Theoretical perspectives for strategic human resource management

Journal of Management, June, 1992 by Patrick M. Wright, Gary C. McMahan

However, more recently, writers have begun to approach the area of HRM from a much more macro-orientation--that is, what could more accurately be called SHRM (Butler et al., 1991). For example, Schuler and Walker (1990) noted that human resource strategy referred to a short-term focus on business needs and defined it as "a set of processes and activities jointly shared by human resources and line managers to solve people-related business problems" (7). Guest (1989) suggested that SHRM is concerned with ensuring that "human resources management is fully integrated into strategic planning; that HRM policies cohere both across policy areas and across hierarchies and that HRM practices are accepted and used by line managers as part of their everyday work" (48). Probably the best definition offered to date, however, comes from Schuler (in press) who states that SHRM is "all those activities affecting the behavior of individuals in their efforts to formulate and implement the strategic needs of the business" (2).

In other words, SHRM is the macro-organizational approach to viewing the role and function of HRM in the larger organization (Butler et al., 1991). Thus, for the purposes of this article, we define strategic human resource management as the pattern of planned human resource deployments and activities intended to enable an organization to achieve its goals. This definition highlights the two important dimensions that distinguish it from traditional HRM.

First, vertically, it entails the linking of human resource management practices with the strategic management process of the organization (Dyer, 1985; Golden Ramanujam, 1985; Guest, 1989; Lengnick-Hall & Lengnick-Hall, 1988; Schuler, in press). Second, horizontally, it emphasizes the coordination or congruence among the various human resource management practices (Baird & Meshoulam, 1988; Milliman, Von Glinow, & Nathan, 1991; Schuler & Jackson, 1987; Snell, in press; Wright & Snell, 1991) through a pattern of planned action. Our definition does not explicitly address the congruence with other organizational contingencies such as product life cycles (Baird & Meshoulam, 1988), but these are implicit given the link to organizational goals.

This definition provides a clear exposition of the variables of interest and their interrelationship to SHRM theory and research. SHRM theory should be concerned with the determinants of decisions about human resource practices, the composition of the human capital resource pool (i.e., skills and abilities), the specification of required human resource behaviors, and the effectiveness of these decisions given various business strategies and/or competitive situations. This model is presented in Figure 1.

In addition, though an explicit link is proposed between business strategies and HR practices, we view strategic intent as only one determinant of those practices. In fact, some of the theoretical models discussed in this article virtually ignore business strategy as a determinant of HR practices, focusing instead on determinants that are not the result of proactive decision making. We argue that SHRM needs to explore the institutional and political determinants of HR practices to as great an extent as necessary to predict and understand the SHRM decision process. It is often these institutional and political forces that impede the coordination of the slate of HR practices toward some strategic end.