Strategic Human Resource Management (SHRM)


Strategic Human Resource Management (SHRM) is a concept in which the HR manager plans the strategies for business to attain certain goals and objectives. The primary aim of SHRM is to maintain a balance between the interest of employees and owners in an organisation. SHRM is consistent and coordinated with the entire objectives of the business to improve the organisational performance. The main emphasis of this concept is on to build a strong connection between human resources of organisation and its strategies. SHRM helps in increasing job satisfaction, morale and engagement of employees. Also, work culture and productivity can be improved with the help of strategic HRM.

SHRM is considered as a key function for the retention and development of staff members. The implementation of strategic human resource management requires the following steps discussed below:

  1. Analyse objectives of the company – The success of an organisation often depends upon its mission, vision and objectives. In strategic HRM, it is necessary for organisations to analyse various aspects such as what are the objectives of the business and how these objectives help in increasing profitability of the business.  In order to achieve these objectives, a business must deploy a transparent communication and effective decision-making process.
  2. Evaluate abilities of employees – SHRM is implemented by evaluating the abilities of staff members in the organisation. It is essential for an organisation to develop skill inventory for each employee. The skill inventory helps the organisations to examine the area of specialisation of each employee. Also, it helps in discovering the areas where employees need training in order to improve their skills in a particular area.
  3. Analyse current HR capacities related to goals of company – The third step is referred to as an analysis of HR capacities that support organisations to implement a plan of action in order to gain opportunities and deal with threats. The performance of staff members or human resource executives can be improved by analysing their abilities effectively.
  4. Estimate future strategic HR requirements of company – After evaluating the abilities of employees and HR managers, the next step is to make an estimation regarding strategic human resource requirements of the company. The estimation should be done in various fields discussed as follows:
  • Demand – It is significant for companies to predict the demand of customers related to products and services.
  • Supply – Also, there is a need to produce the products according to the need or demand of customers.                                                                                                                                                                                                                        5.Determine essential tools for employees to complete the job – In this step, HR personnel determines the tools that are essential to improve the performance of employees. For instance, a company uses workforce management software tool in order to handle various functions of its members such as sick leave management, scheduling, holiday entitlement and so on. In addition, an audit program is conducted by the auditory department in business to examine the gaps among skills of employees by using these tools.                                                                                                                                                                                                                        6.Take corrective action – HR personnel takes some actions by reviewing the past activities performed by staff members. Review the activities done by HR personnel through effective monitoring of the overall performance. An organisation implements strategic HRM activities by taking corrective actions.