How To Create A HR Strategy

How to develop a HR Strategy

We all know why an awesome HR function is an essential part of any successful business. If this was not the case then companies such as Google, Apple, Microsoft, General Electric, Zappos etc would not exist! Their stories would not even register on the radar. These businesses truly understand the value of effective HR and use this very important strategic lever to drive competitive advantage. Bill Gates once famously said:

“Take my 20 best people and, virtually overnight, Microsoft becomes a mediocre company.”

So, if everyone knows this then why do Executives and Management teams still write off HR as an afterthought when it comes to developing business strategy? Well most Executives or Business owners do not really understand what HR Strategy is?

And HR Practitioners are part of the problem here as typically, we find that HR Strategies are normally overcomplicated and overshadowed by academia and jargon (especially in Corporate Landia!) HR strategy documents quite often turn into 30 page juggernauts that only the creator really understands or reads.

At HR gurus one of our key philosophies is around keeping things simple and this applies to creating a HR strategy. We find that the beauty of any strategy is in simplicity. Especially when we are dealing with SME’s and non-HR folk, we need to ensure that any strategy document speaks in plain terms, gives a clear and concise picture of outcomes and links to the overarching business strategy. Sounds simple right, well it really is!

A great HR Strategy

Good HR is about being commercial, great HR is about helping the business drive its strategy by creating a performance driven workforce. Awesome HR is about creating an environment where people understand how they fit into the bigger picture, and in turn want to contribute to the success of your organisation! See below the HR Gurus HR Strategy Roadmap as an example of this.

So what are the key considerations when developing a HR Strategy:

  • What is the overarching Business Strategy including mission, vision and values?
  • Does the business have 5 year, 3 year and 1 year plans/goals?
  • What do you need to do from a people perspective to mobilise this strategy (short/long term)?
  • Where are the obvious gaps? Close the Gaps.
  • Create a People Strategy that plugs into and compliments your business strategy.
  • Who do you need to engage in the development of your strategy?
  • Track and measure ROI! If you cannot measure it you cannot manage it!

In Summary

  • Engage your stakeholders – don’t create the Strategy by yourself you need buy in and input
  • Keep it simple/ don’t over promise and under deliver
  • Use your team, plan your resources
  • Be realistic and measure your progress
  • Implement HR KPI reporting to show how HR adds value to the bottom line e.g.
  • Headcount reporting
  • Labour costs as a % of revenue
  • Staff Turnover reporting
  • Lost Time Injury reporting
  • Absenteeism reporting
  • Employee Engagement

If you need assistance creating a HR Strategy in your business then get in touch today.

Written by Head Guru Emily Jaksch.

Leave a Reply

Your email address will not be published. Required fields are marked *