Strategic Staffing: Business & Staffing Strategies PDF

Strategic Staffing Chapter 2 – Business and Staffing Strategies Lecturer: Ms. Lena Davis Jean Phillips & Stanley Gully 1  Learning Objectives – Identify different staffing strategies – Explain how different staffing strategies support diffe...

Strategic Staffing Chapter 2 – Business and Staffing Strategies Lecturer: Ms. Lena Davis Jean Phillips & Stanley Gully 1  Learning Objectives – Identify different staffing strategies – Explain how different staffing strategies support different business strategies. – Explain when an organization would use talent- oriented rather than job-oriented staffing. – Describe human capital advantage and human process advantages and the differences between them. – Describe and discuss the strategic staffing decisions any organization must make. Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 2  What is staffing? Definition – “Process of acquiring, deploying, and retaining a workforce of sufficient quantity and quality to create positive impacts on the organization’s effectiveness” Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 3  Why Does One Company Succeed and Another Fail? Differences in their strategic, financial, and technological capabilities Differences in organizational capabilities generated by attracting, retaining, motivating, and developing talented employees Staffing therefore plays a central role in creating and enhancing any organization’s competitive advantage Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 4  Resource-Based View of the Firm Proposes that a company’s resources and competencies (including its talent) can produce a sustained competitive advantage by creating value for customers by: – Lowering costs – Providing something of unique value – Or some combination of the two Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 5  Five Requirements of a Competitive Advantage Resources must be valuable to the firm Resources must be rare amongst current and future competitors Resources must not be easily imitated by other firms Resources must not be easily substituted or replaced with another resource The company must be able to exploit the resource Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 6 Some Sources of Competitive Advantage Innovation: developing new products, services, and markets and improving current ones Cost: be the lowest-cost provider Service: provide the best customer support before, during, or after the sale Quality: provide the highest quality product or service Branding: develop the most positive image Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 7  Sources of Competitive Advantage Distribution: dominate distribution channels to block competition Speed: excel at getting your product or service to consumers quickly Convenience: be the easiest for customers to do business with First to market: introduce products and services before competitors Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 8  Business Strategy Definition: how a company will compete in its marketplace Competitive advantage: anything that gives a firm an edge over rivals in attracting customers and defending itself against competition – To have a competitive advantage a company must be able to give customers superior value for their money (a combination of quality, service, and acceptable price) Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 9  Four Types of Business Strategy 1. Cost leadership strategy: be the lowest cost producer for a particular level of product quality (Wal-Mart, Dell, FedEx) – Competitive advantage based on operational excellence: maximizing the efficiency of the manufacturing or product development process to minimize costs Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 10  Four Types of Business Strategy 2. Differentiation strategy: developing a product or service that has unique characteristics valued by customers (Johnson & Johnson, Nike, 3M) – Competitive advantage based on product innovation Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 11  Four Types of Business Strategy 3. Specialization strategy: focus on a narrow market segment or niche and pursue either a differentiation or cost leadership strategy within that market segment (Starbucks, Red Lobster, Seiko) – Competitive advantage based on customer intimacy: deliver unique and customizable products or services to meet their customers’ needs and increase customer loyalty Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 12  4. Growth Strategy Definition: company expansion organically (happening as the organization expands from within by opening new locations) or through mergers and acquisitions Success depends on the firm’s ability to find and retain the right number and types of employees to sustain its intended growth. Organic growth requires an investment in recruiting, selecting, and training the right people to expand the company’s operations. Mergers and acquisitions expand an organization’s business and can also be a way to acquire the quality and amount of talent a firm needs to execute its business strategy. Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 13 Staffing Implications of Different Sources of Competitive Table 2-3 Advantage Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 14 Organizational Life Cycle and Strategy Choice Growth-Maturity-Decline life cycle Strategy during growth phase – New and growing firms often pursue innovation or differentiation strategies to distinguish themselves from their competition. Because they are less established and thus higher-risk employers, they often need to invest more money and resources in staffing to attract the talent they need to grow. Because they lack a strong internal talent pool and need to add new employees as they grow, they frequently need to hire from outside the organization and tend to have an external talent focus. Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 15 Organizational Life Cycle and Strategy Choice Strategy during maturity phase when products and services have fully evolved, and the product’s market share has become established – The focus shifts to maintaining or obtaining further market share through cost leadership, often by streamlining operations and focusing on efficiency. – Because mature companies have a larger pool of internal talent from which to draw, the talent focus becomes more internal. Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 16 Organizational Life Cycle and Strategy Choice Strategy choice during decline phase when markets are shrinking and business performance is weakening – Can pursue a cost-leadership strategy and allow the decline to continue until the business is no longer profitable Focus on reducing labor and other costs – Can try to make changes to revive the product or service If it chooses to try to change its product or service, the firm typically adopts a specialization or differentiation strategy This can change the talent mix needed Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 17  DEFINITIONS TALENT PHILOSOPHY: A system of beliefs about how employees should be treated HUMAN RESOURCE STRATEGY: the linkage of the entire human resource function with the firm’s business strategy in order to improve business strategy execution STAFFING STRATEGY: the constellation of priorities, policies, and behaviors used to manage the flow of talent into, through, and out of an organization over time Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 18  Talent Philosophy A system of beliefs about how employees should be treated Table 2-4 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 2-19  Nine Elements of Staffing Strategy 1. Do we want a core or flexible workforce? 2. Do we prefer to hire internally or externally? 3. Do we want to hire for or train needed skills? 4. Do we want to replace or retain our talent? 5. What levels of which skills do we need where? Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 20  Nine Elements of Staffing Strategy 6. Will we staff proactively or reactively? 7. Which jobs should we focus on? 8. Is staffing treated as an investment or a cost? 9. Will staffing be centralized or decentralized? Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 21 Staffing strategy considerations Filling vacancies or Applicants and hiring for long-term Employees as either careers assets or investors The firms The firm’s commitment to ethical commitment to behaviour diversity Copyright@2009 Pearson Education Inc. Publishing as Prentice Hall 22