opment plans. Net results in the intermediate range could then be the numbers, kinds, dates, and levels of human resources needs. In short, there are a number of short-, intermediate-, and long-range factors that affect SHRM planning.
In successful organizations SHRM planning efforts are viewed not as an all-or-nothing process but as falling at some point along a continuum. At one end of the continuum are those organizations that do no SHRM planning; at the other end are those that completely integrate long-range SHRM planning into their strategic business plans.
One expert has identified a number of benchmarks, or stages, along this continuum. Stage 1 companies have no long-term business plans, and they do little or no SHRM planning. Organizations at stage 2 have a long-term business plan, but tend to be skeptical of SHRM planning. At the same time, such
organizations do realize to some degree that SHRM planning is important. Stage 3 organizations do engage in some aspects of SHRM planning, but for the most part these efforts are not integrated into the longrange business plan. Stage 4 organizations do a good deal of SHRM planning, and their top
managers are enthusiastic about the process. These organizations have at least one human resources component integrated into the long-range plan. Stage 5 organizations treat SHRM planning as an
important and vital part of their long-term business plans. Obviously, organizations at stage 5 are highly enthusiastic about SHRM planning and view it as key to their overall success.
Again, successful organizations require that each step in SHRM planning is a joint effort of the HRM personnel and the various managers and other employees in the organization. An important role of HRM personnel is to coordinate, monitor, and integrate the process. HRM personnel often provide the
structure and establish the timetable to be followed by departmental or operating managers. This helps ensure a unified effort. As managers determine their human resources needs, they can channel this information through, or even develop this information with, the HRM staff to be coordinated and integrated. By funneling all the information through a central source, they can attain maximum efficiency in the process—efficiency that is key to today’s organizational success.
THE CHALLENGES AND POTENTIAL PITFALLS OF SHRM
Supporting Overall Strategy
Developing SHRM strategies to support the organization’s overall strategy is a challenge for a number of reasons. First, senior management may not always be able to communicate the organization’s overall strategy clearly. Second, there may be much uncertainty or disagreement concerning which HRM
strategies should be used to support the overall organizational strategy. In other words, it is seldom obvious how particular HRM strategies will contribute to the achievement of organizational strategies.
Third, large organizations may have different organizational units, each with its own strategies. Each unit should be able to formulate the HRM strategy that fits its strategy best.
Developing HRM Strategies for Unique Organizational Characteristics No two organizations are exactly alike. Organizations differ in history, culture, leadership style,
technology, strategy, and so on. The chances are high that any ambitious HRM strategy or program that is not molded to organizational characteristics will fail (Butler, Ferris, and Napier, 1991). And therein lies one of the key challenges in formulating HRM strategies: creating a vision of the organization of the future that does not provoke a destructive clash with the organization of the present.
Securing Management Commitment
SHRM planning is not strictly a HRM department function. Thus, HRM strategies that originate in the HRM department will have little chance of succeeding unless managers at all levels—including senior management—support them completely. To ensure managers’ commitment, HRM personnel must work closely with them when formulating policies. Unfortunately, HRM personnel tend to become absorbed in their own function and fail to interact or coordinate with others. More will be said later in this chapter about the importance of an effective relationship between the HRM department and managers at all levels of the organization.
Integration with the Organization’s Strategic Plan
As emphasized earlier, HRM plans must be derived from organizational plans. Often a strategic plan that looks great on paper fails because of poor implementation. The real test of any strategic plan is whether or not it makes a difference in practice. If the plan does not affect practice, employees and managers will regard it as all talk and no action. Perhaps the greatest challenge and common pitfall in SHRM planning lies not in the
formulation of strategy but rather in the development of an appropriate set of programs that will make the strategy work. The key here is to develop good communication channels between the organization planners and the HRM planners.
Coping with the Environment
Just as no two organizations are alike, no two organizations operate in an identical environment. Some must deal with rapid change, as in the computer industry; others operate in a relatively stable market, as in the market for food processors. Some must deal with turbulent demand (for example, fashion
designers); others face a virtually guaranteed demand for their products or services (for example,
medical providers). A major challenge in developing HRM strategies is crafting strategies that will work in the organization’s unique environment to give it a sustainable competitive advantage.
Qualitative versus Quantitative Approaches to HRM
Some people view SHRM planning from a qualitative perspective and focus on individual employee concerns such as individual promotability and career development. Others view SHRM planning as a numbers game designed to track the flow of people in, out, up, down, and across the different
organizational units. These people take a strictly quantitative approach to SHRM planning. As is often the case, a balanced approach usually yields the best results, and successful organizations encourage such an approach.
Accommodating Continuous Change
SHRM plans must be flexible enough to accommodate change. HRM planners work in an environment characterized by ambiguous regulations, organizational politics, diverse management styles, and a rapidly changing, demanding broader organizational environment. An organization with an inflexible strategic plan may find itself unable to respond to changes quickly because it is so committed to a particular course of action. This may lead an organization to continue devoting resources to an activity of questionable value simply because so much has been invested in it already. The challenge is to create a strategic vision and develop the plans to achieve it while staying flexible enough to adapt to change.
Maintaining a Competitive Advantage
One realization in today’s environment is that any competitive advantage enjoyed by an organization tends to be short-lived because other organi-
zations are likely to imitate it. This is as true for HRM advantages as for marketing and technological advantages. For example, many high-tech organizations have “borrowed” reward programs for key engineers and scientists from other successful high-tech organizations.
The challenge and potential pitfall from an HRM perspective is to avoid excessive concentration on day- to-day problems and develop strategies that offer the organization a sustained competitive advantage.
For instance, an organization may develop programs that simply put out fires as opposed to developing programs that maximize the long-term direction of the organization.