AIUB University

Strategic HRM
EMBA
Faculty: Mohammad Abu Yusuf PhD

In modern organization HR acts as strategic business partner of an organization

1. What do we understand by HR as business partner, SBP

2. What does SBP or what are the roles in business organization
3. Discuss the significance of HR as SBP of and organization when it act as a
SBP.
4. Discuss the relationship of SBP with the Head of HR and the concern line
manager
5. How SBP can help an organization to gain competitive advantage.

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Also submit a hard copy to Mr. Rakib or Pranto of FBA office.
 Answer to the Question Number 1

Question: What do we understand by HR as business partner?

Answer:

Researchers (Porter, 1985, Becker and Gerhart, 1996; Barney and Wright, 1998)
and practitioners have long maintained that the human resource function plays
an important role in firm performance. Most corporate annual reports boldly
state that the firm's people are its most important asset. However, despite
these widely held beliefs many organization decisions suggest a relative low
priority of both the human resources in firms as well as the Human Resource
department. Since the beginning of the 1980s research have found new interest
in the aspects of human resources that can at a strategic level have
economically significant effects on a firm’s bottom line. A number of writers,
including Bowen and Ostroff (2004) and Wall and Wood (2005) have
commented that, along with the research that has established a connection
between the content of HR practices and organizational performance, more
explanation is required about the processes that underpin the link.

We advocate that HR is supposed to be a partner in dialogue at all levels in

companies where decisions regarding strategy are being taken or acted upon.
This means that no matter if it is the business overall strategy being formulated
or strategic execution at a lower hierarchical level at a business unit or division,
we argue that the HR function is able to be part of the decision making process
by adding another perspective and dimension, complementing other decision
makers. As this should lead to better decision making, more efficient
organizations and long term competitive advantages. Since intellectual capital
and human resources are becoming a more prominent part of firm’s assets and
resources the need for a capability, in all levels of management, that can
conceptualize and understand the role of human capital within organizations.
When excluding HR in strategically important issues or the process and crafting
of business strategy, businesses risk missing out on important insights,
possibilities and constraints, thus leading to be both costly and resulting in
failing to maintain competitive advantage
The definition of a HR business partner is an experienced human resource
professional who works directly with an organization's senior leadership to
develop and direct an HR agenda that closely supports organizational goals.
Rather than working primarily as part of the internal human resources
department, the HR business partner works closely with senior leadership,
perhaps sitting on the board of directors or collaborating regularly with the C-
suite. Placing a human resources professional in close contact with executive
leadership makes HR a part of the organizational strategy. The business partner
model for human resources is becoming more and more popular among
business organizations. The HR business partner (SBP) position is responsible for
aligning business objectives with employees and management in designated
business units. The position serves as a consultant to management on human
resource-related issues. The successful SBP acts as an employee champion and
change agent.

Answer to the Question Number 2

Question: What does SBP or what are the roles in business organization?

Answer:

Involvement in business Research states that HR functions have started to ask

the questions that really matters to business. Moving from analyzing historical
data and transactional information. This is one step in the process regarding HR-
functions involvement in analytics. However, what it refers is the most
important aspect is the modeling process of what analytics is to be done. Not
much can be gained if HR lacks business understanding and how HR connects to
overall business performance. HR-practice and interventions are not only about
analytics but is highly impacted by different opinions and point of views. The
importance of legitimate authority of the HR function is enabled by a higher
political skill level, and thus leading HR functions to have a greater strategic
involvement and impact. Importance of combining qualitative data, intuition
and experience, but perhaps most paramount, co-creation and coherency with
stakeholder to connect HR-decision-support with business and business
challenges. To become a trustworthy advisor to business management,
underlines two factors that HR-professionals need. One is to know their
individual or client and how to sell to that individual and build a personal
relationship. The second starts with trust building, by delivering on the small
things. Without a quality on simple tasks management will not trust HR-
partners with bigger involvement in more strategic tasks.

The role of the HR business partner is to make sure human resource policy and
procedure throughout the organization fit the needs, goals, and aims of the
organization and its top leadership. There is less focus on administration,
compliance, and management. Rather than performing the day-to-day trainings
or dealing with policy wording or the details of benefits packages and hiring, the
HR business partner works with the big picture.

The person in this position determines and steers the objectives of the human
resources department of the organization, focusing more on developing
strategy rather than implementing policy. The HR business partner ensures that
HR strategy fits into the organization’s overall business strategy.

The HR business partner is not a vice president, nor is this person a human
resource manager. Instead, an HR business partner is more of a consultant who
works in human resources, building relationships and providing resources in
departments throughout the organization.

Answer to the Question Number 3

Question: 3. Discuss the significance of HR as SBP of and organization when it

act as a SBP?

Answer:

The devolution of HRM responsibilities to the line function represents a further

important feature of strategic HR integration in the organization. Although
there is evidence of increased line involvement in the management of human
resources, there is still some resistance to the uptake of HR responsibilities at
the line level. Responsibilities differ according to the specific HRM area. In line
with this Currie and Procter (2001) and Sheehan and Scafidi (2005) have
suggested that rather than a devolution of responsibilities, a shared
responsibility between HR and line managers is preferable as strategic
initiatives have better chance to anchor in such setting.

Mindset

HR professionals have historically spent too little time on strategic HR activities.

A traditional mindset is often focused on transactional and basic activities.
Contrary, a strategic HR mindset is more focused on organizational
transformations. Research is stating that the mindset of contemporary HR
functions is very transactional by its nature and culture. There is a tendency that
this focus is leading HR down a path of basic activities that are pulling away
from value creation, and hinders HR from being viewed as a strategic resource.
The simplistic and transactional mindset is hindering HR from reaching a
strategic role in organizations, which is why they need to change to a more
suiting mindset for a strategic partner. HR functions tend to get stuck in the
administrative wave of HR. To reach beyond the administrative roles, the
change in mindset can enable HR to become more involved and comfortable
with using managerial tools and techniques, and thereby becoming more
consultative towards its business. One of these tools is HR analytics and its
connection to overall business performance.

Competence

There is a relationship between HR’s business competence and strategic

partners involvement. HR’s strategic role in management teams are stronger
the more HR professionals can connect human capital to the business strategy.
Despite this, research (one of the most frequent hinders, limiting HR
professionals to become strategic is HR’s “strong focus on administration” and
an inability to measure its direct impact on business performance. This
connection between HR activities and business is referred to as the HC-bridge.
Logic in this case is referring to the connection between how HR initiatives can
leverage overall business performance. Other authors claim that HR needs
competence in analytics to be able to underpin the link of HR-activities and
impact on business strategy. It can be seen that more successful companies are
able to use analytics to link HR to organizational strategy and performance. The
evolution of strategic HR activities and measurement will require a sound
“decision science” for human capital. HR functions need to model itself more
closely against decision-based functions like finance and marketing, the
measurement systems need to be designed to direct key decision makers to
focus on relevant information. However, the competence needed by HR
professionals is not to be statistical expert, rather to have analytical literacy.

HR need to use valid data to understand what matters for firm performance,
and understand which HR activities will matter for successful strategic execution
and business. In the transformation in becoming strategic, and using data driven
analysis, HR professionals are the ones with the competence to understand
what analytics and measures to be used to avoid wrongful conclusions and
misunderstanding. HR needs to report what happened in an unbiased manner.
Followed by a diagnosis of why something happened or whatever issues may
exist. Then address these issues with plans to solve the root cause. From that,
develop the competence to predict what might or should happen.

Role Balance

The theme role balance is based on a logic that the HR partner role requires a
split focus on both short- and long-term time frames, as well as a compromising
between transactional and strategic activities. Thus, it will discuss the role
balance of HR partners in regards to time perspective and the different
characteristics and priorities of the strategic and administrative roles.

Strategies are both plans for the future and patterns from the past”, there is a
clear change of time perspective when a strategic view in opposite to a
transactional practice. Many researchers argue that there is a forward looking,
anticipative and planning dimension of being strategic. The need to meet short-
term goal are often hard enough, and HR professionals are thus struggling to
have time to focus on activities or issues with longer and thereby also often
with more strategic character. Adding to this, some research find that many of
HR management's challenges actually can are found in traditional transactional
and administrative practices.
Balance between strategic HR and “bread and butter” According to Sheehan et.
al. (2016) the opportunity to make an effective contribution during dynamic
periods is diminished by the inability to manage additional strategic role
requirements alongside traditional administrative expectations. The HR
professional can thereby experience role conflicts when balancing strategic
management and employee expectations or administrative work tasks. HR
professionals, who have integrated the roles find that there is simply not
enough time to complete all responsibilities, effectively the HR professional
becomes overloaded. Role overload is an issue raised by many other
researchers as well, that the urgent and immediate nature of the administrative
compliance and service-oriented activities tends to occupy the capacity needed
for HR professionals to attend to more ambiguous and long-term strategic
activities. The comment is made that HR executives who have integrated the
roles find that there is simply not enough time to complete all responsibilities.
Good strategic partnership is enabled when ”old generalists' activities” are lifted
off of the shoulders of HR managers, enabling them to focus, feel free, and be
motivated by a broader management role with an HR identity. This role balance
can clearly become a hindrance for HRBPs if they are overwhelmed with
administrative tasks.
As HR grew in its complexity becoming more involved in business forecasting, establishing
business ROI and executing progress that could be directly tied to future and current business
success, so evolved the role of the HR professional into something more than it ever intended to
be. We are strategic business partners forcibly involved in the success of organizations
evaluating not just hiring, firing and traditional hiring advisory roles but so much more. This is
where the HR ROI Scale developed by Paul Kearns comes into play.

**Answer to Question Number 4** **Question:** Discuss the

relationship of the SBP with the Head of HR and the concerned line
manager. **Answer:** Human resources departments interact with
department managers in various ways. The specific role of an HR manager
or specialist often depends on the department manager's focus. For
example, a department manager in accounting might require more
numerical data from HR than a customer service manager. Regardless of
the department, the relationship between HR and managers is ongoing,
as many HR functions involve the employees managed by these
department heads. Both HR managers and HR business partners
collaborate with leadership to achieve HR goals; however, their roles
differ in certain tasks and levels of expertise. While both positions serve
as a bridge between organizational management and the HR department,
HR business partners tend to concentrate more on the business aspects,
including understanding industry terminology, and they may hold higher
ranks than HR managers. **Responsibilities of HR Managers vs. HR
Business Partners** HR managers and HR business partners work closely
with organizational leadership to ensure HR performance aligns with
company objectives. HR managers primarily oversee the HR department
to ensure its effective operation, while HR business partners focus on
aligning HR initiatives with the organization's business goals. Both roles
typically involve working from an office, with possible travel to company
branches for managing HR departments or attending meetings. **HR
Manager** HR managers play a crucial role in placing new hires in
positions that maximize their skills, among other vital employee
management tasks. One of their primary responsibilities is to meet with
company executives to focus on strategic planning. These meetings are
essential for linking management with employees. Additionally, HR
managers ensure that a variety of important HR tasks are completed, such
as managing benefits programs, consulting with managers, and
addressing employee issues. **Job Responsibilities of an HR Manager
Include:** - Coordinating support staff and specialists - Handling the
recruiting and hiring process - Managing employee discipline - Ensuring
regulatory compliance - Measuring employee productivity
HR Business Partner

HR business partners also report to the senior executives in a company or organization. Their
goal is to support the business structure of an organization by collaborating with the HR
department. They have knowledge about where to place employees to their best advantage as
well as have consulting advice for different members of business leadership. HR business
partners have a strong knowledge about as well as experience with the business they work for,
making them suitable for effective business communication.

Job responsibilities of an HR business partner include:

 Strategic planning
 Coaching executives about HR issues
 Driving talent or HR initiatives
 Developing HR or organizational strategies

Line Manager

The first step to HR’s true integration with strategic business leaders is to acknowledge the
breadth of roles in HR and the differentiated skills and experience required in each role. We need
bright lines, not blurred lines between HRBPs and HRDs. Moreover, as more “HR”
responsibilities are transitioned to Line Managers, there must also be a clear distinction between
HR and the Line Managers themselves. Line managers focuses more on the business functions,
process and operating procedure which involves human resources. HRBP works with line
management hand in hand in attainment of the common objective. HRBP enables line
management to recruit, retain, train & develop and reward the human resources.
Answer to the Question Number 4
Question: How SBP can help an organization to gain competitive advantage?

Answer:
Competitive advantage means positioning your company ahead of other companies in order to
achieve superiority in quality, low cost, value or innovation. Regardless of what it means to a
company, it may be the single factor to attaining success and business sustainability. There are
many strategies that contribute to achieving a competitive advantage, but maximizing your
human capital is a major contributor to achieving a competitive edge in the marketplace.

Linking HR Strategies to High Performing Companies

Numerous studies indicate the importance of aligning human resource strategies to achieving
business goals and enhancing business performance. Such studies indicate that true competitive
advantage can be achieved through people and the people practices of organizations. Companies
that leverage their human capital to achieve their business objectives, especially growth have
more positive results. These companies have well-defined HR practices that align with the
company’s business goal. Their employees stay employed longer and contribute positively to the
overall financial performance. Companies without a clear people plan are at risk of losing
or never obtaining a competitive advantage.

What are these HR strategies and how can they help you gain a competitive advantage

Each company has different business objectives that contribute to developing a competitive
advantage. Your HR strategies should be developed to achieve these objectives.

Business Growth- If you are planning to expand your business, you most likely will need
additional employees therefore establishing a workforce plan is necessary to ensure you are able
to hire the right employees in the time in which you need them. Developing a workforce plan
involves forecasting how long it will take to hire the employee, where you will source your
applicants and when you need to begin the recruiting process. Failure to implement this strategy
could interfere with your ability to scale your business according to your plan and most likely the
quality of your services and products will suffer.

Maximizing and Optimizing Operations- Whether your goal is to achieve quality, quantity, or
efficiency, ensuring you have the right people in the right positions is critical for achieving
business operations goals that are linked to profitability. In addition, a workforce plan can
accomplish this objective. Workforce planning also includes conducting an inventory of your
current talent and identifying gaps in technical skills that relate to the areas of importance. Once
these gaps have been identified, then creating a plan to either develop employees within your
organization or hire from the outside to minimize the gaps.

In addition to the technical aspects of human capital, developing a competitive edge means
selecting and retaining employees with specific traits and behaviors that support competitive
strategies. When recruiting and selecting employees, these traits should be evaluated on
applicants as part of your selection process. For existing employees, these traits can be developed
in a company culture where management supports intrepreneurship and innovation.

Developing innovation as a competitive edge

Developing innovation is fostered in a company culture that provides opportunities that support
intrepreneurship. Intrepreneurship is the concept that your employees have the resources and
abilities to solve the company problems that lead to increased productivity and profitability
within your company.One way to develop a company culture that fosters intrepreneurship is to
allow employees from all levels of the organization to solve problems in either a group setting or
individually. As part of this initiative, managers must understand that failure is part of the
process. Managers that allow employees to fail and look at failure as opportunities for growth
will yield better results.

Developing opportunities that encourage creativity can serve as a platform for managers to
engage with their employees in this environment. A work environment that fosters
intrapreneurship and innovation typically has a high level of employee engagement. High
employee engagement will lead to high employee retention and increased productivity which
leads to profitability.At the end of the day, your people are your competitive edge. They are the
ones interfacing with your customers and producing your products and services. They are
generating new ideas and solving problems. They represent your quality, value and innovation.
Make sure you have specific HR strategies to attract, develop and retain the human capital you
need to be competitive.