Starbucks Hard Vs. Soft Hrm

Topic 1

Strategic human resource management can be defined as the practice of attracting, developing, rewarding, and retaining employees for the benefit of both the employees as individuals and the organization as a whole. HR departments that practice strategic HRM do not work independently; they interact with other departments within an organization in order to understand their goals and then create strategies that align with those objectives, as well as those of the organization. As a result, the goals of a human resource department support the goals of the rest of the organization. Strategic HRM is seen as a partner in organizational success, as opposed to a necessity for legal compliance or compensation. Strategic HRM utilizes the talent and opportunity within the human resources department to make other departments stronger and more effective. The key characteristic of strategic HRM is integrated.

Example: Starbuck believes its employees, called partners, are the key to the Starbucks experience. Starbuck demonstrates the value it places on its partners by treating its partners with dignity and respect, offering benefits exceeding those provided by competitors, putting employees higher on the priority list than investors.

There are 4 models of HRM: “Hard” versus “soft” HRM, “Best fit”, “Best practice” and Resource-based view.

“Hard” versus “soft” HRM

Soft HRM is an approach to HRM that involves treating employees as one of a company's most important assets. When management uses soft HRM, it views its employees as critical resources who are key to their long-term business strategies. Example: Google, Facebook. Soft HRM is different from the concept of hard HRM because hard HRM methods treat the employee as just another resource, similar to the tools and machines needed to operate the business. Under the hard HRM method, employees are treated as resources needed to help the business operate, but their needs aren't considered. Example: McDonalds, KFC

Best Fit/Contingency Models

The best-fit/contingency perspective focuses on the need to achieve a match between the business strategy and the resultant parameters for HRM. In other words, the relationship between the use of specific HR practices and organisational performance is posited to be contingent on an organisation’s strategy (i.e. vertical alignment). The focus on the alignment of HRM with strategy is a direct outcome of the emphasis on 'competitive advantage'. Increasingly, it is being acknowledged that the management of people is one of the key links to generating a competitive advantage. There are a number of different models, for example, those that look at different 'stages' in the development of the organisation and those that link HR strategies to different business strategies, e.g. Porter’s ‘generic’ competitive strategies of innovation, quality-enhancement or cost reduction.