.
Chris Jarvis
21
HRM Strategy
TQM underpinned by policy commitment
 A culture and practice change strategy
 Organisational renewal
 Injection of energy
 Staff encouraged in positive, initiative taking behaviours
 Adopt a prevention and CQI ethic
 Quality improvement teams/circles
 Use of a variety of methods and techniques (tools)
Chris Jarvis
22
HRM Strategy
Kaizen: Continuous Quality Improvement (CQI)





Chris Jarvis
critical view of organisational performance standards
continuously challenge & incrementally upgrade
performance levels
contribution and role of HR team
attitude (ownership), involvement and team effort as
the key to improvement
HR team - line manager relationships
23
HRM Strategy
Classical functional, problem analysis cycle
 Situation analysis
 Problem definition
 Objectives and resourcing
 Solution development - options and best fit from DO

Chris Jarvis
NOTHING to DO EVERYTHING. Min/Max,
optimistic/pessimistic, high/low budget etc.). Test models
against objectives and constraints
Implementation analysis
 detailed planning for operational implementation.
 analysis for potential problems
 scheduling, work allocation, capacity management,
communicating, monitoring systems & overall coordination.
24
HRM Strategy
Questions for Quality Strategy
 Who are our direct and indirect clients
 Define characteristics, needs, requirements?
 Design features of services?



How do clients perceive these?
Bench-mark comparisons
Which features do not compete?
 How can we delight beyond the basic specification?
 Design improvement projects?
 Who, by when & at what cost?
 Operational ability to bridge the gaps?
 Information & monitoring systems?
 Supply chain analysis - performance & communication?
Chris Jarvis
25
HRM Strategy
Specifying HR Quality
 Essential contract for supply
 ensuring delivered quality in a contract of service.
 Implications of failure to draw up a clear specification?
 Design quality dimensions include:
 Features, performance, delivery, cost, reliability,
 Conformance measurement:
durability, serviceability, response, aesthetics, reputation.
Degree to which service design specification is met
Chris Jarvis
26
HRM Strategy
ISO 9000 Certification for HR Services?
 The parties & organisational level?
 Detailed specification
 what best practice will be (product & process definition)
 contract volume, milestones, stage deliverables?
 CSFs/CQFs for inputs, processes, outputs?
 work done to plan, in the defined ways?
 QA/QC methods? inspection, testing and monitoring
 staged prices and conditions? variation orders vs. extras
 penalties?
 audit trail
 client liaison
Chris Jarvis
27
HRM Strategy
Clauses of ISO 9000
4.1
4.2
4.3
4.4
4.5
4.6
4.7
4.8
4.9
4.10
4.11
4.12
4.13
4.14
4.15
4.16
4.17
4.18
4.19
4.20
Chris Jarvis
Management
Quality Plans
Contracts
Controlling design - not ISO 9002
Controls using documents and data
Purchasing and supply
Customer-supplied equipment
Product identification and tracing
Process controls
Inspection/testing
Measuring and test equipment
Identify status of inspected goods
Control over non-conforming products
Corrective and preventative action
Handling, storage, packaging, preserving and
delivery
Records for quality
Internal audits
Training
Servicing
Using Statistics
28
HRM Strategy
USA Baldrige National Quality Award (1999)
Criteria for
Performance
Excellence
Chris Jarvis
 Leadership (weighting 125 points)
 Strategic Planning (85)
 Customer & Market Focus (85)
 Information and Analysis (85)
 Human Resource Focus (85)
 Process Management (85)
 Business Results (450)
29
HRM Strategy
References









Chris Jarvis
Gratton L, Hope-Hailey V, Stiles P. and Truss C, (1999) Strategic HRM: Corporate
Rhetoric and Human Reality, OUP.
Huselid M, (1995) The Impact of Human Resource Management Practices on
Turnover, Productivity and Corporate Financial Performance . Academy of
Management Journal, Vol. 38, No. 3, pp. 635-672.
Kamoche K. (1994) A Critique and a Proposed Reformulation of Strategic HRM .
HRM Journal, Vol. 4, No. 4, pp.29-43.
Miles R and Snow C. (1984) Designing Strategic Human Resources Systems,
Organizational Dynamics, Summer: 36-52.
Swiercz P. (1995) Strategic HRM, Human Resource Planning, 18,3, p.53-.
Truss C. (2001 — forthcoming) Complexities and Controversies in Linking HRM
with Organisational Outcomes . Journal of Management Studies.
Truss C. and Gratton L. (1994) Strategic HRM: A Conceptual Approach .
International Journal of HRM, 5,3, pp.663-686.
Truss C, Gratton L, Hope-Hailey V, McGovern P, & Stiles P. (1997) Soft & Hard
Models of HRM: A Reappraisal . Journal of Management Studies, 34,1, pp.53-73.
Wright, P. and McMahan, G. (1992) Theoretical Perspectives for Strategic HRM ,
Journal of Management, Vol. 18, No. 2, pp. 295-320.
30