Functional-level strategy
Functional-level strategy pertains to the major functional operations within the
business unit, including research and development, marketing, manufacturing,
finance and HR. This strategy level is typically primarily concerned with
maximizing resource productivity and addresses the question, 'How do we
support the business-level competitive strategy?' Consistent with this, at the
functional level, HRM policies and practices support the business strategy
goals.
These three levels of strategy - corporate, business and functional - form a
hierarchy of strategy within large multidivisional corporations. In different
corporations, the specific operation of the hierarchy of strategy might vary
between 'top-down' and 'bottom-up' strategic planning. The top-down
approach resembles a 'cascade' in which the 'downstream' strategic decisions
are dependent on higher 'upstream' strategic decisions (Wheelen & Hunger,
1995). The bottom-up approach to strategy making recognizes that individuals
'deep' within the organization might contribute to strategic planning. Mintzberg
(1978)^24 has incorporated this idea into a model of 'emergent strategies',
which are unplanned responses to unforeseen circumstances by non-
executive employees within the organization. Strategic management literature
emphasizes that the strategies at different levels must be fully integrated.
Thus strategies at different levels need to inter-relate. The strategy at
corporate level must build upon the strategies at the lower levels in the
hierarchy. However, at the same time, all parts of the business have to work
to accommodate the overriding corporate goals. (EA. Maljers, Chairman of the
Board of Unilever, quoted by Wheelen & Hunger, 1995, p. 20)
The need to integrate business strategy and HRM strategy has received much
attention from the HR academic community,
2.4 Strategic Human Resource Management
The SHRM literature is rooted in 'manpower' planning, but it was the work of
influential management gurus (for example Ouchi, 1981; Peters & Waterman,