Chapter #3
Strategic HRM and the HR Scorecard
HR must develop systems

that support the firm’s
mission statement
–
strategic goals and
direction
–
By hiring, firing, training
etc.
Steps in the Strategic Process
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Step 1
Step 2
Step 3
Step 4
Step 5
Step 6
Vision, mission
SWOT
Translate mission to goals
Formulate strategy to achieve goals
Implement strategy
Evaluate performance
Levels of Strategic Planning
–
Corporate level

Diversification
Vertical integration
Consolidation
Geographic Expansion

Business level
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–
Define competitive advantage
 Cost Leadership – Wal*mart
 Differentiation - Volvo
 Focuser - Ferrari
Strategic Fit

Structure must follow strategy
–
All activities must support strategy
–
Look page #78
HR provides competitive advantage
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Hiring right
Training
Motivating
Inspiring commitment
Policies and practices
HR strategic role cont.

To identify the human issues vital to business
strategy U of Michigan study

HR is a partner not a cost center
–
Study of CEO’s
 HR
execs need strategic skills and
business knowledge!!!!!!!
High Performance Work Systems

Idea is to create HPWS

HR must understand what competencies are
need and know how to train and hire to
acquire them.

LOOK # 85 (Comparing high and low
performance)
The HR Scorecard Approach
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Creates bottom line
value
Measurable
Metrics (quantitative
standards
You must have 3 types of information
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

Know strategic goals
Match employee
behavior to goal
attainment
Must have metrics or
standards to measure
by
Look # 88
Seven Step Approach
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Step 1
Step 2
Step 3
Step 4
Step 5
Step 6
Step 7
- Define business strategy
Outline value chain
Identify outcomes or org. goals
Identify competencies needed
Identify polices, training programs
Design a measuring system
Continually evaluate ( Page # 92)