Strategic HR offers the HR function the opportunity to act a key partner to the business and influence organisational performance. It can contribute significantly to the organisation by enacting the organisation’s strategy through a focused HR plan which is in line with the goals and objectives of the organisation. It is about identifying HR priorities and develop the HR plan in line with the organisation’s future direction.
The size of the typical HR department has increased considerably. This increase reflects both the growth and complexity of government regulations and a greater awareness that HR issues are important to the achievement of business objectives. In recent years, the compensation of HR specialists has increased faster than other jobs, and for some HR jobs pay is sharply on the rise, reflecting greater professionalization and increasing awareness by business that a well-managed HR function may help the firm achieve a sustainable competitive advantage.
Companies compete for talent, and those that are capable of attracting, retaining, and motivating good employees are more likely to achieve and sustain a competitive advantage.
■ Just a short time ago, Google Inc. was considered the ideal place to work and it was repeatedly chosen by Fortune in the “best companies to work for. Google used to receive more than 1,000 applicants for every 5 jobs available, and very few employees left the company once they were hired.
Yet the situation seems to have changed almost overnight, making it much tougher for Google to attract and retain top talent despite the tumbling economy. Google Inc. is now fighting off many growing Internet firms that are poaching its staff. Last year alone, Facebook, Zynge, and Twitter have increased their staff an average of 80 %, and many of those employees migrated from Google. To help attract new recruits and preempt defections, all of Google’s employees (about 23,000) have been given a 10 percent raise, at an estimated cost of $400 million.
■ Recently, Motorola has lost thousands of engineers, researchers, and designers to competitors such as Apple, Samsung, Nokia, Dell, and Sony Erickson. “Motorola has a very deep and wide pool of thousands of talented and experienced employees as well as strong succession pipeline of executives,” says the company’s senior vice president of human resources. Meanwhile, however, the drain continues. A group of software experts recently laid off by Motorola marketed themselves to Yahoo as a team, and all were quickly hired.
Human Resource Management: The Challenges
On a strategic level, the major HR challenges facing managers today can be divided into three categories:
- environmental challenges,
- organizational challenges, and
- individual challenges
The environmental challenges are rapid change, rise of the Internet, workforce diversity, economic globalization, legislation, evolving work and family roles, skill shortages, and the rise of the service sector.
The organizational challenges are choosing a competitive position, decentralization, downsizing, organizational restructuring, the rise of self-managed work teams, the increased number of small businesses, organizational culture, advances in technology, and the rise of outsourcing.
The individual challenges involve matching people with the organization, treating employees ethically and engaging in socially responsible behavior, increasing individual productivity, deciding whether to empower employees, taking steps to avoid brain drain, and dealing with issues of job insecurity.