Fusing the HR Strategy to the Business Strategy

By Lynn Lochbihler

Gone are the days that Human Resources (HR) was largely an administrative role responsible for assisting employees with personal problems and health benefits, organizing the annual staff Christmas party and on clean-up duty after a situation with an employee went awry. Enlightened organizations now respect and value Human Resources Management (HRM) for their key leadership role as long-term strategic business partners.

Today HRM is an integral part of the strategic position that an organization assumes – inseparable from key organizational goals, product/market plans, technology and innovation, and an organization’s strategy to respond to governmental, environmental and societal pressures. To be effective, the HRM strategy should be formulated after considering an organization’s objectives, threats and opportunities, and the company’s internal strengths and weaknesses.

It is now a generally accepted belief that people are the ultimate resource for any employer. How well an organization recruits, maintains and retains its human capital determines its success or failure. Compensation and benefits, adherence to safety requirements, employee and labour relations, legal compliance, outplacement, (to name just a few) are complex issues in today’s marketplace. They require highly skilled experts to manage them appropriately, with the ultimate goal of maximizing employee potential, minimizing risk, and obtaining high return on investment (ROI) from both the people and the material/financial resources.

An HR department helps people and organizations reach their goals. There are many challenges along the way – challenges that arise from the demands of people, the organization and the external environment. Success as a manager of people or a specialist of human resources depends upon how well these challenges are met. Whether you are a manager/supervisor, an employee, or a citizen, you are affected because organizations touch everyone’s lives somehow every day. How well our organizations succeed determines everyone’s well being and the well being of society at large, hence the need for responsible, moral and ethical management ideals.

Managing human resources involves future oriented, integrated, (and sometimes large-scale) plans to achieve organizational objectives and respond to uncertain and competitive environments facing the organization. A carefully planned Human Resources Strategy always reflects the larger organizational mission and priorities. Such a strategy can significantly contribute to an organization’s health, productivity, and capacity for innovation. Strategic HRM is systematically linked to the strategic needs of the organization and aims to improve the effective and productive contribution of individuals (i.e., the workforce), while simultaneously attempting to attain other societal and individual objectives.

The field of HRM focuses on what managers do and what they should do. Human Resources departments have never controlled the factors that shape an employee’s contribution, such as capital/materials and procedures/systems, and people management skills, although it now has the mandate to strongly influence both.

All managers of people are “mini” human resource managers, and are able to significantly influence the creation of a motivating work environment. One significant factor in motivation is employee development – preparing individuals for new challenges through training and development (T&D), which is now routinely combined with career planning to reflect the growing emphasis on development and the importance of being a learning and innovative organization.

Progressive organizations have bought into the value of the HR Effectiveness Audit concept – these evaluate any/all of the human resource activities implemented in an organization – research into these practices and procedures may uncover better ways to strengthen the competitive advantage. It can also build support, respect and trusting relationships between employees and management.

Growing in popularity is Virtual HR or Outsourcing HR. They are cost-effective solutions for smaller companies to grow their business through the benefits of contracting professional HR services, which may not be available “in house”. Even larger companies that have downsized find these options suitable for specific services or projects on an “as needed” basis.

Never before has PR (Public Relations) been so closely linked to HR. Any company’s culture and corporate public image is often largely determined by its corporate HR practices. PR and HR work hand-in-hand to ensure positive practices and positive public messages prevail.

For modern human resources departments to make a strategic contribution to better meet organizational needs, they face a fundamental challenge to balance societal, organizational, functional and human capital objectives. It must be done in a way that respects the importance and dignity of human beings (doing the right thing!). HR exists to drive the achievement of the total organization’s success.

HRM touches every aspect of every business. Training in HRM is critical for all managers at every level, now that companies are so lean and routinely operate in a more complex and dynamic “global village” setting. The influential long-term strategic and advisory capacity of HRM is now a key leadership role directed by responsibility to “lead the charge!”

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