Human Resources Management in Perspective
Human Resources Management in Perspective
Strategic Planning and Human Resources
The idea remains only a premise for action until we put it into practice. To deliver on this
promise, we need to understand some of the systems and processes in organizations
that link human resources management and strategic management. A few definitions
may be helpful up front.
First of all, strategic planning involves a set of procedures for making decisions about
the organization's long-term goals and strategies. In this chapter, we discuss strategic
plans as having a strong external orientation that covers major portions of the
organization. They especially focus on how the organization will position itself relative to
competitors in order to achieve long-term survival, value, and growth. Human resources
planning (HRP), by comparison, is the process of anticipating and making provision for
the movement of people into, within, and out of an organization. Overall, its purpose is
to help managers deploy human resources as effectively as possible, where and when
they are needed, in order to accomplish the organization's goals. Strategic human
resources management (SHRM), then, combines strategic planning and HR planning. It
can be thought of as the pattern of human resources deployments and activities that
enable an organization to achieve its strategic goals.
Although planning has always been an essential process of management, increased
emphasis on HR issues becomes especially critical when organizations consider global
strategies, mergers, relocation of plants, innovation, downsizing, outsourcing,
offshoring, or the closing of operating facilities. Dramatic shifts in the composition of the
labor force require that managers become more involved in planning, since such
changes affect the full range of HR practices (such as employee recruitment, selection,
training, compensation, and motivation).
Strategic Planning and HR Planning: Linking the Processes
As organizations plan for their future, HR managers must be concerned with meshing
HRP and strategic planning for the organization as a whole.' Through strategic planning,
organizations set major objectives and develop comprehensive plans to achieve those
objectives. Human resources planning relates to strategic planning in are seen as
inherent in the management of the business. As James Walker, noted HRP expert, put
it, "Today, virtually all business issues have people implications; all human resource
issues have business implications."' HR managers are important facilitators of the
planning process and are viewed as credible and important contributors to creating the
, Human Resources Management in Perspective
organization's future. This positive linkage occurs when the HR manager becomes a
member of the organization's management steering committee or strategic planning
group. Once this interactive and dynamic structure exists, HR managers are
recognized as contributing strategic planners alongside other top managers.'
This is an important element for the rest of our discussion in this chapter. Traditionally,
authors—and too many HR managers—have treated HR planning and strategic
planning as separate activities. Instead, we provide a step-by-step process to show how
the two aspects of planning can be integrated.
One: Mission, Vision, and Values
The first step in strategic planning is establishing a mission, vision, and values for the
organization. The mission is the basic purpose of the organization, as well as its scope
of operations. It is a statement of the organization's reason for existing. The mission
often is written in terms of general clients it services. Depending on the scope of the
organization, the mission may be broad or narrow. For example, the mission of Merck
and Company is as follows:
The mission of Merck is to provide society with superior products and services by
developing innovations and solutions that improve the quality of life and satisfy
customer needs, and to provide employees with meaningful work and advancement
opportunities, and investors with a superior rate of return!
The strategic vision of the organization moves beyond the mission statement to provide
a perspective on where the company is headed and what the organization can become
in the future. Although the terms mission and vision often are used interchangeably, the
vision statement ideally clarifies the long-term direction of the company and its strategic
intent.
Organizational core values are the strong enduring beliefs and principles that the
company uses as a foundation for its decisions. Starbucks, for example, lists the
following core values:
Provide a great work environment and treat each other with respect and dignity.
Embrace diversity as an essential component in the way we do business.
Apply the highest standards of excellence to the purchasing, roasting, and fresh
delivery of our coffee.
It Develop enthusiastically satisfied customers all of the time.
Contribute positively to our communities and our environment.
Recognize that profitability is essential to our future success.
These are the underlying parameters for how the company will act toward customers,
employees, and the public in general. In many cases, the values capture the underlying
philosophy of the company culture and give direction to its employees. The values also