Alignment of HRM and Business Strategies Essay
Human resource strategy refers to the human capability of an organization to meet the future needs of its external and internal environment (Dhar, 2008). HR strategy may be planned, emergent, or a combination of the two. The concept of strategic human resource management is predicated on the belief that human resource strategies should be integrated with business strategies. For this relationship to exist, it is necessary to ensure that management initiatives in the field of HRM are consistent with those decisions taken in other functional areas of the business. HRM strategies should also be consistent with the analysis of the product-market situation. The key is to make operational the concept of fit. That is, the fit of human resource of management with the strategic thrust of the organization (Ulrich, Losey, & Miesinger, 2005). Congruence of HRM and business strategies means aligning HR strategies to the strategic orientation of the firm. Different orientations establish the need for different types of people and require changes in approaches to investing in the organizational human capital. In any organization, the core responsibility of the HR is to formulate HRM strategies that correspond with the business’s central principles (Dhar, 2008).
How to Ensure Hr Strategy Is In Alignment with the Business Strategy
A fundamental requirement in developing HR strategy is that it should be in alignment to the business strategy and should fit the organizational culture (Wang & Shyu, 2008). The approaches to the development of HR strategies are configurational, contingency, and universalistic policies. The starting point in the formulating HR strategy that is in alignment with the business strategy involves consultative decision making between the top management and the HR. The management does not usually involve the HR in formulating business strategies (Wang & Shyu, 2008). Therefore, it is the duty of the HR to constantly approach the management concerning both short term and long-term objectives of the business. The existing business strategies must be internalized within the HR making it the culture of the organization. Hereby, the HR system of recruitment, training and development, and business operations should be directly proportional with business’s set objectives. The HR should constantly sensitize the employees on the direction of business in the organization. In this way, they are focused on giving out that which meets these objectives (Wang & Shyu, 2008).
HR Job Positions and the Responsibilities
Ford Motor Company is an international organization that deals in the manufacture and assembly of Ford-make vehicles (Ford Motor Company, 2014). Business at Ford Motor Company has been a success thanks to the competitive marketing processes, ideal leadership, and favorable HR strategy that is in alignment with the business’s policies. The different positions for the company’s HR department are (Raduan and Naresh, 2006):
- Learning and Development. This position involves training employees on the company’s business processes, seeking for new skills and techniques of business operation, and imparting them on the workers.
- HR Strategy. This role involves the formulation of HR policies and adjusting them to the business’s strategies. It involves consultative duties with the top management.
- Personnel Relations. This role is responsible for ensuring candid relationships between all the workers in the organization. It involves arbitrating on any differences or conflict of interest among the employees.
- Organization Development. This role is responsible for the general growth of the business. It ensures that the performance of employees is in line with the long-term growth objectives of the business.
- Workforce Planning and Recruiting. This position is responsible for the workforce recruitment processes. It also involves duty allotment among qualified employees.
- This position keeps a database of employee benefits such as pensions, allowances, national hospital funds, and performance incentives.
- This position is responsible for the management of the payroll.
- Business operations. This position ensures that the different departments of the business are working efficiently in a cost effective manner. It is responsible for the distribution and sales of the company’s products. It conducts promotional activities for new vehicle models.
- Labor Relations. This position is responsible for maintaining a good relationship with trade unions and all external workers organizations.
At Ford Motor Company, I would prefer a position in the Organization Development and HR Strategy departments. These are the most important roles not only in the human resource management but also to the whole organization. Personnel at the Organization Development department oversee the key growth strategies in the business in relation to its competitors (Ford Motor Company, 2014). This would be a good position to work in since it provides the market exposure necessary for a professional to succeed in a competitive labor market. A position in HR Strategy improves one’s decision making skills (Gilmore & Williams, 2012).
Establishing HRM Strategies to Improve Competitive Advantages
Key HRM policies and practices have been linked to competitive advantage (Blount, Castleman, & Swatman, 2005):
- Communication and corporate responsibility.
- This entails both internal and external resourcing and involves providing employee training and managing outflows.
- Organizational structure and control.
- Promoting diversity and an equality culture.
Investment on research and development would be an exclusive strategy by the HR at Ford Motor Company towards improving competitive advantage. Innovation is the major factor that will contribute to the establishment of competitive advantage at Ford Motor Company. Innovation oriented strategies leads to cost reduction, improved customer service, productivity gains, and product and service differentiation. These are all variables of innovation (Raduan and Naresh, 2006).
Increasing Diversity at Ford Motor Company
Increasing diversity at an international company like Ford Motor Company should be a core principle for the HR department. A diversified company is that which accommodates different characteristics possessed by different people in the labor market. Its recruitment process should crosscut all races, denominations, and creed. Further, it should employ a workforce with global experience. Diversity also entails involving external labor unions to represent interests of the employees. However, Ford Motor Company is an established organization whose HRM fully understands market operations and the strategies that would improve the company’s competitive advantage (Gilmore & Williams, 2012).
Blount, Y., Castleman, T., & Swatman, P. M. C. (2005). E-Commerce, Human Resource Strategies, and Competitive Advantage: Two Australian Banking Case Studies. International Journal of Electronic Commerce, 9(3), 74-89. Retrieved, 20 January 2014. <http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.135.2374&rep=rep1&type=pdf>.
Dhar, R. L. (2008). Strategic human resource management. New Delhi, India: Excel Books.
Ford Motor Company. (2014). Web, accessed 20 January 2014. <http://corporate.ford.com/careers/career-paths/human-resources?
Gilmore, S., & Williams, S. (2012). Human resource management. Oxford: Oxford University Press.
Raduan Che Rose, and Naresh Kumar (2006). The influence of organizational and human resource management strategies on performance. Performance Improvement, 45(4), 18-24. Retrieved, 20 January 2014. <http://www.performancexpress.org/wp-content/uploads/2011/10/Vol45_04_18.pdf>.
Ulrich, D., Losey, M. R., & Miesinger, S. (2005). The future of human resource management: 64 thought leaders explore the critical HR issues of today and tomorrow. Hoboken, N.J: Wiley.
Wang, D.-S., & Shyu, C.-L. (2008). Will the strategic fit between business and HRM strategy influence HRM effectiveness and organizational performance? International Journal of Manpower, 29(2), 92-110. Retrieved, 20 January 2014. <http://ir.ncue.edu.tw/ir/bitstream/987654321/12746/1/2030200310004.pdf>.
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