Strategy and Human Resources Planning

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Strategy and Human Resources Planning




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Presentations text content in Strategy and Human Resources Planning

Slide1

Strategy and HumanResources Planning

1–1

The Challenges of Human Resources Management

Slide2

Strategic Planning and Human Resources

Strategic PlanningProcedures for making decisions about the organization’s long-term goals and strategiesStrategy

formulation: the process of deciding on a strategic direction by defining an organization’s mission and goals and its SWOTsThe process of devising structures and allocating resources to enact the strategy a company has

chosesStrategy implementation: plans are enacted and put into place Human Resources Planning (HRP)Process of anticipating and making provision for the movement (flow) of people into, within, and out of an organization.

Slide3

Why Strategic Planning Is ImportantTo All Managers

The firm’s strategic plan guides much of what is done by all to accomplish organizational goals.

Decisions made by managers depend on the goals set at each organizational level in support of higher level goals.

Slide4

Strategic Planning Process

Strategic Human Resources Management (SHRM)The pattern of human resources deployments and activities that enable an organization to achieve its strategic goals

Strategy formulation —providing input as to what is possible given the types and numbers of people available.Strategy implementation —making primary resource allocation decisions about structure, processes, and human resources.

1–4

Slide5

Step One: Mission, Vision, and Values

MissionThe basic purpose of the organization as well as its scope of operationsStrategic VisionA statement about where the company is going and what it can become in the future; clarifies the long-term direction of the company and its strategic intent

Core ValuesThe strong and enduring beliefs and principles that the company uses as a foundation for its decisions

1–5

Slide6

Merck & Co.’s Mission and Values

Slide7

Starbucks’ Corporate Mission Statement

Slide8

Strategic Planning Process

Strategic Human Resources Management (SHRM)The pattern of human resources deployments and activities that enable an organization to achieve its strategic goals

Strategy formulation —providing input as to what is possible given the types and numbers of people available.Strategy implementation —making primary resource allocation decisions about structure, processes, and human resources.

1–8

Slide9

Type

of Strategy at Each Company

Level

Slide10

Environmental Analysis

Environmental ScanningThe systematic monitoring of the major external forces influencing the organization.Economic factors: general, regional, and global conditions

Industry and competitive trends: new processes, services, and innovationsTechnological changes: robotics and office automation

Government and legislative issues: laws and administrative rulings Social concerns: child care and educational priorities Demographic and labor market trends: age, composition, literacy, and immigration1–10

Slide11

Worksheet

for Environmental Scanning

Slide12

SWOT

Matrix, with Generic Examples

Slide13

Personal SWOT Analysis

http://homepages.se.edu/cvonbergen/files/2012/11/SWOT-Analysis-for-Individuals_060313.docx

1–13

Slide14

Types of Corporate Strategies

Concentration

Vertical integration

Diversification

Corporate Strategy Possibilities

Consolidation

Geographic expansion

Slide15

Strategic Planning Process

Strategic Human Resources Management (SHRM)The pattern of human resources deployments and activities that enable an organization to achieve its strategic goals

Strategy formulation —providing input as to what is possible given the types and numbers of people available.Strategy implementation —making primary resource allocation decisions about structure, processes, and human resources.

1–15

Slide16

Linking Strategic Planning and HRP

Strategic Analysis What human resources are needed and what are available?Strategic FormulationWhat is required and necessary in support of human resources?

Strategic ImplementationHow will the human resources be allocated?

1–16

Human Resources PlanningStrategic

Planning

Slide17

Strategic HR Choices

Slide18

Comparison

of Selected Human Resource Practices in

High-Performance

and

Low- Performance Companies

Slide19

The Human Resources Planning Process

1–

19

Slide20

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20

Slide21

10 Things Managers Should Avoid When Supervising Temporary/Contingent Employees

Treat the temporary employee as if the temp agency is in fact his or her employerDO NOT

Slide22

Quantitative Approach: Trend Analysis

Forecasting labor demand based on an organizational index such as sales:Select a business factor that best predicts human resources needs.Plot the business factor in relation to the number of employees to determine the labor productivity ratio.

Compute the productivity ratio for the past five years.Calculate human resources demand by multiplying the business factor by the productivity ratio.

Project human resources demand out to the target year(s).1–22

Slide23

Forecasting Demand for Employees

1–23

Slide24

500 Bed Hospital → 1200 Beds

Size of Hospital (Number of Beds)

Number of Registered Nurses200

240300260400470500

500600620700660800

820900860

Slide25

Excel Problem: Beds and Nurses

1–25

Slide26

Forecasting the Supply of Employees: Internal Labor Supply

Staffing TablesMarkov AnalysisSkill Inventories

Replacement ChartsSuccession Planning

1–26

Slide27

Forecasting the Supply of Employees: Internal Labor Supply

1–

27

Slide28

Internal Demand Forecasting Tools

Skill InventoriesFiles of personnel education, experience, interests, skills, etc., that allow managers to quickly match job openings with employee backgrounds.Replacement Charts

Listings of current jobholders and persons who are potential replacements if an opening occurs.Succession PlanningThe process of identifying, developing, and tracking key individuals for executive positions.

1–28

Slide29

Skills inventory and HRIS

Slide30

Internal Demand Forecasting Tools

Skill InventoriesFiles of personnel education, experience, interests, skills, etc., that allow managers to quickly match job openings with employee backgrounds.Replacement Charts

Listings of current jobholders and persons who are potential replacements if an opening occurs.Succession PlanningThe process of identifying, developing, and tracking key individuals for executive positions.

1–30

Slide31

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31

Slide32

Calculating employee Turnover

and Absenteeism

1–

32

Slide33

Employee Turnover Rates

Computing Turnover Rates (for a month):The U.S. Department of Labor suggests the following formula for computing turnover rates:

Thus, if there were 25 separations during a month and the total number of employees at mid month was 500, the turnover rate would be:

25/500 X 100 = 5%1–33

Slide34

How would you determine annualized turnover?

Slide35

Key Terms

1–35

Balanced Scorecard (BSC)

benchmarkingcore capabilitiescore valuescultural audits

environmental scanninghuman capital readinesshuman resources planning (HRP)management forecasts

Markov analysismissionorganizational capabilityreplacement charts

skill inventoriesstaffing tablesstrategic human resources management (SHRM)strategic planningstrategic vision

succession planningSWOT analysis

trend analysisvalue creation

Slide36

Slide37

Slide38

Chapter 2 - Learning Outcomes

Learning Outcome

Statements

Related Outcomes from Body of the Text1

Identify the advantages of integrating human resources planning and strategic planning. Why is HR planning integral to a firm’s strategic planning? As an HR professional, what do you think you could do to tie the two functions together?

2Understand how an organization’s competitive environment influences its strategic planning.

What external factors in the environment do you think firms are most likely to overlook when formulating their business strategies? How can an HR manager help its executive team get a fuller picture of the competitive environment in which it operates?3Understand why it is important for an organization to do an internal resource analysis.

Think back to the discussion in Chapter 1 about the auto-parts makers that had to look for new business lines when GM, Ford, ad Chrysler sales plummeted in the last recession. How do you think the auto-parts makers assessed their ability to enter their new markets? Do you think they looked first at new markets and then the capabilities of their employees and external partners or vice versa?

4

Describe the basic tools used for human resources forecasting.

If you are currently employed, ask your manager how your

firm goes

about forecasting

5

Explain the linkages between competitive strategies and HR.

Think about a firm you enjoy doing business with or one you don’t. What competitive strategy does it pursue? Do you think its employees have the right skills given the strategy? Do you detect any mismatches?

6

Understand what is required for a firm to successfully implement a strategy.

Why is it difficult to translate a firm’s strategy into HR deliverables that actually get the job done? What part of this endeavor do you think HR managers struggle with the most?

7

Recognize the methods for assessing and measuring the effectiveness of a firm’s strategy.

Why do some organizations rely more on some HR metrics than others? Think about the businesses on or near your campus. Which metrics do you think they are most likely to track?

Slide39

Employee Turnover Rates (cont’d)

Computing Turnover Rates (cont’d):Another method of computing the turnover rate is one that reflects only the avoidable separations (S). This rate is computed by subtracting unavoidable separations (US) from all separations. The formula for this method is as follows:

where M represents the total number of employees at mid month. For example, if there were 25 separations during a month, 5 of which were US, and the total number of employees at mid month (M) was 500, the turnover rate would be:

1–39

Slide40

Employee Absenteeism RatesComputing Absenteeism Rates

1–

40

Slide41

1–41

Slide42

Chapter Objectives

After studying this chapter, you should be able to

Identify the advantages of integrating human resources planning and strategic planning.

Understand how an organization’s competitive environment influences its strategic planning.Understand why it is important for an organization to do an internal resource analysis.Describe the basic tools used for human resources forecasting.Explain the linkages between competitive strategies and HR.Understand what is required for a firm to successfully implement a strategy.

Recognize the methods for assessing and measuring the effectiveness of a firm’s strategy.

LEARNING OUTCOME 1

LEARNING OUTCOME 2LEARNING OUTCOME 3

LEARNING OUTCOME 4

LEARNING OUTCOME 5

LEARNING OUTCOME 6

LEARNING OUTCOME 7

Slide43

Measuring a Firm’s Strategic Alignment

1–43

Slide44

Ensuring Strategic Flexibility for the Future

Organizational CapabilityCapacity of the organization to act and change in pursuit of sustainable competitive advantage.Coordination flexibilityThe ability to rapidly reallocate resources to new or changing needs.

Resource flexibilityHaving human resources who can do many different things in different ways.

1–44

Slide45

Measuring a Firm’s Strategic Alignment

1–45

Slide46

Measuring a Firm’s Strategic AlignmentStrategy Mapping and the Balanced Scorecard

Balanced Scorecard (BSC)A measurement framework that helps managers translate strategic goals into operational objectivesfinancialcustomer

processeslearning

1–46

Slide47

Step Four: Formulating Strategy

Strategy FormulationMoving from simple analysis to devising a coherent course of action.SWOT analysis A comparison of strengths, weaknesses, opportunities, and threats for strategy formulation purposes.

Use the strengths of the organization to capitalize on opportunities, counteract threats, and alleviate internal weaknesses.

1–47

Slide48

Step Four: Formulating Strategy

1–48

Slide49

Step Four: Formulating Strategy

1–49

Strategic Alliances

and Joint Ventures

Growth and

DiversificationMergers and

AcquisitionsCorporate Strategy

Slide50

Business Strategy

Value CreationWhat the firm adds to a product or service by virtue of making it; the amount of benefits provided by the product or service once the costs of making it are subtracted (value = benefits - costs).

Low-cost strategy: competing on productivity and efficiencyKeeping costs low to offer an attractive price to customers (relative to competitors).

Differentiation strategy: compete on added valueInvolves providing something unique and distinctive to customers that they value.1–50

Slide51

Business Strategy (cont’d)

Functional Strategy: Ensuring AlignmentExternal Fit/Alignment

Focuses on the connection between the business objectives and the major initiatives in HR.Internal Fit/AlignmentAligning HR practices with one another to establish a configuration that is mutually reinforcing.

1–51

Slide52

Step Five: Strategy Implementation

Taking Action: Reconciling Supply and DemandBalancing demand and supply considerationsForecasting business activities (trends)

Locating applicantsOrganizational downsizing, outsourcing, offshoring

Reducing “headcount”Making layoff decisionsSeniority or performance?Labor agreements1–52

Slide53

Step Five: Strategy Implementation (Cont.)

1–

53

Slide54

Step Six: Evaluation and AssessmentEvaluation and Assessment Issues

Benchmarking: The process of comparing the organization’s processes and practices with those of other companiesHuman capital metricsAssess aspects of the workforce

HR metricsAssess the performance of the HR function itself

1–54

Slide55

Step Two: Environmental Analysis (Cont.)

1–

55

Slide56

Step Two: Environmental Analysis (Cont.)

1–

56

Culture

Composition

Capabilities

Internal Analysis

Slide57

Step Two: Environmental Analysis (Cont.)

1–

57

Slide58

Corporate Culture: Values, Assumptions, Beliefs, and Expectations (VABEs)

Cultural AuditsAudits of the culture and quality of work life in an organization.How do employees spend their time?

How do they interact with each other? Are employees empowered?What is the predominant leadership style

of managers?How do employees advance within the organization?1–58

Slide59

Forecasting: A Critical Element of Planning

Forecasting involves:forecasting the demand for laborforecasting the supply of laborbalancing supply and demand considerations.

1–59

Slide60

Step Six: Evaluation and Assessment

1–60

Slide61

Step Two: Environmental Analysis (Cont.)

1–

61

Slide62

Step Two: Environmental Analysis (Cont.)

1–

62

Culture

Composition

Capabilities

Internal Analysis

Slide63

Step Two: Environmental Analysis (Cont.)

1–

63

Slide64

Corporate Culture: Values, Assumptions, Beliefs, and Expectations (VABEs)

Cultural AuditsAudits of the culture and quality of work life in an organization.How do employees spend their time?

How do they interact with each other? Are employees empowered?What is the predominant leadership style

of managers?How do employees advance within the organization?1–64

Slide65

Forecasting: A Critical Element of Planning

Forecasting involves:forecasting the demand for laborforecasting the supply of laborbalancing supply and demand considerations.

1–65

Slide66

Forecasting Demand for Employees

1–

66

Quantitative Methods

Qualitative Methods

Forecasting Demand


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