Strategic Human Resource Management
From administration to strategy
Strategic HRM aligns people practices with the organisation's competitive strategy so that workforce capability becomes a source of advantage. Candidates must know the vertical fit (HR practices matching business strategy) and horizontal fit (practices reinforcing one another) distinction, plus the classic frameworks: the Harvard model's stakeholder and situational factors, the Michigan/Devanna matching model, and the resource-based view with its VRIN test (valuable, rare, inimitable, non-substitutable). Human capital theory and the AMO framework (Ability, Motivation, Opportunity) explain the pathway from HR practices to performance.
Universal versus contingent
Know the debate: universalistic "best practice" bundles versus contingency "best fit" arguments, and configurational approaches that stress internal coherence. High-performance work systems are the usual example of a bundle, and questions often test whether a practice is additive or synergistic.
Traps in questions
Watch for options that treat "fit" as imitation of competitors rather than differentiation; that confuse HR strategy with HR operations; or that assume high-commitment practices always raise performance regardless of context. Another frequent trap is conflating the resource-based view (internal, inimitable resources) with Porter's positioning (external industry forces).
Worked example
A budget airline competing on cost leadership should design simplified job roles, productivity-linked variable pay, and high-volume standardised recruitment. A luxury hotel pursuing differentiation needs selective hiring, extensive training, and discretion-based rewards. Rule of thumb: name the competitive strategy first, then predict the practice bundle; if an option's practices contradict the stated strategy, it is wrong.