Is Your HR Strategy Aligned To Your Business Needs?

The HR profession has been in transformation for many years now. It was back in the 1990s that leading HR thinker, Dave Ulrich [1] put forward the idea that in order to become a respected business partner, HR needed to change.

It needed to move away from being a reactive profession, a kind of menial servant to the business – and move toward being a strategic business partner – challenging the status quo and providing proactive HR solutions to challenging business problems.

HR KPIs in BSC Designer

He called for the end of the HR Generalist and pushed for a new HR structure based around:

  • HR administrators,
  • HR Specialists, (Reward, Hiring, Training, Employee Relations), and
  • Strategic HR Business Partners.

It was these Strategic HR Business Partners who were meant to use the HR Administrators and Specialists to devise strategic HR focused and business strategy aligned HR solutions to solve business problems.

If the IT department was failing to hit quality targets, the Strategic HR Business Partner would proactively develop an individualized HR intervention, using HR specialist and admin input to address the problem.

It was the Strategic HR Business Partner that was going to be the foundation of HR’s move from reactive servant to a valued top line contributor with a seat at the revered executive table. But, unfortunately, despite the lofty aspirations of HR, research suggests that the HR profession still hasn’t managed to make that move to strategic business partner status.

Many HR professionals working in senior HR roles might feel this is a harsh assessment, but studies support it.

This working paper, titled What Makes A Strategic Partner, by the Center for Effective Organization [2] outlines a longitudinal study of large firms which confirms that HR is not a business partner, and has made little or no movements towards becoming one.

How to become a strategic partner and relevant to the business

Dave Ulrich [1] outlined six competencies that HR needs to master to be perceived as an effective performer. These were:

  • Credible Activist,
  • Capability Builder,
  • Change Champion,
  • Human Resource Innovator and Integrator,
  • Technology Specialist and
  • Strategic Positioner.

This latter strategic component was one of the top 3 skills and is what we will focus on here. There seemed to be three elements of being a strategic partner, according to Ulrich and these were:

  • Interpreting global business context,
  • Decoding customer expectations and
  • Co-crafting a strategic agenda.

And to do this effectively, HR needs to carefully align HR strategy with business strategy.

Where to start…

But, these are lofty goals, which can seem intimidating, but HR needs to start somewhere. I think the best place to start is by developing HR strategies that are closely aligned with the business strategy.

This will make HR relevant to and highly valued by the CEO and executive team, because the CEO and executives will be able to see how all of your interventions are immediately relevant to their day to day concerns.

How to tell if your strategy is business aligned and relevant

You’ll know if you have developed a valued and business relevant strategy, because your CEO and executive colleagues will be engaged and excited by your plan, as they will be able to see how it drives their business goals.

You won’t be a distraction, you’ll be eagerly awaited.

Developing and communicating your HR strategy in a persuasive way

BSC Designer can help you develop and communicate a compelling business strategy. It does this by enabling you to quickly produce a visual and diagrammatic presentation of your HR strategy and see how it aligns to business strategy.

You can include the overall business goals of: Customer Perspective, Financial Perspective, Internal Process Perspective and Learning and Growth Perspective and you can visually present and align your HR interventions with these corporate goals.

This document can form the basis of a discussion between HR and a CEO or a business colleague and provide a big picture view of how HR strategies and interventions are relevant to their business goals.

The CEO will not be in doubt to how your HR goals are driving business goals and that you are always focused on this alignment. This will help make your discussion relevant, valued and persuasive.

You can see an example of a typical business aligned HR strategy map from BSC Designer below, which shows the four levels of high level business goals with each containing your HR strategic plans and progress against these plans (in the form of KPIs). This is a clear graphical presentation of HR strategic alignment.

An Example of HR Strategy Map

This particular BSC Designer strategy map is probably more suited to ‘big picture’ discussions with the CEO, but if you are liaising with functional heads you might want to have more detailed discussions around specific process areas such as recruitment and how that might be feeding into the technology sourcing strategy over the next year.

Using a process map is a great way to have this kind of discussion with functional heads and ensure that your actions and interventions can be seen and discussed in the context not only of their goals but in terms of corporate goals.

If you need to tell an IT Director that he/she needs to change the type of person they hire, you’ll need to show the business context of your decision and how it drives business strategy if you are to persuade them. This is exactly what a business process map will enable you to do.

Overview of HR KPIs

What makes BSC Designer strategy maps such a powerful tool is that they are more than just pretty diagrams. Each strategy within the schematic has a dynamic KPI associated so you can easily view the progress or performance of initiatives in each strategic area. This means that BSC Designer is an excellent way to view strategy plans and progress in a big picture way within the overall business context – and to show the executive team that you are in control.

Download the project of BSC Designer that was discussed in this article. To open the project you will need to download BSC Designer PRO.
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BSC Designer strategy maps enable you speak in a strategic, corporate aligned business language increasing HR credibility and helping you position HR as a true strategic business partner.

References

[1] The State of The HR Profession, Dave Ulrich, Jon Youngers, Wayne Brockbank and Michael D. Ulrich: http://www.shrm.org/HRStandards/Documents/HRM 52 3.pdf

[2] What Makes A Strategic Partner, by the Center for Effective Organization (University of Southern California): http://ceo.usc.edu/working_paper/what_makes_hr_a_strategic_part.html

Kazim Ladimeji is the Director of thecareercafe.co.uk; thecareercafe.co.uk is a HR resource for start-ups and small businesses. Kazim is also an MCIPD qualified practicing HR professional with 17 years experience.

Posted in HR

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