Entrepreneurial Ecosystem
What is an Entrepreneurial Ecosystem? All of us are endowed with skills, abilities, and capabilities. However, the reason why some of us are so successful whereas others languish is mainly due to the way in which these traits are nurtured, encouraged, and enabled. For instance, we need to go to the right schools, have supportive […]
Gestures and Body Language in Soft Skills
Soft skills refer to the way one conducts himself/herself at workplace. It is an individual’s behaviour which either makes or breaks him. Gestures and body language play a crucial role in soft skills. Gesture is a type of communication where the individual communicates without speaking, simply with the help of hand and body movements, facial […]
Role of HR Consulting Firm During Termination and Outplacement
Termination of employment simply means the ending of employment in a particular organization. Termination of employment is inevitable in any employment relationship and it may happen either voluntarily or involuntarily. Voluntary termination may come through resignation, retirement or death of the employee. Involuntary termination of employment can take place by employee dismissal or lay-off. Dismissals […]
Importance of Being Efficient at Workplace
Before we begin this topic, let us throw some light on the following example. Peter and John were best friends who did their studies together at Alpha management school (Just an example).They both got their first jobs in XYZ Organization as marketing executives. Within a span of five years, Peter was promoted as Vice President […]
Performance Appraisal and Performance Management
The contemporary organizations are undergoing a transformation for coping against the changing needs of the environment and excelling in the business by building up their adaptive capabilities for managing change proactively. The traditional performance appraisal system did not suffice the needs of the changing scenario as it was mainly used as a tool for employee […]
Organizations work towards the achievement of their mission and strategic objectives. This requires a thorough understanding of the resources required for achieving the same. Resources here imply financial and non financial both and they are equally important and interdependent.
Technically these resources have been divided into two, non contingent and differentiating capabilities.
Whereas non contingent capabilities are basics that enable an organization to compete and exist in the marketplace, differentiating capabilities are those that differentiate an organization from that of the other and offer competitive advantage.
Effective marketing management, for example can be one of non contingent capabilities. Similarly many HR processes aspire to develop non contingent capabilities but they often fail to align with the strategy and offer competitive advantage. Most of these processes end up developing people in similar areas and similar capacities as their rival firms but this fails to provide any competitive advantage.
For organizations to develop competitive advantage through HR processes it is very important to define strategic differentiating capabilities and then develop a process for identifying and developing the same. This empowers the HR people to create an impact on the organizational strategy and also provides a link between talent management and strategy.
For HR to prove that talent management can be of strategic importance to organizations, the critical relationship between the two must be proven. Talent management specially needs to be projected as a differentiating strategic capability that can offer real and substantial competitive advantage.
According to research conducted by various bodies it was found out that creation of differentiating strategic capabilities signifies the relationship between business strategy and human resources.
Human resources, it was deduced are the primary sources of strategic advantage. The research study was primarily based on Resource based view (RBV) of an organization. This view has gained significant ground among HR practitioners as basis of models for formation and structure of resources.
Unlike other non contingent capabilities that can be developed easily and cannot contribute to a large extent towards the development of a sustainable competitive advantage, differentiating strategic capability such as strategic HR through talent management can. However for human resources to qualify as potential sources of competitive advantage they should fulfill the following criteria:
There are not many things in the business environment that can fulfill all the above criteria and offer unique competitive advantage except human resources and that is under the jurisdiction of talent management. There is also a need to understand the strategic intent of the organization before defining strategic capabilities.
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