Strategic HRM is the process of linking the HR function with the strategic objectives of
the organization in order to improve performance.(Bratton & Gold 2007)
Strategic Human Resource (SHRM) management is human resource management with a
strategic edge, linking both business strategy with human resource (HR) strategy of an
organization. Human resource management has become an integral part of almost all the
companies all over the world. Human resource management concerns not only how
peoples are managed but also how managing people could maximize the competitive
advantage in that market sector (Tyson, 1991 p2). Business strategies are defined as a
strategy of a particular business unit (Tyson 2000, p66). Human resource(HR) strategy is a
series of policies and programs designed to achieve a people management objective
(Tyson, 2000 p66) .SHRM on a broader term is a overall sense of mission and direction, an
appreciation in general terms of where the company is going and why. This may include
articulation of core values, distinctive competencies and corporate vision. SHRM also
focuses on translating the complex and dynamic set of internal and external variables,
which an organization faces, into a future oriented framework which can then be
implemented on a day to day basis (Watson, 1999). In the subsequent paragraphs, This
study tries to explain why and how different automobile companies adopt different
business and HR strategies. For this study focuses on works of two authors Porter (1980)
who has classified business competitive strategy into three types: cost leadership,
differentiation, and focus and of that of Schuler and Jackson (1987) who has classified
business strategy into three types: cost reduction, innovation, and quality enhancement
(Huang 1999). At the end it would try to reach at an particular point where by the help of
the practical and secondary data it can identify the best HR and Business practices.
LUXURY SECTION
Case 1: VOLVO GROUP
Organization:
Assar Gabrielsson and Gustaf Larson founded Volvo in 1924, but it was officially founded
on April 14, 1927, when the first car left the factory in Hisingen, G*teborg. Till then the
Volvo Group has become one of the leading Swedish automobile manufacturing company
offering products such as buses, trucks, construction equipment, drive systems for marine
and industrial applications as well as aircraft engine components (Volvo annual Report
2006).
Key Business Strategies:
One of the Groups HR statement is Our customers needs govern our strategy (Volvo
annual Report 2006), which clearly indicates that the Group is customer centric.
