Strategic Human
Resource
Management
Chapter 1
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-1
1. Discuss the objectives of human resource
management.
2. Identify steps in the strategic management of
human resources.
3. Explain how human resource departments are
organized and how they function.
4. Discuss the role of human resource professionals in
today’s organization.
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-2
HRM is the leadership and management of people
within an organization using systems, methods,
processes, and procedures that identify, select,
motivate, and enable employees to achieve outcomes
individually and collectively that enhance their
contribution to the organization’s goals.
HRM supports and enables organizations to:
•
Meet short and long-term economic, social, and
environmental goals
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-3
The Interconnectivity of Human
Resource Management Activities
Schwind 13th Edition, Figure 1-1
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-4
Strategic Human Resource Management
• The process of integrating the strategic needs of an
organization into the choice of HR systems and
practices to support the overall mission, strategies,
and performance
• The choice of HR tools will depend on what the
organization is trying to achieve
• HR activities must align with and contribute to the
organization’s strategies
• Each HR practice should generate value for the
organization
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-5
A Model of Strategic HRM
Five Steps
1. Organizational Mission, Goals,
and Strategy Analysis
2. Environmental Scan
3. Analysis of Organizational
Character and Culture
4. Choice and Implementation of
Human Resource Strategies
5. Review, Education and Audit
of Human Resource Strategies
© 2022 McGraw Hill Ltd.
Schwind 13th Edition, Figure 1-2
Schwind 13th Edition 1-6
Step 1: Organizational Mission, Goals, and
Strategy Analysis
Mission statement
•
Statement outlining the purpose, long-term objectives, and
activities the organization will pursue and the course for
the future
•
The organization’s goals outline what specifically the
organization seeks to achieve in a given time period,
which impacts its HR practices
•
The organization’s strategies determine the
appropriate array of HR practices
•
HR strategies enable the successful completion of the
organization’s strategies
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-7
Step 2: Environmental Scan
Continuous monitoring of economic,
technological, demographic, and cultural forces
The major forces:
1.
2.
3.
4.
5.
Economic
Technological
Demographic
Cultural
Legal
Schwind 13th Edition, Figure 1-3
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-8
Four Critical Economic Forces
1.
2.
3.
4.
Economic cycles
Global trade
Productivity and innovation improvement
Knowledge workers
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-9
Economic Force: Economic Cycles
Canadian economy goes through boom and bust
cycles
•
Often linked to other economies
During recessionary periods, HR faces challenges
•
Layoffs, wage concessions, lower morale
During boom cycles, HR must consider
•
How to recruit and develop talent
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-10
Economic Force: Global Trade
• International trade has always been crucial
to Canada’s prosperity and growth
• Canada ranks high among exporting nations
• Canadian jobs and economic prosperity
depend upon international trade
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-11
Economic Force: Global Trade Cont’d
How Competitive is Canada Compared to Other Nations?
Schwind 13th Edition, Figure 1-4
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-12
Economic Force: Productivity
and Innovation Improvement
• Productivity: Ratio of an organization’s outputs to its inputs
• Productivity improvement is essential for long-term success
• For over a decade, U.S. productivity has been consistently
outpacing Canada
• Without innovation, productivity differences tend to
increase
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-13
Economic Force:
Knowledge Workers
• Extractive industries
(e.g., mining and fishing)
have decreased
• Industries relying on
knowledge workers
(e.g., education, health
care, tourism, trade, public
administration) have
increased
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-14
Three Critical Technological
Forces
1. Connectivity and work design
2. Automation
3. Data and analytics
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-15
Technological Force:
Connectivity and Work Design
Connectivity influences organizations and the way
people work
•
Changed the way we work, play, study, and entertain
ourselves
•
Access to information has affected the way
organizations conduct business
Technology has brought flexibility
•
When and where work is carried out (e.g., telecommuting)
•
Increased cybersecurity concerns
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-16
Technological Force: Automation
Organizations automate to:
•
•
•
•
•
Increase speed
Provide better service
Increase flexibility
Increase predictability in operations
Achieve higher standards of quality
May use robots to replace boring or hazardous jobs
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-17
Technological Force: Data and
analytics
• The role of data and analytics have shifted due to
AI/ML and rapidly increasing computing power
• Intranets and integrated information systems help
store and access information quickly and accurately
• Information management systems capturing digital
information about employees give rise to human
resource data analytics
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-18
Four Critical Demographic Forces
1.
2.
3.
4.
Gender balance
Educational attainment of workers
Aging population
Generational shift
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-19
Demographic Force:
Gender Balance
• 47% of the workforce assigned female at birth
(2020)
• Participation rate of biologically female in health
care and professional, scientific, and technical
services continues to grow
• More women than men work part-time
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-20
Demographic Force:
Educational Attainment of Workers
© 2022 McGraw Hill Ltd.
Schwind 13th Edition, Figure 1-8
Schwind 13th Edition 1-21
Demographic Force: Aging Population
Average age of the workforce is increasing
•
Impending “old age crisis”
© 2022 McGraw Hill Ltd.
Schwind 13th Edition, Figure 1-9
Schwind 13th Edition 1-22
Demographic Force:
Generational Shift
•
Although the differences within groups may be wider than the
differences between groups, some managers find benefit through
understanding that not all generations view the world through
the same lens that they do
•
Baby Boomers, Generation X, Generation Y (Millennials), and
Generation Z and soon Generation Alpha, are all in the workforce
•
Different people have different expectations from their
workplaces
•
Generational diversity creates an interpersonal dynamic for all
leaders
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-23
Two Critical Cultural Forces
1. Diversity and social justice
2. Ethics
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-24
Cultural Force: Diversity and
Social Justice
• Canadian society is a cultural mosaic
• Canada encourages maintaining unique culture and
heritage vs. U.S. “melting pot”
• Continued inequalities articulated by social justice
advocates for Indigenous, Black, and other
racialized people of colour attributed to systemic
bias
• Social justice has become central to diversity,
equity, and inclusion initiatives in the workplace
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-25
Cultural Force: Ethics
• Ethical conduct of business is becoming an
increasingly important issue
• Managers should understand ethical perspectives
and consider ethical implications
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-26
Step 3: Analysis of Organizational
Structure and Culture
Human resource strategies should be formulated only
after a careful look at the organization’s structure
•
Employees, objectives, technology, size, age, unions,
policies, successes, failures
Structure reflects the past and shapes the future
Each organization has a unique culture
•
Core beliefs and assumptions that are widely shared by
all organizational members
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-27
Step 4: Choice and Implementation
of Human Resource Strategies
There should be a
clear line of sight
between HR strategy
and corporate goals
Schwind 13th Edition, Figure 1-10
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-28
Step 4: Choice and Implementation
of Human Resource Strategies
HR must continuously focus on the following activities:
1. Identifying opportunities, risks, and challenges
2. Making data-informed decisions aligned to strategy
3. Optimizing for high performance
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-29
Step 5: Review, Evaluation, and
Audit of Human Resource Strategies
•
•
•
HR Strategies should be examined periodically in
consideration of changing factors (e.g., technology, environment)
A holistic review of HR strategies with the intention of
identifying and correcting deficiencies is called a human
resource audit
Human resource activities aimed at productivity
improvement, succession planning, and cultural change
are critical to competitive survival
Schwind 12th Edition, Figure 1-12
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-30
The Organization of HRM
HR Department in a small organization
• Separate HR department emerges when HR
activities becomes a burden
• Often emerges as a small department or
individual reporting to a middle-level manager
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-31
The Human Resource
Department in a Small Organization
Schwind 13th Edition, Figure 1-12
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-32
The Organization of HRM
Large HR Department
• As the organization grows, the HR department
usually grows in impact/complexity
• Specialists are added
• Vice President title
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-33
A Large Human Resource
Department
Schwind 13th Edition, Figure 1-13
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-34
The Service Role of the HR
Department
Staff authority
•
•
HR departments are service departments
Authority to advise, not direct
Line authority
•
Possessed by managers of operating departments (i.e.,
authority to make decisions)
Functional authority
•
HR department may be provided authority to make
decisions (e.g., deciding type of benefits)
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-35
Today’s HR Professional
Enormous growth in the number of HR managers
•
HR had been slow to evolve into a profession
Competencies for HR Managers:
•
Strategy; engagement; labour and employee relations; learning and
development; human resource metrics, reporting, and financial
management; professional practice, workforce planning, and talent
management; health, wellness, and safe workplaces; and total
rewards
The nationally recognized designation in HR is called the CPHR
(Chartered Professional in Human Resources) for all Canadians
except in Ontario, which has the Certified Human Resources
Professional (CHRP) designation
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-36
1
Strategic Human Resource Management
Summary
After mastering this chapter content, you should be able to:
1. Discuss the objectives of human resource management.
2. Identify steps in the strategic management of human
resources.
3. Explain how human resource departments are organized
and how they function.
4. Discuss the role of human resource professionals in today’s
organization.
© 2022 McGraw Hill Ltd.
Schwind 13th Edition 1-37