Learning outcomes
By the end of this chapter you should be able to:
• identify and discuss the core principles that underpin the concept of strategic human resource planning;
• critically evaluate the extent to which strategic human resource planning represents the vital connecting link between organisational strategy and SHRM practice;
• analyse the conceptual and operational difficulties surrounding the practise of strategic human resource planning;
• assess the relevance of strategic human resource planning to organisations facing an increasingly changing business environment;
• review potential avenues for addressing the difficulties associated with human resource planning to enhance its operational viability.
Summary
• HRP is the name given to formal processes designed to ensure that an organisation’s human resources capability can support the achievement of its strategic objectives. It involves forecasting the future demand for and supply of labour and drawing up HR plans to reconcile mismatches between the two.
• When viewed as the vital link between organisation and HR strategies HRP can be regarded as a bridging mechanism fulfilling three vital roles: aligning HR plans to organisational strategies to further their achievement; uncovering HR issues that can threaten the viability of organisational strategies and thereby lead to their reformulation; and acting in a reciprocal relationship with organisational strategies such that HR issues become a central input into the strategy formation process.
• Numerous difficulties surrounding the practise of HRP may thwart its potential to serve as the link between organisational strategy and SHRM practice. These difficulties may be sufficient to lead organisations to abandon any thoughts of practising HRP, may conspire to reduce the effectiveness of HRP practice or may limit its application to short-term, operational matters.
• Patchy and limited data on HRP practice points to its low level of take-up by organisations leading to an alternative perspective of HRP as the missing or weakest link between
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organisational and HR strategies. This leads to a paradox where the more the complexities of organisational life warrant the establishment of HRP as the vital link the more these complexities are likely to cause HRP to be cast aside to become the missing/weakest link. • Avenues for confronting operational difficulties and forging HRP as the pivotal bridging
mechanism between organisational strategy and SHRM practice focused on: raising the profile of HR issues generally and the status and credibility of HR practitioners particularly; using contingency and scenario planning to introduce flexibility into the HRP process; building towards a flexible workforce that can manage the vagaries arising from unplanned developments and an uncertain future; and developing an HRP process centred on continual review, evaluation and adaptation and adopting a multi-stakeholder approach to make this a realistic possibility.
Teaching and learning suggestions
Comment
An immediate problem facing the delivery of this topic is the overall lack of attention it receives in the human resource management (HRM) literature, particularly in the United Kingdom, despite its potential bridging role between corporate strategies on the one hand and HRM strategies and operational activities on the other. Increasingly mainstream HR texts do not include a chapter on human resource planning and where they do its strategic role receives only passing attention. One reason for this is the conflation of HRP and HRM such that both may come to be regarded as synonymous. This is not the stance adopted in this chapter, which makes the case for human resource planning (HRP) to be regarded as the prime vehicle for translating the strategic imperatives of organisations into meaningful human resourcing strategies, policies, procedures and operational activities. Drawing on the seminal work of Schuler and Jackson (1987), for example, HRP is the bridge that links their competitive strategies with HRM practices. Here the argument is that to identify and develop HR practices relevant to different organisational strategies requires a deliberate planning intervention, that is, HRP. However, it is also important to emphasise that this one-way, top-down strategic relationship between corporate and HRM strategies is only one of a number of different types of strategic fit such that at the other extreme, for example, HRP when used to identify and generate core competences can become a vehicle for shaping organisational strategy itself.
It is also important to emphasise to students that there is a potential conflict between the whole notion of planning and the environmental uncertainties surrounding many organisations. Planning suggests a degree of certainty that is largely unrealistic in today’s volatile business climate. Therefore to be useful HRP processes have to be shaped so that they can accommodate planned and unplanned change over different time horizons.
Student preparation
Prior to the class, we believe it is essential that students read and make notes from the chapter. We have found that producing mind maps of the chapter content is a useful approach to note taking and encourages students to reflect on the internal integration of the subject content of the chapter.
We use a variety of vehicles to bridge student preparation and class-based activities to enhance their understanding of the chapter content and its overall relationship to managing human resources (HR) strategically. As standard, we would ask students to make a note of any queries arising from their reading and to come to the teaching session prepared to raise them. Sometimes this may be formalised by asking students to write down (as questions) the three issues addressed by the chapter where they would like further clarification and guidance.
Students may also be asked to do one or more of the following:
• address pre-set questions and write their answers briefly in note format;
• complete the self check and reflect questions and come to the session prepared to share and discuss their responses; and
• familiarise themselves with the chapter case study (or an alternative case supplied in advance) and come to the session prepared to tackle the case questions.
Our outline answers to both self check and reflect questions and case study questions follow in the next two substantive sections of this chapter guide. Pre-set questions that we have found useful for structuring student reading, preparatory activities and classroom discussion for the topic of strategic HRP include:
1. How would you define HRP and set it into the SHRM context?
2. What are the principal strategic relationships between HRP and corporate strategy and how could they be evidenced in practice?
3. What do you understand by the HRP paradox and how does this impact on the utility of the concept?
4. How would you argue the case for and against the formal adoption of strategic HRP by organisations?
In the classroom
Clearly the approach adopted to ‘student preparation’ can be followed through into the classroom. A starting point that we find useful is to surface and discuss the issues arising from students’ preparatory reading. This avoids providing lecture input that simply repeats what students have already grasped, reinforces the value of reading as an essential prerequisite for class-based discussion and provides a platform from which further class-based activities can be launched. However, when adopting this approach, we find it useful, once student queries have been exhausted, to provide a snappy summary of key issues.
Where preparing answers to self check and reflect questions has been set as part of preparation for the teaching session, at least two alternatives present themselves. First, students can be asked to contribute individual responses that are then subjected to plenary discussion. This is our preferred approach because it makes students more accountable for their personal learning and reserves any group work for case study analysis. Second, students can be formed into groups to share their individual answers and draw conclusions from their discussions. However, if preparing answers to self check and reflect questions was not part of preparatory work but consideration of the questions is to feature as part of the teaching session, we would favour the group approach as a more stimulating approach. In all cases student responses can be considered against our suggested answers, which themselves can be usefully critiqued.
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Where case study work has featured as part of preparatory activities, similar approaches to those suggested for self check and reflect questions can be adopted. Our approach here would be to start with a more general exploration of the HRP implications of mergers and acquisitions and use this to develop an evaluative framework against which practice in the three case companies can be analysed. If coming to the case afresh, there is unlikely to be time for groups to consider all four questions. Here we would suggest that groups be allocated one of the case companies (Deutsche Bank/Bankers Trust or British Petroleum/Amoco or Volvo/Ford) and asked to work through Questions 3 and 4 for their allocated company. Group outputs can then be used as the basis for a plenary consideration of Questions 1 and 2.
Greater topicality can be achieved by capturing the big business news stories of the week, discussing the HRP issues that are likely to arise and exploring how HRP might be used effectively to address these issues.
Follow-up work
The pedagogic features adopted throughout this book are intended to offer up a number of alternatives for follow-up work while at the same time leaving the lecturer free to add or substitute their own ideas.
If they have not already been used as part of class activities, self check and reflect questions and/or the chapter case study, ‘Human resource planning in mergers and acquisitions’, can be set as follow-up work and should serve as a useful reinforcement of chapter content. Our outline answers to both self check and reflect questions and case study questions follow in the next two substantive sections of this chapter guide.
There are also a number of follow-up study suggestions after the chapter summary that can be undertaken by students either individually or in groups and an extensive list of references provides many opportunities for directed further reading.
A further task could require students to research reported case examples of mergers and acquisitions and analyse the extent to which HRP is evident during the planning, implementation and consolidation stages and the likely consequences of their findings.
Answers to Self-Check and Reflect Questions
7.1 To what extent can the hard and soft variants of HRP be regarded as mutually exclusive? Too frequently hard and soft HRP are presented as either/or alternatives. Like much else in the literature this is far too simplistic and ignores the potential for both to operate in tandem and for hard HRP to have a soft edge and vice versa. For example, throughout the chapter mergers and acquisitions are used as a linking theme to illustrate facets of HRP practice. Here hard HRP will often involve: restructuring work activities to remove unnecessary duplication; forecasting staff numbers against this reduced requirement; and making staff surplus to requirement redundant to bring labour supply into line with demand. Although ‘hard’ this action may be vital if the planned synergies from merger/acquisition are to be realised. However, at the same time soft HRP may be evident. The organisation may be trying to manage the cultural integration of surviving employees or setting aside the cultural inheritance to re-align the organisation culture. Further the hard, quantitative manifestation of HRP arising from redundancy may simultaneously exhibit a soft edge. The way the organisation manages the process, including its
treatment of survivors, is likely to directly affect the success of the redundancy programme itself and the future prospects of the emerging organisation. Similarly, if cultural alignment is imperative for the future survival of the organisation, employees unable to make the necessary adjustment may find themselves managed out of the organisation.
7.2 To what extent can the view that HRP is all about ensuring that the right person is in the right place at the right time be interpreted as a soft, as well as hard, approach to HRP? In a similar vein to Question 1, this simple view of HRP has been strongly associated with the ‘hard’ variant but arguably contains within it the potential for a ‘soft’ interpretation. This view is often bracketed with manpower planning with the assumption that the ‘right person’ carries with it quantitative overtones. Here it is interpreted as referring to the number of employees with manpower planning being about ensuring that the supply of staff matches the demand for staff arising from the different tasks to be performed. However, this is a restrictive interpretation because ‘right person’ could equally be said to refer to the soft, qualitative dimension of HRP. Here ‘right’ could be expressed in terms of skills and competences, cultural orientation, motivation, commitment, values etc. However, a number of these attributes represent intangibles. Some are personal, some contextual and some organisational such that any attempt to incorporate them within HRP will require an approach that reflects the longer-term orientation consistent with strategically focused HRP. Therefore, although this view of HRP appears simple in appearance, it can be argued that a broader interpretation reflects more comprehensive definitions of HRP. The key lies in how ‘right’ is interpreted and similar analysis can be applied to ‘right place’ and ‘right time’.
7.3 How would you map out the benefits of HRP identified in the above analysis against the ‘regulation’, ‘control’ and ‘shape’ phases of Ulrich’s (1987) model of transitions in SHRP (see Table 7.4). You might find it helpful to structure your answer in tabular format. To get you started, one example under each of the three phases identified by Ulrich has been provided below.