When undertaking strategic human resource management, managers should focus on the highest priority competitive building block to define an HRM system. a distinct, independent system may be required for each business division. every HRM system component applies to every organization in a similar way. managers must recognize that each component of an HRM system influences the others. benefits packages are more critical than pay structures. The component of an HRM system ensures employees have the knowledge and skills needed to perform their jobs effectively now as well as in the future. training and development labor relations performance feedback performance appraisal recruitment and selection