Introduction
Human Resource Management can be stated as the managerial task that involves the matters associated to populace such as recompense, appointing, presentation, administration, association, expansion, security, well being, remuneration, worker incentive, communiqué, supervision and teaching. “Human Resource Management (HRM) is the function within an organization that focuses on recruitment of, management of and providing direction for the people who work in the organization.” (Heathfield, 2009, para.1). The complete handling of human resources is the actual job of a Human Resource Manager. The importance of Human Resource Management was identified through the fact that effective communication between the employees is necessary for the success of the organization and conflicts existing within the people in the firm should never lead to aggressions.
Strategic Human Resource Management
Strategic human resource management is the practical human resource management. It necessitates accepted wisdom in advance and planning methods for the firm to achieve an enhanced approach to the requirements of the workers as well as for the workers to achieve an enhanced approach to the requirements of the firm. “Strategic human resource management is designed to help companies best meet the needs of their employees while promoting company goals.” (Upson, 2009, para.1).
Planning is carried out by the strategic HR manager keeping the mission and vision of the firm in mind to make the maximum utilization of human resources cutting out redundancies.
Resource Based Model or Resource Based View (RBM or RBV)
The analysis of effective strategic human resource management requires various techniques. There are many methods available in the management sector for attaining this, but Resource Based Model or Resource Based View is the one widely accepted in this field. “The Resource-Based model adopts an internal perspective to explain how a company’s unique bundle or collection of internal resources and capabilities represent the foundation upon which value-creating strategies should be built.” (The resource-based model, 2007, para.1).
The resources of a firm include the monetary investment, talents of the workers, trademark, exclusive rights and the managing groups. The resources can be categorized in many ways where all those are evaluated on their potency in accomplishing various errands. The physical as well as the intellectual resources are of much importance in a firm.
The resource based view helps in analyzing various resources in a very effective model. The resource based model implies the fact that the entire group of resources is much significant in concluding the strategies and plans rather than the exterior factors available. Identification of the strategies for human resource management helps in best utilization of the entire resources effectively. “The major implication of that model was that some employee groups are more instrumental to competitive advantage than others.” (Schuler & Jackson, 2007, p.79).
The model analyses and deduces the significance of each group and the influence of each on different competitive merits, thus concluding on the hierarchy of their extent.
The resource based models usually are carried out through five steps in a specific order. The steps can be seen as shown in the figure below.
Resources
The various feeds given to the firm are required to manufacture the end products. This group includes both substantial and insubstantial objects contributing to the successful production process.
Capability: This step of the resource based model identifies the competence for an incorporated collection of resources to collectively execute a mission or action. The weights given for each group of resources are analyzed to determine the most influential resources and the least ones.
Competitive Advantage: The widely accepted idea is that human resources are the real source of competitive advantage of a firm. The competitive advantage is very often referred to as the capacity of an organization to go one better than its competitors. So, this step of resource based model defines the competitive advantage of each group of resources.
An Attractive Industry: After the analysis of the merits and capabilities of various resources of the firm, resource based model proceeds with the action of recognizing and spotting out the sites where the concluded advantages of the analysis can be used to exploit the sites to the maximum limit. The determination of a striking industry that matches with the available resources of the firm will add to the possibility of the firm’s success.
Strategy Formulation & Implementation
The entire steps performed prior to this final step are required for the effectiveness of this step. The identification and analysis of the resources, their capacity and the favorable industries, result in the efficient formulation of the strategies of the organization. “The overall themes of Strategic Human Resource Management (SHRM) are the integration of all HRM functions, adherence to broad organizational goals and responsiveness to the external environment.” (Worland & Manning, 2005, p.12).
The objective of formulation of the strategies and implementation of those is to earn favorable profit without fail. The defining of strategies is of much significance because the entire actions carried in the organization are based on those identified strategies whose implementation becomes the real-time utilization of the resources. Formulating strategy implies recognizing the competitive advantages of the firm with constancy in attaining a profit above the average.
Case Study
Exploration on the Strategic Human Resource Management propositions in various parts around the globe leads to a clear cut idea on the field of Strategic Human Resource Management. Strategic Human Resource Management sector has been keeping the dominance throughout the past many years in the management theory as well as the real life practice. It is a known fact that the effectiveness of the execution of Strategic Human Resource Management leads to a very high yield and profit. A study on the SHRM execution of a country lights up the factors influencing it as well as the conditions prevailing.
Iran is considered as a developing country in every aspect. The internal environments in the firms in developed and developing countries can coincide but the external environment will be different always. So, those concepts accepted by many of the developed countries like US are not applicable completely in the case of Iran as well. “Management theories and practices must be developed based on the local conditions and circumstances and socio-cultural forces.” (Namazie, n.d., p.3).
The early 1960s saw a balanced economy in Iran with a straight path available for economic development of the country. Later, due to the reforms within the nation resulted in a little twist in the developmental path of the country. The newer launches of enterprises in Iran thus should face the existing circumstances which actually affect the Strategic Human Resource Management of the firms.
The Strategic Human Resource Management of the firms in Iran is exposed to a variety of strains. The restructuring of the economy of Iranian business and market by the government accepted a fresh idea of privatization. “In theory, privatization would increase efficiency, create a more competitive atmosphere, and promote the culture of free enterprise.” (Khajehpour, 2000, The structure of the Iranian economy, para.1).
The promotion of more self-financing companies always contributes to healthy competition for existence which will help in developing the economy as well as the quality of the goods and services delivered. Thus, the overall efficiency is introduced to the business market of Iran.
Strategic analysis
The analysis of various aspects of SHRM in Iran can be carried out by close observation of the country’s position and approaches. The investigation can be done in a more systematic way.
SHRM tools
The TQM (Total Quality Management) and EFQM (European Foundation for Quality Management) Excellence Model are very effective management tools available in the Strategic Human Resource Management along with the Resource Based Model (RBM).
Total Quality Management (TQM)
The entire behavior of the company contributes to the success of SHRM. “TQM is a management philosophy that seeks to integrate all organizational functions (marketing, finance, design, engineering, and production, customer service, etc.) to focus on meeting customer needs and organizational objectives.” (Hashmi, 2009, TQM defined, para.1).
Total Quality Management (TQM), is a technique by which employers and workers will be able to turn out to be implicated in the permanent development of manufacturing of goods and services. It is an amalgamation of superiority and administration tackles intended to develop the trade and lessen the failure owing to inefficient activities. “TQM places strong focus on process measurement and controls as means of continuous improvement.” (Total quality management (TQM), 2009, para.1). TQM is a group of managing activities all through the association, carried out to guarantee that the firm constantly reaches or surpasses the clients’ necessities.
EFQM (European Foundation for Quality Management) Excellence Model
Self-evaluation is the first requirement for any firm prior to the Strategic Human Resource Management process. “The EFQM Excellence Model is a practical tool to help organizations to do this by measuring where they are on the path to Excellence; helping them understand the gaps; and stimulating solutions.” (European foundation for quality management: EFQM, n.d., para.4).
The model sets forward a set of bases for the firm to flourish in the existing competitive environment. Self-estimation has extensive relevance to the industries – big and tiny, in the government as well as in the self-financing sectors. Thus, the significance of EFQM Excellence Model is identified.
Challenges of SHRM in Iran
It is seen that Iranian economy is trying to absorb the entire advantage of SHRM. They have recognized it as the key factor in the development of an organization to a consistent position in the market. The first and foremost challenge faced by the Iranian economy is in recognizing and understanding the present environment and disputes. Another significant challenge encountered is in appointing the right person to the manager’s position. This is of much importance because only this can help the firm to identify and attack various other challenges of the firm. The SHRM gets its success only if an efficient person handles it.
Conventional and philosophical point of view, overriding the managerial approach in the Iranian society, contributes many inefficiencies to SHRM. Because of this, the thrust on the success of the manager has degraded gradually in Iran. “Another challenge in the implementation of SHRM in Iran that also results in the inappropriate management style in the organizations is the debate of professional human resource immigration to foreign countries that shapes the Brain Drain phenomenon.” (Bidmeshgipour, 2009, p.33).
The youngsters in Iran migrate to different foreign countries in fetch of their fortune which is identified as Brain Drain phenomenon. This always adversely affects Iranian development due to the reality that the potential of management lies in the hands of efficient managers alone. If the capable ones migrate, the loss for the nation becomes a real time challenge to SHRM. “The young generation demands accountability from the government that is progressive and modern and not tied up in the past.” (Daily deeply regrets rising trend in “brain drain” phenomenon in Iran, 2003, para.7).
The youngsters have already recognized the faults in the traditional approach of the Iranian society. The challenge affecting the Iranian development as well as other areas is the culture prevailing throughout the country and within an organization.
Implementation of SHRM in Iran
The implementation requires an effective evaluation accompanied by successful execution of those strategies identified through it. For this, a tool is essential in order to reduce the possible redundancies. From the tools discussed earlier, the EFQM Excellence Model can be used in the case of SHRM in Iran.
EFQM Excellence Model for SHRM in Iran
The SHRM situation in Iran can be analyzed and modeled using the EFQM Excellence Model. “Companies apply the EFQM Excellence Model since the pursuit of business excellence through TQM is a decisive factor in allowing them to compete in today’s global market.” (Watson, 2002, p.2).
The studies give a clear idea of the reality of the influence of cultural aspects of Iranian civilization in the Strategic Human Resource Management. “The first step in performing the right human resource management in governmental organizations in Iran was the establishment of management and employment organization and the approval of country employment law in 1966.” (Bidmeshgipour, 2009, p.32).
The situation in Iran in the sector of appointment is just based on the decision of the head of the enterprise, at times with a namesake interview. The cultural factors are more influential in Iran because of the truth that the people keep their traditions intact. The evaluation of the strategic situation in Iran can be represented diagrammatically as shown below.
The leadership, process, performance and revision are embedded inside the suite of culture. The entire activities are in accordance with the traditions prevailing in Iran.
Recommendations
The evaluation of different aspects of SHRM in Iran shows that the Iranian economy should mainly “focus on the Iranian skilled individuals and evaluation of their migration intentions as well as conditions to prolong their residency outside of Iran.” (Announcement by Iranian Studies group at MIT, n.d., para.2).
If the Brain Drain phenomenon is controlled effectively, a major challenge can be eliminated from the strategic scenario. Cultural innovations in the managerial field should be limited to a little extent so that the skills and talents of the manager play in the field of SHRM to deliver the best performance, but without giving up the morality existed as moral values will always add to success. The usage of tools like EFQM Excellence model and other models like TQM, RBM etc. along with it should be entertained for excellent evaluation of situations as well as identification of strategies. Managers and employees should keep the value of faithfulness within the firm and among the workers. The fact is depicted as “within the workplace loyalty to one’s superior is necessary for an organization to survive.” (Budhwar & Debrah, 2004, p.127). The overall performance of a firm is in the hands of the manager as well as the workers. SHRM can be successful only if the strategies identified are executed accordingly in the most effective manner and with least delay.
Conclusion
The expedition through the Iranian economy to dig out the facts related to the SHRM in Iran leads into various areas of cultural, economical and managerial factors prevailing in Iran. The utilization of various SHRM tools finds their significance in Iranian economy as well. The managers handling SHRM in the firms of Iran can effectively help the nation introduce an easy pavement to approach the success of the overall economy.
Reference
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