If a firm is following cost leadership strategy it is hardly likely to benefit from the introduction of innovative schemes in HRM, unless it views the investment in employees with a long term view.
The firm would then constantly attempting to compete on the market in this cost leadership fashion, and would do everything it could to keep their costs to a minimum, a feat that is easier to achieve via a traditional style of management.
Rather than relationship building and getting employees to take ownership of their portfolio, this environment of cost leadership in turn creates a work force of clock watchers who do nothing beyond the exact letter of letters of appointment.
The cost cutting strategy is short-sighted in its approach and will not lead to sustainable long term growth.
With the advent of total quality management (TQM) the emphasis must shift away from conformance and specification and moved towards customer satisfaction, this will only be achieved if employees feel that work is something that they do and not a place they come to. This means fulfilling all facets and commitments, which the customer has when coming into contact with the firm, improving operational effectiveness.
The firm needs to follow the following steps to implement a strategy which reflects the vision:
1. What does the organisation want to achieve? | Vision and Mission Fit, paying attention to external factors likely to affect it over the next 5 years |
|---|---|
2. Where is the organisation now compared to the vision and values? | GAP analysis between vision and current reality |
3. What are the barriers to achieving the Vision and Values? | Legislation, Macro and Micro Economic pressures |
4. Turning strategic issues into specific actions | A key step in moving from identification of a problem to a more positive approach is to identify what can be done to action the issue. |
5. Prioritise Action Points | Decide when action points need to be looked critically to establish what needs to be done immediately and which can be scheduled for later action. |
6. Draw up Strategic Plan | And obtain top management approval |
7. Communicate Strategic Plan and Action Plan | It is vital that, once they are approved, these Plans should be communicated to all staff. Openness is important so that everyone can move forward in the same direction. |
8. Monitor and Review | It is imperative that this is ongoing |
Also see: "People: Your Competitive Advantage" & "People Strategy Cycle"
