Strategic human resource management.

John Bratton
"If a global company is to function successfully, strategies at different levels need to interrelate."

Throughout the first half of our century and even into the early eighties, planning – with its
inevitable companion, strategy – has always been a key word, the core, the near-ultimate
weapon of 'good' and 'true' management. Yet, many firms, including Sony, Xerox, Texas
Instruments, ...have been remarkably successful... with minimal official, rational, and
systematic planning.

The word 'strategy' was first used in English in 1656 and comes from the Greek noun
'strategus', meaning 'commander in chief'. The development and usage of the word
suggests that it is composed of stratos (army) and agein (to lead) and in its military context
means 'to produce large-scale operations'. The Oxford Dictionary
defines strategy in terms of 'generalship'. In a management context, the word 'strategy' has
now replaced the more traditional term, long-term planning, to denote an activity that top
managers perform in order to accomplish

In the descriptive and prescriptive management texts, strategic management appears as a
cycle in which several events follow and feed upon one another. The strategic management
process is typically broken down into five events or steps:
1. organization's direction
2. environmental analysis
3. strategy formulation
4. strategy implementation
5. strategy evaluation.
The first step in the strategic management model begins with senior managers evaluating
their position in relation to the organization's current mission and goals. The mission
describes the organization's values and aspirations. It is the organization's raison d'être,
and indicates the direction senior management is going. A goal is a desired future state that
the organization attempts to realize (Daft, 1998). Environmental analysis looks at
the internal organizational strengths and weaknesses and the external environment for
opportunities and threats. The factors that are most important to the organization's future
are referred to as strategic factors and are summarized with the acronym SWOT, meaning
Strengths, Weaknesses, Opportunities and Threats. Strategic formulation involves senior
managers evaluating the interaction of strategic factors and making strategic choices that
guide the organization to meet its goal(s). Some strategies are formulated at the corporate,
business, and specific functional level such as marketing and HRM. The use of the term
'strategic choice' raises the question of who makes decisions in work organizations and
why they are made (McLoughlin and Clark, 1988). The notion of strategic choice also draws
attention to strategic management as a 'political process' whereby strategic choices on
issues such as resources are taken by a 'power-dominant' group of senior managers within
the organization. Child (1972) affirms this interpretation of the decision-making process
when he writes:
[W]hen incorporating strategic choice in a theory of organizations, one is recognizing the
operation of an essentially political process, in which constraints and opportunities are
functions of the power exercised by decision-makers in the light of ideological values (Child,
1972 and quoted in McLoughlin and Clark, 1988, p. 41).
In a political model of strategic management, it is necessary to consider the distribution of
power within the organization. According to Purcell and Ahlstrand (1994), we must consider
'where power lies, how it comes to be there, and how the outcome of competing power
plays and coalitions within senior management are linked to employee relations' (p. 45).
The strategic choice perspective on organizational decision making makes the discourse on
strategy 'more concrete'; it also provides important insights into how the employment
relationship is managed.
Strategy implementation is an area of activity that focuses on the techniques used by
managers to implement their strategies. In particular, it refers to activities which deal with
leadership style that is compatible to the strategies, the structure of the organization, the
information and control systems, and the management of human resources. Leading
management consultants and academics (see Champy, 1996; Kotter, 1996) emphasize
strongly that leadership is the most important and difficult part of the strategic
implementation process. Strategy evaluation is an activity in the strategic management
process that determines to what extent actual change and performance matches desired
change and performance. The strategic management model depicts the five main activities
undertaken by senior managers as a rational and linear process. However, it is important to
note that it is a normative model. That is, it shows how strategic management should be
done and hence influences managerial processes and practices, rather than describes what
is actually done by senior managers (Wheelen and Hunger, 1995). As we have already
noted, the notion that strategic decision making is a political process implies a potential gap
between the theoretical model and reality.

The first step in the strategic management model begins with senior managers evaluating
their position in relation to the organization's current mission and goals. The mission
describes the organization's values and aspirations. It is the organization's raison d'être,
and indicates the direction senior management is going. A goal is a desired future state that
the organization attempts to realize. Environmental analysis looks at
the internal organizational strengths and weaknesses and the external environment for
opportunities and threats. The factors that are most important to the organization's future
are referred to as strategic factors and are summarized with the acronym SWOT, meaning
Strengths, Weaknesses, Opportunities and Threats. Strategic formulation involves senior
managers evaluating the interaction of strategic factors and making strategic choices that
guide the organization to meet its goal(s). Some strategies are formulated at the corporate,
business, and specific functional level such as marketing and HRM. The use of the term
'strategic choice' raises the question of who makes decisions in work organizations and