Linking HR Strategy to Business Strategy

1. Linking HR Strategy to Business Strategy An organization's most significant competitive advantage is its talent, and leaders must expect there HR function to make a strategic business contribution. The challenges presented to organizations this year have firmly positioned HR into the role of strategically defining how to meet business goals by effective management of its talent. Most people are convinced of the importance of forming a business strategy to focus and drive the organization to achieve its mission. However, a business strategy on its own is not enough; each function in the organization must define departmental strategy in alignment with their business strategy. In this approach, the direction and goals of the organization are cascaded down to each employee, and everyone is clear as to how their actions are contributing to the overall success of the organization. The most significant risk to this cohesiveness of purpose is the tendency for departments to focus on their area of responsibility and define strategies that are disconnected from each other and from the organization's. Siloed approaches lead to scenarios where department goals are met, but the organization cannot achieve business success. When you accept the need for strategies to be aligned, it is also clear that the HR function has a tremendous responsibility in this regard as it is involved in and affects every other business function. Here are the necessary steps you can take to ensure that your HR strategy is linked to your business strategy: •Make sure that you fully understand the overall organization strategy, goals and expectations. What are the key issues the organization is facing? What is the focus for the coming year? Where are the priorities for investment and growth? What are the perceived risks? •Identify what roles and skills will be needed to deliver on the strategy. Do you have the necessary mix of skills in the organization? Is the structure set up in such a way that it can meet any new demands? Do you need to recruit or develop any new skill bases to meet core needs or take advantage of new opportunities? What roles need to change or be created? How will new roles and skills be compensated? •Define the HR strategies through the employee lifecycle– attracting, training, developing, performance managing, retaining, and rewarding your talent. What new or amended policies or procedures do you need to create? Do any of your current approaches need to change to meet demand or expectations? Do you have the resources

2. required to deliver? Is your team agile enough to adapt to any necessary changes? Do you need to outsource any areas that need specialized skills? •Establish measurement criteria to determine whether you are successfully implementing the strategy or if it needs amending to achieve its objectives. What needs to be measured and when? How will you collect the necessary data? How will the measurements be presented to senior executives? Taking the above steps to align your HR strategy properly with your business strategy will ensure that you are well on the way to being a valuable strategic partner in achieving organizational success.