Inspection and Reflection of Strategic Human Resource Management〔*〕

Liu Dawei

(School of Social Development East China Normal University, Shanghai 200241)

Ⅰ.Introduction of the problem

Knowing the term “Strategy” was from a classic sentence of Comrade Mao Zedong excerpted in the Chinese textbook in primary school — “Strategically we should despise all our enemies,but tactically we should take them all seriously”.〔1〕This sentence has so far been unforgettable,I remembered when I was young,none of the class could distinguish the concept of “strategy” and “tactic” when Chinese teacher was explaining those two words.It is no wonder that children at their 10s could not understand such abstract concept and I reckon that the Chinese teacher must have put lots of efforts into explaining the two terms.I think,even to this day,few adults could explain it clearly.

“Strategy” is stemmed from military terminology.The earliest systematic study of the strategy was in the third book “Of Strategy in General” of On War written by Clausewitz,who dedicated a significant portion to systematically discuss the importance of the strategy in war.〔4〕However,the first person to introduce “Strategy” into management was Ansoff — “Father of Enterprise Strategy”,in his book Enterprise Strategy published in 1965 which comprehensively explained “enterprise strategy”.〔5〕By the year of 1980,Michael E.Porter made a completely new view on it,studying enterprise strategy from the perspective of “competitive strategy” which made the concept of “strategy” gleam again and further developed the theory of “competitive advantage”.〔6〕Therefore,more people tend to believe it was Michael E.Porter who first quoted the military term “Strategy”,but it was not.

For the definition of human Resource management strategy,the author carefully studied various documents and materials in the definition and analysis of the above two concepts and eventually summarized the similarities and differences between “Human Resource Management Strategy (HRMS)” and “Strategic Human Resource Management (SHRM)”.“In most cases,the essence of the two different English expression is the same,only in a very few cases,the ‘Human Resource Management Strategy’ only refers to a relatively specific strategic programme.The subtle difference between the two concepts is that SHRM uses strategic methods to study human Resource,emphasizing on perspectives,methods,and processes while HRMS has already been a mature theory,emphasizing on results.No matter expressing in which methods,the ultimate goal is to emphasize the competitive advantage of human Resource management.The method used to analyze is no more than from the perspective of the external environment,internal Resource,advantages and disadvantages and other aspects (that is,the SWOT analysis tools commonly used in enterprise strategic management).”〔7〕Finally,the author defined “human Resource management strategy is to make decisions related to human Resource management with scientific methods to ensure a way of thinking of enterprises obtaining a competitive advantage in terms of human resource.”〔8〕

Although such a definition of “Strategic Human Resource Management” is given,it has always been thought that it is quite difficult to further comprehend,analyze and understand its profound meaning,especially for beginners who would feel more difficult to get command of.In fact,strategic human resource management is actually a trade-off behavior,that is,what kind of human resource management modes,technologies,methods and means should be chosen to use.Those could all be regarded as a selective behavior of strategy,thus,the essence of strategy is “trade-off”,while the strategic human resource management is the trade-off decision-making for human resource management modes,technologies,and other aspects to obtain the competitive advantage.

Ⅱ.The significance on study of “strategic human resource management”

This topic could also be changed into “Why Studying Strategic Human Resource Management from the Perspective of Strategy”.This is because,in the former human resource management practices,no matter entrepreneurs or human resource management workers,all put their focuses on the human Resource management of their own company,therefore lacking global concept and external viewing perspective.In other words,they do not possess competition awareness from the very beginning.However,in today’s human Resource,except self-development and improvement,there exists a more important task — surpass the competitor.Michael E.Porter spoke more straightforward:the essence of strategy is “the difference in profitability among competitors”,〔9〕so today’s human resource is a management not only focuses on the internal growth but also focuses on external competitors.This is strategic human resource management,also known as the human resource management emphasizing more on competitors.

Therefore,the study of strategic human resource management has a foundation and practical significance.There are three popular books categorized as “Strategic Human Resources Management”:Strategic Human Resource Management written by Jeffrey A.Mello of Towson University in the US,Human Resource Management:Gaining a Competitive Advantage written by Raymond A.Noe along with other writers of Ohio State University in the US,Strategic Human Resources:Frameworks for General Managers written by James N.Baron along with other writers of Stanford University.Those are all classic works in this area and are the must-read materials for master and doctoral students majoring in human resource management.In addition,it is found during the collection of literature,that many research “go with the minority”,that is,many essays are confined to a specific field of view,lacking the overall and associative sense,even could be described as “scratch the surface” similar to the competition between the management master Peter Drucker and the CEO of General Motors Sloan.We could clearly read such a passage from the preface management master Peter Drucker wrote in My Years with General Motors:Autobiography AlfredP.Sloan,JR:“The original intention of Sloan’s writing My Years with General Motors was to refute — or at least to counter — a masterpiece which he thought to be harmful — the book I wrote about General Motors Concept of the Corporation”.〔10〕Drucker wrote “At a meeting dedicated to bring everyone for this book,Sloan stepped forward bravely to defend me when his colleagues attacked me.He said ’I completely agreed with all of you that Mr.Drucker’s view is totally wrong,but he did complete the task he promised to do when we invited him.Besides,just like you and I,he has the right to express his opinion even if it is not true”.Drucker also pointed out the main reason of Sloan opposing his work was “the content in the book would mislead professional managers as well as academic researchers which would make them go far away from the right path.” — However,many of today’s studies on the so-called “ Strategic Human Resource Management” exactly play such a misleading role.

At the same time,we captured a passage in the work Winning written by the CEO of General Electric,Jack Welch “Forget about the strategic method those so-called masters told you because they are just tedious and laborious stacking of data.Forget about those so-called scenario planning,lengthy research process and hundreds of pages of reports because they waste people’s time and energy to generate rubbish you do not really need.”〔11〕

The above two figures are the undisputed master in management practices.If management method must be used by managers and the research purpose of management is to be transformed into productivity,then those so-called master of management,both Peter F.Drucker or Michael E.Porter shall feel ashamed of the above two passages for the comment to their works are either “mistake” or “rubbish” — almost a total denial.

Therefore,“Is it necessary to study Strategic Human Resource Management?” seems to be a more important topic.

Ⅲ.Why there exist problems in “strategic human resource management”

Many domestic experts,scholars,and laborers in human resources management extremely believe in “Strategic Human Resource Management”.Especially when the balanced scorecard being introduced into China,“Strategic Human Resource Management” reached its climax,the main reason of which was Kaplan and Norton put special emphasis on the significant importance of strategy in the balanced scorecard.They pointed out:“A well designed balanced scorecard should comprehensively reflect the strategy of the business unit.It should confirm and clarify the causal relationship of assumptions between the result and the motivation behind it.Each index selected into the balanced scorecard should be a link to the causal chain which could convey the strategic significance of business unit to the enterprise”.〔12〕The following works of the above two used a significant portion to study the issue of strategy.〔13〕It is precisely because the “popularity” of balanced scorecard in Chinese enterprises that lead to the “overflow” of “Strategic Human Resource Management”.

As early as in 1997,Professor Dave Ulric of Michigan Ross School of Business proposed that human resources must help enterprises with eight major challenges:globalization;focus shift from HR to enterprise value chain;improvement of profitability through reducing costs and increasing revenue;focus on capability;continuous reformation;improvement in technology;attraction (maintaining intellectual property);transformation instead of improvement.〔14〕

After reading loads of works and papers about human resource management strategy,the author admires the most the title of the work written by Raymond A.Noe — Human Resource Management:Gaining a Competitive Advantage.〔15〕The title concisely pointed out the essence of strategic human resource management — gain a competitive advantage in human resource management.As long as there exists the term “strategy”,it refers to the competition in business,and where there is competition,there is win and loss.However,as the “complete defeat” and “complete victory” in the war,it could not take effect immediately anytime soon,but the competitive advantage in a short period is absolutely conceivable.Obtain temporary “advantage” is possible for any enterprise,for example,adopting a higher-than-market salary in order to attract talents and such high-salary strategy might be effective in the market in a short period.However,it is hard to define if it could be effective and stable in a long-term.So,there still remains a problem if the gained competitive advantage could last for a long time.Short-term competitive advantage and long-term competitive advantage are two completely different strategies.Without doubts,we pay more attention to the latter which might be the reason why there are so many experts interested in the studying of “strategy”.

On the one hand,we are more concerned about the possibility and effectiveness of obtaining a long-term competitive advantage,on the other hand,the fast-changing market forces us to adjust our strategies at any time,even our annual assessment urges us to launch research on how to make the advantage strategy take effect in a short-term.Sometimes we know clearly that some specific selections of strategy are effective in a short-term,such as high salary,but if it is sustainable in a long-term is doubtful.However,the brutal competition in the market force us to formulate strategy that go against our true desire and follow the market to “choose” painfully.Some enterprises might succeed in a short-term,but in a long-term,the harm might prevail because they could not make their own decisions and the implementation of strategy changes with the market.Once the strategy has been made,the pain and the cost of adjusting it are tremendous which lead to the failure of the strategy — such examples are common.

Ⅳ.Is “strategic human resource management” still effective

The most commonly encountered nouns in enterprises are “Vision,Mission,Strategy” and other concepts.Strangely,few students could explain those concepts clearly and perfectly when they are brought up in EMBA and MBA classes.“Vision” is actually the ideal or dream of the entrepreneur.To achieve this dream,“Strategy” is needed,that is to select ways,methods,and technologies and other things,reflecting specific to each dimension are about the production,sale,human resources,etc.which is complex and could not be summarized by a simple model for the model could only provide us with some tools to analyze the problem;while “Mission” is the responsibility under the established framework of “Strategy” to achieve the “Vision”.In other words,to eventually realize the ideal of entrepreneurs through the everyday mission - setting up goals and through choosing the appropriate path in accordance with the strategy.The core and essence of that is “Vision”,without which,enterprises are blind.An enterprise with its entrepreneur harboring a dream for a better life would not be lasting nor having a continuous motivation,but will form the above mentioned imperceptibly content which forms corporate culture with time passing by.No matter the corporate culture is “good” or “evil”,“democratic” or “autocratic”,no matter what kind of adjectives are used to describe it,one thing is certain that there exists “culture” in an enterprise.

“Enterprise” and “Corporate Culture”,which comes first?Eric Emerson Schmidt,CEO of Google,pointed out “It is wise to seriously consider and define the corporate culture you wish for your company at the start of the business.”〔16〕The author thinks that this is unlikely to happen for three reasons:One is that at the beginning of a business,it is difficult to survive,especially when the products,markets even human resources are all in a blank,let alone to consider the “luxury” of an enterprise — “corporate culture”.The other is that human resources are not yet in place,the organizational structure may change at any time,how to form a corporate culture?The last one is that even if entrepreneurs strive to create some kind of corporate culture,will it turn out to be what they expect?Especially more emphasize has been putting on the “invisible rules”,many of which might not be specified in the enterprise regulations and rules or the employee manual,during the formation of corporate culture (the author think the visible rules exactly means the incomplete convention which still needs to be emphasized in order to implement and cannot be regarded as culture),and in particular need each individual in the company to practice consciously.Therefore,the author is doubtful about the existing corporate culture and the corporate culture come first before enterprise.

But Eric Emerson Schmidt stressed “most enterprises fail to value this.Generally,they only realize the importance of recording corporate culture after success which leaving the task on the shoulder of HR or PR sections.Most personnel in these sections do not belong to the founding team of the enterprise,their duty is just to compile a mission statement that highlights the essence of the business.” “And the success of a business depends on whether its employees are convinced of the content of the mission statement.”〔17〕Eric Emerson Schmidt even quoted the ideas from former General Electric CEO Jack Welch written in his book Winning to support his own point of view “If you cannot convey your goal from time to time and consolidate your goal through rewards,your vision is not as valuable as the paper printing vision then.”〔18〕

“Vision”,“Strategy”,“Mission” is eventually the subsystem of the corporate culture system which are integrated through the corporate culture.“Strategic Human Resource Management” is the subsystem under the big frame of “Strategy Management”,therefore,only under the double guarantee of effective corporate culture and strategic management will “Strategic Human Resource Management” be realized,or will have to face the fact that there exists nothing in the core.

Ⅴ.Relationship between strategic human resource management and HRBP

Dave Ulric proposes in his work the concept of human resource business partner (HRBP) which is popular and has been wildly circulated.He pointed out “As long as reformation is involved,the role of HRM will be changed into strategic partner or reformation practitioner.” At the same time,human resource management shall ensure “the conformity of human resource management strategy and corporate strategy.”〔19〕The proposition of this concept improve the role of HRM.

The author has long been engaged in the human resources management consulting work.From the working experience,the author believes that if the HR of an enterprise wants to make an influence on the entrepreneur and realize the reformation of human resource strategy,he needs to become a human resource business partner (HRBP).It is a requirement,but also a guarantee for the success of human resource strategy.Why only when the HRM manages to be a human resource business partner will he or she exercise influence?

First,it is because of the particularity of status of the HRM.Having discussed with HRM about one question for many times — human resource management represents the stance employer or the labor?There is no doubt that most of the answers received are “stance of the employer”.Indeed,the role of human resource management,as the management method and tool of the employer,is to help the employer with human resource management problem.But in another thought,could human resource management function well if it completely stands for the employer?The answer is obvious,without the active cooperation of labor,even the best human resource strategy is difficult to put into practice.So,human resource management represents the interests of the employer could not survive without the recognition of the labor.Therefore,HRM must be capable of implementing influence on the employer,participating in making decisions related to the corporate strategy,and having a voice in the major decisions related to human resource management rather than simply an executor.

Second,to be a human resource business partner must first be an expert in the field of human resource management.Traditionally,HRM has been regarded as a passive implementer,however,being an expert requires professionalization and specialization.〔20〕This is because from the growth process there exists a lot of flaws.One is that is a piling up process of learning module from the perspective of learning process,which is the cause of the introduction of CHRP and the suffering of prevalent so-called “Six Modules” in China (Strategic Human Resource Management,Job Analysis,Job Interview,Salary Administration,Performance Management,Labour Relation).But the module of human resource management would by no means merely be divided into six parts.— No matter what,the study of modules is a fact,so the whole learning process is separate and fragmented.Specific in the process of implementation,they need to be unified to use,such as in the recruitment of graduates,there exist issues in the job interview,salary,performance,staff training and other aspects of graduates and might exist a huge difference between the recruitment,salary,performance management of senior executives.Such requirement to combine each module greatly reduces the possibility of the excellent performance of human resource management.The other is that is a unilateral promotion process from the perspective of the responsibilities as HRM,which is a typical growth process of HRM,generally including the recruiter,training manager,salary manager,performance management manager,and human resources director.It can be found that every promotion may not be consistent with the previous one.As a result,the “perception” of human resource management is particularly important.The author’s understanding of “perception” is the ability of integration.So it can be concluded that it is extremely difficult to be an excellent professional HRM and it requires manifold ability to be qualified as an expert which is a “maxim” the author always says:Talents can only be managed,people who manage others are master.

In the end,HRM must have certain authority.There are three sources of authority:One is the authority of jurisprudence,that is compulsory arranging through the appoint and dismiss of duty;the other is the authority of appeal,that is,to establish image to gain reputation,set prestige among employees through specialty;the third is the authority of relationship,that is to form “authority” through forming an informal relationship with authorities.The third authority is the most unreliable nor worth promoting.The most ideal authority of HRM is to possess both the first and the second authority at the same time,that is,to possess both the legal jurisprudence and the cohesive appeal.The more convincing part is the professionalism of both employers and employees.If HRM can be regarded as an expert who people could often consult with,then a psychological contract would be reached.The authority guaranteed by jurisprudence is “being professional because of authority”;while the authority obtained by appealing is “being authoritative because of professional”,therefore,it seems more convincing and reliable.

To summarize,it can be found that,through the above analysis,the successful implementation of human resource strategy requires human resource management to become the strategic partner of the enterprise.The acquisition of title of the strategic partner requires the improvement of HRM in professionalism.The above two ideas depend on each other and interact as both cause and effect.

References:

〔1〕Mao Zedong, All the reactionaries are the Papertiger,Beijing:Versioned by People’s Publishing House,1974,p.25

〔2〕〔German〕Clausewitz, On War,(Book 1, 2),Xi’an:Shanxi Renmin Publishing House,2001.

〔3〕〔America〕Ansoff,H.Igor, Corporate Strategy,McGrew Hill,New York,1965.

〔4〕〔America〕Michael E.Porter, Competitive Strategy,Beijing:Huxia Publishing House,1997;〔America〕Michael E.Porter, Competitive Advantage,Beijing:Huxia Publishing House,1997.

〔5〕〔6〕〔18〕Liu Dawei, On Research of Human Resource Integration during Enterprise Merger Acquisition,Beijing:China Economic Publishing House,2005,pp.149,150,65.

〔7〕〔America〕Michael E.Porter, On Competition,Beijing:Zhongxin Publishing House,2003,Itroduction Page IX.

〔8〕〔American〕AlfredP.Sloan,JR,My Years with General Motors:Autobiography AlfredP.Sloan,JR,Beijing:Huaxia Publishing House,2005,Perface of Peter F.Drucke, Why My Years with General Motors a Must-Read Work,pp.1,2.

〔9〕〔America〕Jack Welch, Winning,Beijing:Zhongxin Publishing House,2005,p.151.

〔10〕〔America〕Robert S.Kaplan,David P.Norton, The Balanced Scorecard:Translating Strategy into Action,Guangzhou:Guangdong Economic Publishing House,2004,p.25.

〔11〕〔America〕Robert S.Kaplan,David P.Norton, The Strategy-Focused Organization,Beijing:Post & Telecom Press,2004;〔America〕Robert S.Kaplan,David P.Norton, Converting Intanglement:Assets into Tangible Outcomes,Guangzhou:Guangdong Economic Publishing House,2005;〔America〕Robert S.Kaplan,David P.Norton, Alignment:Using the Balanced Scorecard to Create Corporate Synergies,Beijing:The Commercial Press,2006.

〔12〕〔America〕Dave Ulrich, Human Resource Champions:The Next Agenda for Adding Value and Delivering Results,Beijing:Publishing House of Electronics Industry,2015,pp.2-14.

〔13〕〔America〕Raymond A.Noe, Human Resource Management:Gaining a Competitive Advantage (Version VII),Beijing:China Renmin University Press,2013.

〔14〕〔15〕〔16〕〔America〕Eric Emerson Schmidt and other writers, How Google Works,Beijing:China Citic Press,2015,pp.6,6-7,8-9.

〔17〕〔America〕Dave Ulrich, HR Transformation Building Human Resources from the Outside in,Beijing:China Electric Power Press,2014,p.80.