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What is Strategic Human Resource Management

Strategic HRM – How it helps in improved Business Performance

 Don’t forget to take the HR QUIZ at the end of this article

Definition: Strategic human resource management (strategic HRM or SHRM) is a tactic to managing human resources that supports long-term business goals and outcomes with a strategic framework.

It means that all HR Activities will be linked to the Organization’s Strategic Objectives.

Here I have to mention a little bit about strategy – A company has to plan its activities not only for short-term but for a long-term also.
This futuristic activity has to be backed up by some solid policies and practices without which the firm will start limping after a particular point of time.

These goals and objectives are called strategies which are formulated in lieu of internal and external business environment, and also take into account legal, political and economic considerations.

Strategic HRM is an approach that defines how the organizations goals will be achieved through people by means of HR strategies and integrated HR policies and practices.

what is strategic human resource management

Basics of strategic hrm:

  1. Formulation of HR Programs to enhance overall organizational performance
  2. Strategic HR planning from start
  3. Pro-actively participate in big picture decision making
  4. Redesign organizations and the work processes
  5. Measure financial results of all HR activities

 Human Resource managers need to go for:

  • Focus on developing HR programs that improve organizational performance
  • Pro-active decision making on mergers, acquisitions, and downsizing
  • Restructure the work processes to enrich overall organizational performance
  • Measure and document the financial results of all HR activities
Strategic HRM is the key to improved business performance

hr do's and dont's

A good SHRM strategy

In the majority of organizations people are now the biggest asset.

Their knowledge, skills and abilities have to be employed and used to the maximum effect if the organization is to create any value.

Benefits of strategic hr

  • Enables development of high-quality workforce through focus on types of people and skills needed
  • Helps in cost-effective utilization of labor, particularly in service industries where labor is generally expensive
  • Facilitates planning and assessment of environmental uncertainty, and adaptation of organization to external forces 

Strategic human resource management is important in both large and small companies.

Small companies have an ease of managing HR because of the small number of people involved and training them for a strategic approach might be lot easier.

Larger companies need to have a whole department in charge of human resources and development.



1. ————is the assessment of internal and external conditions that affect the organization

  • Environmental scanning
  • Environmental scrutiny

2. The elementary way of employee learning in which the employees of an organization copy the behaviors of someone else is classified as

  • Behavioral modeling
  • Spaced modeling

3. The completion time of training, cost of resources and number of trainees are variables that must be considered in

  • Delivery of training
  • Selection of employees

4. The step in recruitment process in which the candidates are shortlisted fulfilling the minimum requirements of the job is classified as

  • Pre-employment screening
  • Affirmative screening

5. In an organization, the research efforts that are made to evaluate current structure of human resource management are classified as

  • HR audit
  • HR rating
Buy Handbook of Strategic HRM by Michael Armstrong