The Importance of Developing a Strategic Partnership Role for HRM

The conceptual literature strongly argues for the importance of developing a strategic partnership role for HRM, and the empirical results point to significant economic returns to the organization for doing so. So, why is it so difficult to implement these ideas in practice? Discuss, with specific examples and reference to relevant strategic HRM literature.

Introduction
As the world is becoming global and competition is becoming more intense, human resource is becoming more important to a firm’s success. If we look at the history we can see that workforce has been considered as commodity in many firms. Firms were only concerned about maximizing output, with no consideration to human feeling and social needs. For most of its history HR has been treated as a paper shuffling and pencil moving function or hiring and firing department. With the growth of Information technology and global competition, many practitioners and academics have started believing that employee performance has implications to the firm’s output. Growing number of firms have realized the importance of its people (i.e. Human resource) in gaining and keeping competitive advantage. For example Barney’s (1995) resource-based theory of the firm contended that firm’s human resources can provide a source of sustained competitive advantage if it satisfies four attributes; value, rareness, inimitability and organization. Associated to this point is Barney’s assertion that “Managers must look inside their firms for valuable rare resources and exploit these resources through their organization”. It is through highly skilled employees, unique organizational culture, management system & process and organizational structure that distinctive competency can be obtained. Organiz...

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