Managing People Strategically
Lecture & Articles Summary
,Week 1, Lecture 1: Introduction to SHRM
Strategic Human Resource Management - What is it?
SHRM: Pattern of planned HR deployments and activities designed to help an organization
achieve its goals.
Focus: aligning the workforce’s skills and behaviors with the strategic needs of the business.
Ultimate aim: use human capital to achieve sustained competitive advantage.
Difference Between HRM and SHRM?
HRM
1. All activities associated with the management of employment relationships in the firm
2. Management of work and people in organizations
3. An inevitable process that accompanies the growth of organizations
→ HRM is a function and process that is fundamental to every organization
SHRM
1. The pattern of planned human resource deployments and activities intended to an
organization to achieve its goals
2. SHRM aims to align the workforce’s skills and behaviors with the strategic needs of the
business
3. Using human capital to achieve a sustained competitive advantages
→ connects HR directly to the organizational success and long term performance
Delivery of HRM
Shows how HR moves from basic administration to being strategically connected to business
goals. It can be delivered in 2 primary ways:
1. Traditional form of HRM
a. Separate HR activities (hiring, training, pay) with no clear link
b. Focus on daily operations, not long-term goals.
2. Strategic form of HRM
a. HR activities are planned, connected, and support each other
b. All HR work is aligned with the company’s strategy
c. Goal: make HR a source of competitive advantage.
1
,5 Levels (how HR strategy becomes action):
1. HR Strategy → sets direction.
2. HR Policies → give broad rules (how values, principles, strategies are applied)
3. HR Processes → formal procedures to put strategies into effect
4. HR Practices → approaches to manage people (e.g., pay, hiring).
5. HR Programs → enable the implementation of strategies, policies, practices
SHRM = HRM + Strategy →
Competitive Advantage
Vertical fit: HR aligns with
business strategy.
Horizontal fit: HR practices
align with each other.
Goal: integrated,
consistent HR system that
supports company goals.
Result: better performance
& sustained competitive
advantage.
Different Approaches of HRM
SHRM represents the intersection of HRM and strategy. By integrating the two, SHRM seeks to
position human resources as a source of competitive advantage.
1. Contingency Approach: emphasizes the alignment of HR policies with the firm's strategy,
often referred to as achieving a "best fit" or vertical alignment
2. Configurational Theory: highlights the internal consistency of HR practices, known as
horizontal alignment or “bundling,” where practices are related and mutually supportive.
How and When Can People Provide a Form of SCA?
(1) How do human resources contribute to Sustainable Competitive Advantage?
Human resources can drive sustained competitive advantage through two key mechanisms:
1. Human Capital Advantage
a. When your human resource pool has high quality
2
, b. Your workforce is skilled, motivated, and adaptable
2. Human Process Advantage
a. When you have evolved firm processes
i. Your people work effectively together
Both are influenced by HRM practices/Systems
(2) When do human resources contribute to Sustainable Competitive Advantage?
According to the Resource-Based View of the Firm (RBV), competitive advantage arises from a
firm’s unique configuration of internal resources. For human resources to contribute to this
advantage, two conditions must be met:
1. Resources/capabilities can vary considerably across firms (firm heterogeneity)
2. These differences can be stable (resource immobility)
The VRIO Framework provides criteria for
assessing whether resources can sustain
competitive advantage. Resources must
be:
1. Valuable: Contribute to
organizational goals.
2. Rare: Not widely possessed by
competitors.
3. Difficult to Imitate: Not easily
replicated or substituted.
4. Organized: Supported by systems
and structures that enable their
effective utilization.
a. Resources alone insufficient
without effective
organization
b. Importance of systems of management practices
3
Lecture & Articles Summary
,Week 1, Lecture 1: Introduction to SHRM
Strategic Human Resource Management - What is it?
SHRM: Pattern of planned HR deployments and activities designed to help an organization
achieve its goals.
Focus: aligning the workforce’s skills and behaviors with the strategic needs of the business.
Ultimate aim: use human capital to achieve sustained competitive advantage.
Difference Between HRM and SHRM?
HRM
1. All activities associated with the management of employment relationships in the firm
2. Management of work and people in organizations
3. An inevitable process that accompanies the growth of organizations
→ HRM is a function and process that is fundamental to every organization
SHRM
1. The pattern of planned human resource deployments and activities intended to an
organization to achieve its goals
2. SHRM aims to align the workforce’s skills and behaviors with the strategic needs of the
business
3. Using human capital to achieve a sustained competitive advantages
→ connects HR directly to the organizational success and long term performance
Delivery of HRM
Shows how HR moves from basic administration to being strategically connected to business
goals. It can be delivered in 2 primary ways:
1. Traditional form of HRM
a. Separate HR activities (hiring, training, pay) with no clear link
b. Focus on daily operations, not long-term goals.
2. Strategic form of HRM
a. HR activities are planned, connected, and support each other
b. All HR work is aligned with the company’s strategy
c. Goal: make HR a source of competitive advantage.
1
,5 Levels (how HR strategy becomes action):
1. HR Strategy → sets direction.
2. HR Policies → give broad rules (how values, principles, strategies are applied)
3. HR Processes → formal procedures to put strategies into effect
4. HR Practices → approaches to manage people (e.g., pay, hiring).
5. HR Programs → enable the implementation of strategies, policies, practices
SHRM = HRM + Strategy →
Competitive Advantage
Vertical fit: HR aligns with
business strategy.
Horizontal fit: HR practices
align with each other.
Goal: integrated,
consistent HR system that
supports company goals.
Result: better performance
& sustained competitive
advantage.
Different Approaches of HRM
SHRM represents the intersection of HRM and strategy. By integrating the two, SHRM seeks to
position human resources as a source of competitive advantage.
1. Contingency Approach: emphasizes the alignment of HR policies with the firm's strategy,
often referred to as achieving a "best fit" or vertical alignment
2. Configurational Theory: highlights the internal consistency of HR practices, known as
horizontal alignment or “bundling,” where practices are related and mutually supportive.
How and When Can People Provide a Form of SCA?
(1) How do human resources contribute to Sustainable Competitive Advantage?
Human resources can drive sustained competitive advantage through two key mechanisms:
1. Human Capital Advantage
a. When your human resource pool has high quality
2
, b. Your workforce is skilled, motivated, and adaptable
2. Human Process Advantage
a. When you have evolved firm processes
i. Your people work effectively together
Both are influenced by HRM practices/Systems
(2) When do human resources contribute to Sustainable Competitive Advantage?
According to the Resource-Based View of the Firm (RBV), competitive advantage arises from a
firm’s unique configuration of internal resources. For human resources to contribute to this
advantage, two conditions must be met:
1. Resources/capabilities can vary considerably across firms (firm heterogeneity)
2. These differences can be stable (resource immobility)
The VRIO Framework provides criteria for
assessing whether resources can sustain
competitive advantage. Resources must
be:
1. Valuable: Contribute to
organizational goals.
2. Rare: Not widely possessed by
competitors.
3. Difficult to Imitate: Not easily
replicated or substituted.
4. Organized: Supported by systems
and structures that enable their
effective utilization.
a. Resources alone insufficient
without effective
organization
b. Importance of systems of management practices
3
