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Aligning SHRM With Culture

This article discusses the importance of aligning organizational culture with strategic human resource management. The authors present a conceptual model showing that organizational culture moderates the relationship between an organization's strategy and its strategic human resource management. They argue that properly aligning HR as a source of competitive advantage and as an influence on strategy is important for organizational success. The model and testable propositions they provide aim to guide future research on how firm performance may depend on the linkage between strategy, culture, and the utilization of HR. Misalignments in these areas could prove detrimental to organizations.

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0% found this document useful (0 votes)
74 views11 pages

Aligning SHRM With Culture

This article discusses the importance of aligning organizational culture with strategic human resource management. The authors present a conceptual model showing that organizational culture moderates the relationship between an organization's strategy and its strategic human resource management. They argue that properly aligning HR as a source of competitive advantage and as an influence on strategy is important for organizational success. The model and testable propositions they provide aim to guide future research on how firm performance may depend on the linkage between strategy, culture, and the utilization of HR. Misalignments in these areas could prove detrimental to organizations.

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Journal of Management Development

Aligning organizational culture and strategic human resource management


Teresa Harrison, Joshua D. Bazzy,
Article information:
To cite this document:
Teresa Harrison, Joshua D. Bazzy, (2017) "Aligning organizational culture and strategic human
resource management", Journal of Management Development, Vol. 36 Issue: 10, pp.1260-1269,
https://doi.org/10.1108/JMD-12-2016-0335
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(2014),"SHRM: alignment of HR function with business strategy", Strategic HR Review, Vol.
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JMD
36,10 Aligning organizational culture
and strategic human resource
management
1260 Teresa Harrison and Joshua D. Bazzy
Department of Management, University of the Incarnate Word,
Received 31 December 2016
Revised 22 May 2017 San Antonio, Texas, USA
10 July 2017
Accepted 14 July 2017
Abstract
Purpose – As strategic human resource management (SHRM) continues to grow as an important
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issue for organizations, it is imperative to examine all factors that contribute to the success and
failure of the organization’s human resources (HR) and strategy implementation. The purpose of this paper
is to demonstrate that organizational culture should be an integral factor when considering SHRM.
The authors also present a model for the strategy-culture-SHRM linkage and propositions to guide
future research.
Design/methodology/approach – The authors present a conceptual model proposing organizational
culture as a moderator of the relationship between an organization’s strategy and SHRM.
Findings – In addition to the conceptual model, the authors present a number of testable propositions for
determining how firm performance and effectiveness may depend on the linkage between strategy and the
utilization of HR as a competitive advantage.
Originality/value – Currently, there is a lack of research regarding the conceptualization of organizational
culture as a moderator between an organization’s strategy and SHRM. We discuss the importance of the
alignment of HR both as a source of competitive advantage and an influence on an organization’s strategy.
The authors integrate the current research to create arguments for testable propositions and future
research directions. The authors also argue that misalignments may occur which may prove detrimental to
the organization.
Keywords Organizational culture, Alignment, Strategy, Strategic human resource management
Paper type Conceptual paper

Strategic human resources management (SHRM) has been defined as “the pattern of
planned human resource deployments and activities intended to enable an organization to
achieve its goals” (Wright and McMahan, 1992, p. 298). Within SHRM, the goals being
achieved should typically be dictated by the organization’s strategy as there is an inherent
connection between strategy and SHRM. However, previous research has found that there
is often a discrepancy between intended and realized implementation of strategy
(Mintzberg and Waters, 1985), and by extension SHRM ( Jackson et al., 2014), thereby
making this connection at times tenuous at best. Moreover, research into strategy and
SHRM has been hampered by level of analysis issues (Buller and McEvoy, 2012) as well as
a lack of research examining factors that are unique to an organization which may result
in competitive advantage ( Jackson et al., 2014). The purpose of this paper is to address
these issues by examining the impact of organizational culture on the linkage between
strategy and SHRM. Specifically, we propose that discrepancies between intended and
realized strategies may be due, at least in part, to the culture of the organization which is
an important factor to overall organizational outcomes. Therefore, this paper contributes
to the SHRM literature by explaining how organizational culture moderates the
relationship between organizational strategy and implementation of SHRM and how
Journal of Management
Development misalignment may lead to detrimental outcomes.
Vol. 36 No. 10, 2017
pp. 1260-1269
Organizational culture has been described as the shared values and beliefs resulting
© Emerald Publishing Limited in a behavioral component (Smircich, 1983). Although organizational culture is influenced
0262-1711
DOI 10.1108/JMD-12-2016-0335 by national culture, the general consensus is that organizational culture is a separate
concept from national culture (Khilji and Wang, 2006; Sheehan et al., 2007). Within the Human
diverse workforce that comprises organizations within the USA, for example, there are resource
factors that bring people together toward a common goal beyond shared national values. management
Despite these common goals, what brings people together may, at times, detract from the
overall strategy.
As we demonstrate, alignment of organizational culture may influence the successful
implementation of a strategy. However, an organizational culture that is misaligned with 1261
strategy may also lead to unintended SHRM outcomes and result in negative firm
performance ( Jackson et al., 2014). This strategy-organizational culture-SHRM linkage is a
neglected area of research (Buller and McEvoy, 2012; Gratton and Truss, 2003;
Jackson et al., 2014; Molineux, 2013). For this reason researchers have suggested that
future research examine the relationship between strategy, culture, and SHRM (Boswell, 2006;
Jackson et al., 2014, Panayotopoulou et al., 2003; Wei et al., 2008).
First, we present the theoretical background to explain how organizational strategy and
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SHRM relate to organizational culture and how examining culture would allow for a multi-
level analysis of the relevant factors. Specifically, we propose that an organization’s culture
will moderate the implementation of SHRM practices based on how the culture aligns with
strategy, establishing congruence with SHRM. This is followed by a discussion of the
factors that may contribute to the cultural alignment or misalignment. We integrate this
research by presenting a model of the strategy-organizational culture-SHRM framework
and testable propositions. Finally, implications for research and practice and suggestions
for future research are discussed.

Theoretical background
SHRM includes various HR practices, which from the universalistic view, are considered
best practices (Delery and Doty, 1996). However, it is understood that the practices that are
best for one organization may differ from those that are best for another. The contingency
view maintains that the best practices are dependent on the “best fit” of the organization.
The configurational view introduced “bundles of practices” depending on the needs of
the organization. Regarding these views, these practices will vary based on the needs
of the organization (Delery and Doty, 1996). The following discussion will outline various
approaches to defining fit and explain why organizations would be well-served to consider
organizational culture when determining the fit in order to align their strategic and
SHRM practices.

SHRM and the concept of fit


There are several approaches to defining fit. Integration is concerned primarily
with the potential problems between corporate offices and their foreign subsidiaries
(Milliman et al., 1991). Many factors contribute to this type of fit including corporate
philosophy and structure.
Fit is also discussed as the alignment of the HR functions to reinforce each other
(e.g. management awareness, management of the function, and portfolio of programs
to include personnel skills, information technology, and environment awareness;
Baird and Meshoulam, 1988). However, in this type of fit the alignment is only concerned
with the HR functions and not the alignment of the strategy, organizational culture, and
SHRM linkage.
Congruence is considered the fit between strategy, structure, and resources with human
capabilities and preferred strategy (Wright et al., 1995). Wright et al. (1995) discuss the value
of fit particularly as the organization moves through various stages of development, but do
not include the cultural component.
JMD Schuler and Jackson (1987) suggested that there is a linkage between strategy-role
36,10 behavior and HR practices. Although this is similar to the relations we propose between
strategy, organizational culture, and SHRM, role behavior is more specific to each
individual as opposed to culture which permeates the organizational as a whole.
Wright and Snell (1998) move the fit concept forward by discussing the employee skills,
behaviors, and HR practices and subsequent fit with strategy.
1262 Lengnick-Hall and Lengnick-Hall (1988) also discuss fit in terms of business strategy and
organization strategy and suggest that especially during an organizational change, fit may
not always be desirable. We expand on this notion, suggesting that organizational alignment
may not be desirable if the strategy intended does not agree with the culture and that culture
should be strategy supportive in order for the intended strategy to be implemented. Lengnick-
Hall and Lengnick-Hall (1988) did not address the concept of organizational culture as a
strategy supportive variable within the fit and flexibility continuum.
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Organizational culture alignment


In terms of fit, it is surprising that the organizational culture component is lacking in
when examining intended vs implemented strategies. However, some research has
evaluated the alignment of organizational culture with strategy (Chan et al., 2004;
Jackson et al., 2014; Wei et al., 2008); although the results are mixed.
Semler (1997) discusses systematic agreement theory and organizational alignment in
particular and defines organizational alignment as “the extent to which the strategy,
structure, and culture of the organization combine to create a synergistic whole that
makes it possible to achieve the goals laid out in the organization’s strategy” (p. 23).
We expand this concept of alignment to show how SHRM is linked to strategy and culture
resulting in increased firm performance. Way and Johnson (2005) extend systematic
agreement theory, including organizational culture alignment, to develop a framework of
the impact of SHRM. They also support the notion of consistency between organizational
goals, objectives and culture.
Cabrera and Bonache (1999) examine culture as an outcome of HR practices. They argue
that organizational culture is aligned through the implementation of strategy supportive HR
practices. However, this is only part of the equation. We contend that organizational culture
should be strategy supportive before the implementation of SHRM, just as particular values
must be in place before acceptance of the strategy will be carried out.

Organizational culture misalignment


Another area of research relevant to the strategy-organizational culture-SHRM linkage
involves the examination of HRs management as it relates to national culture and the
discovery of an intended vs implemented discrepancy (Boswell, 2006; Khilji and Wang,
2006; Sheehan et al., 2007; also see literature review by Lengnick-Hall et al., 2009).
These researchers identified the importance of national cultural differences as it impacts the
interpretation (or misinterpretation) of organizational goals and the subsequent
implementation of strategies across countries. As such, absent a congruent organizational
and national culture, the link between organizational strategy and SHRM will be
compromised. Similarly, we propose that the appropriate interpretation, understanding,
and implementation of goals and strategies within a single organization are contingent upon
the cultural fit between the strategies and the SHRM activities.
Researchers have generally been concerned with the internal fit of SHRM to the
current organizational culture (Delery and Doty, 1996; Jackson et al., 2014; Schuler and
Jackson, 1987). However, empirical research has not examined the possibility that the
organizational culture is dynamic and may be misaligned with the intended strategy, which
we propose often leads to the gap between intended and realized strategy implementation.
For instance, Schein’s (1990) model of culture is based on a dynamic process with Human
multiple levels (observable artifacts, values, and underlying assumptions), each impacting resource
each other. By discussing misalignment, we also highlight the complex and dynamic nature management
of organizational culture and change as a result of multiple factors, some of which include
market conditions, leadership, and technology.
We argue that alignment is relevant across organizations and should not be excluded
simply because the organization operates in only one national setting. Wei et al. (2008) 1263
examined the role of corporate culture in the SHRM process in a Chinese context and found
that national culture is an antecedent of SHRM. They suggested that HR practices are
implemented based on a variety of cultures and subcultures, which are used to continually
shape organizational culture. Indeed, HR practices are commonly organized in ways
that are consistent with a firm’s business strategy (Block et al., 1987; MacDuffie, 1995;
Osterman, 1987) although congruence with organizational culture may not be considered in
advance and instead may be an afterthought.
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However, organizational culture should facilitate the success of strategy and HR


management systems (Panayotopoulou et al., 2003). Khilji and Wang (2006) found that
when organizations had similar strategy and HRM practices but differed in performance
outcomes, one of the main factors that minimized gaps between realized and intended
HRM was organizational culture. Boswell (2006) brings out the idea of “line of sight”
and the relation of the individual employee alignment with organization strategy and
outcomes. Although Boswell’s (2006) research and the research by Chatman (1991)
and O’Reilly et al. (1991) discuss fit, they do not consider the link from strategy to SHRM
as impacted by organizational culture.

Strategy-organizational culture-SHRM linkage


Strategy and culture. Strategies can be thought of as “the diverse approaches that
organizations choose to follow in order to achieve success or a competitive advantage”
(Cabrera and Bonache, 1999, p. 52). The resource-based view (RBV ) is often the theory
mentioned as explaining the key component for competitive advantage (Wright and
McMahan, 1992). RBV theory states that in order for a firm to have a sustained competitive
advantage, the resources providing the advantages must be rare, imperfectly imitable, and
have no substitutable resources within the firm (Barney, 1991). Cabrera and Bonache (1999)
proposed that linking organizational strategy with organizational culture could serve as a
competitive advantage, but their suggestions focused on the role of HR technology in
facilitating these connections.
When examining a firm’s organizational culture, the values and beliefs that make
up the organizational culture also lead to the organization’s specific level of idiosyncrasy.
This means an organization’s identity is developed so that all individuals in the
organization are socialized into the organization’s culture and their specific role.
Some organizations have a strong corporate culture, while others have a weak culture
(Cabrera and Bonache, 1999). The strength of the organization’s culture is necessary,
but not a sufficient condition of the linkage:
P1. The strategy-SHRM relationship is contingent upon the alignment of the
organization’s culture with the strategy.

The impact of alignment vs misalignment


As noted, organizational culture can be seen as the shared values and beliefs, which lead to
behaviors (Smircich, 1983). This suggests that supportive internal cultures may increase the
possibilities of success with the implemented strategy.
JMD Schneider and Bowen (1993) suggest that organizational culture is a key factor as a
36,10 source of sustainable competitive advantage, and suggest that the values held by the
individuals in the organization are much more difficult for other organizations to imitate.
They suggest that culture is even more important than “superiority in product or process
technology, marketing or advertising, or capitalization” (Schneider and Bowen, 1993, p. 48).
We agree and argue that cultural alignment or misalignment is a key factor in determining
1264 the relations between an organization’s strategy and its SHRM.
Figure 1 illustrates the conceptual model of this strategy-organizational culture-SHRM
relation and the impact of the alignment and misalignment of organizational culture on
SHRM, and subsequently, organizational outcomes. This depiction shows that the strategy
is developed which leads to the SHRM functions and HR practice implementation.
Organizational culture is a moderator in this relationship and is ultimately aligned or
misaligned with strategy. As the SHRM functions are carried out, a feedback loop reinforces
and develops the organizational culture based on hiring, training, and other processes. This
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linkage leads to strategy implementation and organizational outcomes.


When the culture is misaligned, SHRM becomes inconsistent with strategy. The lack of
strategy supportive culture is, in turn, reinforced by the subsequent inconsistent SHRM
practices. This may be one reason the intended vs implemented strategy and SHRM issues
occur. When strategy and culture are misaligned, it creates a perpetual spiral that is
detrimental to executing SHRM and ultimately organizational performance:
P2. Organizational culture positively influences the strategy-SHRM relationship when
culture is aligned with strategy resulting in consistent SHRM implementation.
P3. Organizational culture negatively influences the strategy-SHRM relationship
when culture is misaligned with strategy, resulting in poorly executed SHRM
implementation.
Table I provides examples of the organizational culture values adapted from generic
strategies that we propose could be considered strategy supportive and moderate the
relation between strategy and SHRM. Previous research has mentioned the idea of strategy
supportive organizational values; however, specific values have not been integrated for
particular strategies (Wei et al., 2008).

Organizational outcomes
Southwest Airlines provides a classic real-world example of the potential impact of an
alignment between strategy, organizational culture, and SHRM. Southwest Airlines often
credits their organizational culture and their HRs with maintaining their strategy of a fun,
low cost airline (O’Reilly and Pfeffer, 1995). Through socialization of the organizational

Aligned
organizational culture

Consistent Improved
SHRM organizational
implementation outcomes
Figure 1. Organization
Conceptualization of strategy
aligned or misaligned Inconsistent Weakened
organizational culture SHRM organizational
within the implementation outcomes
organization strategy- Misaligned
SHRM linkage organizational culture
Organizational culture
Human
Strategy values (strategy supportive) SHRM focus resource
management
Low cost leadership Following rules Administrative/cost orientation
Employment security Hire from within
Efficiency/productivity Internal training
Differentiation Being flexible Creative orientation
Taking risks Hire from outside 1265
Innovation Less training
Superior customer service Customer experiences Service quality orientation
Quality Extensive training
Company reputation Rewards for service
Innovation Entrepreneurial behaviors Learning orientation
Table I.
Knowledge workers Creativity coaching Organizational culture
Risk taking rewards values moderating the
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Sources: Adapted from Jackson et al. (2014), Mathis and Jackson (2000), also see Porter (1980), Thompson strategy-SHRM
and Strickland (1998) linkage

members and a strong corporate culture aligned with the strategy, they have established a
high performance outcome. It merits noting that this is also consistent with RBV theory.
On the other hand, Arthur Andersen is another example. This company had a long
history of strong corporate culture and profitability before it was discovered that their
methods of business were less-than-desirable (i.e. Ferrell et al., n.d.). This is an instance
where the organizational culture became misaligned with the corporate strategy.
Organizational culture somehow became misaligned when the strategy shifted away from
its once strong ethical convictions resulting in detrimental organizational outcomes.
Therefore, we propose that the outcomes of organizations are, in part, dependent upon
the congruence between their strategies, cultures, and SHRM (see Figure 1):
P4. Organizations with aligned strategy and culture will experience increased
organizational outcomes than those with a misaligned strategy-culture relation.
Alternatively, if a strategy is developed that is lacking the supportive organizational culture
(see Table I), then misalignment may occur where the HR continue to operate in a fashion
that they have grown accustomed. In addition, if the unsupportive organizational culture
determines the functions of the HR, misalignment will continue to occur and negative
outcomes may result (see Figure 1).

Multi-level theory
In addition to considering the alignment between strategy, culture, and SHRM, researchers
must also consider additional levels of analysis. Individuals throughout hierarchical levels
of the organization, not only the top management team, must be considered to develop the
organizational culture and whether it is congruent with the strategy and SHRM.
Ostroff and Bowen (2000) suggest that little research has been conducted to determine
the factors that contribute most to HR system alignment and instead of focusing on
particular HR practices used to achieve goals researchers should also examine
organizational climate. In agreement and by extension, we suggest that one must
consider organizational culture. Ostroff and Bowen (2000) discuss an alignment between
strategy and climate (e.g. focusing on innovation skills if the climate is one of
implementation of innovation).
Schneider et al. (2003) suggest that the reason alignment in organizations has not been
thoroughly studied, especially regarding HR functions, is because the responses are usually
JMD from one source, an HR executive, rather than the employees within the firm. In addition,
36,10 they suggest that the surveyed practices are often too general and could be applicable to
many firms regardless of strategy. Finally, Rousseau (1990) suggests using both qualitative
and quantitative methods to determine the level of approval and agreement of values within
the organization.

1266 Discussion, implications, and future research


Because SHRM is typically studied as its fit with strategy, an important moderating
variable, organizational culture, may be overlooked. Importantly, culture may impact the
discrepancy between intended and realized strategy. When mismatch occurs, organizational
culture should be examined to determine corresponding organizational outcomes.
One critical future research issue to the proposed linkage is the assumption that the
organizational leaders have selected an appropriate strategy. For instance, the top
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management team wishes to implement a strategy that is not congruent with the
organization’s culture. The strategy may be inappropriate for the organization,
and organizational performance would be expected to be low. However, once a proper
strategy is selected which is aligned with the culture, the organization could turn itself
around with minimal impact, depending on the timing of the reaction.
Another area for future research is the organizational values in Table I. These are far
from exhaustive and cannot encompass every conceivable situation. Additional strategies
and values that are strategy supportive should be developed to include the resulting SHRM
practices that would promote alignment.
Future research should be conducted to determine the extent to which organizations that
have had intended vs implemented strategy and SHRM incongruence and also lacked
alignment with organizational culture. This could be a key indicator to the top management
team to take a leadership role in establishing and developing the supportive culture and
values needed first in order to implement a current strategy to continue success through the
SHRM functions. This may also uncover a timeframe to be utilized for a more successful
execution of the HR practice implementation and positive organizational outcomes.

Conclusion
We examined a gap in the literature regarding the impact of the organization’s strategy on
SHRM when taking into account organizational culture in order to develop propositions for
future research. In addition, a model was developed to show the resulting outcomes when
alignment or misalignment of culture is present in the strategy-SHRM linkage. We further
extend the literature by presenting a table of suggested organizational culture values
necessary to encourage a strategy-supportive culture.
Organizational culture should be studied as an important moderating variable in the
strategy-SHRM-performance linkage ( Jackson et al., 2014). The alignment of organizational
culture is imperative in order to determine successful HR practices that will shape the
organization. Finally, although there is “no one best culture;” the value is determined by
aligning the culture to achieve the best possible strategy-SHRM-outcome linkages.

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About the authors Human
Dr Teresa Harrison is an Assistant Professor in the H-E-B School of Business and Administration at resource
the University of the Incarnate Word in San Antonio, Texas. She earned her PhD in Business
Administration (concentration in Organizational Behavior) from the University of Texas at management
San Antonio. She has published articles in peer reviewed journals on topics such as factors influencing
the utilization of electronic selection as well as diversity in entrepreneurship. Results of her research
have been presented at the annual meetings of the Academy of Management, Society for Industrial and
Organizational Psychology, and the Southern Management Association. Dr Teresa Harrison is the 1269
corresponding author and can be contacted at: [email protected]
Dr Joshua D. Bazzy is an Assistant Professor in the H-E-B School of Business and Administration
at the University of the Incarnate Word in San Antonio, Texas. He holds a PhD in Industrial and
Organizational Psychology from the Haslam School of Business at the University of Tennessee.
He has published articles in peer reviewed journals on topics such as integrity testing, work ethic, ego
depletion, and counterproductive workplace behavior. He has also presented at Academy of
Management and Society for Industrial and Organizational Psychology meetings as well as
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other conferences.

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