Strategic human resource management, or SHRM refers to a managerial process requiring human resource (HR) policies and practices to be linked with the strategic objectives of the organization. It provides a framework, linking people management and development practices to long-term business goals and outcomes. So why have academics and HR professionals embraced SHRM? From the reading material provided in the lecture, the reason can be explained from two perspectives: ‘rational choice’ and ‘constituency-based’ perspective. From a ‘rational choice’ perspective, by focusing attention on people’s skills and intellectual assets, it can provide a major competitive advantage for companies. From a ‘constituency-based’ perspective, in the case of academics, it will secure greater respect and strengthen the position for HRM as a field of study, and in the case of HR managers, it will enhance their status and solidify their position within organizations by appearing more ‘strategic’.
In my opinion, academics and HR professionals have embraced SHRM not only out of self-interest. Even though there are few companies that are dedicated to improve their HR practices for better business performance, one of the top companies, Google had demonstrated exemplary strategic human resource management. Cited from a blog I read, in 2006, co-founders Sergey Brin and Larry Page decided to take an empirical approach to HR founded on feedback and employee data. A manifestation of this is Project Oxygen, an ongoing study into management practices that identifies and measures key management behaviours and helps nurture them. Google undertook in-depth statistical analysis into what their employees consider to be good managers, then trained the rest in them. As a result, Google saw an overall improvement in people management and team metrics such as turnover, satisfaction, and performance over time. Thus, collecting data from employees and using it to improve the employee experience does work. This can be taken as a strong business case for the strategic approach to HRM.