Marrying HR with Business Strategy
Updated: Aug 14, 2020
Of all the G&A functions in the corporate framework, by far, the Human Resources department has had the most change and added value than is given credit. With more demand for retaining top talent, engaging and developing employees, HR has become THE most essential function.
History: The Human Resources field began to take shape in 18th century Europe. Built on a simple idea by Robert Owen (1771-1858) and Charles Babbage (1791-1871) during the industrial revolution that concluded: people were crucial to the success of an organization. In surveying workers, both Owen and Babbage found that workers wanted to be treated as humans, rather than dispensable resources by their organization. However, it wasn't until the late 1990s that Human Resources started to deviate from the traditional administrative & compliance framework to the more robust and strategic HR that we see today.
Traditional HR does not incorporate or take into account the strategic add value that HR should also be keeping in mind and shifting their organization for the growth and betterment of all their employees.
TRADITIONAL HR RESPONSIBILITIES
Training & Development
State, Federal & Safety Compliance
TRADITIONAL & STRATEGIC RESPONSIBILITIES:
Diversity & Inclusion
Employee Experience & Engagement
Data-Driven Decision Making
Now that we know the short history of HR evolution, it is easy to visualize why HR must be aligned with the C-Suite more than ever. With more CEOs putting their greatest asset first (their people), HR has a seat at the table, and it is here to stay.
The list below will help put important strategic initiatives in place in order for HR leaders to align vision and goals with the C-Suite and Board at their respective company.
1. Use business strategy to drive HR initiatives
It is important for HR leaders to understand the organization's financial viability and goals. As we all know, finance is front and center in all strategy setting conversations. However, HR should also be at the core of these discussions as well. For example, if you have a culture that is geared more towards customer service and stabilizing, then change without buy-in may not be perceived very well by the majority of your workforce. A fast-moving growth model, in this case, may not be the best course of action, but rather a phased-out approach where buy-in and change management are at the core of this strategy. Knowing how people will react to a change in strategy is key to successfully tying business results with a people-first approach. HR should have a seat at the table in order to enable results, however, hitting the breaks and discussing current structure, talent capabilities, succession planning, and other important attributes are crucial prior to solidifying a strategy to ensure optimal success and acceptance rate by the majority the workforce is present.
2. Understand the drivers of success for the business
It is important to understand what captures business success at your company and what success looks like. Is it the ability to remain innovative, dominating your niche market, customer service excellence? Whatever the case may be, the ability to speak about these factors and help leaders integrate them into every day normal practice across the organization will not only help with business results but also to create a cohesion in relation to a set of shared values and cultural norms across all departments. This is when HR can start to capture data around what success looks like in order to create policies and a total awards framework to retain top talent, set expectations, and clearly lay out expectations from managers to their employees.
3. Create an organizational design that taps into a talent optimization framework
At the core of talent optimization is the collection, analysis, and application of people data against the business strategy and results. The way in which companies are organized largely depends on their current strategic objectives and where they are in the business growth model. If a company is in a high-growth mode, it may lean more towards a sales-driven culture with more leaders at the top in Sales making many of the decisions in driving strategy. Mature companies with a retention-focused strategy may hire more customer success roles while scaling in their sales operations so that retaining new customers does not go to vain. The ability for HR leaders to identify top talent and match them to business-critical roles based on interest, skill-sets, and drive will allow for a mature and robust organizational development discussion tapping into the current needs and current abilities of the workforce to move around in order to meet changing business demands and needs.
4. Know when to promote from within and when to hire externally
Having a data-driven HR department will allow for strategically driven conversations with all managers in helping them lead their individual department goals and KPI setting. Having metrics that measure performance, skill sets, tenure, robust performance reviews, and 360 reviews from colleagues and customers will position top performers into new exciting roles. This also instills a culture of learning and an increase in employee engagement rates. Occasionally, companies will need to hire externally, and having this data, will help create an interview based on what top talent looks like at the company. Make sure to include the top performers throughout the interview process to ensure top talent is hired. Having a solid, screening, and interviewing process will ensure fit and viability for the candidates being considered.
It is important for HR leaders to add value in areas outside of just the traditional administrative landscape they once led. Talent is much more complex and the need to drive people initiatives in business strategy is becoming more apparent when speaking with C-Suite and Board members throughout all organizations. A highly engaged and top-performing culture is due to leveraging people data, informed management teams, and a people-first approach in everything a company does. All hail, HR leaders! Now is your time to shine and make a difference in peoples lives.
ABOUT MVG HR SOLUTIONS:
MVG HR Solutions is a one of a kind Executive Search & HR Consulting Powerhouse. Founded on the principles of providing stellar outsourced HR services, we are a team of HR & Strategy Consultants that specialize in a talent optimization framework that touches every aspect of your people operations and business outcomes.
Contact us today to learn how we can help enrich your organizational culture, talent, and people strategy at every level.
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