Role of Strategic HRM in Organization
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Introduction to Strategic Human Resource Management
Research project explored the complete scenario of Strategic human resource management. The strategic HRM helps organization in achieving competitive advantage over other rivals. It addresses reputed firm so long term strategic decisions are efficiently taken and identifies their affect on organization behavior and success (Sheehan, 2005). HRP deals with personal objectives so it is beneficial for individual as well as organization also. It enhances the market share and profit margin which maintains and retains talented employees with them.
AC 1.1 Importance of strategic human resource management in organizations
SHRM is a process in which effective utilization of resource in well planned manner is present to achieve the goal of organization. In every organization, human resource is an important asset and it is required that it treats employees well. The Millennium hotel UK offers dynamic hospitality services to the customers. It follows contingency model, which proposes that effective group performance depends on a relationship between the leadership styles and the situation. They assign tasks to their staff members in a proper manner and lead their subordinates through rewards system so they give their best in success of the organization (Human Resource Management International Digest, n.d). Established firm achieves its vision, mission and other long-term or short-term goals in well planned manner by successfully implementing the strategic human resource in respective order. Other important points of strategic human resource management are described as follow:
Strategy Define: Strategic Human resources management helps the firm to make business strategies in more effective way so that it can achieve its goal in a well planned manner.
Leader member relationship: HRM is helpful for the reputed hotel to maintain better relationship with customers. They respect customers and improve the lives of employees by providing compensation and rewards in a timely manner (Park and James, 2004). The contingency model used by the hotel can help in preparing employee benefiting policies so the talented employees get easily attracted and retained in the firm.
Task structure: Management of hotel uses SHRM effectively to reduce the company’s costs and it would be helpful in recruitment, selection and employee satisfaction related activities of the hotel. It links operating strategy with asset management for disciplined control of costs.
AC 1.2 Assess the purpose of strategic human resource management activities in an organization
The strategic HRM helps the hotel in achieving competitive advantage through HRM. It addresses organization so long term strategic decisions are efficiently taken and identifies their affect on organization behavior and success. SHRM generated strategic capability and ensured them, reputed firm has well-motivated, skilled and committed employees. It will be helpful to achieve sustained competitive advantage and in competing with other rivals. By development and implementation of HR policies, the individual and organization collective needs have got fulfilled in well planned manner (Kumar, 2010).
SHRM puts great emphasis on the making strong human relations and concerns with communication, involvement and security of employment. It makes proper balance between the hard and soft elements of organization to achieve goals. Without proper human resources management, organization cannot achieve their goals. On the basis of strategic business contribution in activities, HRM objectives must be evaluated. It supports the organizational principal such as profitability, ethics business reputation, and principles. It helps in scanning environment and ensures that fair and legal treatment is done with employees (Jackson, 2008.).
Other purposes of SHRM are job analysis, competency modeling, and measuring performance, providing feedback and promoting workplace healthy and safety. Strategic human resource also helps the organization to make good relation with stakeholders, customers, society and other organizational members.
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AC 1.3 Contribution of Human resource management to the achievement of an organization’s objectives
SHRM plays vital role to achieve organizational goals in well planned manner.
HRM strategy: It helps hotel in efficient execution of human resource policy so organization effectively utilizes employee's skills and human capital in right direction. It is beneficial in maintaining strong relationship among team members so all workforce works together to achieve common goal. HRM policy influences the organizational strategy of the Millennium hotel because it maintains high standard of corporate governance in business operations and keeps updating their stakeholders by providing information on time. The hotel ensures the customers that the information provided by them is encrypted and secure. But it is difficult task and for this the firm will require appointing security experts who have the capability of handling such kind of issue.
In hotel, people belonging to multiple cultures are working together, SHRM works as a mediator between them and encourage the staff members to share new ideas without any hesitation & language barriers. It helps in managing globalization and adopting corporate social responsibility in business so that organization achieves its objective in significant way. It creates a healthy working environment where trust, mutuality and collaboration get enhanced between employees (Fombrun, 2008). Millennium hotel used risk management system to map the nature of the risk like financial, leadership etc. It is required for the firm to make a committee, provide training and assign responsibility to staff members for eliminating or transferring risks.
HRM policy influence the human capital of the firm and if hotel framed policy than it contribute ethically and socially to solve out emerging challenges like laws regarding safety, HR decisions etc. Strategic human resource helps department of hotel to understand their need and effectiveness to attain organization goal. It reduce employees’ dissatisfaction so that employees get motivated to work together to achieve common organization goal. It would help in improving the performance of employees by providing training and development (Sheehan, 2005).
AC 2.1 Business factors that underpin human resource planning in an organization
SHRM helps organization to make policies so they can achieve better result. The businesses factors involved in human resource planning are described as follow:
Business growth: Demand for products and services influence the growth of business. When hotel expand their business in same country or abroad then they require staff who have high skills such as language proficiency, technology knowledge etc.
Capital for labor substitution: The internal working arrangements of organization are affected through business unit expansion because firm requires capital to recruit more skilled employees and it spends on training of employees. (Sheehan, 2005).
Business Decline: In case hotel sales decline, this may occur due to several reasons like rate of product is too much or too low; in both cases demand does not match with supply, global competitions, changes in customers’ preference and new regulatory regulations affect the HRP of the firm. In this case, reputed firm layoff human capital and adopts retrenchment strategy so that the company focuses on effective utilization of resources (Hernandez, 2009).
Impact of technology: In the global era, difficult competition is arising in market and customers’ preferences are also changing. They demand good quality products in lesser prices. So if hotel adopts new technology then it is able to high offer quality of services like online booking facility to customer which will attract them toward the brand.
Location of operations: The Millennium hotel is operating in best places in the city so labor is easily available and transportation cost are less.
Other factors such as labor market competition, employee development and competition present in market influence the human resource planning of an organization. The firm can take benefits from the market by effective utilization of labor and providing training and compensation to them so they will contribute in success of the organization .So the hotel will come in position to better compete with other competitors in a proper manner (Sheehan, 2005).
AC 2.2 Assess the human resource requirements in a given situation
Identifying personnel requirements: To achieve organizational goal several things are required like numbers, skill sets, experience, qualifications.
Size of organization: Based on size of hotel, staff is recruited. The firm determines the manpower requirement and assigns responsibilities at all levels. Organization could mobilize manpower planning to effectively use human capital in a well planned manner.
Skills set & qualification: Task is assigned to employees on the basis of their skills and knowledge related to specific area. If employees belong to finance background then firm appoints them in finance department and utilizes their financial skills to improve productivity of firm and manage cost structure. Based on qualification and experience employees are promoted to higher positions in the organization (Shortland, 2006). Building up the profile of staff members by providing training, experience and qualification.
Skills requirements: Hotel provides training to their employees and enhances their core area skills that are needed by employers so that they are in position to better compete with other competitors. Firm motivates employees through plans for future - appraisals, awards, certificates etc. so they synchronize their personal goals with organizational goals (Ling and Qing, 2014).
Demand of labor: It is affected through change in business needs, productivity of labor and levels of national insurance contributions, health and safety legislation, training and cost and productivity of machinery and technology etc. If hotel staff members are skillful then their demand will increase and it improves quality of service to the customers.
Supply of labor: Supply of labor depends on the demand in market. Economic ups and downs, unemployment, recession, boom period affects the supply of labors. In recession time, decline in demand of labor results in increase in supply of employees and in form of reduction in the real value of wages, compensation and perks are provided to them (Aladwan, 2014).
Other requirements: Government policies influence the organizational goal because in the UK, government policies are favorable to hospitality industry; it generates employment opportunities at regional and national level. So labor competition in market increases. To retain the skillful employees within organization, the firm has been investing in training and development programs to retain labor and better compete with other competitors.
AC 2.3 Develop a human resources plan for the Millennium Hotel
HRP is a continuous process. Human resource management is the practice in which people are managed in well planned manner to achieve organization goal.
Purpose: Millennium Hotel expands its business in other locations, for that it requires human capital and other resources. Manger and top people identifies the needs of the firm, creating the opportunities within the organization.
Recruitment and retention: After selecting the profile of user, hotel conducts interview which may be telephonic or face-to-face. The hotel should recruit skilful employees, check their qualifications and knowledge related to hospitality industry. When company finds the employee suitable for job then they should appoint them. With new appointment firm should also retain the existing employee also by providing perks and compensation on timely manner.
Job Analysis: With help of job analysis process, the hotel would identify the needs of human capital, Nature of the job, Materials and equipment to be used and other attributes like education, training etc. for opening new plants in a proper manner (Deb, 2006).
Re-skilling: The firm should understand the nature of the recruitment and development process and then appoint skilled manpower and thereby making effective utilization of resources. Systematic steps must be taken to store talent with organization. It helps to determine the demands of a job in terms of skills, qualities and assign responsibilities and duties to perform these tasks (Fombrun, 2008).
Personnel (Manpower) Forecasting: The Millennium hotel, forecasts the number of personnel required for planning location with help of work-load analysis. The sales forecasts and work schedules need to be found out and based on that the manpower required for location will be decided
Succession planning: By using this technique, hotel can increase the availability of experienced and capable employees within organization. It promotes them for advancement or more challenging role.
Training and Development of Personnel: Training session will be conducted for learning new expertise for new employees as well as existing employees; it is beneficial for the preparation and managing skill inventory (Hernandez, 2009).
AC 2.4 Evaluate how a human resources plan can contribute to meeting an organization’s objectives
HR plan maintains the organizational structure and working relationships among all members of the organization so that they grow in a well planned manner. By providing fair and efficient leadership the firm minimizes socio-economic evils like unemployment, under-employment etc. and improve the welfare of society. Established organization creates favorable atmosphere and good working conditions for maintaining stability of employment (Sheehan, 2005).
Human resource plan helps Millennium organization to prepare business roadmap and expand business across geographies in the market. It contributes to establish the culture, values and work ethics of the organization to compete with other competitors’. HRP helps reputed firm to reach in terms of milestones/goals by inherent “people needs. It manages manpower acquisition and development of human capital so enhances in its business growth and increase operational efficiency. It would be helpful for organization to achieve its short, medium, long-term goals. SMART techniques are used in which a goal should be specific and describes about who is involved in process, time frame, requirements and constraints. Organization sets the goal will be measurable. To attain the aim that includes attitudes, abilities, skills, and financial capacity.
A high goal of firm is realistic and grounded within a time frame (Armstrong, 2008).
AC 3.1 Purpose of human resource management policies in organizations
Millennium organization develops the policy for recruitment and selection which clearly mentions the job title, location, grade of the post, purpose of the job and duties and responsibilities. Other special working conditions like shift working pattern, obtain health clearance will be checked. Firm should provide equal opportunity to individuals or in groups and follow health and safety legislation at workplace. In policy guideline, it is mentioned to protect the health and safety of their employees related to prevent workplace accidents, injuries and diseases. Appropriate training will be provided to handle dangerous equipment and informing employees about working conditions and setting up safe work practices (Fombrun, 2008).
If employees are well performers, company provides rewards and compensation to motivate them so they will give their best and organization attains its goal in significant manner. Millennium promotes equality of opportunity for all staff so discrimination and unfair treatments are reduces. The firm should provides an open and transparent mechanism to measures performance and rewarding. Organization should effectively manages and forces on confidentiality of information of employees. In policy, it is clearly mentioned that smoking, drugs and alcohol are prohibited at workplace (Aswathappa, 2005).
AC 3.2 Impact of regulatory requirements on human resource policies in an organization
Organization has responsible to pay fair amount to workers and maintain the health and safety provisions in term of equal opportunities, providing safe environment and machinery and effectively handle health related issues. Age discrimination helps organization to prevent direct discrimination, indirect discrimination, harassment and victimization at work place (Legislation law UK, 2014). Employment Act 2010 is developed to protect the rights of individuals and to check equality of opportunity for all. Several discrimination laws come under this like Equal Pay Act 1970, Sex Discrimination Act 1975, the Disability Discrimination Act 1995, the Employment Equality (Sexual Orientation) and Equality Act 2006 etc.
Millennium promotes equality of opportunity for entire staff so discrimination and unfair treatment gets reduced. Race Relations Act and Race Relations Amendment Act are applied on working environment to provide equal chances to individuals and no partiality should be done on basis of color, race, nationality or ethnic value. It offers social security, social protection, and health care and prevents insulting on bases of racial groups.
The Employment legislation provides benefits in form of effective business planning, equal opportunity offers to individuals, handling changes in employment, safety and security from hazardous working environment at workplace, restrictions on child labor, working time regulation, minimum wage rate, mandating a minimum period, options of the private pension and set minimum standards for worker and create minimum standards of decorum at work etc (Legislation law UK, 2014).
AC 4.1 Analyze the impact of an organizational structure on the management of human resources
Weber theory is adopted by Millennium organization for industrial location which focuses on Regional factors like invests in training and development activity and maintain labor costs by diversify operations. Based on weight to be transported and distance to be covered, company develops strategy and it influences the structure of organization. Agglomerative factor is also used by reputed firm to cheapen production which is carried on at one place. Through this method organization communicates, adapts changes and utilizes its resources. Organization structure is also influenced through functional and products that they are producing (Coser and Rogers, 2010).
Millennium uses decentralization approach because it is easy to control overhead savings and economies of scale are easily achieved. Reputed firm uses specialization and decision-making is quick that helps organization in form of increase market share and profit margin.
AC 4.2 Analyze the impact of an organizational culture on the management of human resources
Charles Handy expounded his Four Cultures theories that are described as follow:
The Power Culture: It is based on Zeus and states whether culture is centralized or top-down. The Millennium hotel, adopt this culture because monitoring is done through single system.
The Role Culture: Based on Apollo culture, it is bureaucratic, in which strict procedures and narrowly defined roles are followed (Management Theory of Charles Handy. 2014). According this culture respective hotel defined the role & responsibility of their staff members.
The Task Culture: It is based on Athena, small-team-based culture that has flexibility, adaptability and results oriented. The Company can divide the work and assigned it to sub team so increase the efficiency of the work.
The Person Culture: Based on Dionysius, it is focused on the individual and it has value oriented to fulfill self-actualization needs. Based on individual skills responsibility are assigned and monitoring the work to improve in business process. Cultural impact comes on organization working structure like Compensation and reward systems, Performance management programs, Recruiting and Selection, Talent acquisitions efforts and Training & Development programs.
AC 4.3 Effectiveness of human resources management is monitored in an organization
Millennium organization achieves its goal by formulating HRM strategies and policies in successful manner by executing business operation in well planned manner. It improves the workplace structure and support equal employment opportunity at work place. With help of Balance card method and grading method check the performance of the system. By effective utilizing human capital management organization attains goal and enhances its profit margin.
The performance is measured in term of quality of output, individual contribution in task. In qualitative term, hotel can examine the output of system with help of survey (collect data from employees about their desire and wants) and stakeholders’ terms (pay divided on time and satisfy customer by providing quality of services in reasonable price).
It provides the facility of professional growth, contribution in maintaining better relations between union and management, identifies potential employees and allocates the jobs to the right person at right time (Kumar, 2010). Effective Human Resource increases the performance of individual and company also. Reputed firms get benefits in form of enhanced productivity, output per person, retention of talented employee so they can achieve their target and compete with other rivals. It promotes employee discipline and enhances their moral so that performance improves and costs are saved (Bramham, 2000.).
AC 4.4 Recommendations to improve the effectiveness of human resources management in an organization
The Millennium hotel should allow their employees to learn new job skills, provide equal opportunity to them to work together and share ideas so they can effectively use their skills in right direction. Company might be focused on building relationships with staff so they will perform better. Organization can be use the Survey method, measure the performance of employees in terms of different job satisfaction criteria (Human Resource Benchmarking. n.d).
Benchmarking methodology could be adopted by firm to measure performance assessment. In Internal Benchmarking reputed firm measures its own performance with comparison to business changes and compare results over time. The hotel can measured individual performance on basis of involvement in different activities. External benchmarking can be used by firm to compare organization’s performance with other organizations. It will helpful for organization to develop action plans and enhance future performance levels.
The Human resource management plays an important role in both medium- and long-term perspective. It helps the reputed firm to identify, investigate and resolve workplace issues and support the company's fair employment practice. With help of strategic management reputed firms can increase their productivity by effective using human resource. It is helpful for company in attainment of that goal (Bhattacharyya, 2009). Research report concluded that human resource planning is essential for organization to effectively use human capital so they can contribute to meeting an organization’s objectives in significant way. HRM and Human resource polices are required for organization to improve organization culture & structure and increase performance levels.
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