Gaining Competitive Advantage and Business Success
HRDI 6:3 (September 2003), pp. 405–411
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• PERSPECTIVES ON PRACTICE •
Gaining competitive advantage and business success through strategic HRD: an Indian experience
Biswajeet Pattanayak Indian Institute of Management, Indore
Abstract: This article offers a case study of a strategic HRD initiative to enhance organizational performance. Based at a corporation in India, the initiative involved an action research component to understand factors hindering current performance and HRD interventions aligned to business strategy to address the identified factors. The case study illustrates the potentials for taking a strategic approach to improving performance through HRD.
Organizational strategy is basically concerned with the creation of missions and the setting of organizational objectives. Specific policies are then formulated and implemented to achieve those objectives, including policies, procedures, methods and programmes relating to the organization’s human resources. Those policies and practices should be linked to business objectives and corporate strategy (Pfeiffer 1998), with human resource development having a key role in ensuring the strategic alignment of training and development, career development and cultural change to the overall performance improvement of the organization. Strategic HRD therefore aims to leverage and/or align HRD practices to build critical organizational capabilities that enable an organization to achieve its goals (Ulrich and Lake 1990). Aligning HRD to the business is an essential component of achieving HRD effectiveness (Rao 1999). One integrative framework for achieving this (offered by Yeung and Berman 1997) used three paths through which HR practices can contribute to business performance: building organizational capabilities, improving employee satisfaction and shaping customer and
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• PERSPECTIVES ON PRACTICE •
Gaining competitive advantage and business success through strategic HRD: an Indian experience
Biswajeet Pattanayak Indian Institute of Management, Indore
Abstract: This article offers a case study of a strategic HRD initiative to enhance organizational performance. Based at a corporation in India, the initiative involved an action research component to understand factors hindering current performance and HRD interventions aligned to business strategy to address the identified factors. The case study illustrates the potentials for taking a strategic approach to improving performance through HRD.
Organizational strategy is basically concerned with the creation of missions and the setting of organizational objectives. Specific policies are then formulated and implemented to achieve those objectives, including policies, procedures, methods and programmes relating to the organization’s human resources. Those policies and practices should be linked to business objectives and corporate strategy (Pfeiffer 1998), with human resource development having a key role in ensuring the strategic alignment of training and development, career development and cultural change to the overall performance improvement of the organization. Strategic HRD therefore aims to leverage and/or align HRD practices to build critical organizational capabilities that enable an organization to achieve its goals (Ulrich and Lake 1990). Aligning HRD to the business is an essential component of achieving HRD effectiveness (Rao 1999). One integrative framework for achieving this (offered by Yeung and Berman 1997) used three paths through which HR practices can contribute to business performance: building organizational capabilities, improving employee satisfaction and shaping customer and
References: Burke, W. W. and Litwin, G. H. (1989) ‘A causal model of organizational performance’, in J. W. Pfeiffer (ed.) The 1989 Annual: Developing Human Resources, San Diego, CA: Pfeiffer. Pfeiffer, J. (1996) Theories and Models in Applied Behavioural Science, San Diego, CA: Pfeiffer. 410 Pattanayak: Competitive advantage through strategic HRD 1 2 3 4 5 6 7 8 9 0 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 Pfeffer, J. (1998) The Human Equation: Building Profits by Putting People First, Boston, MA: Harvard Business School Press. Porter, M. (1985) Competitive Advantage, New York: The Free Press. Rao, T. V. (1999) HRD Audit, New Delhi: Response Books. Ulrich, D. and Lake, D. (1990) Organizational Capabilities: Competing from the Insight/Out, New York: Wiley. Yeung, A. K. and Berman, B. (1997) ‘Adding value through human resources: reorienting human resource management to drive business performances’, Human Resource Management, 36(3): 321–35. 411