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Human Resource Strategy

The role of an organisation's HR function is to help the organisation achieve its stated objectives through the best use of its employees. The diagram below shows how the organisational strategy should drive the creation of the service delivery strategy, people strategy, etc. All of the strategies within the HR function, logically, then flow from the overall People strategy, and narrowing further define the elements within the reward strategy.

It is the responsibility of the Senior Management Team, led by the Human Resource Director, to develop the Human Resource strategy. However, it is important that all HR staff and line managers understand the strategy, as they will be responsible for its day-to-day implementation. Research has found that effective implementation is key to success of reward programmes, but that most organisations do not provide line managers with sufficient support in this area.

Developing a Human Resources Strategy

The generic process for Developing a Human Resource Strategy follows a number of distinct steps for each part of the HR Strategy:

Step 1 The Business Project

The overall HR strategy will identify a number of key business processes/systems, for example, management development and reward amongst others. Depending on the level of distinction and the size of organisation there can be between four and twelve identifiable processes. In effect each of these can become a project in their own right and there is a need to ensure continuity and compatibility with each of the others. This implies that there will an overall co-ordination of all the individual processes.

Step 2 The Objectives

For each clear process a number of strategic objectives will be identified. These are translated into a number of guiding principles providing some boundaries for the resultant design. For example, the overall view on management control, the use of remuneration, the competitive tactic and communication philosophy.

Step 3 The Processes

The various distinct elements making up the overall process need to be identified. For example, a reward initiative might include a skills/competency model, job measurement, performance management and remuneration design. A process is defined as: 'a set of activities which need to be performed to achieve required business results'

Step 4 The Sub-processes

Depending on the complexity of the review this may break down into a further levels. For example the remuneration design may need to consider several components like salary and related structures, variable pay, benefits, longer term incentives, and recognition programmes. At this level, the basic philosophy is identified along with general approaches that are to be adopted (or at least seriously considered).

Step 5 Design Brief

For each element, which represents a piece of design work to be done a design brief needs to be outlined. The brief should contain views on what aspects the designer must consider.

Step 6 Design, Build and Test

The design of each sub process can then be undertaken with various checks and reviews built in to ensure ongoing compatibility with the overall plan.
Each of the sequence of steps will apply to each of the business projects so a complex delta of parallel streams of work exists. It is therefore necessary to identify and acknowledge the various roles that exist in the project.