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Human Resource


Part 1 | Introduction

Chapter 3

Strategic Human Resource Management

and the HR Scorecard

2008 Prentice Hall, Inc. PowerPoint Presentation by Charlie Cook

All rights reserved. The University of West Alabama
After studying this chapter, you should be able to:

1. Outline the steps in the strategic management

2. Explain and give examples of each type of
companywide and competitive strategy.
3. Explain what a strategy-oriented human resource
management system is and why it is important.
4. Illustrate and explain each of the seven steps in the
HR Scorecard approach to creating human resource
management systems.

2008 Prentice Hall, Inc. All rights reserved. 32

The Strategic Management Process
Strategic Management
The process of identifying and executing the
organizations mission by matching its capabilities
with the demands of its environment.
A chosen course of action.
Strategic Plan
How an organization intends to balance its internal
strengths and weaknesses with its external
opportunities and threats to maintain a competitive
advantage over the long-term.

2008 Prentice Hall, Inc. All rights reserved. 33

Business Vision and Mission
A general statement of an organizations intended
direction that evokes emotional feelings in
organization members.
Spells out who the company is, what it does, and
where its headed.

2008 Prentice Hall, Inc. All rights reserved. 34

Types of Strategies


Vertical Geographic
Diversification Consolidation
Integration Expansion
Strategy Strategy
Strategy Strategy

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Types of Strategies (contd)


Cost Leadership Differentiation Focus/Niche

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Achieving Strategic Fit
The Fit Point of View (Porter)
All of the firms activities must be tailored to or fit
the chosen strategy such that the firms functional
strategies support its corporate and competitive
Leveraging (Hamel and Prahalad)
Stretch in leveraging resourcessupplementing
what you have and doing more with what you have
can be more important than just fitting the strategic
plan to current resources.

2008 Prentice Hall, Inc. All rights reserved. 37

Strategic Human Resource Management
Strategic Human Resource Management
The linking of HRM with strategic goals and
objectives in order to improve business performance
and develop organizational cultures that foster
innovation and flexibility.
Involves formulating and executing HR systemsHR
policies and activitiesthat produce the employee
competencies and behaviors that the company needs
to achieve its strategic aims.

2008 Prentice Hall, Inc. All rights reserved. 38

Strategic Human Resource Challenges

Basic Strategic

Corporate Expanded role of

Increased HR
productivity and employees in the
team involvement
performance organizations
in design of
improvement performance
strategic plans
efforts efforts

2008 Prentice Hall, Inc. All rights reserved. 39

Human Resource Managements
Strategic Roles


Strategy Strategy
Execution Formulation
Role Role

2008 Prentice Hall, Inc. All rights reserved. 310

Creating the Strategic Human Resource
Management System

Components of a
Strategic HRM System

Human Resource Employee

Human Resource
Policies and Behaviors and
Practices Competencies

2008 Prentice Hall, Inc. All rights reserved. 311


strategic plan
strategic management
SWOT analysis
strategic control
competitive advantage
strategic human resource management
HR Scorecard
value chain analysis

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Creating an HR Scorecard

The 10-Step HR Scorecard Process

Identify required HR policies

1 Define the business strategy 6
and activities

2 Outline value chain activities 7 Create HR Scorecard

Choose HR Scorecard
3 Outline a strategy map 8
Identify strategically required Summarize Scorecard
4 9
outcomes measures on digital dashboard
Identify required workforce
5 10 Monitor, predict, evaluate
competencies and behaviors

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