HR STRATEGY
MANA 3320
Dr. Jeanne Michalski
Strategic Planning and Human
Resources



Strategic Planning
Human Resources Planning (HRP)
Strategic Human Resources Planning
Mission, Vision, and Values



Mission
 The basic purpose of the organization as well as
its scope of operations
Strategic Vision
 A statement about where the company is going
and what it can become in the future; clarifies
the long-term direction of the company and its
strategic intent
Core Values
 The strong and enduring beliefs and principles
that the company uses as a foundation for its
decisions
HR Alignment
Employee
Relations
Compensation
Performance
Management
Planning and
Job Design
Recruiting and
Selection
Training and
Development
HR Alignment
Employee
Relations
Compensation
Planning and
Job Design
INTERNAL
FIT
Performance
Management
Recruiting and
Selection
Training and
Development
HR Alignment
Employee
Relations
Compensation
Planning and
Job Design
INTERNAL
FIT
Performance
Management
Recruiting and
Selection
Training and
Development
Business Strategy

Value Creation


What the firm adds to a product or service by virtue
of making it; the amount of benefits provided by the
product or service once the costs of making it are
subtracted (value = benefits — costs).
Low-cost strategy: competing on productivity and
efficiency


Keeping costs low to offer an attractive price to customers
(relative to competitors).
Differentiation strategy: compete on added value

Involves providing something unique and distinctive to
customers that they value.
How do they compete?




Wal-Mart
Apple
McDonald’s
Starbucks
McDonalds’ vs. Starbucks
“To Woo Europeans, McDonald’s Goes Upscale”
McDonald’s in London
NYT August 25, 2007
McDonald’s Goes Upscale




Aiming to create a more relaxed experience in a sophisticated atmosphere,
McDonald’s is replacing bolted-down plastic yellow-and-white furniture with
lime-green designer chairs and dark leather upholstery.
The changes are more than cosmetic. McDonald’s is introducing healthier
foods and items that cater to regional tastes, like caffè lattes.
Hoping to attract more young adults and professionals, the chain is also
adding amenities like Internet access and rental iPods.
The original impetus for the makeover was a European sales slump in the
late 1990s, brought on by concerns about obesity and annoyance at
unappealing décor and grumpy employees.
Competitive Advantage
Technological
Capability
Competitive Advantage
Technological
Cap
Capability
Financial
Capability
Competitive Advantage
Technological
Capability
Financial
Capability
Marketing
M
Capability
Competitive Advantage
Technological
Capability
Financial
Capability
Organizational
o
Capability
Marketing
M
Capability
FIGURE
2.1
Linking Strategic Planning and Human Resources
© 2010 South-Western,
a part of Cengage
Learning. All rights
reserved.
2–16
Model of HR Forecasting
HR Planning
How many people do we need?


Product Demand X Labor Productivity
Turnover
Where are they coming from?

Internal Labor Market


Succession Planning
External Labor Market

Recruiting and Selection
Forecasting: A Critical Element
of Planning

Forecasting involves:
a.
b.
c.
forecasting the demand for labor
forecasting the supply of labor
balancing supply and demand considerations.
Demand
Forecasting Labor Requirements
Internal
External
What do we have?
What will be out there?
Skills inventory
Succession plans
Statistical modeling
Labor Market Statistics
and Forecasts
What will we need?
JOB ANALYSIS
How many will we need?
Who else will need
them?
Managerial estimates
Statistical modeling
Competitive Analysis
Quantitative Approach: Trend
Analysis

Forecasting labor demand based on an
organizational index such as sales:
1.
2.
3.
4.
5.
Select a business factor that best predicts human resources
needs.
Plot the business factor in relation to the number of
employees to determine the labor productivity ratio.
Compute the productivity ratio for the past five years.
Calculate human resources demand by multiplying the
business factor by the productivity ratio.
Project human resources demand out to the target year(s).
Trend Analysis of HR Demand
BUSINESS
FACTOR
YEAR

(SALES IN THOUSANDS)
LABOR
PRODUCTIVITY
(SALES/EMPLOYEE)
=
HUMAN RESOURCES
DEMAND
(NUMBER OF EMPLOYEES)
2002
$2,351
14.33
164
2003
$2,613
11.12
235
2004
$2,935
8.34
352
2005
$3,306
10.02
330
2006
$3,613
11.12
325
2007
$3,748
11.12
337
2008
$3,880
12.52
310
2009
$4,095
12.52
327
2010*
$4,283
12.52
342
2011*
$4,446
12.52
355
*Projected figures
Qualitative Approaches

Management Forecasts


The opinions (judgments) of supervisors, department
managers, experts, or others knowledgeable about
the organization’s future employment needs.
Delphi Technique


An attempt to decrease the subjectivity of forecasts
by soliciting and summarizing the judgments of a
preselected group of individuals.
The final forecast represents a composite group
judgment.
Forecasting the Supply of
Employees:
Internal Labor Supply





Staffing Tables
Markov Analysis
Skill Inventories
Replacement Charts
Succession Planning
Forecasting Internal Labor
Supply

Staffing Tables


Graphic representations of all organizational jobs,
along with the numbers of employees currently
occupying those jobs and future (monthly or yearly)
employment requirements.
Markov Analysis

A method for tracking the pattern of employee
movements through various jobs.
Hypothetical Markov Analysis for a Retail Company
Internal Demand Forecasting
Tools

Skill Inventories


Replacement Charts


Files of personnel education, experience, interests,
skills, etc., that allow managers to quickly match job
openings with employee backgrounds.
Listings of current jobholders and persons who are
potential replacements if an opening occurs.
Succession Planning

The process of identifying, developing, and tracking
key individuals for executive positions.