Learn about the key differences between Strategic HRM and HRM.
Strategic HRM is different from conventional HRM (also called as technical HRM). The major difference between the two lies in terms of linking HR strategy with organizational strategy.
Strategic HRM establishes high linkage between HR strategy and organizational strategy. It contributes to organization’s strategic management at all three levels- strategy formulation, strategy implementation, and strategic control.
Difference between Strategic HRM and HRM
Difference between Strategic HRM and Traditional HRM – 10 Points Difference
Strategic HRM:
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1. Meaning – It is a modern and professional approach so as to manage and develop the human resources in line with the overall strategy of the organization.
2. Objectives – The objective is to improve effectiveness and efficiency of employees to achieve organizational goals. It includes selection, training, appraisal, promotion, compensation, motivation and retention of competent employees.
3. Responsibility – All departmental managers (who deal with employees on day-today basis and get the work done) as well as HR department work in tandem.
4. Function – It functions as a strategic partner of the organization so that organizational objectives are achieved.
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5. Focus – It focuses on overall result and issues of the organization.
6. Nature of Decisions – Strategic HRM takes proactive decisions relating to human resource issues.
7. Nature of HR Policies – HR policies are flexible & are reviewed periodically so as to make revisions.
8. Specialization – There is specialization in HR areas such as selection, training, performance appraisal etc.
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9. Employee Treatment – The employees are deemed to be partners in progress. They are treated with respect & considered as internal customers.
10. Other Differences – The relevant employment tests and interviews are conducted during selection. It places great importance on training and development. The modern performance appraisal techniques (assessment centre, role analysis) are used. The promotion is based on merit at all levels. Special measures are designed to retain employees (retention bonus, loyalty programs).
Traditional HRM:
1. Meaning – It is a traditional method of managing people so as to undertake organizational activities or achieve short-term organizational goals.
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2. Objectives – The objective is to select and compensate employees for the activities performed by them for the organization.
3. Responsibility – HR department deals with/is responsible for managing the employees.
4. Function – It is a part of the organization that implements and ensures compliance of all HR policies.
5. Focus – It focuses on operational issues and needs of human resources.
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6. Nature of Decisions – Traditional HRM takes reactive decisions relating to human resource issues.
7. Nature of HR Policies – Generally, HR policies are rigid in nature.
8. Specialization – One manager looks after almost all areas of HR (such as selection, training, performance appraisal etc.)
9. Employee Treatment – The employees are treated as hired workers. There is lack of deep respect & care for employees.
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10. Other Differences – There is less emphasis on relevant employment tests & interviews during selection. It places less importance on training & development. The traditional performance appraisal techniques are used. The promotion by seniority is followed at all levels. No special measures are taken to retain employees.
Difference between Strategic HRM and HRM
Strategic HRM is different from conventional HRM (also called as technical HRM). The major difference between the two lies in terms of linking HR strategy with organizational strategy. Strategic HRM establishes high linkage between HR strategy and organizational strategy. It contributes to organization’s strategic management at all three levels- strategy formulation, strategy implementation, and strategic control.
Conventional HRM has low linkage between HR strategy and organizational strategy. Therefore, its role in organization’s strategic management is limited. Because of this basic difference between strategic HRM and conventional HRM, there are other differences between the two which have been presented as follows-
Dimension of Difference – Conventional HRM:
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1. Responsibility for HRM – Staff specialists
2. Focus – Employee relations
3. Role of HR – Transactional, change follower, respondent
4. Inititatives – Slow, reactive, fragmented
5. Time Horizon – Short term
6. Control – Bureaucratic roles
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7. Job design – Tight division of labour, independence, specialisation
8. Key investments – Capital, products
9. Accountability – Cost center
Dimension of Difference – Strategic HRM:
1. Responsibility for HRM – Line managers
2. Focus – Partnership with internal and external customers
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3. Role of HR – Transformational, change leader, initiator
4. Inititatives – Fast, proactive, integrated
5. Time Horizon – Short, medium, long term (as necessary)
6. Control – Organic, flexible (whatever is necessary to succeed)
7. Job design – Broad, flexible, cross training, teams
8. Key investments – People, knowledge
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9. Accountability – Investment center