Strategic Human Resource Management

The increasing popularity of strategic human resource management brings new respect for both the company's workforce and the human resources department which plays such an important role in the company's success. Although in the past employers paid dutiful lip service to the idea that people were its most important resource, this fact has come under much closer scrutiny. Workforce issues have become important items for consideration as employers realize that attracting and retaining an effective team of employees is a critical factor in a company's success. In the global business environment, profits and losses can result from even seemingly insignificant areas. How much more, then, of an effect can be produced by the very people who bring the company's objectives into contact with the world on an everyday basis? Although technology and strategies about new ways to provide products and services are important, a workforce is where everything about a business' philosophy and policies is translated into concrete results. For better or worse, this saying by an anonymous commentator is true: 'a company is known by the people it keeps.'

Human resource departments deal with a whole host of areas. One might tend to think of the human resource (HR) department in terms of hiring, resolving disputes and administering benefits. These are important aspects, yet these areas are increasingly being assigned to human resource outsourcing services. Other areas which may be reassigned are employee counseling, retirement and pension planning, temporary staffing, background checks and employee training. Health care benefit administration alone could keep HR personnnel occupied for much of the time. There are many reasons for allowing human resource outsourcing services to take charge of these areas. Although some employers may worry that they are losing control of these areas when they are outsourced, in some cases they may actually be gaining control, since stricter controls may be set forth as part of the agreements with human resource outsourcing services than might be acceptable for an in-house empoyee. Also, employers may be forced to pay closer attention to these areas than would normally be expected. However, take care not to view these services in an adversarial way, but instead as partners working toward mutual goals. The HR service should be a good fit with the company's image as well as its objectives, because the firm will be representing the company as it performs its duties. Be sure it has expertise in the particular industry as well as general HR capability.

Expenses for outsourcing can vary depending upon whether a business chooses to hire a full Professional Employer Organization (PEO), or just outsource a few time-consuming tasks. A PEO will recruit, hire, and deal with everything from payroll to pension administration. Actually, the PEO is the employer, and a company leases these 'employees' from the PEO. This works well for someone who just wants to focus upon the business and not worry about HR responsibilities. If one is not comfortable with that, there is also the option of outsourcing selected areas. Rates for such services vary according to the type of project and the length of time required. To get competitive rates, shop around before signing any contracts. Endorsements from other companies which have purchased these services would also be helpful.

Some other reasons for outsourcing include the desire to have 'specialists' to improve compliance with complex government regulations, or provide services which present staff are not capable of giving, such as certain types of counseling. In most cases, time or money is saved by alloting duties to human resource outsourcing services. HR departments can then focus on areas which will help further company goals. This aspect of management is called strategic human resource management (SHRM).

Although strategic human resource management may call for outsourcing certain of its activities, this does not imply that these areas are no longer an important part of its job description. Rather, such a style of management attempts to link these HR areas with the company's goals and objectives so that business performance is enhanced and a competitive advantage is gained. Instead of a near-sighted involvement with internal conflicts, strategic human resource management focuses on long term human resource objectives, so that employee motivation and productivity can be increased.

Because human resource departments have great influence, a representative of the HR department team should be present at executive meetings and share in company decision-making. In this way, the HR department will be better equipped to do its job, as it will have a full understanding of the needs of the business. Management can also benefit from immediate feedback about the impact its decisons will have upon the workforce culture. Strategic human resource management seeks to have HR personnel involved and accepted as equal partners in formulating company policies and strategies about recruiting, training and rewarding the workforce and creating a culture where business objectives can be obtained. For this reason, do not have HR personnel report through layers of managers who may not share the same outlook about certain aspects of this mindset. Instead, direct HR involvement assures that 'people issues' get equal time with financial considerations in the formulation of company policies.

Speaking about the group of believers, the apostle Paul writes, ...there should be no schism in the body; but that the members should have the same care one for another. And whether one member suffer, all the members suffer with it; or one member be honored, all the members rejoice with it. (I Corinthians 12:25-26). In a similar way, the members of a corporation have differing responsibilities, yet each is an integral part of the organization. Working together, instead of competing for resources and influence, members of a business can accomplish many things. Utilizing human resource outsourcing services, an HR department can be free to concentrate on effectively using a company's most important asset -- its employees -- to further a company's objectives in a way that will be beneficial for all involved.

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