Human Resource Management vs. Strategic HRM

To enhance the efficiency and productivity, organizations are required to pay attention to their most valuable asset – The Human Resource. An efficient and skilled workforce, is when aligned with the organizational objectives, works wonder in achieving the goals in the big picture.

The specialized efforts, involving effective planning, in managing the Human Resource is the strategic HRM.

“To win the marketplace, you must first win the workplace.”

This timeless statement from the ex-CEO & president of Campbell- Doug Conant is guidance for the firms to ponder on the strategic planning with their human resource.

While Human Resource Management is applying the conventional principles in recruiting, developing, training, and retaining the workforce, the Strategic approach is its extension, ensuring that HRM objectives are consistent with those of the related department and the organization as a whole. It is a tactic to manage people that support an organization’s long term goal with an overall planned and coherent framework.

It is important to realize that the Strategic Human Resources Management is entirely independent of the HR Strategy. The strategic approach is about the way how Human Resources work.  it is not about the vision of Human Resources.

Major Differences and comparison:

• Process Type:

Human Resource Management is a reaction based approach where the managers react to a change.

Strategic Human Resource Management is a proactive approach aiming to create a change from the start. Determining the operational requirements and expansion areas, the plans are conceived to attain the strategic objective.

• Focus Area:

HRM focusses on the employee management and the relationships with them in the internal issues and their motivation.

SHRM concentrates on developing partnerships with internal as well as external parties.

• Time Span

HRM is related to the short term objectives with the capital and products as the main elements.

SHRM is focused on the long term objectives, with the individuals and their knowledge as the fundamental element.

• Control:

In HRM there is a strict control over employee and in contrast, SHRM offers lesser control and also the workforce regulations are not so strict.

Benefits:

The purpose and the biggest benefit of strategic human resource is improving organizational performance by integrating individual efforts aligned to the business strategy. Other benefits associated are:

• HR-Related Impact: Lower turnover, reduced absenteeism, better job satisfaction, and higher employee commitment.
• Organizational Impact: Enhanced productivity, quality, efficiency, services, and client experience.
• Financial Impact: Better profits, increased sales, and better returns on assets and investments.

All these features also improve the performance in capital market which can be seen with increased market share, stock price growth.

Winding Up:

The significant differences in both terms are evident with such comparison, but it is also obvious that SHRM is the branch emerged from the conventional HR management approach. In the last decade organizations have started to acknowledge the close relationship of HR practices with the business functions and the overall organizational goals. The development of strategic & aligned approach, and the perceptible results delivered with it, corroborates this relationship.