Strategy and Human Resource Management

1. What is the difference between Corporate Strategy (or strategy formulation) and Business Unit Strategy (Strategy Implementation)? The strategy formulation is about making choices, decisions and plans for the organization. Strategy Implementation is about the ways and means to achieve those plans, decisions and choices. How to execute the strategy decisions or plans. Strategy formulation comes before strategy implementation.

Strategy formulation talks about business strategy which determine how should the organization compete with others, and corporate strategy which determines where should the organization compete with others. Global strategy which determines where and how should the organization compete with others around the world. Strategy implementation talks about organizational design which determines how should the organization organized and put the formulated strategy into practice, and corporate governance, business ethics, and strategic leadership which determines what type of strategic leadership and corporate governance does the organization need and how to anchor the decision in business ethics.

2.Why is that distinction important for a firm that operates in different product markets? These distinctions can help the firm gaining and sustaining competitive advantage. In every competitive situation the winners are always those firms with better strategy. “A firm that formulates and implements a strategy that leads to superior performance relative to other competitors in the same industry or the industry average has a competitive advantage.”(Chapter 1 Strategic management) and these advantage could lead firm to success in their business.

3. What role does (or should) HR play in Strategy Formulation? HR people play in a role that clarify future management performance expectations and figure out the methods to achieve the expectations. Furthermore, HR people should help the organization to make right decisions and determine business missions, plans and resources. Finally, ensure the objectives and action plans fit the business strategy.

4. What role does (or should) HR play in Business Unit Strategy? HR people should play in a role that help the organization to develop the means and methods to achieve the organizational change, developing employment relations, cultural learning, and ensure the execution of strategy. Ultimately, HR helps the organization to increase their ability in business action and changing and finally achieve the goal of gaining and sustaining competitive advantages.

We will be happy to hear your thoughts

Leave a reply