Introducing the Steps on How to Develop an HR Strategic Plan

AdobeStock_103199139The HR function in any organization has a great opportunity to connect to and add measurable value to the bottom line of the business. Developing an HR Strategic Plan is a difficult and complex undertaking but one that will be well worth the effort in establishing HR as an important and valuable function of the organization.

Since the ability of an organization to establish and maintain a competitive edge depends almost entirely on the quality of their workforce and the people management processes, being able to develop an effective HR Strategic Plan is crucial to the financial success of the organization.

There are six steps involved in developing an HR Strategic Plan that I’m listing below and will review much more in-depth in the following several weeks/months.

The six steps are:

  1. Determine and communicate a Vision, Mission Statement, and Value Statement for the HR function. These three things will assist the HR function in identifying and distinguishing itself to the organization’s leadership and employees.
  2. Conduct an external and internal environmental scan of the organization in order to identify opportunities and threats that might affect the organization in the future. Understanding how these opportunities and threats might affect the organization in the future is critical to creating an effective strategic plan.
  3. Establish and align HR strategies and goals in order to provide the direction that will guide the organization towards achieving its long term objectives.
  4. Develop action plans and assign accountabilities designed towards moving the planning process from the long term to the shorter term goals necessary to achieve the strategic goals.
  5. Execute the plan and monitor its progress in order to ensure that the plan stays on track. HR is responsible for developing, communicating and supporting the HR strategy implementation with the responsibility of actually implementing it residing with the line managers. Changes may be necessary with shifts in the business environment.
  6. Evaluate the plan’s results by measuring the success of the HR initiatives and identify things that worked or didn’t work. The evaluation establishes the foundation for additional HR strategic and business plans.

An organization’s HR strategy should never be separate from its overall business strategy. It should always be an integral part of all the organization’s strategies that require people to implement them, obviously. It requires HR’s thorough understanding of the organization’s business. With that understanding, HR programs and practices can be identified that will help the organization successfully execute its strategy.

The HR strategy must be externally aligned with the business plan in addition to being internally aligned for the HR programs and practices to support and complement one another. And in order for any HR strategy to be successful, HR must build relationships with, and gain the support of, the line managers who will ultimately be responsible for carrying out the HR practices and ensuring the success of the HR strategy.

That’s this week’s brief introduction of the steps on how to develop an HR strategic plan. In the coming weeks, I am excited to explore each of these steps much more in depth.

Speaking the Language of Business for Strategic HR Professionals

AdobeStock_101865782This week I’m returning to discussing strategic HR and am going to define some important business terminology Strategic HR Professionals must know in order to be taken seriously by their organization’s leadership.

This is not a comprehensive list but simply some basic business terms that relate to developing an effective HR strategic plan.

The first term is Business Strategy.  Business strategy as defined by Michael Watkins of the Harvard Business Review is the following:

A business strategy is a set of guiding principles that, when communicated and adopted in the organization, generates a desired pattern of decision making. A strategy is therefore about how people throughout the organization should make decisions and allocate resources in order accomplish key objectives. A good strategy provides a clear roadmap, consisting of a set of guiding principles or rules, that defines the actions people in the business should take (and not take) and the things they should prioritize (and not prioritize) to achieve desired goals.

The definition implies that a business strategy can be looked at from the perspective of creating shareholder value, competitive market position, and creating a strategic advantage within the constantly changing business environment.  

This constantly changing business environment is influenced by things such as national and local politics, regulatory agencies, the economy, customers, suppliers, competitors, technology, economic trends and current and potential markets.

The second term is Strategic Intent. The business strategy, described above, is built upon the strategic intent and is defined by the website Simply Strategic Planning as the following:

Strategic intent is a statement of the course that the management of an organization plans to take the enterprise in the future. As many people as possible should understand these intentions. Then everyone can work consistently to achieve the corporate purpose.

Statements of intent aim to be more explicit than the usual directional statements. Most mission and vision statements point the way forward only in general terms. Sharp statements of intent can provide more clarity about what to do in the near future to achieve the vision and/or mission. Such statements convey the flavor of the strategic decisions taken through the planning process

In order to determine an organization’s strategic intent, the following questions must be answered: who we are and what we are trying to accomplish, what business are we in, what is our mission, what is our vision, what are our core values, how do we compete, and how do we add value to the marketplace.

The third term is Strategic Focus. A good description of strategic focus comes from Ann Latham at Forbes where she writes the following:

A good strategic framework provides focus by limiting the number of directions the organization runs. You’d be foolish to try to extend all your products while simultaneously expanding all your markets while also ramping up capacity or shifting your business model to include new types of production, sourcing, sales, delivery, and partnerships. This isn’t just an issue of capacity. It is also an issue of risk, learning, complexity, and credibility.

A great way to identify an organization’s strategic focus is to take a close look to the classic Generic Strategies by Michael Porter where he identified three strategies that address the question of how value is added by an organization.

These three approaches are cost leadership, differentiation, and focus as described in this article by the Institute for Manufacturing:

Cost Leadership

In cost leadership, a firm sets out to become the low cost producer in its industry. The sources of cost advantage are varied and depend on the structure of the industry. They may include the pursuit of economies of scale, proprietary technology, preferential access to raw materials and other factors. A low cost producer must find and exploit all sources of cost advantage. if a firm can achieve and sustain overall cost leadership, then it will be an above average performer in its industry, provided it can command prices at or near the industry average.

Differentiation
In a differentiation strategy a firm seeks to be unique in its industry along some dimensions that are widely valued by buyers. It selects one or more attributes that many buyers in an industry perceive as important, and uniquely positions itself to meet those needs. It is rewarded for its uniqueness with a premium price.

Focus
The generic strategy of focus rests on the choice of a narrow competitive scope within an industry. The focuser selects a segment or group of segments in the industry and tailors its strategy to serving them to the exclusion of others.

The focus strategy has two variants.

(a) In cost focus a firm seeks a cost advantage in its target segment, while in (b) differentiation focus a firm seeks differentiation in its target segment. Both variants of the focus strategy rest on differences between a focuser’s target segment and other segments in the industry. The target segments must either have buyers with unusual needs or else the production and delivery system that best serves the target segment must differ from that of other industry segments. Cost focus exploits differences in cost behaviour in some segments, while differentiation focus exploits the special needs of buyers in certain segments

In order for an organization to be successful and grow, it must have a business strategy that excels in all three of these strategies, not just one or two.  All of the organization’s operating and management systems, which include HR, must support all three of these approaches.

Bottom line, for an HR pro to be seen as an effective business partner, they must fully understand such important basic business elements such as the operations of the organization, its sales/revenue LY and YTD, its profit margin, how those margins compare with competitors and industry, its cash flow, its growth rate, the metrics leadership tracks, and the top initiatives of each of the members of the leadership team.

Jeeps, Tires, and an HR Foundation

I’m taking a break from my series on strategic HR and pushing out a post about a recent purchase I made that ended up inspiring me to write a post that equates to HR.

This morning I had to buy new tires for my Jeep Wrangler – my dream car and one I was finally able to buy (with my wife’s consent, of course!) after pining for one since High School. I’m not an off-roader but have always loved the look of the CJ-5 and CJ-7 and then the Wrangler through all its iterations.

I also had to buy new tires for my wife’s car a couple weeks ago so it’s been an expensive couple of weeks but one I’m OK with it now that winter is here. I’m OK with spending money on important safety and foundational things.

As I was driving from Les Schwab Tires to Starbucks this morning, I noticed how much better the ride was compared to my old tires. I hadn’t noticed my old tires were worn down to the point where I needed new ones until it had snowed a little the other evening and I was slipping around more than usual. This being the rig I’d always wanted, I take very good care of it, religiously washing, getting my oil changed, and rotating my tires every 5,000 miles.  I was hoping I could squeeze out another winter on my old tires

And by just looking at them, they looked fine, the treads were all evenly worn and there were no bald spots (something I used to use as a guide when I was much younger and poorer!) But having slipped around more than usual the night before, I did the “penny test” and discovered that it was time to get new tires.

As I said earlier, I immediately noticed how much better the ride was compared to my old tires. My wife also commented how much nicer her ride was after getting her new tires. Of course, we always notice this whenever we get new tires because it’s a drastic change going from worn out to new tires. We never notice our new tires being slowly worn down because it happens over a long period of time. 

Now that I can afford it, I always buy the highest quality tires I can. I do this because the tires on my vehicles are the foundation of the car. They are the only piece of equipment that has contact with the ground.  Whether the surface is smooth dry pavement, a rough dirt road, a wet surface, or a snowy icy road.

The tires we have on our vehicle are what allows us to safely, or unsafely, navigate the different road conditions to get where we need to go.  If we have poor quality or worn out tires, we can usually survive for a while on the dry smooth roads but they may eventually blow out and leave us stranded. Ultimately, we will have trouble on the other types of road conditions. Its very important to have a solid and safe foundation.

So yes, I’m equating the quality of the tires on my Jeep to building and maintaining a solid HR foundation. Is that a stretch? Maybe, but let me tell you why and explore further as I equate the parts of my Jeep to the functions of an organization. All are equally important.   

So let’s break it down like this:

  1. The financing of the loan for my Jeep is the Finance organization. (Boom. Easy)
  2. The engine and drive train are the Operations organization. This function is what actually propels the Jeep and organization forward and makes everything in the Jeep and organization run. Like the tires, this function has to be regularly  well maintained.
  3. The body of the Jeep is the Marketing organization. This is what things look like to the outside observers and potential employees.  Just as my Jeep looks so darn cool, Marketing is responsible for making the organization look appealing to their customers.    
  4. The driver is the Leadership of the organization. Of course, like the driver of the Jeep, leadership is responsible for steering the organization to where, and at what speed, it needs to go and essentially sets the tone of everything that happens in the organization.
  5. The passengers are the Employees of the organization. The employees are not always just passive passengers but can assist Leadership with the direction they are going and can help drive and offer advice on where to go and how to get there.
  6. The tires are HR.  As are the tires, HR is not the most exciting part of an organization but the function that should always be in constant contact with the culture of the of the organization just as the tires are always in constant contact with the road. Good tires and good HR help the Jeeper and Organization safely navigate through difficult terrain/culture and weather/business environment conditions.  

The next two items are things that a Jeeper and organization have much less control over.  

  1. The climate and weather is the business environment the organization is in.  Jeepers have no control over the weather and Leadership has no control over the business environment. On any given day the weather/business environment can be clear and sunny, overcast, windy, gloomy, stormy – you get the picture.
  2. The road is the organization’s culture. Similar to an organization’s culture, the roads we drive can be smooth and dry, rough and rocky, slick and icy, and even flooded and impassable. Sometimes we even go off-road to experience something new and unusual.

And when we are talking about these last two items, where we have little to no control, it depends mostly on the skill of the driver/Leadership, the health of the engine/Operations, and quality of the tires/HR foundation that you have on your Jeep/organization that determines how well an organization navigates through challenging conditions as they reach their ultimate destination.

Since this is an HR blog and podcast I’ll close with this.  When the organization invests in a high quality HR organization and takes good care of it, just like me investing in and taking care of the high quality tires on my Jeep, the organization will be able to effectively and safely travel to it’s desired destination, weather all the storms, and navigate the different and often dangerous road conditions along the way.

What is a Strategic Plan?

This week I’m going to talk about what exactly a strategic plan is.

A strategic plan is a written statement about the future direction and goals of an organization or HR department based on an analysis of the organization’s current status, strategy, strengths, limitations, threats, and opportunities in the current and future business environment.  

An effective strategic plan helps the organization understand where it is now, where it would like to be in the future, and how it’s going to close the gap between its current reality and the desired future status in order to get to where it wants to be.

All good strategic plans support the organization’s vision, mission, and values as well as identify its strategic goals and needed resources.

Since I brought it up, let’s take a minute to define vision, mission and values even though most readers probably already know but it never hurts to revisit the definitions.

An organization’s vision statement provides a clear perspective of what it wants to have happen in the future. It includes a description of its operations as well as a compelling explanation of how the organization will look and function once the strategic plan has been implemented.

The organization’s mission statement is a clear description of it’s overall purpose. It identifies the essential reasons the organization exists and the principal products and services it provides to the marketplace.

Finally, the values of an organization represent the key core priorities of it’s culture. It’s what drives the organization’s priorities and how employees honestly behave.  An organization’s values typically remain the same over time.

A complete business strategy is made up of three parts – an operations strategy, a financial strategy, and most importantly IMO a people strategy.  I’m focusing on the people strategy, or HR Strategic Plan, as it provides the foundation of all the other strategies with the ability to identify, build, and reinforce the organization’s capabilities.  

The justifications for creating an HR Strategic Plan are that it provides a solid framework for value-added action, helps establish priorities, allows for the all important measurement of results, and creates a way for reallocating resources from the organization’s low producing activities to its high producing activities.

In addition, it helps increase and improve HR’s credibility within the organization by showing its positive impact on the organization’s bottom line. Which is always a good thing especially since, as I recently mentioned in a previous post, HR is still thought by many business leaders as pretty much an administrative function that operates separately from the rest of the other functions in the organization

In order for HR to take on a strategic role and be a strong strategic business partner, it must be represented in the leadership of an organization and be involved in defining the organizational issues before the strategic decision are made.  HR must be involved in turning those decisions into a set of organizational actions.  

According to my favorite HR thought leader, Dave Ulrich, there are several things an HR professional must do in order to be an effective Strategic HR Business Partner:

  • Understand and communicate that improvements are typically very difficult and complex and will take time to accomplish so watch out for quick fixes as they are typically very seductive but rarely work.
  • Align the HR Strategic Plan with the Business Strategic Plan which will ensure HR being seen as adding value to the organization.
  • Keep the strategic plan top of mind instead of shelving it and forgetting it.  The plan must be executed and managed in order to be effective.
  • Create a Capabilities Focus within the organization.

I want to focus a little more on that last bullet, Capabilities Focus, since the first three bullets are fairly self explanatory.

Capabilities are an organization’s ability to effectively manage its resources in order to gain a competitive advantage in the marketplace. They are anything the organization does well that improves business and creates a competitive advantage in the organization’s marketplace.  

Strategic HR Professionals are able to effectively identify and improve an organization’s capabilities that will help execute the organization’s strategy and leverage new products and services.

Some examples of organizational capabilities include knowledge, innovative designs, adaptability, cost competitiveness, and strong leadership.

Defining deliverables and showing how they can be measured and what actions need to be taken is critical in the strategic planning process. The Strategic HR Professional must focus on the deliverables which are, in other words, value added results.

The HR strategic plan is developed from looking, listening, questioning, clarifying and knowing what needs to be done.

The plan must include ways that HR can help the organization add value to its key stakeholders (employees, customers, and investors), improve organizational capabilities, improve employee competence, fulfill regulatory compliance, determine processes and activities that can be retained or outsourced, and align HR programs with organizational goals.

My next post in this series will discuss how the strategic HR Professional must be able to speak the language of business and define a few important strategic business terms that will need to be understood. Then after that, I’ll get into the steps of how to actually develop an HR Strategic Plan.

Why You Need to Create a Strategic Plan for Your HR Function

So why have an HR Strategic Plan?

In today’s highly competitive business environment, success is often determined by how well an organization and Human Resources can manage change.  Organizations have to constantly monitor their place in the external business environment as well as evaluate and improve their organizational capabilities, or intangible assets, in order to effectively compete in the marketplace.

The strategic planning process is the most effective way for organizations to identify and address all of the various external and internal forces that have an impact their business. This process moves the organization from their current place to their desired future.  And more importantly, brings value to all of the stakeholders of the organization.  

But what value is the strategic plan without the people within the organization being ready, willing, and able to execute the plan? None. The organization’s employees must understand and be fully engaged in and willing to follow the strategic plan in order for it to be of any value to the organization.

This is where HR comes in.  

HR’s value lies in being able to build and maintain the organizational foundation and infrastructure to help drive the necessary changes that will accomplish the organization’s strategic goals.  

Regrettably, HR is still thought by many business leaders as pretty much an administrative function that operates separately from the rest of the other functions in the organization.  Sadly, this reinforces the opinion that HR isn’t that important to the success of the organization. HR is also not typically held accountable for business results, as the other functions are, and because of this, HR considerations are typically ignored and viewed as a cost center rather than a profit line contributor.

There are some leaders, however, who recognize that an organization’s human capital is a key strategic resource for increasing organizational capability and achieving a competitive advantage over competitors.  Being able to attract, retain, motivate, and develop the best employees in the organization’s industry are critical to its success in the marketplace.

The ability of an organization to execute it’s strategic plan rests solely on its effective utilization of its human capital.  

Smart business leaders are recognizing this and have turned to HR to help them positively impact their business results.

In order for HR to have a positive impact on an organization’s business results, we must focus on and engage in both the long-term strategic and the short-term administrative and operational planning.

There are three roles that HR has in an organization that need defining before we go any further:

First is the administrative role. This is the traditional role most people think about HR. It’s things like regulatory compliance, policy & procedure interpretation, record keeping, HRIS management, benefits administration, onboarding & offboarding activities, etc.

Second is the operational role. These are the HR activities that relate to the day to day operations of the organization.  These are the tactical activities such as recruiting, filling job reqs, handling employee relations issues, employee communication, compensation program management, etc.

These two HR roles aren’t the high-level exciting things many of us in the upper levels of HR like doing any more but they are absolutely essential to the organization and the reputation of the HR function. HR must be 100% technically competent in the administrative and operational roles and execute their HR services flawlessly.  

HR’s reputation is built on the employee’s perceptions of competence and has to be flawless in these two roles in order for to build a solid foundation of building on the higher level strategic role.

Third is the strategic role. This is the role where HR can really make a difference.  It requires HR participating in the strategic planning process, improving the organization’s performance, ensuring effective leadership, redesigning organizational processes, and ensuring financial accountability for HR results.  

Business literacy is required in order for HR to be effective in the strategic role. HR must know and fully understand who the organization’s stakeholders are as well as the organization’s markets, products, customers, and competitors.  Fully understanding financial terminology, speaking the language of business, and knowing how to read and interpret the organization’s financial statements – income statement, balance sheet, cash flow statement, etc.- are absolutely necessary.

I believe that the most effective strategic HR professionals are those who have real-life business experience outside of HR. (Self-promotion alert) I’m, of course, biased having successfully led and operated, with full P&L accountability, an award winning full line Macys department store for 13 years.

By having a solid business background and experience, HR can develop effective value-added strategies of staffing, performance management, total rewards, employee relations, and employee development. This puts the organization’s employees in the best possible position to execute it’s strategic plan and contribute to its financial success in the marketplace.

Strategic HR is my favorite topic and the role I enjoy most as an HR professional. I’ve touched on it a bit in my Metrics and Analytics series but I’ve been focusing on writing/podcasting mostly on the operational side of HR.  I had to build a foundation first, you know!

Now I can start exploring more strategic HR topics here at HHHR!  

Next week, I’m going to continue with strategic HR and explain exactly what a strategic plan is.  

What are Metrics and how to Avoid Common Mistakes When Working with Them

Seventh Entry in the Metrics and Analytics Series

Now that we’ve spent several weeks in the Metrics and Analytics Series defining what analytics are and discussing several real world applications, I want to spend this week reviewing and defining metrics and some common mistakes when using them.

Let’s start out by defining what metrics are according to Jac Fitz-Enz in his book The New HR Analytics. According to Fitz-Enz, metrics “are numbers that indicate how well a unit or an organization is performing in a specific function.” Rather than relying on anecdotal evidence, metrics provide context to where we can analyze performance much more accurately.

These metrics come in the form of percentages, ratios, complex formulas, or incremental differences and can be either individual or aggregated. We can also track them over time in order to show trends.

The data for the metrics are found in both internal and external sources. Internally, the data are payroll, employee surveys, Enterprise Resource Planning (ERP) systems, HR functions, marketing data, sales data, and financial statements. Externally, the data are common benchmarks in your industry, national and local labor market trends, salary surveys, actions from competitors, workforce demographics, and government reports.

In addition, the data collected is both quantitative and qualitative.

Quantitative data are the numbers. Examples of quantitative data are retention rate, overtime, training & development hours per employee which can be found in most HRIS systems. Some other examples are tracking the number of daily employee-client interactions, the number of units an employee produces, etc. These data can be used to rank employees to award bonuses, raises, and promotions for those who excel as well as offer additional training and coaching or discipline employees who are falling short.

Qualitative data are actions and behaviors that are observed. There are no numbers involved which means the data are subjective. Often these data are collected via employee surveys, interviews, and observations. Examples of qualitative data are why employees stay or leave an organization, the value of teamwork in an organization, the effectiveness of how a supervisor manages her direct reports, etc.

It’s also very important to avoid making certain common mistakes when working with metrics. HR Professionals need to show that we understand what we are talking about and how we analyze and report them as they contribute to the improving the business. I have summarized the following common mistakes from the The New HR Analytics.

  • Confusing Data with Information – Don’t bury yourself in data thinking you will find some valuable information simply from gathering it. You will need to know what you will do with it once you have it.
  • Valuing Inside Versus Outside Data – As Fitz-Enz says “…no one in the organization cares what is happening with the human resource function. All they want to know is what value HR is generating for the company.” Don’t get hung up on the HR activities, instead focus on the employee activity and how it impacts the organization.
  • Generating Irrelevant Data – Metrics must be able to effectively answer relevant business questions so the focus must be to collect and report only data that is important to the business. Learn and understand what metrics are important to your organization.
  • Measuring Activity Versus Impact – Don’t collect and report data that doesn’t show some positive or negative effect. Just reporting costs, quantities, or time cycles without describing their effects on the business is ineffective and a waste of everybody’s time.
  • Relying on Gross Numbers – Try to avoid averages as they mask the effects on the business. Analyze the mean, median, mode, and the percentile in order to determine if the data points are spread out in a wide range or are bunched up around the middle.
  • Not Telling the Story – After collecting and analyzing the data, make sure to tell the story of what happened, why it happened, when it happened, where it happened, how it happened, and to whom it happened.  Never report something if it doesn’t tell a story.
  • Analysis Stagnation – What are the implications of the data and what are you going to do with it? If the data and the story are compelling enough, determine how to get management to take action in order to solve the identified problem or exploit the identified opportunity.

I encourage you to take another look at these common mistakes and do what you can to avoid them. As I mentioned, HR Professionals must, in order to be take seriously, be able to understand what we are talking about and how to effectively analyze and report our data in order to positively impact the business of our organization.

I invite you to take the survey located at the top of the sidebar on this week’s post about metrics and some common mistakes about them.

An Interesting Alternative to the Traditional Annual Performance Appraisal

Adobe's Check-in Performance Approach

It’s a new year and now that the holidays are over, it’s time to start thinking about everybody’s favorite topic – THE PERFORMANCE APPRAISAL!

Yay.

I’ve written extensively about the traditional annual performance appraisal and believe there is a place for it in certain organizations but I also think it’s time to explore something new and innovative that will be more effective in today’s modern workplace.

There’s a lot of talk about scrapping the performance appraisal altogether. I’m starting to believe that the traditional annual PA is becoming obsolete in today’s modern workplace. There still needs to be some sort of tool, however, to set employee objectives and expectations and then to measure how the employee did against those expectations.

Today, I’m going to explore an alternative to the annual performance appraisal that, in my opinion, is one of the better systems. I did some research and landed on one that seems to be the best, Adobe’s Check-in Performance Approach.

There are three components that make up the Check-in Framework. It’s important to note that the Framework emphasizes that it is the employee’s responsibility to take ownership of their career. I love this approach because it aligns very closely to a similar feedback system I’ve been using and refining in the field for years called Responsibility Based Performance, something I will write about in the future.

1. Expectations, which is driven by the manager. This is where the manager works closely with the employee to establish the employee’s expectations and goals. The manager also helps the employee clarify their role, responsibilities, and success criteria throughout the year.

The first step in any sort of performance appraisal discussion is the need to establish clear expectations and objectives. The Check-in Framework is no different. Employees want to know exactly what’s expected of them and how their performance aligns with the organization’s objectives.

Employees and managers need to meet annually to establish and outline the employee’s objectives in writing. The objectives should be clear to both the manager and employee on what needs to be accomplished and how it should be accomplished. Once the objectives have been agreed upon, they will need to be reviewed and refined throughout the year. The frequency of this periodic review will depend on the department or business unit.

In order to hold everybody accountable to this Framework, employees will need to be surveyed several times throughout the year to make sure they have set expectations with their managers and are having regular follow-up meetings to review and refine their objectives. It is also critical that senior leaders show their support for the program and are following up to make sure this is happening.

2. Feedback, which is driven by both the manager and the employee. Feedback is the key to the entire Framework and will require the most amount of training. This is where both the manager and the employee give and receive ongoing feedback. The manager also provides ongoing and timely feedback that recognizes good performance and works to improve and address performance issues.

Again, feedback is the key to the entire Framework and is the most difficult component to get right. It will require quite a bit of training of the organization’s managers and follow-up by HR in order to get it right. The goal with the feedback component is to have employees at all levels of the organization give and receive feedback.

Feedback needs to be timely and relevant to the needs of the business and the employee. It needs to be given with the honest intention of helping the employee understand that they are doing a good job or that they need to improve. Remember also that feedback should be both positive and constructive.

If employees are not meeting their objectives or performing up to their expectations, they will need to enter into the organization’s corrective action process.

Adobe uses the Specifics, Ask, Impact, Do (SAID) model of giving feedback.

Specifics – State what the person has or has not done by using concrete examples.
Ask – Ask open ended questions to understand their perspective. (How do you see the situation? Did I contribute to the problem in some way?)
Impact – Express the impact on the business, team, or you. When framed as a means to reach a specific business goal, it becomes an opportunity to solve a problem or understand how their actions impacted the business directly.
Do – State what needs to continue or change.

I also strongly recommend taking a look at the Manager Tools Feedback Model for advice on how to give effective feedback. It’s similar to SAID but leaves out the Ask element.

Its also worth taking a look at my friend Morag Barret’s recent article on delivering tough feedback.

Again, to hold everybody accountable, employees will need to be surveyed throughout the year to make sure they are receiving regular feedback from their manager. Senior leadership will also need to support and follow up to make sure this is happening.

3. Growth & Development, which is driven by the employee, supported by the manager, and enabled by the organization. Here, the organization and manager must provide opportunities to the employee to develop and increase their skills, knowledge, and experience in their current role. These opportunities, of course, must be aligned with the business needs of the organization and the employee’s individual ambitions.

The organization must provide a work environment that encourages and helps employees grow and develop their skills and knowledge as it relates to the organization’s business. Giving them different job experiences, providing training and opportunities are ways to help employees expand their skills in their current roles and to develop them for future roles within the organization.

The skills and knowledge that are being developed must, of course, align with the needs and objectives of the organization in order for the employee’s growth and development to be relevant and actionable.

The organization should create a form that will help employees communicate their interests, career goals, and professional aspirations. The employee and manager should discuss these so that the appropriate opportunities can be provided by the organization and supported by the manager.

Once again, to hold everybody accountable, employee surveys will need to be taken to measure the effectiveness of the Growth & Development component as it relates to employee engagement.

I really like this Framework and would love to help an organization implement a version of it. It’s an innovative system that would be very effective measuring employee performance and developing employees in today’s modern workplace.

As a reminder, last week I started a new feature called the HHHR Weekly Survey (using SurveyGizmo) where I survey my readers and listeners on the current blog post and podcast. Remember to take the survey I’ve included for this post which is located on the top of the sidebar or can be found by clicking here.

Introducing the HR Metrics and Analytics Series

First Entry in the Metrics and Analytics Series

Notepad with hr analytics on a wooden backgroundI’m a big proponent of the importance of HR metrics and analytics. In order for HR to be taken seriously in the business world, we have to be able to speak the language of the business. We need to translate what we do in HR into metrics and analytics that can be presented to and understood by the senior leadership of our organizations.

Business uses numbers to explain itself and we need to use numbers to have leadership understand how HR can positively impact the business. By analyzing the data we gather and putting it to use by helping senior leadership make important strategic decisions based on that information makes HR a critical business function.

We want to be taken seriously by the leadership in our organizations and the only way to do so is to speak the language of business whenever we are communicating professionally with them. To be a true strategic partner, we need to provide them with information and data that helps them see the strategic value in our role as an HR leader.

So with that, I’m starting a series of blog posts and podcasts focusing on the importance of HR metrics and analytics. I will focus on one or two topics per post/podcast and explain how they are calculated, why they are important, and how they can be used in analyzing those numbers to benefit the business of the organization.

The goal in this series is to help us better understand the different metrics and analytics and how to apply them in the real world.

I will explore the metrics and analytics that I have effectively used and some that I see value in and would like to employ in the future.

Jac Fitz-Enz has been writing books about HR metrics and analytics for many years and I strongly recommend them for anybody who wants to dig deep into this important subject. Much of the content for series will be taken from the Fitz-Enz books as I’ve gained most my knowledge from them. I’m re-reading and studying them more closely for the purpose of this series.

My goal is to explore the many facets of HR metrics and analytics and share my knowledge, experience, and opinions. Today’s post is to set the stage for future posts.

First let’s define the types of data that will be used. There are three types of data – structural, relational, and human. Structural data tells us what assets we own. Relational data tells us what our customers and other stakeholders need or want from us, and human data shows us what our only active assets are doing to drive the organization towards its objectives.

Understanding how these three types of data relate to each other and how they support and drive each other will help us make better strategic business decisions about the future. I will cover this as we move though the series.

Second, I want to define metrics and analytics. Many in HR are confused by the terms and often use them interchangeably. They shouldn’t because there is a distinct difference.

As Fitz-Enz says, metrics are the language of organizational management that HR needs to be able to speak in order to make an impression on senior management. Analytics are the communication tool that brings together data from many different sources to establish a cohesive, actionable picture of current conditions and likely futures.

To put it another way, metrics are informational and focus on tracking and counting past data. Metrics look at tangible data that are easy to measure and usually of lower value. Metrics tell us what happened.

Analytics, on the other hand, are strategic and look at both past and present data using mostly intangible data that are difficult to measure and of higher value. Analytics are very helpful with gaining important insights and predictions. Analytics tell us why it happened.

Here are some examples of the difference from the Workforce Dynamics blog:

Talent Metrics (HR): How many top sales reps left last quarter?
Talent Analytics (Business): Why do my top performing employees keep leaving?

Talent Metrics (HR): What is the average compensation for engineers across the organization?
Talent Analytics (Business): Why are our top software engineers dissatisfied even after we’ve given everyone a department-wide raise?

Talent Metrics (HR): Who is next in line to become our CEO?
Talent Analytics (Business): Will the CEO candidate align or conflict with the rest of the executive team?

So now that we understand the three different types of data and the difference between metrics and analytics, we can focus on how to apply this information to strategic business decisions as I progress through this series.

I’m very excited to start this series and I will publish posts & podcasts often as it is one of my favorite HR topics. If you need me to clarify something or want me to discuss a particular topic related to metrics or analytics please comment below.

Retooling Hard Hat HR

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Image courtesy of khunaspix at FreeDigitalPhotos.net

Well, I took a lot of time off from my blog and podcast. I can blame it on a number of things, but bottom line, I just simply ran out of motivation. I’m sure I would have found time to post if I had been passionately motivated to do so. But I just wasn’t. It became a chore and I found it way too easy to find other things to do instead of work on HHHR.

It did bother me that I had abandoned my blog and podcast but not enough to to work on it.  At first, I enjoyed writing posts and putting out podcasts but as time went by, I just felt I didn’t have any real direction for HHHR. I didn’t feel comfortable with the niche I was trying to be a part of. I wasn’t even sure what niche I was in.  When you think about it, the HR profession is very diverse and complicated.  My niche was the entirety of HR which was entirely too big and left me feeling overwhelmed.

Then, after many months of HHHR being dormant and it nagging at the back of my mind, it came to me.

I’m going just focus Hard Hat HR on HR departments of one. Because that’s what I am. I’m in charge of a small HR department for a small mining company. That’s what I do and I do it well. So why not have that as my focus, my niche. I also, like most employees in a small company, wear several other hats. I do the Investor and Public Relations.

I don’t know what I was thinking before. What the heck does “Working Hard and Making it Safe for HR Pros” mean anyway? I guess I was trying to tie it into the Hard Hat theme but I was obviously trying too hard.

I think now that I’m just focusing on  HR departments of one, I can really concentrate on the issues that affect us because I experience those issues every single day and can write about those experiences and challenges. It gives me a great deal of subject matter. I will, of course, have to be careful about some things and won’t be able to share everything but I will take what I know and what I do and share it the best I can.

I also found myself worrying about my writing skills and how others would judge me when reading my blog.  This worry blocked me from sitting down and just banging something out, like I am now.  Even though I’ve stopped writing for a while, I continued to read many HR blogs and observed the folks writing them are clearly not worried about what others think, yet they have huge followings and are considered HR leaders – at least with their readers!

I know I’m not the most elegant writer.  I know I will make grammatical mistakes.  But I’m not going to worry about it any more and concentrate on just putting out good content that will help small and HR departments of one.  And I know the more I write, the better I’ll get.

So with that, I introduce the new and retooled Hard Hat HR, Building HR for Departments of One! I like it. I hope you do too.

HR Mission Statement

I’m working on developing an HR Mission Statement for myself and company and came up with this one:

The mission of the HR Department is to support the company’s business objectives and financial goals by delivering strategic HR Management and excellent customer service to all functions of the company.