Importance of Strategic Human Resource Management

Exploring the Impact of Strategic Human Resource Management on Organizational Performance and Decision Making

Abstract

Strategic human resource management(SHRM) is directly linked to organizational performance. However, despite theincreasing popularity of SHRM; there have been very few systematic evaluationsof the claims that it is linked to performance and doubts remain as to itstheoretical foundations. Therefore, the purpose of this research is to examinethe impact of SHRM implementation on the organizational performance. The mainfocus of this paper is to deliver a decision support tool aiding the decisionmaking process concerning the strategic management of the department of humanresource management. Wright and McMahan (1992: 298) define SHRM as “the patternof planned human resource deployments and activities intended to enable an organisationto achieve its goals”. The goal of the strategic management in an organizationis to assess, deploy and allocate resources providing the management with acompetitive advantage. TQM is an overall organization strategy formulated atthe top level and then diffused throughout the entire organization. Increasedhuman resource requirements, governmental regulations, and expanded computerand information technology capabilities justified the need of an informationsystem within the human resource department (HRMIS). The core of an HRMIS is adatabase system that contains all relevant human resource informationfacilitating accessing, maintaining and processing activities.