Strategic

Human Resource
Management

Unit 2
 Agenda

• Strategic HR

• Analytics Driven HR

• HR Becoming a Strategic Partner

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 Historical view of HR

• HR primarily an administrative/operational function

• HR activities add to an organization’s expenses/costs but not to

revenue generation

• Minimal consideration of its strategic importance

• Not seen as a potential source of an organization’s competitive

advantage

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 Changing view of HR

1. Every segment of the organization must play a key role

in an organization’s strategy
2. Quality of work force is a significant source of
competitive advantage
3. $ put toward HR systems and activities should be
viewed as investment
4. There is increasing evidence that HR activities are
associated with various indicators of organizational
performance (e.g., ROI, profitability, stock prices)

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What is Strategic Management and
what is Strategic HRM?

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 Strategic Management Process
Strategy Formulation Strategy Implementation

External HR Practices
Analysis
Opportunities
Threats

Mission Goals Strategic HR Needs Firm

Choice Skills Performance
Behaviours Productivity
Culture Quality
Profitability

Internal HR Capability HR Actions

Analysis Skills Behaviours
Strengths Abilities Results
Weaknesses Knowledge Productivity
Turnover
Emergent Strategy 6
 Necessary Conditions

Four (4) Necessary Conditions to Enable

Strategic HRM: Can you think of what
these might be?

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 Necessary Conditions
4 Necessary Conditions to Enable Strategic HRM:

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Types of HR – Strategy Linkages

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 Strategic HRM - Example
Strategic Decision: Improve customer service via new
customer management software

Key consideration re: Strategic HRM

• What knowledge/skills are needed in our workforce
to implement, maintain, and use software?
• Where / how will we get these skills ?

Potential next steps

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 Strategic HRM – PepsiCo

What happens when HR is not part of the

decision?

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 What do we know about competitive
advantage in general that may give us
insight into how HR can contribute to an
organization’s competitive advantage?

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 Competitive Advantage of
Human Capital
Resource-based view (RBV): Superior firm performance
and sustainable competitive advantage occurs when
organizations have resources that are:

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 Aligning HR and
Organizational Strategy
• Cost Leadership
• Value created by having low prices
• Can be profitable by keeping costs low (overhead,
R&D, advertising)
• Emphasizing economies of scale, efficiency (in
manufacturing, distribution, etc.)

• E.g., WalMart, Costco, Ikea, Westjet

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 Aligning HR and
Organizational Strategy
• Differentiation
• Value created by differentiating product/service = 
price
• New product development, marketing, R&D, quality,
technological innovation

• E.g., Starbucks, Apple, BMW, Nike

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 Aligning HR and
Organizational Strategy

• Cost Leadership • What HR Strategies

• Low price would you expect?
• Low costs
• High quality
• Efficiency – in service,
manufacturing, etc.

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 Aligning HR and
Organizational Strategy

• Differentiation • What HR Strategies would

you expect?
• Unique product/service
• Price premium
• Growth
• New products
• Emphasis on marketing
• Product engineering
• R&D, innovation

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 Aligning HR and
Organizational Strategy

• But being in same strategic category does not mean the

same HR practices.
• In fact, there can be significant variability in Business and
HR practices within a particular strategic category
• For example, compare Costco and Walmart

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 In addition…

• Success can also come from emergent strategies

• Not formal or intended – can deviate from “strategic
plan”
• Often come from lower levels of organization

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Analytics Driven HR

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 Google’s People Operations

• Google's Approach to HR

• https://www.youtube.com/watch?v=XGw9iARGirQ&feat
ure=youtu.be

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 Google’s Mission

“Our mission is to organize the world’s information and

make it universally accessible and useful”

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 Google “People Operations”

• Laszlo Bock, SVP People Operations, Google 2006 – 2016

• Reinvented HR to “fit” Google and its culture
• The goal is to “___” 
• The people analytics team reports to who?

*Source: Work Rules: Insights from Inside Google; Laszlo Bock

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 Google People Operations Team

• 1/3 HR Resources

• 1/3 Strategy Resources

• 1/3 Business Sense Resources

*Source: Work Rules: Insights from Inside Google; Laszlo Bock

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 Google’s People
Operations Strategy
A framework that guides HR in “where” and “how” they
impact the company:
1.Find them, Grow them, Keep them
2.Put users first
3.Put on your oxygen mask before assisting others
4.This space intentionally left blank

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 Google People
Information Collected
• Attrition / Retention Data and Patterns
• “Spirt of Google” – Google Geist
• Qualitative Feedback
• Ears on Ground
• Upward Feedback

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 Google’s Upward
Feedback Survey
1. My manager gives me actionable feedback that helps me improve performance
2. My manager does not “micromanage” ie/ does not get involved in details that should be
handled at other levels
3. My manager shows consideration for me as a person
4. My manager keeps the team focused on our priority results/deliverable
5. My manager regularly shares relevant information from his/he manager and senior
leadership
6. My manager has had a meaningful discussion with me about my career development in the
past 6 months
7. My manager communications clear goals for our team
8. My manager has the technical expertise required to effectively manage me.
9. I would recommend my manager to other Googlers.
*Source: Work Rules: Insights from Inside Google; Laszlo Bock 27
 Google’s People
Management Practices
Examples arising from its people analytics:

•Leadership characteristics and the role of managers 

•A retention algorithm 
•Improving diversity 
•Calculating the value of top performers
•An effective hiring algorithm
•Increasing discovery and learning
•Workplace design to drive collaboration
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HR Becoming a Strategic Partner

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 The Elements of Modern HR

HR Strategy

Process
Digitization orientation
HR Core

HR Admin
Radical
Automation Simplification
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Source: Global Talent Trends Study, 2019, Mercer

 HR Becoming a Strategic Partner
Focus is: + This
Informed Consulted
Post New Role(s) Organizational Design & Staff
Planning

Reactive Deliberate
“Programs to Achieve Business Goals
Crisis Management “Exec Development, Career Launch,
Diversity”

Narrow & Administrative Strategic

Personnel Management, Labour Development of Career Path for Key
Relations, HR Policy Roles from Entry to Executive Levels

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 HR Becoming a Strategic Partner
Tactical Activities + Strategic Activities

Employee Relations
Focus on policies, compliance and discipline as Engage employees to drive business results and
well as company events and community issues see them as investments rather than costs

Attraction & Selection

Recruit and hire, temporary staffing Create an employer brand and develop talent
pipeline based on what the business needs

Employee Development
Basic skills training, new hire orientation Training and development solutions that drive
business results while developing careers

Performance & Rewards

Performance management, benefits, Cascading business goals down to workforce and
compensation structures, job descriptions rewarding based on goal achieved

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 HR Measures

Today Moving Towards

• # of New Initiatives • ROI
Launched or Completed
• Increase in Employee
• Length of Employment Performance
• Employee Engagement • Time to Develop
• Turnover Rate Competencies

• Exit Interview • Employee Engagement

• Retention Health
• Pay to Quit

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 HR Titles and Levels
Demonstrate Shift in Priorities
From To

Reports To • CEO, CAO, COO, CFO • CEO

• Other Exec Function

Background / • HR Administration or • Business Savvy

Experience Policy
• Analytical, Statistical
• Personnel Management
• Business / Tech
Partnerships

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 HR Titles and Levels in
Organizations

• Chief People and Corporate Affairs Officer, Burberry

• SVP People and Culture, Air Canada
• Chief Talent Officer, Deloitte Canada
• Chief People Officer, Workday
• EVP People, Culture and CHRO, Telus
• SVP People Operations, Google

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Questions / Comments

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