HRM Strategy Design

Subject: Human Resource Management

Word count: 1500

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HRM Strategy Design


The resource based view theory has brought some major attention and scrutiny of the human resource concept and its contribution to the organisation performance. The resource based view has helped to focus interest on ways that resources can be managed strategically by attending to their capacity for creating uniqueness and competitive advantage through economic value.  The discussion below looks at how the resource based view has played a key role in bringing to light linkage between strategic human resource management and how the organisation performs through by capitalising on its competitive advantages.

The resource based view is a theory that looks at how the firm can achieve a sustainable competitive advantage through the accumulation of a strategic asset that has the following capabilities: valuable, rare, hard to copy and difficult to substitute or imitate (Harzing and Pinnington 2011). These capabilities can be achieved through a strategic consideration of the external and internal environments of the organisation. Once the firm identifies the competitive advantage it can then move to the formulation and implementation of the strategy. It is important to note that a sustainable competitive advantage is not just a single or isolated component but rather it can be a combination of various factors that can be combined into one dynamic operation (Wright, Dunford and Snell 2001). The resource-based view might provide a theoretical rational for why human resource could have implications for strategy formulation as well as its implementation.

With the above in mind, we now focus on strategic human resource and how it influences the organisational performance. As the organisation attempts to exploit or achieve a competitive advantage through utilisation of its internal environment strengths, one of the most important resources to consider is human resource. In the past human resource has been utilised by organisations to achieve goals however its only in recent years it has come to light of how some organisations can use these internal strengths to achieve a competitive advantage. The utilization of human resource by management to formulate and achieve an organisational goal through strategy is now what is known as strategic human resource management. The human resource management refers to the stock of employee skills that exist within a firm at any given point and how management utilizes it achieve the firms’ goals (Barney 2001). The resource based view has brought growing acceptance of internal resources as sources of competitive advantage hence bringing a considerable link between human resource strategy design and the firms’ performance.


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