Strategic HRM is based on a resources approach to the enterprise. This resources approach makes clear the interaction between internal resources, corporate strategy and financial performance. SHRM is about thinking in terms of systems and subsystems. From this perspective, SHRM applies a broad focus on resources, aims at value creation and guides the four management building blocks to achieve this.
Broad focus
Strategic HRM's main task is to deploy resources in such a way that they contribute to the company's strategy and financial performance. Resources have a broad meaning in this context. It includes all assets, capacities, organisational processes, business properties, information, knowledge, etc. available to a company for achieving a sustainable competitive advantage. Resources enable a company to design and implement strategies that improve its efficiency and effectiveness. Resources are thus of both an organisational and a human nature. SHRM becomes meaningful to the business to the extent that it is able to optimise both organisational and human resources to achieve the business objectives.
Value creation as a goal
An HRM system is only strong if it meets four criteria: it creates added value, it is unique, difficult to imitate and irreplaceable.
1. The first criterion is about creating added value.
How can HRM create a competitive advantage? Research shows that there is a correlation between HR practices and employee satisfaction, and between HR practices and the quality of services/products. So HR practices have an impact both on employee satisfaction and customer satisfaction. If HRM succeeds in having a positive impact on employee and customer satisfaction, it creates added value for the company and contributes effectively to the business.
2. The second criterion concerns uniqueness.
How can the company develop an HR system, which has rare characteristics and cannot be found in the competition? HR practices can be a sustainable competitive advantage if they are designed as a service to the candidate and the employee. In this respect, the experience created should reflect the way the company treats its employees. It is all about values and norms, i.e. behaviour that corresponds to the values.
3. The third criterion is about HR practices that are difficult to imitate.
Unique HR practices can lose their competitive advantage when the competition is able to imitate them. The competitive advantage has then only been temporary. HR practices become difficult to imitate when they integrate the company's history, culture and values. Two interesting concepts in this area are the employer brand and the corporate brand. These are as good as impossible to copy. The employer brand concerns the image of the company as an employer; the corporate brand concerns the image of the company as a supplier of goods and services.
Pay attention! Building a brand is a long process. This process has a direct impact on the relationship of the company with its stakeholders. In this perspective, stakeholders are always approached as potential ambassadors of the company. This requires a conscious and persistent effort. A brand also uses various formal and informal forms of communication and channels, which must be chosen with care. Brands also do not tolerate incoherent or incorrect communication. Stakeholders do not like manipulation and are particularly sensitive to deception or abuse. Finally, brands demand creativity and innovation to create a unique image.
4. The last criterion wants the company to develop an organisation that makes the most of its resources.
The focus here is on optimising the internal organisation and the HR system rather than on developing individual competencies. SHRM develops feedback systems that make it possible to evaluate, improve and renew internal processes and HR practices. This increases the learning capacity of the company and ensures that it always has an edge over the competition.
Management aspects
SHRM anchors itself in the business by supporting the business strategy and intertwining itself with the operational as much as possible. In order to do this, SHRM needs management aspects. In fact, it has the same four management building blocks as the business, namely structure and culture, people and resources, results and chains. SHRM is successful when these four building blocks are interconnected, in a coherent and consistent manner, and interact with each other with as little friction as possible.
From the management perspective, the building blocks are arranged in a certain order:
| Management aspect | Management Building Block | Orientation |
| 1. Doing the right things | Results | Effectiveness |
| 2. Doing things right | People and resources | Efficiency |
| 3. Doing things better | Structure and culture | Learning capacity |
| 4. Getting things done | Chains | Outsourcing |
The business strategy determines the goals and results that the company wants to achieve. The role of SHRM is to support the business in achieving these goals by developing an adequate HR system. The intended results require specific people and resources. SHRM has a double task here: to ensure the efficiency of the operational staff and to ensure its own efficiency. The intended results have an impact on the structure and the culture. These may not stand in the way of achieving the goals. The learning capacity of the entire organisation and of the HR system must be continuously improved by designing good feedback systems. Finally, SHRM must decide which HR practices it will keep in-house and which it is best to outsource.
Conclusion
SHRM is, so to say, facing a great challenge: it has a double mission. On the one hand, it will support the business in its management building blocks, management aspects and orientation. On the other hand, it will apply the same principles to itself.
In SHRM, the individual HR practices are part of an HR system, which in turn is part of the organisation as a system. These HR practices only have meaning within the HR system of the company and to the extent that they are part of the business activities. They are interdependent and interact with each other. So what you do in one HR domain already has consequences for another HR domain and for the business activity. This interdependence and interaction requires good coordination.
Sources
MULLINS, L.J., Management van gedrag. Individu, team en organisatie. Pearson Education Benelux, 2007
VLOEBERGS, D., Human Resource Management. Fundamenten en perspectieven. Op weg naar de intelligente organisatie., Lannoo Campus, 7de druk , 2010
QUINN,R.E., Handboek managementvaardigheden, 6de druk, Boom Uitgevers Amsterdam, 2016
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