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Argues that a human resource development (HRD) strategy, in alliance with a global‐arching human resource management (HRM) strategy, is the most effective way to link training policy and practice to organizational goals. Both manufacturing and service organizations require a critical mass of positive factors related to the effective management of human resources to successfully accomplish organizational goals. This involves the analysis of a myriad internal and external environmental factors contingent to the organization, followed by a strategic approach to influencing key stakeholders, and the formulation of strategic HRD policies and plans in parallel with and sometimes influencing business strategy. This links to a broad range of systems covering all areas of the human resource cycle ‐ selection, appraisal, rewards and development ‐ related to individual/team and organizational performance. Concludes that the HRD function must become more strategic in focus.

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