STRATEGIC HUMAN RESOURCE MANAGEMENT    

SHRM is the outline of planned human resource activities and developments intended to enable an organisation to obtain its goals (McMahan and Wright). It means accepting the HR function like a strategic partner in both the formulation of the company's strategic, and in the execution of those activities through HR activities. When formulating the strategic plan HR management may play a vital role, especially in recognizing and analysing external threats and opportunity. (Environmental scanning) that can be crucial to the company's success. HR management may also offer competitive intelligence (as new incentive plans being utilized by competitors, data concerning customer complaints etc.) that can be helpful whilst giving shape to strategic plans. HR function may also throw light on company's internal weaknesses and strengths. For instance, IBM's decision to purchase Lotus was perhaps prompted in part by IBM's conclusion that its own human resources were insufficient for the definite to reposition itself like an industry leader in networking systems (Dessler). Some of the firms even develop their strategies depend on their own HR- based competitive advantage. Software Majors, TCS, Wipro have not slowed down their employment efforts at the time of the lean periods, pinning hopes on their own exceptionally talented employee teams. Actually they have built their strategic and operating strategy around outsourcing sourcing contracts from Europe, US, Japan and Germany- which would help them in exploit the capability of their employees completely.

HR has a vital role to play in the execution of strategies. For instance, HDFC's competitive plan is to differentiate itself from its competitors by offering best customer service at striking rates (discovering the right property, concluding legal formalities, offering expert advice when negotiating the deal, quick processing of applications, competitive lending rates, offering other financial manufacture of HDFC at concessional rates, door- to-door service as per customers' opinion etc. (HDFC's growth architecture, Business Today, Jan 6, 2001). Since the similar basic services are offered through HDFC's competitors like private sector and banks, LIC Housing Finance GIC Housing Finance, players like Dewan Housing Finance, Live Well Home, Ganesh Housing, Peerless Abassan etc. HDFC's workforce offers a critical competitive advantage (extremely committed, competent and customer-oriented workforce). HR may help strategy implementation in other ways. It may help the firm carry out restructuring and downsizing attempt without rubbing employees on the incorrect side- say, through outplacing employees, connecting rewards to performance, dropping welfare costs, and retraining employees. HR may also initiate systematic attempt to increase skill levels of employees so that the firm may compete on quality.

Deregulation, Globalisation and technological innovation have- in current times- produced the need for rather, quicker and more competitive organisations. Under the circumstances, employee performance and behaviour is frequently seen as the best bet to push competitors to a corner and increase productivity and market share. HR practices put up competitiveness because they permit for strategic implementation make a capacity for change and instil strategic unity.