Human Resource Management Strategic Context and Process

Human resources management can best be defined as a function within the company that specifically deals with people related issues. These issues may comprise of recruitment of personnel, management of employee performance, safety, wellness, employee benefits and motivation, and communication. Also, human resource management can be described as both a comprehensive and strategic approach usually used to manage people and their working area. Great and effective human resource management provides employees with an enabling environment for increased productivity, which is highly important in contributing to the achievement of company goals and objectives (Trevor 2009). In the current dynamic business environment, human resource management can be seen to be moving away from the usual traditional role of employee administration to a more pro-active role which usually involves adding value to the utilization of employees strategically. Employees, in turn, contribute immensely to the overall organization growth and in the accomplishment of the company goals, mission and objectives.

In the recent times, most organizations increasingly view human resource management as a key asset that can provide cutting edge competitive advantage over its competitors. This can be asserted further by the fact that most companies are in the hunt for top talents, and human resource is the key area which can identify this talent. Because of many existing dynamics in the world of global businesses such as different demographics of employees, firms have increased their interest on profitability and sustained growth following the ever changing technologies. This has led most top firms to have an increased interest in human resource management (Sengupta 2007).

The strategic human resource management is normally centred or encompassed by six major theoretical models. There is the behavioural perspective model, there are the cybernetic models, there is the transaction/agency cost theory, there is also the firm resource based, resource dependent and finally the institutional theory. The institutional theory focuses on the influences that environmental factors have on the Human resource practices. The factors maybe political systems, legislation, social factors and also labour and trade unions. The behavioural model focuses on mostly on how employees behave in the work place. They are viewed as mediators for strategic human resource management business strategy and how the organisation will perform. The transaction cost theories normally focus on the relationship between the employer and employee. It takes into account the governance structures present in the organisation and how they are designed. There is also the agency theory which focuses on the relations between the owners of the company who are known as principals with their managers who are referred to as agents. Normally there is always a conflict of interest between the two parties.

Human resource management strategy or strategic human resource management normally refers to the management process. The process normally requires human resources policies and practices to strategically interlink it with the organization’s overall objectives. This simply means all their workings and functions should be within the organizations best practices. The process of strategy formulation is normally influenced by both internal and external factors (Paul 2012). Internal factors usually relate to the organization’s own internal workings. The internal factors usually consist of the organization’s own culture. However, at times, their maybe a presence of the dominant coalition, employees and management who are considered as internal stakeholders, the human resources department and its level of expertise. The external factors include technological changes, economy of the country, social, cultural factors and the political environment of the country.

When these factors change, the changes manifest themselves through good information processing and automation of most organization processes. There may also be changes in economic growth or sustained growth in some specific sectors of the economy, demographic changes in the organization’s workforce and at times political influences. All these affect strategic direction of most companies, and thus there is a need for the human resource management to always align itself towards handling these changes.

There are also a number of factors within the organization which affect the Strategic human resource process. These factors are normally identified as barriers to effective Strategic human resource management, and they present themselves in a number of ways. First, in most organizations, top management normally does not view human resource department as important during the process of making decisions. However, what most top managers do not realize is that additional competencies are essential for human resource professionals. Currently, human resource management has moved away from the traditional proficiencies like general office administration, compliance with labor laws and keeping employees’ complaints to a minimum. These in due time has come to be known as the bottom line business. What most people do not understand is the fact that within the human resource profession, not everyone is able to perform well. There has been a proposal to align that the human resource departments and develop competencies which should be used in dealing with strategic issues, business acumen and must be able to quantify their contributions to the organization growth.

Barriers preventing human resource professionals from taking a pro-active role in most organizations are their lack of basic economic and financial literacy education. Others are not ready to take risks. Most human resource professionals do not demonstrate confidence as well as courage on principles relating to their conviction. The competency requirement for the human resource professionals is that they should have thorough knowledge in the business. They should also be proficient in the delivery of human resource practices, should be able to manage change effectively, and should be persons of high degree of credibility.