HR Glossary / Strategic Human Resource Management

Strategic human resource management (SHRM) is an approach that aims to align business goals with HR strategies in order to improve business performance and enhance competitive advantages.


Why Is Strategic Human Resource Management Important?

Strategic human resource management provides a closer alignment between the HR practices and the overall business strategy. It allows to better anticipate and respond to customer needs to meet the strategic objectives of the company.

Benefits of strategic HR management include:

  • Avoiding costly surprises that interfere with the strategic goals;
  • Addressing issues before they cause crises;
  • Promoting employee well-being and productivity;
  • Providing strategic goals to guide training and development;
  • Developing a fit-for-purpose organizational culture.

What Is an Example of Strategic Human Resource Management?

Strategic human resource management can take many forms. For example, if a company is planning to hire 20 new employees during a given year, the HR department must elaborate a plan to recruit, onboard, and train each new employee.

The department may elect to hire all 20 employees during the same period of time or to spread the hiring process throughout the entire year. The best strategy should be evaluated based on the availability of resources (budget, staff, capabilities of the team, etc.).

A company whose objective is to improve employee retention may decide to invest in developing its culture.For example, monthly team-building activities could be organized to promote bonding between the employees.

What Is the Strategic Human Resource Management Process?

Before implementing any human resource management strategy, HR professionals must:

  1. Understand the overarching objectives of the company;
  2. Evaluate the available resources of the HR department;
  3. Estimate the future needs of the company;
  4. Determine the resources needed to achieve the objectives of the company;
  5. Plan and execute the human resource management strategy;
  6. Evaluate the outcomes and implement corrective actions if necessary.

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