STRATEGIC HUMAN RESOURCE MANAGEMENT AND ITS IMPACT ON ORGANIZATIONAL PERFORMANCE

Abstract

Strategic Human Resource Management is a growing approach for companies to match up their Human Resource strategy, practice, and policy with their long-term goals and competitive strategy. Unlike Traditional Human Resource Management, which primarily focuses on administration and operations, SHRM focuses on proactively managing Human Capital as a strategic Asset that directly contributes to the Organizational Success of a Company. This research paper aims to explore how SHRM practice areas (Consisting of Strategic Workforce Planning, Talent Acquisition and Retention, Performance Management, Training & Development, and Employee Engagement) impact Organizational Performance, including Organisational Performance; Productivity, Innovation, and Employee Commitment; Financial Performance. The Abstract shows that companies that develop and implement a planned strategic Human Resource Management system can enhance their organization, thereby attaining sustainable competitive advantage, using these various Theoretical Perspectives (e.g., Resource-Based View; Human Capital Theory). On the basis of the findings presented in this paper, firms that utilise SHRM practices that are consistent and integrated demonstrate increased flexibility to changes in the environment, higher levels of employee motivation, and superior overall performance of their organisation. The study emphasizes the importance that an organization maximizes SHRM to achieve its objectives in creating organizational excellence by matching HR strategy with business goals and getting commitment from leaders.