Human Resource and Management
The increasingly changing nature of an organization’s external environment because of globalization, increasing competition, and rapidly advancing technology has meant that firms have to explore other avenues in which to gain or maintain competitive advantage as well as remain relevant in the marketplace. Firms have sought to position themselves as low cost leaders or differentiator with highly competent or committed workforce. This has led to increased interest in strategic management in organizations across the world (Deb 2006, p.54). Companies are fast realizing that they can gain distinctive competencies from highly developed employee skulls, organizational cultures, as well as management processes and systems. A company that desires to maintain its competitiveness in the dynamic global market must therefore master how to reunite and utilize all its resources in a strategic manner, particularly link its business vision with human resource planning. Human Resource Management is more challenging for an international company relative to a domestic company (Aswathappa 2005, p.35). This is because the multinational has not only to contend with the situations in the home market, but also adjust its HRM practices to the economic, political, cultural, and legal situations of the other countries. For instance, local labor laws may demand that the international company to significantly adjust its hiring practices and workplace standards.
The entire concept of HRM deals with varied dimensions of people together with their individual and collective abilities to contribute to the attainment of organizational goals and objectives (Aswathappa 2005, p.16). There is a substantial shift from the conventional emphasis on equipment and technology as sources of competitive advantage to high quality workforce that makes organizations gain ability to compete more effectively in terms of market responsiveness, technological innovation, and product and service quality. In this regard, there is growing realization that a highly skilled and motivated workforce can position an organization to effectively take advantage of the many opportunities provided by the environment. The attitudes, behavior, and qualities in the workplace affect the performance of organizations in significant ways (Deb, 2006, p.59). The organizational practices linked with organizational outcomes include teamwork, flexibility, self-directed and self-managed teams, recruitment and selection, quality teams, internal promotion opportunities, formal performance appraisals, performance-related & incentive pay, formal and regular communication, profit sharing, attitude surveys, as well as job security (Armstrong, 2008, p.4). The HR practices do not only impact on organizational performance but also on commitment and job satisfaction among the labor force and customer-oriented behaviors.
Strategic Human Resource Management
Strategic Human Resource Management (SHRM) is essentially an approach that links the human resource function with the organization’s strategic objectives so as to improve performance. Strategic approach to HRM refers to managerial processes that require human resource (HR) practices and policies to be appropriately linked with the organization’s strategic objectives (Becker & Huselid 2006, p.902).
Two schools of thought have been advanced in relation to SHRM: the “best practice school of thought, and the “best fit” or contingency school. According to the “best practice’ school of thought, any given organization has the potential to employ a set of best practices in approaching management of people to improve overall performance. These best practices include selection hiring, employment security, teamwork or self-managed teams, high pay based on company performance, sharing information, extensive training, and reduction of status difference (Armstrong 2008, p.7). On the other hand, the “best fit” or contingency theory argues for both external and internal fit. External fit implies incorporation of the HR strategies into the overall business strategy for them to perform best. Internal fit alludes to the synergistic gains that result from the adoption of HRM as an organizationally supported group of packages that fit together and mutually support each other (Dibben & Cunningham 2002, p.215).
According to Baptiste and Bailey (2003), SHRM is being practiced in an organization when: (i) HRM strategies are being determined by the overall organizational business strategy; (ii) HRM strategies are consistent with all other functional strategies; (iii) top HR managers are taking part in the formulation of business strategy; (iv) HR strategy includes all levels of the workforce; and (v) the HRM function strives to ensure that achievement of the organization goals is contributed to by the organizational culture, structure and staff quality, as well as their motivation and commitment (Long 2007, p.275).
SHRM as a business strategy perceives the management of human resource as a key organizational capability that should be greatly incorporated with the strategic goals and objectives of the business. In other words, SHRM seeks to integrate the overall strategic goals of the organization on the one hand, and human resources strategy and implementation on the other (Becker & Huselid 2006, p.899). In general, SHRM offers a more thorough examination and explanation of management policies and practices for the firm in their approach to the workforce. SHRM advances from HRM by linking a firm’s organization’s HRM practices to the business overall strategy and help them gain competitive advantage). SHRM ensures full integration of HRM into an organization’s strategic planning, that HRM policies and practices fit together both across all policy areas and hierarchies (Aswathappa 2005, p.19).
HRM entails management of people directly employed by an organization in achieving the organizations goals and objectives. This is made possible through attracting and selection of people needed by the organization in order to get the work done, motivating them to put in sufficient effort to satisfactorily complete tasks by giving them compensation packages together with retaining of employees that are key to the organization’s success (Dibben & Cunningham 2002, p.219). In addition, HR undertakes training and development needs in order to achieve both organizational and individual learning in addition to ensuring that the organization is in compliance with the legislation, policies and procedures.
SHRM concerns itself with the contribution of HRM to the overall effectiveness of an organization by making sure that people in the organization are at all times managed effectively so as to meet the objectives and goals of the organization (Jeong 2012, p.4). This translates that SHRM approaches management of human resources with a macro perspective as opposed to the narrow and more internally focused Human Resource Management. Businesses that employ SHRM strategies are flexible to change, innovative, adaptive, and anticipate the future of the business. The SHRM practices and policies are not effective across the board and thus need to be tailored to individual organization in line with their overall strategy of the business (Pichault & Schoenaers 2003, p.121).
SHRM is therefore the systematic resolution of HR administration and policy issues in order to enhance an organization’s overall effectiveness. SHRM entails deducing how personnel functions correlate in context, recognition of their significance, together with commitment from personnel managers, supervisors, employees as well political leaders work together. The primary stakeholders involved in SHRM are the senior management which establishes the precedence that the organization perceives as its strategy. Senior associates have the obligation to offer guidance to the organization besides engaging middle managers in charge of departments/units as well as specialist activities such as personnel/HRM.
The strategy also includes operational and junior managers responsible for daily and weekly decisions together with team leaders/leaders tasked with achieving tangible results and manage staff dealing directly with customers (Long 2007, p.269). SHRM results in HR strategies which are integrated vertically with the overall business strategy and are key part of that strategy. This vertical integration is essential in providing similarity between business and HR strategy. In the same light, SHRM concerns with horizontal integration where the objective is to ascertain that the varied components of the HR strategy fit well together and are also mutually supportive of each other (Pichault & Schoenaers 2003, p.132). As a proactive management of workers, SHRM demands of the human resource manager to be visionary and plan ahead on ways to better satisfy the needs of the company’s employees on the one hand, and how to make workers better meet the needs of the organization. This would result in improved employee retention and employee development.
Samsung Company and SHRM
Samsung can be said to be the company with most value for its employees considering that its founders drafted their value statement first then their business plan. This translates that the management was keen on giving first priority to people elements of their business before focusing on product specifications and capital requirements. In early 1960s, Samsung became the first Asian company to use competitive recruiting system (Michell 2010, p.135). This was significant considering that most companies at the time were relying on referrals based on connections during recruiting of employees. Samsung is also reputed for managing of its employees on the basis of performance and capabilities. This effective management of its people led to the emergence of the term “Samsung man” to denote competent and well-trained employees of the company.
Samsung first realized the need to adopt strategic human resource management when competition increased both on the domestic and international market. It was highly necessary for the company to build competitiveness in its overall management together with HRM practices so as to thrive especially on the global scene (Rao 2008, p.311). As such, Samsung uses a series of key behavior to inform employee behaviors throughout the organization as opposed to typical set of competencies used by other companies. The company consistently shares its values and planned actions with its employees and invites their complaints, suggestions and feedback on all matters.
Samsung’s business strategy is one that strives to consistently meet the needs of customers in three main dimensions: (1) quality, (2) time-to-volume; and (3) ease of doing business with. The company is known for constantly changing and reinventing itself in line with these goals (Michell 2010, p.139). Each of these change always have considerable impacts on Samsung’s employees as reflected in the design of the company’s HR management systems. This a common phenomenon at Samsung because of the company’s focus on product development along with operations teams which frequently change composition during different product cycles.
The “constant reorganization” means that the HR function always plays a major role in assisting in the placement, evaluation, as well as reintegration of employees at Samsung. This is an appropriate HR practice considering that most of the functions at the company are often temporary and thus constant movements within the firm are regarded as a norm by employees (Rao 2008, p.313). The rather short product life cycles of Samsung makes it constantly push the technology envelope by emphasizing on engineering and product development. This makes the company to develop considerable competencies pertaining to defining where they desire to be as an organization.
The quality of Samsung’s work environment together with “interesting work” has led to higher worker retention in addition to enhancing Samsung’s commitment to the way of managing its people. In this regard, the company has noted the development along with maintenance of an ‘Extraordinary Environment’ as the major factor in the successful implementation of its unique competitive strategy (Michell 2010, p.144). Samsung as an organization disregards formal bureaucracy as evidenced by assertions of a number of its employees that “rules here are made to be broken”.
Samsung Vertical Integration
Samsung is an inspiring company that develops technologies meant for the prosperity and progress of all people. The company exercises ethical management w her needs of its shareholders, customers, and society at large are respected. Samsung is committed to undertaking responsible and progressive management in the 21st century (Rao 2008, p.315). Samsung’s supervisory processes and decision-making hinges on corporate transparency in addition to accountable management.
Investment in people
Samsung is among the global companies with lots of training and learning courses for their employees. The workers are afforded sponsorships to go further their education and update their skills. The design center staff often goes to study abroad in the most reputable art design schools in the US and get opportunities to work with famous talents. This pays off in the form over 700 pieces of new product model each year (Michell 2010, p.147).
Employee Development
It is the belief of Samsung that employees stay will stay with the company only if they feel their contributions are being valued and are able to perform meaningful work in an environment that is both stimulating and challenging (Michell 2010, p.147). It is on these grounds that Samsung’s managers are required to continuously undertake development of their subordinates.
Employee welfare
Samsung support its employees in a range of areas such as family health, housing, children’s education, retirement, and leisure activities (Rao 2008, p.316). The company has commitment significant amounts to employee welfare investment, has employee wage and bonuses arrangements.
Diversity and inclusion
Samsung has a broad diversity and inclusion approach to its workforce, which makes to be among the leading multinational companies with employees from many nationalities (Jeong 2012, p.5). Samsung strategy to diversity is therefore to emphasize on building a fully inclusive culture so as to make every individual feel they are truly valued, are unique and develop a sense of belonging. The 2004 company-review of diversity has led to Samsung to currently have a global diversity board as well as thorough and regular diversity monitoring (Michell 2010, p.149). Female managers also hold more than 35% of all managerial positions at Samsung.
Conclusion
The modern business environment values the place of human resources in meeting the organizational goals and objectives of businesses. The concept of Strategic Human Resource Management (SHRM) continues to be an essential tool as relates to human relations function. Companies must adopt systematic and long-term approach to the treatment and management of human capital so as to enhance their individual competitiveness and maintain a satisfied workforce. It is worth noting that technical HRM effectiveness, which basically entails psychometrically sound practices geared to attain specific short-term objectives, is a necessary foundation for successful implementation of a SHRM process. In this regard, Samsung is a good reference as a global company that has integrated SHRM business strategies and HRM functions. Going forth, SHRM is set to become more entrenched in broader organizational activities resulting in organizations that respond well to their most valuable asset – the human resource.
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