With the work landscape changing and impacting business success, it’s time for organizations to reassess how they utilize their largest asset: their people. It’s time to incorporate strategic HR.
Many businesses miss out on the opportunity to include their HR department in their business strategy planning. However, human resource management is responsible for the acquisition, development, and retention of your people, and bringing that insight into a business strategy that can make a significant impact.
Heavy hitters like Google and Amex embrace strategic HR to set themselves apart in the industry. For example, Google looked at empirical data to see what strategies the most effective managers used and took that to create training programs. They’re considered one of the most productive companies out there.
A strategic HR partner will work with management and employees to create a stronger connection between business and people so they can both work in sync successfully. A strong strategic HR leader will bring technical expertise, HR policy knowledge, and business acumen to the table. However, it starts with buy-in from your executive team and leadership.
Read on to see why your organization should consider strategic HR as part of your approach to the modern workplace.
What is Strategic HR?
Strategic HR is gaining momentum in the wake of some big changes work faces today. Within the last five years, organizations have had to confront economic pressure, high employee burnout, quiet quitting, DEI needs and initiatives, and Gen Z entering the workforce.
Not to mention, how all of us relied on HR teams for mental and wellbeing support and unprecedented change management (hello remote work) during the Pandemic.
Today, business leaders are embracing the value of HR as a strategic business partner, prioritizing employee engagement and talent development alongside long-term business goals.
- Old Way of Thinking: HR professionals are responsible for hiring, firing, and the paperwork in between.
- Modern Way of Thinking: HR professionals are your strategic partners in effectively utilizing your business’s largest asset, your people.
Strategic HR Roles
There are two roles that probably came to mind when you thought of people management meeting business outcomes: the Human Resource Director and the Strategic Human Resource Business Partner (HRBP).
Both the HR Director and HRBP are executive roles that bring extensive human resource knowledge and experience. What sets them apart from an HR manager or generalist is how they work closely with leaders and executives to support business goals and objectives with that lens of HR strategy.
As part of senior leadership, your HR Director can help your organization utilize your HR operations and employee lifecycle to positively support business. This includes a deep understanding of day-to-day HR tasks and challenges. For example, this could be rolling out a hybrid work model for a large organization or launching a new recruitment strategy. As an executive, they are responsible for budget, profit, and loss when it comes to people management.
HRBP is a business-facing and strategic-oriented role that combines talent management with business acumen. Think of HRBP as an executive consultant. They help with real-world issues affecting the business and bring that employee lens, like HR policies and initiatives, into decision-making. Many HRBPs also have a deeper understanding of specific industries and closely coach executives on HR functions.
Benefits of a strategic HR leader
Why does your business need to pivot toward strategic planning and talent management? Your employees are your organization’s biggest and best asset. They are your competitive advantage in your industry.
Employees bring incredible value to an organization. They’re public-facing, are natural brand advocates for your company, and bring a unique skillset and knowledge into their roles.
Taking a step back and seeing how you can bring strategic goals into your employee relations shows your investment in their success. A strategic HR approach can impact any of the following functions:
- Payroll, tax administration, and compliance
- Employee handbook and policy development
- Benefit plan selection, enrollment, and administration
- Recruiting and onboarding
- Learning and development
- Performance management
- Employee retention and turnover
- Company culture
With a strategic HR mindset, you’ll be able to design, develop, and implement a game plan that not only has a high impact on your people management but also your results for the month, quarter, or year.
Read on to see other benefits strategic HR brings.
Leading proactively, less reactively
When you think of traditional HR, you might think of a more reactive process. Often, HR would be presented with an issue, such as the need to fill a vacated role quickly. Instead of reacting and hiring immediately, a more strategic approach ensures a growth plan for that role’s first year or the next five years.
With HR sitting in a more strategic role, this shifts the thinking from transactional to intentional. Planning ahead with the leadership team means you’re using HR strategies to create high-performing employees to meet smaller business objectives that feed into overall goals.
Bringing a metrics-driven approach
Balancing your business success with employee experience means staying accountable, and for many HR teams in modern workplaces that means utilizing a metric-driven approach.
Many HRIS platforms help human resource professionals track important numbers from employee retention, turnover rates, cost per hire, employee referrals, and more. Employee engagement platform Cooleaf also helps people teams review employee sentiment through eNPS, pulse surveys, and app use.
Analyzing the data can help you uncover opportunities at any stage of your employee lifecycle.
Aligning all stakeholders to business goals
Engaging all business units— meaning your leadership, people, operations, and goals — ensures that everyone’s working towards a unifying purpose.
Take a step back for a minute. As a business, you have overarching numbers to track for the year: profit, employee costs, operational costs, etc. When you’re a medium to large organization, it’s unlikely an individual employee or line manager would understand their impact on those goals.
However, bringing more strategic planning alongside people management and development keeps everyone focused on the same overall objectives within their roles. Many organizations use core values for this purpose, host quarterly all-hands meetings to walk teams through new plans or goals, and invest in their employee experience programming.
Supporting Strong Workplace Culture
We’ve seen it time and again: strong employee experience makes a difference in terms of employee productivity, satisfaction, and success.
Bringing HR competencies and strategy together helps you step back and understand the full benefits of investing in people-first initiatives like inclusive talent acquisition, mentor programming, or even wellness days.
Investing in your talent not only supports their career growth, but also succession planning, employee costs, and bottom line.
How to be a Strategic HR Partner
For many organizations, strategic HR is a shift in thinking. It’s going beyond valuing general HR operations like onboarding or paperwork, and bringing that people-first mindset into planning and goal setting.
You can look into working with an HRBP consultant or hire strategic leaders for learning and development or employee programming. You can also sit down with your HR Director to find opportunities to include HR leadership in learning more about the overall business. That can look like inviting HR partners into earnings calls with investors, strategy sessions with executive leadership teams, or mentorship or 1:1s with managers across different departments.
Successful strategic HR starts with getting buy-in and understanding from leadership and HR.
Get ready to pivot your thinking
Having strategic HR partnered with your leadership team opens up new opportunities to set your business up for success down the line.
The future of HR combines a metric-driven approach with a holistic employee experience that can support your most powerful business unit: your people.
If you’re ready to take the leap into the future of HR, check out Cooleaf's most recent webinar on future-proofing HR and strategic HR partnership in business. Check it out!