What Is Strategic Human Resource Management

How do you define strategic human resource management?

In short, strategic means to think and plan long term.

Human resource management means to manage the employees so that they will work towards the profitability of the company.

The official definition is more complicated than that.

The official definition links the strategic business plan and objective to the development, and deployment of human resources.

Many companies now accept that the Human Resource Department is an important business partner.

They seek the input of HR department when there is a need for an organization change.

Why is strategic human resource management important?

A company has many assets.

Of all the assets,

only human asset does not depreciate in value.

You can never see depreciation for human asset in the balance sheet. All the other assets, such as plants, buildings and equipments, get less valuable through use.

You know that you need to replace a computer after a few years.

The only exception is human asset.

As a person gains experience, and knowledge, he becomes more valuable to the company.

That is why the senior management in the company is older and wiser than the rank and file employees.

What does strategic human resource management look at?

The HR department no longer focus on the transactions, even though these are still important functions.

Strategic human resource management looks beyond the daily data entry, filing, and other transactions.

These are the areas that it focus on:

1. Cross cultural issues

Many companies have operations in many countries.

The companies may have the payroll done in India, and the IT service in China.

It is important that employees from different parts of the world work together.

The cross cultural issues also include the management of expatriates and their families.

2. Corporate culture change

Strategic human resource management is the champion of corporate culture change.

A company has to cut business costs as much as possible, in order to produce products at lowest possible cost, and let consumers have great products at most affordable price.

The company no longer thinks of

selling to consumers in one country. It is competing with the other companies in the world for the global consumers segment.

The mindset change triggers the corporate culture change.

3. Rise of developing countries

For many years, the large companies focus on selling to consumers in developed countries.

However, in recent years, companies see the hunger and needs of the consumers in developing countries.

Some of the richest persons in the world live in developing countries.

Nobody can ignore the purchasing power of people in India, China and other developing countries.

That is why the business plan changes. Many companies are making products and selling them in developing countries.

This development presents a challenge to strategic human resource management.

When the trend reverses in the future, and jobs start to return to developed countries, strategic human resource management will play an important part again.

Managing employees in developing countries and developed countries definitely needs a different approach.

Strategic human resource management has become the focus of business studies, and business world.

About me:
Scheng1 is a passionate blogger from Singapore. Rich in every sense reveals my deep desire in enjoying life, and be rich in every possible ways.

Article Written By scheng1

Last updated on 28-06-2016 463 0

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