Hrm Of Lenovo

Introduction:

Human resource management (HRM) is a way of employment management which can create sustainable competitive advantage and add value by integrating employment policies, programs and practices (Bratton and Gold, 2003). According to Storey, HRM consists of two approaches in term of style: ÐŽ®hardЎЇ and ÐŽ®softЎЇ approaches. Compare with personal management, HRM not only identifies the ÐŽ®hardЎЇ, which roots in the manpower planning approach, but also considers the ÐŽ®softЎЇ, which focuses on human relation and high commitment that is seen as the key factor in achieving competitive performance (Storey, 2002). As a strategy approach to HRM, strategy human resource (SHRM) has been proved to influence company performance and company strategy by recent empirical evidence. Furthermore, it can develop strategy to get the systemic change (Liao, 2005). Owning to the rapid environmental change, especially globalization, it is more reasonable and necessary to analyze international SHRM and comparative SHRM.

This essay will focus on analyzing the HRM of the company of Lenovo Group Limited. An assessment will first be made of the background of the firm, and then the overall HRM strategy and HR activities of the firm will be examined, and finally there will be a brief recommendation about the HRM of Lenovo.

Background :

Lenovo, which was established in 1988, is the largest information technology company in China. Its main businesses are the sale and manufacturing of personal computers, mobile telephone handsets, computer servers and printers. It has been the market leader for seven consecutive years, with a 27 per cent share of the domestic PC market in 2003. It is also the market leader in the Asia Pacific region (excluding Japan), having a market share of 12.6 per cent in 2003 (Fan, 2006). In 2003, because of the internationalization strategy, group changed its English brand name from Legend to Lenovo, which is intended to build an innovative image for the group worldwide. Following its opening of seven overseas offices in 2001, Lenovo made the first attempt in internationalization. In 2004, the company bought IBM's personal computer division for US$1.75 billion in cash, stock and assumed liabilities (Fan, 2006).

Overall HRM Strategy:

According to Bamberger and PhilipsЎЇ (1991) model, there are tight connections between tree poles: environment, business strategy and human resource strategy (Bratton and Gold, 2003).

Environmental and competitive changes, including market, technology, national government policies, trade unions and global competitors, significantly affect HRM strategy. Instead the low unskilled and semi-skilled labour in china, the pay level of Lenovo, which requires more managerial employees and engineers with high skill and knowledge, is much higher than the other companiesЎЇ even competitorsЎЇ. In order to maintain the competitive technology and employees Lenovo also establishes its own training school for cultural and technical training and development. Owning to the economy reform & opening policy and cultural revolution, the seniority-based flat rate system is replaced by system that closely links to performance, and recruitment and selection practices are becoming less effected by political bureaucracy and more influenced by economic and market concern (Beardwell, 2004).

On the other hand, According to contingency theory of competitive advantage model (Sculer and Jackson, 1987), there is a close link between business strategy and HRM strategy, which means the HRM strategy need to fit the generic strategies of cost reduction, quality enhancement and innovation. Firms that use a cost-reduction strategy must control and minimize expenses, and look forward to greater economies of scale. Therefore, efficiency, is achieved mainly through ÐŽ®hardЎЇ HRM techniques, is significant for firms to succeed (Beardwell, 2004). Following certain HRM practices such as standard operating procedures, behavioral performance appraisal, close supervision, and feedback, it can create controllable employee role behavior, which can increases efficiency and productivity by routinizing the transformation process. Hence, HRM based on behavior control is closely related to performance for firms emphasizing cost-reduction as business strategy. In contrast, firms focusing on an innovation or quality strategy must adapt to rapid market change and technological progress. These strategies deliver of added value by ÐŽ®softЎЇ HRM techniques and policies (Beardwell, 2004). In the other words, employees need to be creative; to be cooperative with one another; to be able to pursue long-term objectives; to devote proper consideration to the quality and quantity of products and services provided; to be able to take risks; and to cope successfully with ambiguity and uncertainty (Liao, 2005). Following the globalization strategy, Lenovo has gradually adjusted its competitive strategy from lower price to quality and innovation. As a result, company has chosen certain ÐŽ®softЎЇ HRM policies, including performance appraisals reflect long-term and group and functional-level based achievements, broad career paths to reinforce the development of a broad rang of skills from frequent trainings and job rotations, distribute shares to employees every year. In order to suit the globalization, especially cross-cultural context, group has recruited more and more managerial employees and engineers with high skill and knowledge from oversea labour market.

The contingency approach links a strong relationship between business strategy and HRM strategy, which seems to be a rational-planning model of strategy management. It focuses on the vertical integration between business strategy and HRM strategy, which identify the degree of fit. In order to look insight the internal context and horizontal integration within HR policies and practices, it is useful to analyse another approach to understand the relationship between a companyЎЇs approach to HRM strategy and its business performance (Beardwell, 2004).

According to Bamberger and MeshoulamЎЇs theory, the integrative model builds an approach to identify two main dimensions of HRM strategy, which are ÐŽ®acquisition and developmentЎЇ and ÐŽ®locus of controlЎЇ. This model focuses on both the strategyЎЇs underlying logic of managerial control and the reward-effort exchange (Bratton and Gold, 2003). Acquisition and development means whether the organizations depend on more towards ÐŽomakingЎЇ