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Outline the steps in the strategic management process.. Explain what a strategy-oriented human resource management system is and why it is important.. Illustrate and explain each of the

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Human Resource

Management

ELEVENTH EDITION

G A R Y D E S S L E R

Strategic Human Resource Management

and the HR Scorecard

Chapter 3

Part 1 | Introduction

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© 2008 Prentice Hall, Inc All rights reserved 3–2

After studying this chapter, you should be able to:

1 Outline the steps in the strategic management process

2 Explain and give examples of each type of

companywide and competitive strategy

3 Explain what a strategy-oriented human resource

management system is and why it is important

4 Illustrate and explain each of the seven steps in the HR

Scorecard approach to creating human resource

management systems

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The Strategic Management Process

 The process of identifying and executing the

organization’s mission by matching its capabilities

with the demands of its environment

• Strategy

 A chosen course of action

• Strategic Plan

 How an organization intends to balance its internal strengths and weaknesses with its external

opportunities and threats to maintain a competitive advantage over the long-term

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© 2008 Prentice Hall, Inc All rights reserved 3–4

Business Vision and Mission

• Vision

 A general statement of an organization’s intended

direction that evokes emotional feelings in

organization members

• Mission

 Spells out who the company is, what it does, and

where it’s headed

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Types of Strategies

Diversification

Strategy

Geographic Expansion Strategy

Vertical Integration Strategy

Corporate-Level Strategies

Consolidation Strategy

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© 2008 Prentice Hall, Inc All rights reserved 3–6

Types of Strategies (cont’d)

Cost Leadership Focus/Niche

Business-Level/

Competitive Strategies

Differentiation

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Achieving Strategic Fit

• The “Fit” Point of View (Porter)

 All of the firm’s activities must be tailored to or fit

the chosen strategy such that the firm’s functional

strategies support its corporate and competitive

strategies

• Leveraging (Hamel and Prahalad)

 “Stretch” in leveraging resources—supplementing

what you have and doing more with what you have— can be more important than just fitting the strategic plan to current resources

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© 2008 Prentice Hall, Inc All rights reserved 3–8

Strategic Human Resource Management

 The linking of HRM with strategic goals and

objectives in order to improve business performance and develop organizational cultures that foster

innovation and flexibility

policies and activities—that produce the employee competencies and behaviors that the company needs

to achieve its strategic aims.

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Strategic Human Resource Challenges

Corporate productivity and performance improvement efforts

Increased HR team involvement

in design of strategic plans

Basic Strategic Challenges

Expanded role of employees in the organization’s performance efforts

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© 2008 Prentice Hall, Inc All rights reserved 3–10

Human Resource Management’s

Strategic Roles

Strategy Execution Role

Strategic Planning Roles

Strategy Formulation Role

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Creating the Strategic Human Resource

Management System

Human Resource

Professionals

Employee Behaviors and Competencies

Components of a Strategic HRM System

Human Resource Policies and Practices

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© 2008 Prentice Hall, Inc All rights reserved 3–12

K E Y T E R M S

strategic plan strategic management vision

mission SWOT analysis strategy

strategic control competitive advantage leveraging

strategic human resource management

HR Scorecard metrics

value chain analysis

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Creating an HR Scorecard

1

2

3

4

5

Outline value chain activities Define the business strategy

Outline a strategy map

Identify strategically required outcomes

Identify required workforce competencies and behaviors

6 7 8 9 10

Create HR Scorecard

Identify required HR policies and activities

Choose HR Scorecard measures

Summarize Scorecard measures on digital dashboard

Monitor, predict, evaluate

The 10-Step HR Scorecard Process

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