The 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:
- 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.
- 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.
- Establish and align HR strategies and goals in order to provide the direction that will guide the organization towards achieving its long term objectives.
- 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.
- 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.
- 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.