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    Businesses that align their human resources strategy with their business strategy tend to be more profitable and efficient. This report argues that aligning HRS should be based on each organization's circumstances rather than a one-size-fits-all approach. HR departments need to understand business language and strategy development works best with a strong cultural and business fit. Each HR strategy requires metrics to measure its impact, such as reduced turnover or increased innovation.

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    Businesses that align their human resources strategy with their business strategy tend to be more profitable and efficient. This report argues that aligning HRS should be based on each organization's circumstances rather than a one-size-fits-all approach. HR departments need to understand business language and strategy development works best with a strong cultural and business fit. Each HR strategy requires metrics to measure its impact, such as reduced turnover or increased innovation.

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    44 views2 pages

    HR Alignment

    Uploaded by

    mlekwa
    Businesses that align their human resources strategy with their business strategy tend to be more profitable and efficient. This report argues that aligning HRS should be based on each organization's circumstances rather than a one-size-fits-all approach. HR departments need to understand business language and strategy development works best with a strong cultural and business fit. Each HR strategy requires metrics to measure its impact, such as reduced turnover or increased innovation.

    Copyright:

    Attribution Non-Commercial (BY-NC)
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    Download as doc, pdf, or txt
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    Businesses that aim to align their human resources strategy (HRS) with their business

    strategy tend to be more profitable and more efficient than those that do not. This
    depends on: in the first instance, understanding what the business strategy or strategies
    are; second, what constitutes the HR strategy; and third, seeing if there is sufficient
    congruency.

    This report argues that the process of aligning HRS with business strategy should be
    based on circumstance (contingency) rather than a one-size-fits-all approach
    (universalist). Consequently, it will not point the reader down some specific, ‘primrose’
    path where strategy and HR can be aligned for benefits all round.

    HR departments need to become far more literate in the language of business and
    financial planning, improve their networking skills across the organisation and
    understand that HR strategy development works
    best when there is a strong cultural and business ‘fit’.

    Each HR strategy requires the development of robust metrics that enable the HR
    department to show ‘before and after’ effects wherever possible. Some examples are
    reduced employee turnover, new skills acquisition by staff, increased numbers of ideas
    and levels of innovation through re organisation.

    Universalistic approach
    Academics such as Peters and Waterman, Huselid and Pfeffer have claimed that there is
    ‘one-best’ or ‘universal’ way to manage HR.4 In other words, they have identified a
    number of HR policies and practices, which they suggest if followed would always result
    in organisational success. Pfeffer, for example, advocates the use of seven integrated
    practices, which will enable organisations to ‘obtain profits through people’.5 These
    practices are:

    • employment security
    • selective hiring of new personnel
    • self-managed teams and decentralisation of decision making as the basic
    principles of organisational design
    • comparatively high compensation contingent on organisational performance
    • extensive training
    • reduced status distinctions and barriers (including dress, language, office
    arrangements and wage differentials across levels)
    • Extensive sharing of financial and performance information throughout the
    organisation.

    Scope of HRM
    The scope of HRM is very wide. Research in behavioural sciences, new trends in
    managing knowledge workers and advances in the field of training have expanded the
    scope of HR function in recent years. The Indian Institute of Personnel Management has
    specified the scope of HRM thus:
    • Personnel aspect: This is concerned with manpower planning, recruitment,
    selection, placement, transfer, promotion, training and development, lay off and
    retrenchment, remuneration, incentives, productivity, etc.

    • Welfare aspect: It deals with working conditions and amenities such as canteens,
    creches, rest and lunch rooms, housing, transport, medical assistance, education,
    health and safety, recreation facilities, etc.

    • Industrial relations aspect: This covers union-management relations, joint


    consultation, collective bargaining, grievance and disciplinary procedures,
    settlement of disputes, etc.

    Employees should be accepted as partners in the progress of a company. They should


    have a feeling that the organisation is their own. To this end, managers must offer better
    quality of working life and offer opportunities to people to exploit their potential full

    Job evaluation: Organisations formally determine the value of jobs through the process
    of job evaluation. Job evaluation is the systematic process of determining the relative
    worth of jobs in order to establish which jobs should be paid more than others within the
    organisation. Job evaluation helps to establish internal equality between various jobs.

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