The Integrative Model of Human Resource Strategy Formulation

The Integrative Model of Human Resource Strategy Formulation

The Integrative Model of Human Resource Strategy attempts to establish a true integration between the corporation's overall strategy, the HR strategy, and certain operational systems. The model is derived from the combination of rational and progressive approaches, relying on "Strategic Reference Points" (SRPs). SRPs are outstanding objectives or patterns organizational decision-makers use to assess their approaches so they can adopt strategic decisions to develop the HR strategy. As part of this process, decision-makers consider and combine 2 main variables:

LABOR MARKET: The amount of attention to the internal labor market or the external labor market (SRP1). This implies the degree or extent to which the human resource strategy will consider providing the required employees, skills or competencies from the "inside" versus from the "external market" (build or buy).
CONTROL: The quantity and quality of control over the labor process or the labor product (SRP2). This implies the degree or extent to which the human resource strategy considers monitoring personnel behavior and productivity.

This results in four major strategies: Paternalistic Strategy, Commitment Strategy, Secondary Strategy, and Free-Agent Strategy.

Note that the words "process" and "product" in the picture refer to the quantity and quality of control over the labor process or labor product.

These are the features of each of the four strategic patterns in the Integrative Model:

SECONDARY STRATEGY: This strategy is appropriate for simple, recurring and standardizable occupations for which the required workforce is adequately available in the labor market outside the corporation and there is no need to train and maintain such employees.
PATERNALISTIC STRATEGY: This strategy is also applied for simple, recurring and standardizable occupations, but with the difference that the corporation management prefers to maintain and upgrade the existing employees and coordinate them with the organizational culture of the corporation.
FREE-AGENT STRATEGY: This strategy is appropriate for sophisticated and specialized occupations causing high costs for the corporation because such occupations are only temporary needed or for a short term.
COMMITMENT STRATEGY: This strategy is also used for sophisticated and specialized occupations, but the corporation constantly needs experts active in such businesses and their replacement is not easily feasible.

References:
Bamberger, P., & Meshoulam, I. (2000), "Human Resource Strategy", Newbury Park, CA: Sage.
Dariush Gholamzadeh and Sonya Jalali (2013), "Integrative Approach in Human Resources Strategy Formulation" (Case study: MDN Company), Social and Behavioral Sciences №75, pp.479 – 487.