Strategic Human Resources Management in Government: Unresolved Issues.(Brief Article)

The concept of strategic human resources management (SHRM) holds considerable promise for improving government performance. However, to realize this promise, it is necessary to invest the concept with clear meaning. This article explores unresolved issues regarding the meaning of SHRM and its relevance to public organizations. Arguing that the value of the concept is undermined by tying it too closely to strategic planning, the article offers an expanded, two-pronged understanding of SHRM. The personnel office, in addition to helping the agency implement strategic initiatives, also carries out an integrated personnel program guided by a coherent theory about what it should be doing and why.

The concept of strategic human resources management (SHRM) is well established in business literature.[1] It refers to ongoing efforts to align an organization's personnel policies and practices with its business strategy. The recent interest in SHRM reflects a growing awareness that human resources are the key to success in both public and private organizations. Yet, despite this growing awareness, the relevance of SHRM to public organizations is far from clear. Government agencies rarely operate in competitive markets and thus do not develop business strategies in the same sense that private organizations do. And because they function within larger systems of authority, they do not enjoy the same degree of autonomy that private organizations do to alter their personnel policies or provide performance-based incentives to employees. Given these inherent differences, SHRM cannot be transferred successfully from the private to the public sector without tailoring its design and implementation to the unique characteristics of public organizations.

At present there remain many unresolved issues about what modifications are required and the probabilities of their success. If SHRM is to succeed in fundamentally altering the role of the personnel department and the practice of public personnel management, greater clarity is required regarding the concept of SHRM and how it is to be implemented in public organizations. Accordingly, this article examines unresolved issues regarding the relevance of SHRM for government agencies and closes with an argument for an expanded understanding of what it means to manage human resources strategically.

Procedural and Structural Prerequisites: Unresolved Issues

Figure 1 presents a conceptual framework representative of the kind found in the business literature. It depicts SHRM as a process that merges strategic planning and human resource management. Specifically, it views SHRM as a continuous process of determining mission-related objectives and aligning personnel policies and practices with those objectives. The personnel department plays a strategic role to the extent that its policies and practices support accomplishment of the organization's objectives. Key components include analyzing the agency's internal and external environments, identifying the agency's strategic objectives, developing HR objectives and strategies consistent with the agency's goals (vertical integration), and aligning HR policies and practices with each other (horizontal integration). For this conceptual understanding of SHRM to be implemented successfully, certain structural and procedural requirements must be satisfied. These core requirements include the following:

1. An established strategic planning process.

2. Involvement of the HR director in the strategic planning process and full consideration of the personnel-related implications of the strategic objectives or initiatives under discussion.

3. A clear statement, written or unwritten, of each agency's mission and the strategic objectives to be achieved in pursuit of mission.

4. The vertical alignment of personnel policies and practices with an agency's mission and strategic objectives, and the horizontal integration of personnel policies and practices with each other.

5. A personnel office whose organizational role and structure are consistent with and contribute to the attainment of the agency's mission and strategic objectives.

These prerequisites capture what is required to integrate strategic planning with human resources management in a way that enhances organizational performance. Such an integration is difficult to achieve, for example, if there is no strategic planning process in place, no participation by the personnel director, and no subsequent development of personnel initiatives designed to support identified objectives. These prerequisites are explored below, along with unresolved issues about how to fulfill them in governmental settings.

An Established Strategic Planning Process

The role of strategic planning is to provide agencies with a clear sense of direction by clarifying mission, setting priorities, and identifying goals and objectives. NAPA's Guide for Effective Strategic Management of Human Resources recommends a short and simple planning process, five to seven days in length, which establishes five or six key objectives to be accomplished during the next few years.[2] A short and simple process has the advantage of providing a clear sense of direction to line and staff officials without becoming an overly elaborate and ultimately hollow planning exercise.

Most federal agencies engage in strategic planning because they are required to do so by the Government Performance and Results Act of 1993. The extent of its use among state and local governments, although somewhat less clear, is indicated by the results of two studies. Of those responding to a national survey of state agencies conducted by Berry and Wechsler, 60 percent said they had strategic planning processes in place.[3] Similarly, in a study of municipalities with populations between 25,000 and 1,000,000, Poister and Streib found that 60 percent had adopted strategic planning in at least one department or program area.[4] These findings indicate that a large and growing number of state and local agencies are using strategic planning as a basic way of doing business.

One unresolved issue is whether the goals of SHRM are best achieved through a single, top-down, jurisdiction-wide strategic planning process or by separate agency-level planning processes. The business literature promotes strategic planning as a company-wide process in which top executives identify strategic objectives for the entire organization and managers develop their operational plans accordingly. But however appropriate this may be in the private sector, it is less so in the public sector. The essential task of government agencies is to execute public law. Because each agency has a unique mission and set of mandates to carry out, a single, top-down strategic planning process is less appropriate for purposes of SHRM. As Poister and Streib observed in their study of municipal governments, strategic planning may be "more useful for major organizational units with a unified sense of mission rather than a highly diversified and fragmented municipal jurisdiction as a whole."[5] While it is true that states such as Oregon[6] and communities such as Rock Hill, South Carolina[7] have engaged in strategic planning, such efforts are typically short-term exercises designed to resolve jurisdiction-wide problems or policy issues rather than institutionalized processes designed to enhance agency performance. Enhanced performance is the purpose that SHRM is intended to serve. Because each agency has a unique mission and set of mandates, SHRM logically requires agency-level strategic planning processes guided by legislative intent as well as the chief executive's policy or political agenda. The subsequent integration of agency plans into a jurisdiction-wide strategic plan is not required for purposes of SHRM.

A second unresolved issue is whether SHRM requires a particular kind of strategic planning to deliver on its promise of enhanced organizational performance. Strategic planning may be practiced in a variety of ways.[8] It may be externally-oriented, bringing together a diverse range of stakeholders to resolve issues of mutual concern, or internally-oriented, bringing together a cross-functional team of agency officials to set internal priorities and objectives. It may be mandated from above for purposes of accountability, or adopted voluntarily by an agency to establish a clear sense of direction. It may comprise a temporary, problem-specific process that ends when the immediate problem has been resolved, or an ongoing, institutionalized process for goal setting and issues management. Lastly, it may follow the Harvard policy model and call for extensive analysis of the agency's internal and external environments, or it may avoid lengthy analyses, opting instead for simple goal-setting exercises.[9] Process characteristics are important because they affect how seriously strategic planning is taken by agency staff, its perceived value as a management tool, and how much it ultimately contributes to organizational performance.

Advocates of SHRM tend to assume an institutionalized, internally-oriented strategic planning process adopted by agencies to clarify their missions, set priorities, and decide upon strategic objectives. There are, however, two contrasting approaches in current use. Little attention has been given to which of these is best suited to SHRM. The performance management approach, which is typically mandated by law or executive order, aims to ensure accountability. Under this approach, strategic objectives are stated in terms of desired results, such as a ten percent increase in the number of criminal cases closed successfully, and appropriate performance measures are identified to track success in achieving identified objectives. Although touted as an important governmental reform by members of the managing-for-results movement,[10] this approach relies upon several problematic assumptions. Among these are that agencies do not and will not pursue meaningful results on their own initiative, that rational planning models are appropriate for use in the public sector, that agencies can in fact translate their missions into measurable outcomes, and that agencies should be rewarded and sanctioned according to their degree of success in achieving their stated objectives. Despite the difficulties inherent in this approach, it has been mandated for use in the federal government as well as in many states. By contrast, the issues management approach is undertaken voluntarily to address emerging issues, internal or external to the agency, that are likely to affect its ability to carry out its mission.[11] Its primary purpose is adaptability rather than accountability. Under this approach, strategic objectives are stated in terms of the actions required to achieve a desired future state. Although the planning process is sometimes institutionalized and ongoing, in many cases it is undertaken on a limited basis to address emerging areas of concern. Examples of the latter include a federal agency seeking to maintain program quality in the face of budget cuts, a suburban school district wishing to explore educational reform initiatives, and a public library struggling to maintain employee morale as demand for its services continue to rise.[12] The issues management approach tends to emphasize political rationality (doing what is politically acceptable to powerful stakeholders) over formal rationality (utilizing objective criteria and cost-benefit calculations to determine how best to attain agency goals). Key stakeholders are often brought together to negotiate an agreement about what to do and how. This approach also tends to be more pragmatic than ideological, reflecting the assumption that strategic planning is a valuable management tool for adjusting an organization to its external environment and keeping it focused on desired future states. Although tracking success with quantitative measures is not excluded under this approach, emphasis is placed on addressing issues affecting the agency's ability to carry out its mission rather than managing performance through the use of outcome measures.