Human Resource Management & Strategic Alignment

This assignment delves into the crucial relationship between Human Resource Management (HRM) and strategic business goals. It examines various theoretical frameworks like the resource-based view and VRIO model to understand how HRM practices contribute to competitive advantage. The analysis also encompasses performance management systems and their role in aligning employee efforts with organizational objectives. The provided research papers offer insights into these concepts and their practical implications for businesses.

Strategic Human
Resource Management

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
CONCLUSIONS............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Strategic human resource management is the practice of hiring, developing, rewarding
and retaining employees for the benefit of individual that is workers' and whole organisation.
The best method to understand SHRM is to compare it with the human resource management.
The functions of HRM are limited up to recruiting and developing whereas SHRM involves
working with employees in collaborative manner that can enhance the mutual advantages for
both the employee and the employer (Kull, Mena and Korschun, 2016). This report will describe
the theoretical basis, models and practices of SHRM. The main objective of this study is to
provide business leaders with a deep understanding and thorough knowledge of strategies to
shape, structure debate and assist their decision making while developing an effective strategy by
human resource management. Further, to achieve the desired aim of promoting understanding of
theoretical basis, performance management and reward, some considerations will be made such
as managing the employee relation.
The organisation selected for the promotion of SHRM is Morrisons, a retail industry. The
entity is serving the people of UK by 500 stores. Also, it provides its services and products
online for the convenience of consumers. Thus, in order to manage such a large group and to
achieve the desired business goals, it is necessary for it to follow effective SHRM.
MAIN BODY
Every business requires effective HR strategies to ensure their success by attaining the
desired objectives. The main motive of linking organisation with HRM is to get sustained
competitive advantage that can face the rapid changes in the business environment. Thus, it is
necessary for Morrison to link the organisation with best HR policies. The basic postulate behind
the management of human resource is that the entity can adopt a specific policy for managing the
workforce along with the objective of business (Oppong, 2017). There are different models
which can assist in creating relationship between the entity and the human resource strategies.
According to separation model, there is no link between HR strategies and business. further, it
explains that the success of an organisation is independent of the roles of human resource
policies. This model is totally fail and doesn't match the requirements of selected organisation.
Whereas in context to the fir model, HR functions responds by defining a strategy that meets the
demand of organisation. Besides this, dialogue model focuses on two-way communication that is
it recognises the demand of the organisation. If the strategy of organisation is not observed to be
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feasible then HRM can propose alternatives. In contrary to this, people are considered as
competitive advantage in Holistic theory. In this model, business strategies also covers some
other policies along with the HRM. At last, in HR driven model strategies proposed by human
resource are the kept at the prime position in the entity.
Out of all the explained approaches to human resource strategies, the most suitable for
the Morrisons is the Holistic theory. In this the strategies of business and HR are operated
together in a single direction. Also, there are some other schemes too which are involved in the
entity rather than the HR which helps in getting the desired outcomes in a more stipulated time
frame (De Spiegelaere, Van Gyes and Van Hootegem, 2016). The theory which is increasingly
popular as the Six sigma business strategy aims on the overall development of the organisation
that can help it in getting competitive advantage. Also, when HRM added to this model than it
emphasise on the internal factors too that ensures the profitability of the firm. This approach
focuses on running business on full potential as opposed to simple have strong areas and weak
areas, hence a comprehensive evaluation of the performance is gained.
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Illustration 1: Link between business and HR strategies
Source: Bromiley and Rau, 2016

There are various benefits of using it in the firm. With the help of holistic model,
Morrisons can reduce its costs by implementing a single system. This model is closely linked
with the system approach. In this, the whole functional and operational units of the entity unites
together which prevents additional cost with the maintenance of numerous departments. Besides
this, it aids in optimise inventory by establishing flexible capacities. Furthermore, it helps in
simplifying the complexness of structure by integrating all of them. The biggest advantage of
implementing this model in organisation is that it consumers less time and thus, five prompt
results that can boost up the performance. It may however be recognised that like other
approaches, holistic model also have some drawback such as integration of different units may
sometime results in rising of conflicts. Also, as both organisational and HR strategies are
dependent of each other and hence, if some negative results obtained in any of them it will affect
the other too.
SHRM estates the linking of practices of human resource management with the strategic
direction process of the organisation. There are three theoretical basis to support the
implementation of SHRM in Morrisons. These approaches includes the, "one best way" of
managing HRM, "the need to align" employment policies and practices with the needs of
business strategy and "Resource based view"(Saha and et.al., 2016).
Firstly, it is required to have an effective way of managing the practices of HRM. This set
of strategies are needed to enhance the level of employee commitment and performance to the
Morrisons. These practices are effective for the employer as they yield higher performance than
tradition practices of employment and the employees' can focus on development and motivation.
SHRM model of high performance emphasises on the profitability, innovations, labour
productivity and employee turnover. According to the Zehir and et.al. (2016 ), high commitment
model leads to excellent outcomes of organisational performance irrespective of the context in
which the entity operates. Also, competitive strategies of the firm can not affect the superior
results of high involvement of employees. In addition to this, SHRM ensures performance
management by the planning, monitoring and reviewing the efforts made by individual
employees.
To best understand the significance of the requirement of high-commitment -or high-
involvement or high-motivation, (Gao, Zhou and Wu, 2016) described a model high-
performance work practices (HPWPs). They are the human resource management practices that
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focuses on increasing the performance of workers. This is the most widespread tool that involves
degree of control to employees such as involvement in various programmes, team based works,
enhanced training and development. Qamar and Asif, (2016) described the importance of
engaging workers in different activities that can boost their motivation and commitment towards
work. These HRM practices which are required to be perform to boost up the engagement of
employee includes recruiting the right people at the right time on the right place. Besides this, it
emphasis on the security of the employment of labours. hey further aims on high wages,
incentives, better training sessions, etc. Some major examples of HPWPs involves use of
psychometric and validated employee selection tool, previews of realistic jobs, continuous
mentoring and leadership development strategies, programmes for suggestions of employee, etc.
Also, payment to the workers should done on the basis on their competence and performance.
David Guest model, proposed in 1989 is based on four major policies of human resources
which includes strategic integration, commitment, flexibility and quality. In order to achieve the
desired organisational outcome, Morrisons should ensure full integration of HTM into strategies
planning (Brunetti and et.al., 2017). Also, HRM policies should be coherent and line managers
should share the responsibility. Behaviour of HRM team also plays a major role in making
employees feel that they are bound with the organisation which will impact positively on their
performance. Training and development are the elements that helps employees in personal and
professional growth by enhancing their skills. Besides this, it helps in making them adaptable to
the structure of the entity. Lastly, Morrisons can boost the overall performance by providing high
quality services through highly skilled, flexible, and committed employees. By
implementing David Guest Model in the practices, Morrisons can have high job performance,
problem solving skills, change innovation, cost effectiveness, low employee turnover, etc.
However, (Seo, Park and Choi, 2016) argued the statement and explained some limitation of the
model. The model lacks in describing a specific HR practice will results in the high commitment.
Further, flexibility and commitment sometimes don't fit together.
In addition to this, Henry and Pettigrew proposed Warwick model which is quite similar
to the other human resource management models. It centres around five fields: outer or macro
environmental factors, internal or micro forces, business strategy content and HRM context and
content. This model aims on the activities of HR and the process by which they take space. The
major function of applying this theory in the business policies is to identify the different factors
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that impact upon the organisation (Kull, Mena and Korschun, 2016). Also, this is a helpful tool
in establishing relationship between the internal and external environmental factors which
Morrisons can adopt to ensure proper performance and growth. However, it may be recognised
that this technique does not enhance the employee performance directly and hence, is less
effective.
Later, Harvard framework was produced that sits between the universalist and the fit
approach. According to this model, interests of different stakeholders impacts on the behaviour
and performance of employee. This theory is more focused on the situations rather than
preparation of strategies to shape HR choices. This tool is a soft approach to HRM which
believes that business strategy should not depends ion any other factor instead they should help
in dealing with the competitive environment and with the current conditions of market it faces.
Morrisons can make use of this model in increasing their organisational structure. Lioukas,
Reuer and Zollo (2016), claimed this model to be more comprehensive as it covers six critical
components of human resource management. These are the stakeholders, interests, situational
factors, HRM policy, outcomes, long-term consequences and feedback.
Firstly, the interest of stakeholders helps entity in development of the strategies that
concentrates on all the elements which are associated with the firm. They are shareholders,
management, employees, government and community. All of them are included in the planning
of policies. The major areas or policies outlined by this theory includes the human resource
flows, reward system, employee influence and work systems. The outcomes of applying this
model in human resource management of an organisation results in commitment, competence,
congruence and cost-effectiveness (Bromiley and Rau, 2016). In addition to this, the long-term
results involve the well-being of individual, effectiveness of the firm and societal well-being.
With the help of Harvard framework different situational factors can be dealt out. Major among
them are the characteristics of workforce, business strategies, condition of firm, management
philosophy, tasks technology, laws and societal values.
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It is necessary to align the employment practices and policies with the needs of the
business strategies. Further, alignment of policies with the organisations should be done
depending upon the type of business. This coalition can be understand with the help of fit or
contingency approach. According to this theory, there are basically two critical forms in which
schemes can fit, these are vertical and horizontal. Vertical integration is also known as internal
fit, in this approach HR strategies are tried to fit with the demands of the business policies.
Besides this, in case of external or horizontal integration, it is essential that all HR activities,
practices should fit together (Hitt, Carnes and Xu, 2016).
According ton the matching model of HRM, the structure of an organisation should be
managed in a way which is congruent to the organizational strategies. Thus, the match is done
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Illustration 2: Framework for HRM
Source: Barney and Mackey, 2016

between the structure and policies of an entity. Moreover, there should be clearly defined
objectives and mission for which the complete process in carried on. Also, they are required to
be realistic and achievable. There are three more forces that comes in the category of external
environment which influence the organisation. These forces are political, cultural and economic.
Political forces can ruin the entire business setup and that's why entity should remain updated
with the present regulations of current political party (Barney and Mackey, 2016). Also, it is
necessary to have thorough knowledge of the culture in which the business is running. In
addition to this, economic forces are those that highly influence the revenue generated. Thus,
before preparation of any HR practice with organisational structure, it is required to consider
them.
In addition to this, the model also emphasise on the human resource cycle that consist of
four generic processes namely, selection, appraisal, rewards and development. Firstly, the
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Illustration 3: Matching model of HRM
Source: Becker and Huselid, 2010

selection of candidates is done in a way that suits the job role. For this HRM can choose fro
effective recruitment techniques (Becker and Huselid, 2010). It is the first step towards
enhancing the performance of an entity. Morrisons should also work on the recruiting methods
so that effective employees can be selected that can meet the objectives of the business.
Moreover, HRM should regularly monitor the performance of an individual worker so that
appraisal sheets can be prepared. It is crucially required to appraise the employees on the basis of
their performance so that they can feel motivated which will directly impact on their
performance. Also, rendering rewards is a good option that organisation can implement for
boosting the efficiency. Thus, in this, Morrisons can manage the performance of the
establishment. This model closely links with the hard interpretation of HRM which varies from
firms to firms. It focuses on unitarism that is conflicts and issues can not exists in the workplace
when employees, employers and managers work together towards the same goals. However,
there are also some limitations of using this model such as it does not involves the strengths,
weaknesses and calibre of the workforce (Zehir and et.al., 2016). In addition to this, it does not
focus on the motivation and employee relation issues. Further, no alternative is present in case of
the HR responses doesn't matches with the required labour behaviour and performance.
In the present section, some attempts are made to apply micro and macro level
organisations theories in the HRM field of Morrisons. Assets, capabilities, processes of business,
attributes, information, etc. are those factors which requires effective strategies to improve its
efficiency. Also, by achieving competitive advantage by valuable creation of the strategies that
are not implemented by potential competitor, the effectiveness of resources can be boosted.
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Resources and competitors are those factors which keeps high concentration of any
entity and thus Zehir and et.al. (2016.), explained that resource based view(RBV) of the firm is
one of the most important theoretical development. In addition to this, it is receiving a significant
amount of attention. It has been observed that the evolution of RBV based SHRM took place
when researchers found that this tool well explains the relationship between the practices of
human resource and competitive advantage. The most significant function that is played by
resource based view is to predict relationship between specific resources of firm and the
sustainable competitive advantages associated with it. RBV is paradigm shift in SHRM thinking.
This theory focuses son improving the internal elations of the firm. It is a key asset in developing
and maintaining sustainable competitive advantage.
In addition to this, Kull, Mena and Korschun (2016), supported the argument and added
that it is that tool which helps in identifying key resources of an entity. So, to gain the
competitive advantage, Morrisons should identify all the potential resources. Further, this
technique aids in evaluating the value of those key origins on the basis of their ability to fulfil the
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Illustration 4: Resource based view
Source: Becker and Huselid, (2010)

VRIO criteria. Where, VRIO is acronym for valuable, rare, imperfectly imitable and organised,
these factors ensures the success of an organisation. Meanwhile, Bromiley, and Rau, (2016),
said that Morrisons should care for and protect the elements that passes VRIN criteria. For
passing this assessment, the entity has to select and develop the strategies that improve its
effectiveness. Also, they should be unavailable to other competitors and can not be copied by
them. Further, they should be effective enough to not get replaced by other. Thus, Morrisons
should focus on the identifying and developing the potential abilities to stay ahead of all the
competitors. The HRM should not only focus on the organisational transformation but should
regenerate the strategies and competing for opportunity share.
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However, Barney and Mackey (2016), presented contradictory arguments for the resource
based view of SHRM in its implementation in an organisation. The nature of RBV has been said
to tautological that is same value will be generated even from different resource configuration.
Also, the role of product is underdeveloped in the theory. Further, it is nearly impossible to select
a resource that passes the all four elements of VRIO criteria. Also, its strong focus on the internal
factors made Becker and Huselid, (2010), to state that the effectiveness of the RBV is
unresolvable associated to the external environment factors. Macro environmental factors keeps
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Illustration 5: VRIO Model
Source: Becker and Huselid, 2010

prior significance and can made or fade any business. RBV being an approach of enhancing
performance management by dealing internal factors is not able to deal with the external ones
and this is the biggest drawback.
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CONCLUSIONS
The main objective of this study is to provide business leaders with a deep understanding
and thorough knowledge of strategies to shape, structure debate and assist their decision making
while developing an effective strategy by human resource management. Strategic human
resource management and human resource strategies is important for business leaders to shape
their business. In this study, theoretical basis of SHRM, performance management and rewards
are explained to aid employers in attaining their organisational goals. Besides this, link is also
created between the business and HR strategies to bring effectiveness in the operations and
functions performed there. Holistic approach of link has been selected depending upon the needs
of the entity. In addition to this, techniques of managing business are described in the report.
Also, alignment methods of HR strategies are explained to improve the performance. Moreover,
in the present section, some attempts are made to apply micro and macro level organisations
theories in the HRM field in form of resource based view to strengthen the internal factors on
the organisation.
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REFERENCES
Books and Journals
Barney, J. B. and Mackey, A., 2016. Text and metatext in the resource‐based view. Human
Resource Management Journal. 26(4). pp.369-378.
Becker, B. E. and Huselid, M. A., 2010. SHRM and job design: Narrowing the divide. Journal
of organizational Behavior.31(2‐3). pp.379-388.
Bromiley, P. and Rau, D., 2016. Operations management and the resource based view: Another
view. Journal of Operations Management. 41. pp.95-106.
Brunetti, M. L. and eta., 2017. Sustainable competitive advantage in Construction: Study of
Central Region of Parana. REBRAE. 8(2).
De Spiegelaere, S., Van Gyes, G. and Van Hootegem, G., 2016. Innovative work behaviour and
performance-related pay: rewarding the individual or the collective?. The International
Journal of Human Resource Management. pp.1-20.
Gao, Y., Zhou, Z. and Wu, L. Z., 2016, January. Strategic Orientation, Strategic Flexibility, and
Firm Performance: The Important Role of SHRM. In Academy of Management
Proceedings (Vol. 2016, No. 1. p. 16559). Academy of Management.
Hitt, M. A., Carnes, C. M. and Xu, K., 2016. A current view of resource based theory in
operations management: A response to Bromiley and Rau. Journal of Operations
Management. 41(10). pp.107-109.
Kull, A. J., Mena, J. A. and Korschun, D., 2016. A resource-based view of stakeholder
marketing. Journal of Business Research.69(12). pp.5553-5560.
Lioukas, C. S., Reuer, J. J. and Zollo, M., 2016. Effects of information technology capabilities
on strategic alliances: Implications for the resource‐based view. Journal of
Management Studies.53(2). pp.161-183.
Oppong, N. Y., 2017. Exploring the importance of human resource activities-strategies
alignments: Interactive brainstorming groups approach. Cogent Business &
Management. 4(1). p.1273081.
Qamar, A. and Asif, S., 2016. Performance Management: A Roadmap for Developing
Implementing and Evaluating Performance Management Systems. South Asian Journal
of Management, 23(2), p.150.
Saha, N. and et.al., 2016. The impact of SHRM on sustainable organizational learning and
performance development. International Journal of Organizational Leadership.5(1).
p.63.
Seo, B. G., Park, D. H. and Choi, D., 2016, August. Innovative service concept generation based
on integrated framework of design thinking and VRIO: the case of information
supporting system for SMEs in Korea. In Proceedings of the 18th Annual International
Conference on Electronic Commerce: e-Commerce in Smart connected World (p. 23).
ACM.
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Zehir, C. and et.al., 2016. Superior Organizational Performance through SHRM Implications,
Mediating Effect of Management Capability: An Implementation on Islamic Banking.
Procedia-Social and Behavioral Sciences.235. pp.807-816.
Zehir, C. and et.al., 2016. Superior Organizational Performance through SHRM Implications,
Mediating Effect of Management Capability: An Implementation on Islamic Banking.
Procedia-Social and Behavioral Sciences.235. pp.807-816.
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