Harvard Model of HRM Definition
The Harvard Model of HRM, in simpler words, is a strategic plan that empowers organizations to use their human resources according to their overall visions. The model helps businesses to achieve their goals efficiently.
Back in 1984, a model was created to simplify human resources management by Harvard Business School. The model was named Harvard Model of HRM. It eventually emerged as an effective method to help organizations to make the most of their resources and achieve results super faster.
Let’s dive in and understand everything about the Harvard model of HRM.

Here, we will discover:
What is a Harvard Model of HRM?
According to the Harvard Model of Human Resource Management, employees are considered valuable assets and not liabilities or costs.
This approach organically weaves together HR policies, employees and organizational strategies, with the aim of achieving success; where each policy and practice would complement others to achieve the organization’s goals.
There are four basic cornerstones of the model: situational factors, stakeholder interests, HR policy choices, and situational factors net of all stakeholder interests.
As the business environment is substantially more complex, dynamic, unpredictable, and cyclical, the Harvard framework on those grounds suggests it may be wise and reasonable, to avoid overly theoretical or formulaic approaches.
The Harvard Model of Human Resource Management encourages a strategic, holistic and flexible approach to all of the various functions of HRM.
Why is the Harvard Model Important?
In order to communicate and understand each other from different areas and hierarchies, the Harvard HRM model is meant to be used. The point of the model is to build trust between employees and management and turn an office into a positive place in which everyone has the opportunity to flourish. It’s a holistic approach: HR policies and long-range planning should benefit all parties, the model recommends. Not only should these policies take the interests of stakeholders into consideration, but they should also be made with consideration of the specifics of the situation, according to the model.
Important Factors of the Harvard Model
Here are the five factors of the Harvard model you must be aware of:
Situational Factors
Situational factors are both inside and outside work, and they affect how people do their jobs. According to the Harvard model of HRM, you should think about things outside your company, including the economy, the job market, new technologies, the law, public policy and government decisions and your competitors. Internal situational factors include the business plan and the organization’s culture and its structure. You should think about both sets of factors properly when you are making any HR policies.
Stakeholder Interests
The Harvard Model says to look at lots of different people and what they want whenever HRM policies are being made.
Every HRM process includes internal management, labour, the community and the government. They are interested in what decisions are made, and what the outcomes are.
Consulting with the proper people in the company is invaluable to ensuring the HR plan is a comprehensive one. And it is also a good way to ensure that it is equitable and to avoid violating the rights of anyone impacted. Their input and thoughtful consideration of what they say, and think is very important for this reason.
HRM Policies
Human Resource Management policies refer to the plans that result from the organization’s strategy and operation.
These policies are designed to ensure the company performs well in areas such as recruitment, pay, training and development. They can also serve to ensure the company meets legal requirements and have an arm to rest on when it comes to structure and process. Further, they must be able to change and adapt as the company’s needs change along the way.
Results of HRM
There are four HR outcomes (the 4Cs) that can be reached with good HR practices. The Harvard model is based on these:
- Commitment– a promise or pledge to work towards an organizational goal.
- Congruence– managing people, their jobs, and the organization effectively.
- Competence– helping employees develop their skills and holding onto skilled workers.
- Cost effectiveness– reducing costs and making sure that employees are happy and motivated.
Long-Term Effects
By the Harvard model, well executed HRM practices can have a long-lasting impact on a company that can change the whole ball game.
For instance, by having HR policies that are fair it can make employees more engaged, happy and healthy, which can make them more productive and make profits higher. This can also make the workplace a peaceful place where people respect each other, genuinely believe in each other and share the same values. All of which makes it easier to recruit and retain top talent.