02: Aligning HR with Strategy

How to Evaluate Your HR Impact 

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Thoughtful attractive young businesswoman relaxing with a mug of hot coffee at her desk staring pensively off to the side with a serious expression
racorn/Shutterstock

Introspective HR

Before HR can align itself with an organizations business strategy it must analyze itself.

HR is always concerned with corporate measurements, such as Key Performance Indicators, benchmarking, and turnover rates. These organizational measurements are good and are required but they not all that is required. In order to impact an organization’s behaviour HR has to first be able to measure its own impact.

Here is a great little article by Tom Haak, a Global HR expert from HR Trends Institute where he highlights his insights into how HR can simply measure its impact.  He outlines ingredients in his recipe for HR impact.  Here are 12 questions every HR department should think about:

  1. To what extent does your HR team speak the language of the business?
  2. How good is your HR team at connecting the various disciplines within the organization?
  3. Which description fits better with your HR team: are you leaders or followers?
  4. Does HR have clear principles?
  5. Is your HR department sufficiently flexible and client focused?
  6. Does your organization laugh with HR or laugh at HR?
  7. Does your HR team dare to experiment?
  8. Is your HR department good at implementing major projects?
  9. Does your HR team dare to innovate?
  10. Does HR have a large and strong network?
  11. Does HR use the opportunities offered by HR analytics?
  12. Does HR come with practical and simple solutions?

Click here to read the complete article by Ton Haak.

Looking inward at your HR department’s ability to influence organizational performance is key to helping the organization meet it business goals and objectives.

Questions

  1. 1. Think about an HR department you are familiar with, rate them on the 12 questions above using a 5 point scale, 1 being low and 5 being high. Where are the HR department’s strengths? Where are the areas of improvement?
  2. Your VP of HR wants you to draft an action plan to present to the Board of Directors on how to improve the HR department’s success.

 

 

Valuing Human Capital the Easy Way

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It is not that difficult. Knowing how, when, what, and why an organization should engage in the financial valuation of resources is something that all companies should understand.  It seems, however, to be something that many organizations forget about when considering their most expensive asset, human capital.

A humorous explanation about the valuation process linked to measuring human capital is shown in the following video clip.

Source: PeopleStreme.  The above content constitutes a link to the source website.  Please click the play icon to stream the video.

From this perspective, we can see how much is invested when following the progress, appreciation, and depreciation of company equipment and materials.   There are numerous actuarial tables and formulas that can be used to evaluate the contributions of hard ‘things’ to the overall financial health of an organization.  Keeping track of Barry the boardroom chair is easy!  Keeping track of what Sammy brings to the boardroom table seems much more complicated!

Why is it so difficult to provide similar value based financial assessments for employees?  When organizations tell their people that they are valued, what is the actual measure of that statement?

As Sammy finds outs in this video clip, the results can be quite shocking when we look at the return on investment that companies make on an individual employee basis.  Perhaps it is time to be as open and transparent with all employees to let them know how valuable they really are as they continue to contribute to the bottom-line financial success of any organization.

This clip ends with a pretty simple message that is, in itself, quite valuable.  Find your people.  Know your people.  Manage your people.  The return on investment will definitely pay off.

Discussion Questions:

  1. Think about your own work experience over the past five years. How much did the company you worked for, pay you?   How much value did you contribute back to the company?  What is the differential?
  2. Upon leaving your current place of employment, do you see yourself as an appreciating or depreciating asset from a pure, return-on-investment perspective?
  3. What types of measures and tools can the Human Resources practitioner put into place in order to value the true cost of employees as part of the Human Capital investment strategy?

The Demise of Goodwill

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The very sudden and very public downfall of the Goodwill Toronto charitable retail organization has received much media scrutiny as the unfortunate chain of events has unfolded.  At the time of this posting, the latest step has been the declaration of bankruptcy on the part of Goodwill Toronto.

Goodwill Donations sign on building
Source: Ken Wolter / Shutterstock

Click Here to Read the Article

There is no doubt that the Goodwill Toronto saga is complex and difficult.  While it is easy to speculate and analyze this case from the perspective of an outsider, this is a painfully real strategic human resources planning issue that links directly to the connection between strategic organizational mission and the delivery of business outcomes.  When these are not connected, the results are clearly devastating.

Marnie Soupcoff of the National Post, provides some thoughtful insight into this much needed connection between organizational mission and business results.

Click Here to Read the Article.

Strategic organizational mission should drive everything down to the last detail of business decisions which end in operational and transaction based results. The Goodwill Toronto situation shows us exactly how this is all unfolded from a negative perspective.   The organization’s disconnection from it’s own mission statement seems to have fractured everything in its path right down to the messy appearance surrounding donation drop-off doors.

One can only hope, should Goodwill Toronto choose to rebuild, that they will take a different approach by using its mission in a pro-active and connected way in order to achieve a positive new start that supports a sustainable future.

Discussion Questions:

  1. As an HR professional, how will you ensure that an organization’s mission is embedded into functional business strategy?
  2. Have you worked in an organization where there was a clear disconnect between the organization’s values and its day to day practices? How did that disconnect present itself?
  3. What advice would you give to the CEO of an organization that is mission driven when it becomes clear that the mission is not supported by all employees?
  4. Would you resign from an organization if you thought it no longer upheld its own mission, vision, and values? If so, why?  If not, why not?

Why Wouldn’t Anybody Love HR?

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Oh, let us count the ways!  Some common negative HR mantras include; “HR is only about the people”, “HR is afraid of the numbers”, “HR doesn’t understand the numbers”.

Man holding small heart in hands
Source: wk1003mike/Shutterstock

If these negative mantras prevail, HR Professionals will not be perceived as credible business leaders.

This brief article re-iterates the critical importance of why HR Professionals must fully understand the businesses in which they are engaged. By living and understanding the businesses needs and goals, the HR Professional is able to bring the human element into the numbers equation – that’s right, HR needs to bring the human element into the business numbers, not the other way around.

It is HR’s role to provide the link between organizational profits and its people.

Click Here to Read the Article.

The more we are able to live and speak in the language of the business, the more imperative the role of HR becomes to the leaders influencing the business.

Why is it HR’s job to influence those who influence the organization? Because, when the mantel of HR Professional is assumed, also, is the responsibility for all of the humans in the organization.

Let’s not be tentative about HR’s role in running the business.   HR is not just a business partner, they are business leaders.  Rather than keeping up the myth that HR has to find a seat at the numbers driven corporate business table, it will be time for the organizational units to start earning a place at the HR driven corporate business table.

As HR Professionals, we need to ask ourselves the following questions:

  • Am I speaking the language of the business so that I am understood?
  • How am I presenting my knowledge of the business in my everyday practice?
  • Do I understand who my organizational Human Resources customers are?
  • Where is the evidence that what we do in Human Resources shows a clear path to the appropriate business function?

Discussion Questions:

  1. Why is the perception that, Human Resources is just about the people, still prevalent?
  2. What will I bring to the business table to enhance the quality of work-life for all employees?
  3. What is my understanding of organizational business units?
  4. What was the perception of the HR department in places where I have worked previously?
  5. How do I, as an HR professional, want to be perceived by employees and organizational business leaders?