To achieve success in any business, it’s crucial for HR execs and business leaders to work together, making the intersection of HR and business strategy an ongoing conversation within all industries.
The core question HR professionals and leaders must ask is: “Where do we want to go as a business and how can HR help the company get there?” Below are five areas where HR practices should align with the company’s objectives – in order to positively impact a business – and the elements to consider in each.
1. Recruiting: Evaluate the spending and effectiveness of recruiting practices, like job postings costs, recruiting fees and/or temporary placement fees, and perform a budget analysis parallel to the business strategy. Typically this should include reviewing contracts and engagements for each practice. HR should negotiate with partners and vendors in advance if a higher volume of applicants is expected and test whether current practices are successful. Ask yourself: “Are we getting the right candidates at the least financial burden, and are we maximizing the potential ROI with top candidates and low turnover with our current practices?”
2. Onboarding: Invest in technology to support solid onboarding practices. While many companies today still consider this too expensive, there are low-cost systems available that can help collect applications, track and analyze traffic, as well as streamline the approach by incorporating background check and drug screen vendors, in addition to making employee forms electronic. These systems can also feed into payroll and reduce the clerical overhead needed to process employee documents.
3. Organizational management: Appraise the positions and job allocations within the company. Look at the organizational chart from a hierarchical, efficiency and skills point of view. Step away from the traditional organizational chart and instead work with management to determine other methods and areas of improvement. Additionally, HR can contribute by examining talent and identifying opportunities to restructure and close any gaps in knowledge, skills and ability.
4. Succession planning: This area is often discussed by HR, but not as commonly developed. Build a growth plan for employees who may feel they have reached a ceiling, and clearly outline a path of success and career development for high performers. Succession plans also protect the company in case of emergencies – regardless of issue, obstacles and potential risks, the business can continue moving forward.
5. Risks: A major factor in any business strategy should be the potential human capital and compliance risks, therefore, HR should regularly examine against legal compliance, especially for any changes. For example, if a company needs to expand to a new state, there may be new rules for policies, such as paid time off and leave requirements, workers’ compensation, minimum wage and more. Understand both the legal and financial impacts of each law and regulation. Also, growth in the number of total employees can lead to new business requirements, like ACA compliance. Each legal change has factors to consider, including administrative costs for additional overhead support and financial implications for potential investments needed to maintain compliance.
These tips are just a few ways to position the HR function in your company. Ultimately, every business has unique goals and objectives, but HR and business leaders should come together to not only meet these expectations, but surpass them.