What is strategic human resource management?
What is strategic human resource management?

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What is strategic human resource management?

The link between ‘trends’ and theories

Five trends – and their associated theories – are summarised below. We suggest that each of these should be treated as propositions requiring testing and qualification rather than as absolute truths.

  1. Globalisation feeds hyper competition. This theory suggests that global transportation systems, such as air-freight and massive seaborne container carriers, facilitate extensive and complicated supply chains which allow products such as clothing and electronic goods to be produced and shipped for very low unit costs. Added to this, business support services such as accountancy and IT, and even functions such as R&D, sales and marketing can be dispersed and configured globally.
  2. Deregulation and the lowering of trade barriers. This theory suggests that where governments and other regulatory authorities liberalise their rules, the globalised capabilities mentioned above may be accelerated.
  3. A retreat from bureaucracy and a shift to networked forms. This is the theory that there is a change in the way work is organised – drawing on collaboration rather than hierarchy and formal rules. One major manifestation of this is the growth in forms of work which differ from the archetypal model of full-time employment (Cappelli and Keller 2013). These include part-time work, temporary work, contract work, agency work and many other types of ‘non-standard’ employment. Agility and responsiveness become prized over standardisation and economies of scale.
  4. Another theory is that rapid advances in technology also support and accelerate the above trends. Information and communications technology supports global supply chains and international networked organisations. In addition, automation has already reduced the number of routine manufacturing jobs and so has transformed the nature of workplaces and reduced the need for armies of supervisors and production managers. Routine white collar office jobs are now also being subject to automation and to inroads from artificial intelligence. Many high street retail jobs have been lost to online shopping. Amazon.com provides a classic example. This revolution means that work is polarising into, on the one hand, knowledge work where creativity and intellectual capital is critical, and on the other, personal service work such as hairdressing and social care. The implications for HR are the drastic reductions in traditional industrial and traditional white collar occupations and a severe questioning of the continued relevance of much conventional personnel administration.
  5. The death of deference is a theory in the social sphere. Shifts in identity and social structures such as mobility and the breakdown of traditional communities lead to social patterns built on consumption rather than production. The social world is also characterised by the VUCA elements noted in the introduction to this free course. Social norms and values become less certain.

We will be concerned to understand what implications such wider contextual trends carry for the practice of human resource management.

One immediate implication can be noted. The above five trends lead on to another general phenomenon which can be called ‘new modes of managing’. If traditional personnel administration approaches to people management are ill-fitted to the new work landscape then the new forms appear to depend on more sophisticated modes of managing through common purpose and values. There are associated HR implications including a need to accommodate flexible working of all kinds; to combine and recombine teams from across the globe on a regular basis; and to manage at a distance.

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