18th October 2019

This Is Why You Need An HR Strategy

Most people would look at Human Resources as a transactional tool in an organization. From record keeping, payroll processing, being the bearer of bad news and administering sick leaves to mention a few. More often than not, companies tend to underestimate the power that an HR has in ensuring sustainable individual and organizational growth.

What HR does is make sure the company is proactive rather than reactive in all decision making for the business to survive. These proactive decisions could come in handy when addressing systemic issues, rapid and ongoing change, managing company reputation etc. This is where your HR strategy come in. Having an HR strategy simply means having a thought-out plan that aligns existing and future human capital and internal capabilities with the business activities in order to maximize profits and employee engagement. For any company, it would mean having business goals, projecting oneself in time and working backwards on how to achieve these goals using existing internal capabilities, structure and the core team. Therefore, regardless of the industry an organisation is operating in, the HR strategy must be aligned with the organisation’s goals, mission and vision.

An effective HR strategy would first require the analysis of the existing state of your company, some companies do a SWOT analysis, some prefer a general HR Audit, but all in all for an HR strategy to be developed, four key elements need to be outlined beforehand. These include the culture of the company, the organizational goals and structure, HR processes and most importantly the people and their capabilities. From this outline, a custom strategy can be created.

The HR Strategy can also touch basic elements, such as, resource planning, recruitment, learning and development, talent management, rewards and succession planning. The crux of laying out an HR strategy will depend on various factors, such as communication, having the management buy-in, a set HR budget, all HR initiatives in line with the HR strategy and finally having the performance incentives connected to the strategy and measured through key performance indicators.

If a company is present in various countries, just like CEG, it is even more fundamental to align the HR strategy to the cultural environment- both organizational and societal.

To be able to achieve this, well-oiled organizational machines tend to have cultures and business strategies that align well to engage employees and guide them towards attaining the company’s goals and identifying common grounds that fuel employees’ going the extra mile, such as innovation.