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What is Strategic Human Resource Management?

Margo Upson
Updated May 16, 2024
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Strategic human resource management is designed to help companies best meet the needs of their employees while promoting company goals. Human resource management deals with any aspects of a business that affects employees, such as hiring and firing, pay, benefits, training, and administration. Human resources may also provide work incentives, safety procedure information, and sick or vacation days.

Strategic human resource management is the proactive management of people. It requires thinking ahead, and planning ways for a company to better meet the needs of its employees, and for the employees to better meet the needs of the company. This can affect the way things are done at a business site, improving everything from hiring practices and employee training programs to assessment techniques and discipline.

Companies who work hard to meet the needs of their employees can cultivate a work atmosphere conducive to productivity. Human resource management is the best way to achieve this. Being able to plan for the needs of employees by thinking ahead can help to improve the rate of skilled employees who chose to remain working for a company. Improving the employee retention rate can reduce the money companies spend on finding and training new employees.

When creating a human resources plan, it is important to consider employees may want or need and what the company can reasonably supply. A larger company can usually afford training and benefit programs that smaller companies cannot afford to offer. This does not mean that a smaller company should not engage in strategic human resource management. Providing specialized on-site training, even if provided by senior members of the company, and offering one-on-one assessment and coaching sessions, can help employees reach peak performance rates.

An important aspect of strategic human resource management is employee development. This process begins when a company is recruiting and interviewing prospective employees. Improved interviewing techniques can help to weed out applicants that may not be a good match for the company.

After being hired on, a strong training and mentoring program can help a new member of the staff get up to speed on company policies and any current or ongoing projects they will be working on. To help employees perform at their best, a company can follow up with continual training programs, coaching, and regular assessment. Investing in the development of its employees can allow a company to turn out more consistent products.

Strategic human resource management is essential in both large and small companies. In small companies, this may be as simple as the owner or manager taking a little time every day to observe, assist, and assess employees, and provide regular reviews. Larger companies may have a whole department in charge of human resources and development. By meeting the needs of the employees in a way that also benefits the company, it is possible to improve the quality of staff members. Taking the effort to provide employees with the tools they need to thrive is worth the investment.

SmartCapitalMind is dedicated to providing accurate and trustworthy information. We carefully select reputable sources and employ a rigorous fact-checking process to maintain the highest standards. To learn more about our commitment to accuracy, read our editorial process.
Margo Upson
By Margo Upson
With a vast academic background that has ranged from psychology and culinary arts to criminal justice and education, Margo Upson brings a wealth of knowledge and expertise to her role as a SmartCapitalMind writer. Her wide-ranging interests and skill at diving into new topics make her articles informative, engaging, and valuable to readers seeking to expand their knowledge.
Discussion Comments
By anon960208 — On Jul 09, 2014

Good material, I agree. Organizational strategies are all linked to achieving its long term objectives - long term survival. Important to consider are the organizations' core competencies. That's where its Human Capital comes into play. The more effective its people are, the better it is positioned to achieve the strategic goals in relation to its internal and external environments, of course.

By anon343210 — On Jul 28, 2013

This is a hotly contested and debatable topic, hence comments are generally a function of the perspective of the individual.

In my opinion, SHRM, is more about strategically aligning an organization's human capital to the business objectives and financial goals of the organization.

This covers a wide range of activities from organizational positioning (reputation) as an organization of choice for prospective employees in its reward systems, recruitment, training and development of employees an objective not only targeted toward better customer service, but also for the retention of the firm's best performers.

By anon336701 — On May 30, 2013

Strategic HR is about the business' objectives and financial goals of the firm. One aligns an "HR strategy" to achieve these. "Strategy" is about maximizing the firm's ability to make money (business model). The key to this is knowing what are our labor costs? What is the quality of our customer service versus that of our competitors? What is our quality versus the industry norm? There are many more questions, but it's about the business model, not about employees.

I didn't see any of that mentioned above. Most of the stuff above was about employees and thus, "tactical HR".

By anon329130 — On Apr 08, 2013

I want to know what is the link between SHRM and the recruitment model such as the STAR.

By anon300897 — On Nov 01, 2012

What is the process use by an organization to plan its physical resource requirements?

By anon282743 — On Jul 31, 2012

How do we integrate Strategic Human Resource Management into the organization's strategy while striving for the accomplishment of the organizational goals?

By anon273390 — On Jun 06, 2012

What are the implications of strategic human resources management?

By anon269016 — On May 16, 2012

What are the most important strategic aspects of human resources management as applied to purchasing?

By anon267354 — On May 10, 2012

Do you think that it is easier to tie human resources to the strategic management process in a larger or smaller organization? Why?

By anon186410 — On Jun 15, 2011

Please can anyone explain a comprehensive model of Strategic Human Resource Management?

By anon185695 — On Jun 13, 2011

I've been searching the web and this resource is useful and straight to the point. keep it up.

By anon138474 — On Jan 01, 2011

Human resource planning is an activity that an organization must go into when it has shaped its business strategy. for example, it may want to increase production by 10 percent by the end of a year. Managers should then plan for the right quantity and quality of human resources that will enable the organization to realize its objective.

Depending on circumstances and factors prevailing in the organization, that may lead to expansion or reduction of workforce, redeployment or enrichment of certain jobs. Human resource planning does not always translate into hiring of new employees.

By anon138468 — On Jan 01, 2011

A very useful article for people interested in human resource management. I just want to add a few comments that may broaden our understanding or trigger debate.

Strategic human resource management is obviously directed at achieving organisational objectives. While it is directed by organisational strategy (which may change depending on whether the organization is expanding activities, developing a new product or reorganising its activities), strategic human resource management must be an ongoing activity.

Management must continuously scan the human resource environment in order to identify developments that can either enhance or threaten its survival. Managers must be proactive and cannot wait for things to happen first. Strategic human resource managers, for example, study workers' habits, needs, tastes and so on in order to predict their (workers) possible actions and movements and the impact these will have on the organization.

By anon123368 — On Nov 01, 2010

i just wanted to know what are the alternatives of strategic HRM?

By anon97526 — On Jul 20, 2010

discuss the intergrating hr issues with business strategy.

By anon90241 — On Jun 15, 2010

thank you for the nice definition of SHRM.

By anon88983 — On Jun 08, 2010

This is very essential information to human resource personnel and very vital to the growth of an organization.

By anon80887 — On Apr 29, 2010

Excellent and to the point. Very helpful and interesting.

By anon80361 — On Apr 27, 2010

very useful. thank you very much!

By anon79611 — On Apr 23, 2010

I was looking for the need of SHRM and after searching heaps, finally got the article which is really helpful. Thank you very much.

By anon75614 — On Apr 07, 2010

how much money would a company loss if they fire someone?

By anon75373 — On Apr 06, 2010

thank you very much. it was very helpful in knowing the exact definition of SHRM.

By anon67747 — On Feb 26, 2010

this is really useful info. However, I've been trying to find some info on the founding fathers of HRM.

By anon66538 — On Feb 20, 2010

to anon40931: H.R. Planning is the process by which management determines how an organization should move from its current manpower position to its desired manpower position.

One of H.R.P objectives is to connect the H.R.P with organization planning which means the organization strives to have the right kind of people at the right places at the right time doing things which results in a benefit to the organization through the help of the Human Resource department.

i believe the organization strategy is a result of HR planning because an organization strategy is an organization's long term plan of how it will balance its internal strengths and weaknesses with its external opportunities and threats to maintain a competitive advantage, etc.

By anon56602 — On Dec 16, 2009

good material for students.

By anon40931 — On Aug 11, 2009

How does human resources planning link to the organization strategy?

By anon36144 — On Jul 10, 2009

Excellent and very useful. Thank you very very much

Margo Upson
Margo Upson
With a vast academic background that has ranged from psychology and culinary arts to criminal justice and education,...
Learn more
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