HR alignment with Business Strategy

HR is often left out of business plans and strategy meetings. The problem is that HR is fundamental in implementing these changes and in restructuring companies because it can foresee how, what and especially who will be needed to achieve a successful change. Change is often needed and people are the ones who implement it. People with the right aptitudes, competencies and who are a great fit with the company’s culture. This is often overlooked by managers who tend to focus more on cutting cost or raising money, when they should worry about using their human capital to achieve change.

In other words, HR can forecast how many people will be needed and what skills are necessary to achieve a company’s goal. HR can also help in acquiring new talents or creating a pipeline for the positions that will be needed in the near future. It is also important to continuously provide top talents with a good career path in order to retain them, because these are the people who tend to leave the company when restructuring happens. To reward high performers or to manage low productivity is key in any strategic plan and this is HR’s role. In addition to that, HR is responsible for training and development and to help with outsourcing strategies that might be necessary to fulfil the plan.

HR should provide training for the company’s workforce to figure out how to capitalize on a rapid changing environment and help leaders cast a good, positive, shadow that will inspire others. Change only happens if the leaders are engaged and if they engage their teams.

Also, if employees are connected to the company’s strategy and goals and are awarded for high performance, the business goals are more likely met. Engaged employees are crucial to the company’s productivity. HR can be a key player at the executive table if it develops performance management goals based on the company’s objectives and values.

It is delicate for HR to balance compensation strategies that take into consideration the company’s finances with the employee’s expectations. That is why HR must be included in budget planning meetings too in order to ensure talent retention and to establish a succession plan. There are many ways to keep employees happy, sometimes it is not even costly, so HR has to lead these efforts and ensure the necessary funds are adequately allocated.

The best metric to establish HR success is closely related to a company’s ability to retain talent. This is also beneficial to the business as a whole, not only for HR.

“So HR are an important part of a successful business strategy. Successful business managers realize the importance of well-trained and motivated employees to achieve the company’s financial goals. Successful HR departments realize the importance of keeping employees’ focus on the company’s financial goals while providing opportunities for employee’s growth and advancement. Employees and management must both realize that a cooperative, not adversarial, relationship is vital to a company’s success”. (Lisa Nielsen)

The best way to achieve change and success is through good, effective, communication. Leaders are responsible for communicating the company’s goals to their teams and they must “take people with them”. They must make their employees feel that they are partners in the process and that they play a key role in the success of the company’s business strategy. HR should be heavily involved in this process and should coach managers on how to communicate with employees and address concerns.

This is closely linked with the need for an effective program for employee’s training and development, performance assessment and rewards. Organizational development, recruitment and succession planning are key for successful management and HR should ensure that managers are properly trained for the task. HR and managers must work closely to find solutions that keep employees satisfied and keep the business on-track.

Poor performers are usually the most difficult task for managers to deal with. HR should provide guidance to managers in the art of understanding labor laws, policies and disciplinary measures so that fairness and equality is achieved and poor performers are dealt with. Low performance management is surely the most delicate part of the puzzle and should be addressed before a new strategy is implemented. A company must never compromise on the quality of the staff that is hired because poor performance is not only costly, but it also sends the wrong message to good performers and discourages the whole company.

The most important point, besides hiring good people, managing poor performers and establishing good communication is ensuring that the employees are aligned with the company’s values. All of these aspects are interconnected and have a direct impact on productivity and growth.

A clear set of values that cascade into tangible competencies are fundamental for the recruitment and selection of employees who are a good fit for the company. This is also how performance evaluations should be designed. All aspects of the business should be embedded with the company’s mission and values so that consistency is achieved and decisions are aligned with the overall company’s strategy.

If the company’s values are not internalized and respected, it is easy for an employee to go off-track and soon a whole department is misguided. Miscommunication and misalignment are extremely costly and difficult to correct, but can be avoided if the company’s values and missions are a top priority.

If companies are invested in planning their strategies and goals around their values, they will be consistently successful. Communication is key in this process, but it is also fundamental for the leaders to cast a positive shadow to their teams and lead by example.

When new employees are hired, they must benefit from training and on boarding to essentially understand these basic principles and align with them. This will create a healthier company and avoid future problems relating to cultural fit.

All companies have a culture, whether intentional or not, all companies have a specific culture. Some can help employees thrive and succeed and some can be unhealthy and lead to high turnovers. The company’s culture starts with the brand, not the external brand, but the internal way of acting, talking to customers, the internal communication, the leader’s shadow, etc. It is a combination of many different people, personalities and work habits.

It is a complicated and delicate balance that all employees should care for and value. A healthy culture will be beneficial to all and will attract better talent as well as retain high performers. Companies must ensure that their healthy culture is preserved. Clear and transparent communication is definitely key in this process.

Thank you, Rebeca Gelencser

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