The concept of fit is very subjective, it is not measurable, yet it is treated as if it can be targeted or observed.
SHRM is gaining widespread popularity due to the inducement it provides of supporting the organizational strategy and help it to gain competitive advantage.
Link between Human Resource Management and Organizational Strategy
One of the most famous works on linking strategy with human resource management is by Miles and Snow (1984). They have classified three types of organizational strategies and described the HR strategy that will be suitable in each case (Ogbonna & Whipp, 2006). In case of ‘defender strategy’ where organizations aim for steady growth in market share, the human resource management should be in-house, have selective recruitment, adequate training and should have a policy of promotion-within. In case of firms aiming for speedy growth or having ‘prospector strategy’, they should have a flexible workforce which can multi-task and perform assignment having a wide range of technical resources. Third is the ‘analyser strategy’ in which the firm emphasis on an exclusive product and promotes throughout its lifecycle, the human resources required for it are people who can have a long-lasting relationship with the firm, are open to learning, training and can contribute their maximum to the firm.
This importance of this topic can be judged by the large number of researches that were conducted on it subsequently. Some of the prominent works include Bird and Beecher’s work on links between business strategies in 1995; Porter’s observation of how effectual HRM can help in bringing down cost and improve efficiency; Lado and Wilson’s work of how HRM can help businesses gain competitive advantage. In all these editorials, the importance of a proactive HRM is emphasized and how it can contribute to business performance.
Practicing strategic human resource management in UK companies has faced difficulties. Politics and customary practices in institutions have hampered the progress from personnel management to strategic HRM. According to an article, connection between HRM and competitive performance has not been established (Ogbonna & Whipp, 2006); because HR is an intangible resource of a firm which is based on competencies, so a concrete theory has not been built in this area of knowledge.
In this regard, culture has a very important role to play. Culture guides the employees of an organization about the desirable practices, it vision and a sense of direction. Some of the cultural values that are also the HR policy objectives include commitment, flexibility and competence. The HR should play a proactive role in maintaining a constructive culture in an organization and then molding to assist in strategic planning. It is the positive energy and consistency in the relationship between an organizational culture, proactive HR policies and the firm’s strategy that support strategic HRM. Hence the role of strategic HRM is to change...