Strategic HRWeek 1

What is Strategy?

A strategy is something that allows a firm to gain a competitive advantage Competitive Advantage-Superior marketplace

position over other firms Tactics are the means through which firms

accomplish this There are three primary business-level

strategies Cost leadership Differentiation Focus

Generic Strategies

Is HR Strategic?

What makes a function strategic? A function is strategic if it

contributes to firm profitability by providing competitive advantage.

A function is administrative and a cost center if it is concerned mainly with compliance.

So, is HR strategic? Why or why not?

So you think HR is strategic…

How could HR contribute to firm profitability? Competitive advantage Capital▪ Human (people)▪ Tangible (access to resources)▪ Intangible (distribution networks)

Human Capital andStrategy

How do we get a competitive advantage from HR? Through the A-S-A model

The highest level of human capital is not always the objective

The human capital needs of the organization must match the strategy of the organization

Recruitment and Strategy

Recruiting practices should match the strategy of the organization

High human capital needs-Recruit from best sources

Low human capital needs-Recruit from other sources

Recruitment practices should also match selection and retention practices

Selection and Strategy

Selection practices should match the strategy of the organization

High human capital needs-Select on talent (IQ, special skills, etc.)

Low human capital needs-Select on integrity

Retention and Strategy

Retention practices should match the strategy of the organization

High human capital needs-compensation and benefits should be high

Low human capital needs-compensation and benefits should be moderate. Quality of life and commitment should be emphasized

Integration

All HR practices must match Practice bundles, if appropriate,

should lead to a competitive advantage

Tanglewood Case

Form groups Choose well because this will be your

group for the entire semester Get acquainted Read the Tanglewood Case Discuss the issues