Posted on March 10, 2014

How to Connect HR Strategy to Business Strategy

It’s no secret that the work world has changed, and this fast-paced, highly mobile, multigenerational, volatile environment requires a more strategic focus on HR and people processes than ever before. Simply put: HR strategy is business strategy.

In a recent webinar, Meera Alagaraja, PhD, of the University of Louisville, described a new HR model and recommended steps for integrating HR with business operations:

Link the metrics

HR professionals need to be able to connect their metrics to general operational measurements to show how the success of both correlate. Depending on the organization, different types of metrics will make a bigger impact when communicating to executives:

* Organizations that want bottom-line growth: These are businesses focused on cost-cutting and delayering. HR should prioritize measuring transaction effectiveness, quality of execution and quality of learning or training. For example, how well does the company perform on-the-job training and informal learning in the context of downsizing?
* Organizations that want top-line growth: These are businesses performing mergers and acquisitions, increasing new customers, expanding products and growing revenue. In these types of companies, HR must focus on the quality of direction and building big-picture strategic value.

Three levels of HR involvement

In terms of job function, there are three levels on which HR can make an impact on the overall organization.

1. What HR does

This refers to HR’s core strength of taking care of employees on an elemental level, executing tasks such as hiring, promotion, compensation and benefits, compliance and legal, and training.

2. Where HR is needed

This is where HR can leverage its expertise to deepen its involvement in the organization by grooming new managers, translating employee engagement into actionable items, enhancing its interface with operations and linking HR metrics to business performance.

3. Where HR brings value

To play a more significant role in deploying the company’s business strategy, HR professionals should:
* Mobilize strategic direction and purpose
* Communicate corporate goals and objectives so employees understand
* Monitor the pulse of the organization to address potential incidents of instability in the workplace
* Help operations leaders make sense of the internal and external environments

How to go forward

First, remember: HR strategy is business strategy. So focus on how you can maximize your value to the organization.

Everything is constantly changing, but HR professionals can continue to thrive by building their competencies and those of their employees. You can help address current business needs by:

* Gathering employee feedback to ensure transparency and build engagement
* Excelling at hiring and retention, helping operations and managers shine, and grooming new managers
* Improving diversity through recruiting, retention and promotion

The key is for HR professionals to see the potential of everyone around them and ask, “How can we, and they, add value?” That kind of thinking will earn HR a seat at the table in all organizational conversations.

To hear more from Meera, watch her recent webinar here.


You also can learn about how Paycor can help HR professionals add strategic value to their organizations with our suite of solutions, including:

* A robust applicant tracking system that streamlines the hiring process and prevents you from missing out on top talent
* HRIS systems that provide tools for training administration, document archiving and employee communication through a secure portal
* An HR Support Center that includes sample documentation for performance reviews, social media policies and numerous other useful forms
* Custom reporting that allows HR and company executives to compile and analyze data quickly and efficiently

Get in touch with us to find out more about how these tools can help your HR staff play an integral role in organizational strategy and influence C-level decision-makers.