Business

Strategy

& HRM

Corporate strategy
The direction and scope of an
organisation over the long term, which
achieves competitive advantage for
the organisation through its
configuration of resources within a
changing environment and to fulfil
stake holder expectations
Johnsons and Scholes

The three levels

Corporate: relates to the over all
scope of the organisation
Competitive:
how the organisation
is to
compete in the given market
Operational: how the various sub units
contribute to the higher level
strategies

Whittingtons topology of
strategy Processes
Deliberate
Classical

Systemic

Outcomes
Profit Maximising

Pluralistic

Evolutionary

Processual

Emergent

Classical
Strategy portrayed as a
rational process of deliberate
calculation and analysis,
undertaken by senior
managers

Evolutionary
Strategy seen as a product of
market forces in which the
most efficient and productive
organisations win through

Processual
Strategies tend to evolve
through the process of
discussion and disagreements
that involves managers at
different levels in an
organisation

Systemic
Strategy is shaped by the
social system in which it is
embedded factors such as
class, gender and legal
environment and choices are
influenced by interests of a
broader society

Linking

Strategy & HRM

Life cycle models

MATURITY
GROWTH
START UP

DECLINE

Life cycle models

Flexibility necessary
For growth and development and
commitment to entrepreneurialism

Emphasis on flexible working pattern

Recruit and retain staff with the
motivation to work long hours

START UP

Employees encouraged to look

forward to potential benefits

Life cycle models

Formal policies emerge to manage
size and build on earlier success
Retain expertise and ensure earlier
levels of commitment are maintained
Need for specialist
GROWTH becomes apparent
HR policies formalised to
avoid the danger of
inability to address
grievance and discipline

Life cycle models

Surpluses level out
Procedures formalised
Control labour costs
Reduced t&d activities
Positive psychological
contract challenging
Focus on productivity
and staff made to move
around and out

MATURITY

Life cycle models

Business struggling to survive
Emphasis shift to rationalisation and redundancy

Policies and procedures reconsidered

Specialist HR function disbanded
Focus on re-skilling & outplacement
Increasing tendency to contract out
services

DECLINE

Competitive advantage
model
PRACTICES
Resources

STRATEGY

Cost reduction

Learning &
development

Quality
enhancement

Reward
management

Innovation

HR function

HRM & the resource

based view
It

is the range of resources including

human, that gives each organisation it
unique character and may lead to
differences in competitive performance
Organisations obtain sustained
competitive advantage by
implementing strategies that exploit
their internal strength and neutralise
external threats

HRM& RBV
Potential

for sustained competitive

advantage requires four specific attributes
Value resources adding value in some way
Rarity shortage of these particular
resources
Imperfect imitability unable to imitate or
copy
lack of substitutes not easily substitutable

Finally
Competitively advantageous equipment
can be designed and continuously
improved only if the workforce is highly
skilled.
Continuous education is attractive only if
employees are willing to learn.
Sending workers throughout the world to
garner ideas is cost effective only if they
are empowered to apply what they have
learned to organisational problems.