HRM textbook

CHAPTER 3 HUMAN RESOURCE MANAGEMENT STRATEGY AND ANALYSIS 93
Second, Table 3-1 illustrates the things employers must do to have highperformance
systems. For example, they hire based on validated selection tests. They
fill more jobs from within. They organize work around self-managing teams.
They extensively train employees.
Third, the table shows that high-performance work practices usually aspire to help
workers to manage themselves. In other words, the point of such recruiting, screening,
training, and other human resources practices is to foster an empowered, self-motivated,
and flexible workforce. 49
Fourth, Table 3-1 highlights the measurable differences between the human
resource management systems in high-performance and low-performance companies.
For example, high-performing companies have more than four times the
number of qualified applicants per job than do low performers.
R E V I E W
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CHAPTER SECTION SUMMARIES
1. Strategic planning is important to all managers. All
managers personnel and other decisions should be
consistent with the goals that cascade down from the
firm s overall strategic plan. Those goals form a hierarchy,
starting with the president s overall strategic goals (such
as double sales revenue to $16 million) and filtering down
to what each individual manager needs to do in order to
support that overall company goal.
2. Because each manager needs to make his or her decisions
within the context of the company s plans, it s
important for all managers to understand management
planning. The management planning process includes
setting an objective, making forecasts, determining what
your alternatives are, evaluating your alternatives, and
implementing and evaluating your plan.
3. Again, because all managers operate within the framework
of their company s overall plans, it s important for all
managers to be familiar with the strategic management
process.
A strategic plan is the company s plan for how it
will match its internal strengths and weaknesses
with external opportunities and threats in order
to maintain a competitive advantage. A strategy
is a course of action.
Strategic management is the process of identifying
and executing the organization s strategic plan. Basic
steps in the strategic management process include
defining the current business, performing an external
and internal audit, formulating a new direction, translating
the mission into strategic goals, formulating
strategies to achieve the strategic goals, implementing
strategies, and evaluating performance.
We distinguished among corporate-level,
competitive-level, and functional strategies.
Corporate strategies include, among others,
diversification strategies, vertical integration,
horizontal integration, geographic expansion, and
consolidation. The main competitive strategies
include cost leadership, differentiation, and
focuser. Functional strategies reflect the specific
departmental policies that are necessary for
executing the business s competitive strategies.
Department managers play an important role in
strategic planning in terms of devising the strategic
plan, formulating supporting functional/
departmental strategies, and of course in executing
the company s plans.
human resource metric
The quantitative gauge of a human resource
management activity such as employee
turnover, hours of training per employee, or
qualified applicants per position.