Strategic Planning and HRM

Strategic Planning and HRM
Learning objectives
• Understand the nature of strategic management
• Describe the strategic management process
• Integrate HR functions with the strategic
management process
Strategy
Strategy is a way of doing something. It
usually includes the formulations of a goal
and set of action plans for accomplishment
of that goal.
Strategic Planning understand as the
process of formulating, implementing and
evaluating business strategies to achieve
organizational objectives.
So it includes environmental scanning,
strategy formulation, strategy
implementation and evaluation and control.
Therefore strategic management involves four
steps
1.Analyses the opportunities and threats or
constraints that exist in the external
environment
2.Formulate strategies that will match the
organization’s strength and weakness with
the environmental threats and opportunities
3.Implement the strategies
4.Evaluate and control activities to ensure that
the organization’s objectives are achieved
Strategic Management process
Environmental scanning
Strategy formulation
Strategy implementation
Strategy evaluation and control

Strategy Strategy Evaluation
Environmental
Formulation implementation and control
Scanning
Corporate
strategy
formulation Strategic
Programmes
External Business control
budgets
strategy process and
formulation procedures
performance
Internal Functional
strategy
formulation
Strategic management process

Environmental Scanning
• Scanning helps identify threats and
opportunities existing in the environment.
• Threat to one company may be an
opportunity for another.
• The oil crises threatened oil-fired
electrical utilities, but provided a great
opportunity for coal producers and
shippers.
Strategy Formulation
it is formulated in three levels
1.Corporate level strategy – this is
formulated by the top management of an
organization
• What kind of business
• What are the goal and expectations
• How should resources be allocated to
reach these goals?
2.Business level strategy – how should
we compete in the chosen industry or
business?
• Need market, competitors, different
goals from the competitors
3.Functional level strategy - each
business unite will consists of several
department such as manufacturing,
sales, finance, HRD.
It identify the basic courses of action
that each of the department must
follow in order to help the business
unit to attain its goal.
Strategy Implementation
It requires such actions, as adding new
departments, hiring new employees,
changing an organization’s pricing
strategies, developing financial budgets,
employees benefits, changing
advertisement, training, transfer etc.
Strategy Evaluation
1.Establishing performance targets
2. Measuring the performance
3.Analyze deviations
4.Execute (carry out) modifications.
Importance of Strategic Management
Strategic management offers both
financial and non-financial benefits to
an organization
1.Identification and prioritization of
opportunities
2.Provides an objective
3.Improved coordination and control of
activities
4. Minimizes effects of adverse
conditions and changes
5. Allows major decisions to better
support established objectives
6. Time and resources to identified
opportunities
7. Creates a framework for internal
communication among personnel
8.Helps to integrate the behaviours of
individuals into a total effort.
9.Provides a basis for the clarification
of individual responsibilities.
10.Gives encouragement to forward
thinking.
11.Provides a co-operatives,
integrated and enthusiastic
approach to tackling problems
and opportunities.
12.Encourage a favourable attitude
towards change.
Role of HRM in Strategic Management
 HRM function is getting integrated
into strategic management process.
 More and more HR managers are
involved in the strategic management
process.
Role in strategic formulation -
HR manager supplies competitive
aptitude that is useful in strategy
formulation
Role in strategy implementation -
HR manager helps strategy
implementation by supplying
competent people.
And HRM facilitates strategy
implementation by encouraging
practical thinking, communicating
goals and improving productivity and
quality.
HR function can contribute to strategic
plans and actions of the firm in the
following ways
1.Encouragement of pro-active (practical)
rather than reactive
2.Open communication of goal
3.Stimulations of critical thinking
4.Productivity (output) as an HR based
strategy
5.Quality and service are HR-based
strategies
6.Proficient (capable) strategic management
Corporate level strategy Cor
porate
level
strategies
Re
Growth trench
Stability
strategy ment
strategy
strategies
Hori Vertical
Hori Vertical
zontal integration
Internal zontal Congio integration Strategic Turan Di Liqui
Related Of un Mergers
growth Inte merate Of related alliances around vestment dation
Diversi related
gration business
fication business
Business level strategy
Business
level
Strategies
Of the
siyaram
Poddar
company
Siyaram
Govind Balakrishan
silk
rubber industries
mills
Functional level strategy
Functional
Level
strategy
Manufacturing Sales Finance HRD

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Strategy evaluation and control

Strategic management process

Manufacturing Sales Finance HRD

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