Strategic Human Resource Development

1
Lecture 3

• Strategic Human Resource Development

2
Lecture outline

• The growing importance of SHRD
• Definition of SHRD
• Characteristics of SHRD
• Benefits of SHRD
• The role of the legitimate and shadow systems
• Examples of SHRD
• Empirical evidence of SHRD

3
The growing importance of SHRD

• The competitive and volatile environment within
  which businesses operate is prompting senior
  management to take a greater interest in the
  development of the organisations human
  resources.
• A number of possible specific triggers -
• Difficulties in recruiting skilled employees
• Need to develop a more flexible and adaptable
  skill base
• The need to align the potential of employees with
  business objectives
• Greater emphasis on performance evaluation
• The need for HRP and succession planning

4
Definition of SHRD

• HRD is best seen as the strategic management of
  training, development and of management/profession
  al education interventions, so as to achieve the
  objectives of the organisation while at the same
  time ensuring the full utilisation of the
  knowledge and skills of individual employees.
• It is concerned with the management of employee
  learning for the long term keeping in mind the
  explicit corporate and business strategies.

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Characteristics of SHRD

• Integration with organisational missions and
  goals
• Top management support
• Environmental scanning
• HRD plans and Policies
• Line management commitment and involvement
• Existence of complementary HRM activities

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Characteristics of SHRD cont.

• Expanded Trainer role
• Recognition of Culture
• Emphasis on evaluation

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Integration with organisational missions and goals

• Integration of training and development into
  wider business planning.
• Move from activities that are fragmented to a
  situation where TD is more systematically linked
  to such goals or is so systematically integrated
  with organisational needs that it is seen as a
  necessity for organisational survival.
• Effective HRD must be aware of mission, goals and
  needs of the organisation.
• Zenger (1985) micro and macro view

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Top management support

• SHRD must command the support and participation
  of top management.
• HRD higher profile.
• Reality is that in many cases top management is
  not committed to TD - due to not being
  systematically trained themselves, time
  constraints, HRD seen as long-term investment,
  benefits of TD intangible, HRD must improve
  quality and market their function, management
  training is considered towards the bottom end of
  the management hierarchy.

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Environmental scanning

• SHRD function must have continuous knowledge of
  its external environment.
• SHRD function must have the capacity to analyse
  the external environment in terms of the
  opportunities and threats which it presents in
  the context of both the business and HRD
  strategy.
• The environment can also be a threat to the HRD
  function - competition if not tackled effectively
  can reduce profit margins and therefore HRD
  budget.
• Characteristics of a firms environment shapes
  HRD activities - major triggers for HRD -
  technological and product market changes.

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HRD plans and policies

• Formulation of basic plans and policies.
• Hales (1986) sets out a number propositions on
  the development of HRD plans -
• strategic business plans must exist before SHRD
  plan can be developed - long term focused.
• Top management sanction and involvement.
• If firm is dominated by short-term considerations
  HRD plan will also reflect this deprivation.
• HRD plans are devised from both strategic plans
  and an analysis of internal and external
  environment.
• HRD plan provides a link between business
  activities and HRD activities.

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HRD plans and policies cont

• Policies are an essential component of the
  implementation phase.
• Reasons why a strategic HRD function should
  engage in policy formulation -
• Ensures that supervisors, line managers and top
  managers are all equally aware of their HRD
  responsibilities and participate in HRD
  activities.
• It provides operational guidelines for management
  - why it is important to invest in HRD.
• Sets out for employees the different types of
  education, learning/ development that is
  important for career progression.

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HRD plans and policies cont

• A clear policy statement helps to define the
  relationship that exists between the
  organisations objectives and its commitment to
  HRD.
• Enhance public relations with new recruits - can
  see benefits on offer to them.
• HRD policy can facilitate the establishment of
  employee career development opportunities.
• Provides a guideline against which HRD activities
  can be evaluated.
• Allows function to be placed in context.

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Line manager commitment and involvement

• Line managers conducting training sessions
• Consultation with line managers concerning areas
  of improvement they would like to see in
  employees.
• Line managers becoming involved in coaching and
  counselling of subordinates.
• Line managers learning skills being updated.
• Active involvement in HRD policy and planning
  process.
• Line managers being made responsible for the
  identification of HRD needs within their
  department.

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Line manager commitment and involvement cont.

• The competence of the line manager is vital to a
  successful implementation of SHRD.
• Number of problems with the relationship between
  the HRD function and line manager -
• Ownership of HRD
• Competence
• Role definition

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Existence of complementary HRM activities

• Effective HRD must be a coherent package of
  complementary measures aimed at servicing various
  aspects of the employment relationship.
• Some of these measures are -
• HRP
• Upgrading the quality of employees being
  recruited
• Forging closer links educational institutions
• Greater formalisation of PA and training needs
  procedures
• A range of career development systems both
  individually and organisationally focused.

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Expanded trainer role

• Number of deficiencies of trainers -
• Many training specialists dont view their
  activities as cutting edge - low status of TD
  function.
• HRD function a number of role conflicts.
• HRD specialists are poor at marketing their
  services.
• HRD specialists limited perceptions of their role
  - maintenance of status quo.
• SHRD requires a considerable role change -
  marketing benefits of HRD, proactivity, HRD as
  central to the achievement of organisational
  objectives and developing a more strategic role
  rather than being simply learning specialists.

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Recognition of Culture

• The need to match corporate strategy and culture
  - very little literature concerning the link to
  HRD.
• Ogbonna and Wilkinson (1988) HRD function has a
  key role in maintaining and changing corporate
  culture.
• Peters and Waterman (1982) HRD function cannot
  ignore the the prevailing and desired culture.
• Culture must be viewed as central to the function
  of HRD.
• The transmission of culture is important part of
  HRD.
• See Table 1

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Emphasis on evaluation

• Criteria of suitability - measure how far HRD
  activities fit the situation identified in the
  strategic analysis.
• Criteria of feasibility - how feasible HRD plans
  and policies are in practice?
• Criteria of acceptability -whether the
  consequences of the proceeding strategy are
  acceptable.

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Benefits of SHRD

• Greater extrinsic and intrinsic job satisfaction
• Fewer accidents, lower labour turnover and less
  absenteeism
• Greater customer satisfaction
• Improved job performance and enhancement of
  career opportunities
• Shorter learning times and more effective use of
  resource and less wastage of materials
• The creation of a learning organisation that is
  flexible

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The role of the legitimate and shadow systems

• Conventional strategic planning is critical in
  short term planning and operationalism.
• The identification of the organisations mission
  and strategies allows the legitimate system to
  keep the organisation moving in the right
  direction for immediate future.
• Auditing the ideas emanating from the shadow
  system.
• The legitimate system is responsible for the
  intended or deliberate strategy of the
  organisation whilst the shadow system searches
  and tries to have implemented the emergent
  strategy.

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Shadow system

• Staff in the shadow system come from various
  levels throughout the firm - they must be
  involved, committed and motivated by the specific
  strategy issues at hand.
• The shadow system is all about learning -
  individual and organisational learning.
• The creation of an organisational culture that
  promotes trust and loyalty to provide a safe and
  caring culture in which the delicate organism can
  grow.
• Learning process linked to strategic planning -
  knowledge generation, emancipatory learning,
  increasing the knowledge capital of the
  organisation and organisational culture.

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SHRP

• Entrepreneurial strategy
• Dynamic growth strategy
• Analyser strategy
• Defender strategy
• Rationalisation, liquidation and turnaround
  strategies

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Empirical HRD (Garavan 1991)

• Sample of 90 high technology companies.
• 81 reported written HRD policy statement.
• 95 established a HRD function.
• Most important factor contributing to the shape
  of HRD function was the mission, goals of the
  firm - 90.
• How is the HRD policy formulated? Typically drawn
  up by HRD specialist and approved by the HRM
  director and then by other members of the
  management team. Policy was communicated to staff
  through the medium of a policy manual.

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Empirical HRD (Garavan 1991)

• Implementation of HRD policies - key issues to be
  considered -
• Publicity
• Procedures and plan
• Monitoring and modification
• Existence and scope of HRD - 74 of respondents
  had written HRD plans covering a financial year
• See Table 3.
• See Table 4.

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Kane, Abraham and Crawford (1994).

• Purpose of investigation - the purpose of TD,
  extent to which TD consistent with strategy and
  environment, TD methods are consistent with
  each.
• Sample characteristics - 53 out of largest 500
  firms in Australia responded to the survey,
  resulting in an overall response rate of 10.6.
• 32 per cent of the sample reported a considerable
  degree of formal HRM/HRD input to the
  organisational goals. Only scattered and
  inconsistent links were found between training
  and development and organisational strategy.
  Training and development is treated in splendid
  isolation, as it is not linked to organisational
  strategy and driven in many cases by training and
  development programs themselves.

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Drost, Frayne, Lowe and Geringer 2002

• 437 Australian managers and engineers were
  surveyed concerning training and development.
• Results TD to -
• Reward employees 2.25
• Improve technical abilities 4.01
• Improve interpersonal skills 3.23
• Remedy poor performance 2.90
• Prepare for future job 3.07
• Build teamwork 3.01
• Help understand business 3.10
• Provide skills for different jobs 2.87
• Teach employees about values 2.89