The success of any organisation largely depends on the effectiveness of its human resources management. In today's rapidly changing business environment, it's crucial for organisations to adopt a strategic approach to HR management. Strategic HR management is a process of developing and executing HR policies and practices that align with the overall mission and goals of the organisation.
This approach focuses on the long-term development of the organisation and its employees, rather than just addressing immediate HR issues. It is a proactive, forward-thinking approach that leverages HR policies and practices. It aims to drive business results and create a competitive advantage.
According to a survey conducted by Gartner, nearly half of HR managers reported that their company had difficulties in cultivating competent leaders. Additionally, 45% stated that the leadership pool lacked diversity. An equal number of respondents said that the succession planning procedures did not produce the desired results in terms of having the right leaders in place at the appropriate time.
By taking the right approach to strategic HR management, the case above can be minimised. Additionally, strategic HR management plays a critical role in creating a positive work environment and leadership. In this article, we will explore the definition of strategic HR management, its importance, the strategic planning of a successful HR management program, and the connection between remote work with strategic HR management.
What is Strategic HR Management?
According to Emeritus, strategic HR Management involves the management of an organisation's workforce in a way that aligns the employees with the company's main strategies, aims, and objectives.
The focus of HR operations is on the following elements:
- Implementing practices that promote adaptability and provide a competitive edge for the organisation.
- Developing a culture that aligns with the organisation's values.
- Achieving exceptional business outcomes.
Given that strategic human resource management (SHRM) is a cutting-edge approach to managing human resources. The HR department must play a crucial role in its success. HR managers need to have a deeper understanding of SHRM so they can be active participants in the creation and implementation of company policies.
SHRM can be integrated into various HR functions such as recruiting, training, and performance-based rewards. The SHRM approach provides opportunities for HR professionals to make a positive and direct impact on the company's growth. There must be a strategic plan in place for each employee's development and retention that is aligned with the organisation's long-term business goals.
The importance of Strategic HR Management
The importance of SHRM lies in its ability to assist companies in reaching their objectives. There are five main points of why strategic HR management is important, according to Forbes, as followings:
- Enhance employee performance: By creating systems to track and improve performance, SHRM can help businesses improve employee performance.
- Develop the workforce: By identifying employees’ development needs and providing training and resources, SHRM allows businesses to develop their workforce.
- Build a positive work environment: SHRM can assist businesses to create a positive work environment by managing employee relations.
- Lower turnover: SHRM reduces turnover by designing compensation and benefits programs that attract and retain employees.
- Improve productivity: By improving employee performance, SHRM creates a positive work environment.
7 Strategic Planning of HR Management
Strategic human resource management is essential for maintaining and nurturing a high-quality workforce. When employees feel valued and their development is a priority, they are more likely to remain with the company and become engaged in their work. According to Deputy, there are seven steps in the strategic HR planning process as follows.
1. Have a clear understanding of your organisation's goals
The effectiveness of SHRM depends on how well it aligns with your company's goals. Therefore, it is crucial to have a complete understanding of your company's aims, objectives, and mission.
You need to be able to clearly convey both your short and long-term growth plans to the relevant HR staff. By ensuring clear communication of your company's goals, it will be easier for HR personnel to develop an effective human resource management strategy.
2. Assess your HR capacity
Assessing your HR capacity will allow you to gain insight into your current workforce and how they contribute to achieving your objectives. You should also perform a skills assessment for each employee to determine which employees excel in certain areas and those who have the desire to be trained in a specific aspect of your company. A performance review is an ideal opportunity to assess employees' skills.
3. Analyse the alignment of your current HR with your goals
By evaluating your HR capacity, you can identify any obstacles and develop a plan to make the most of opportunities and address any challenges. The HR team will examine the number of employees and their abilities, and collaborate with senior management to find ways to improve employees' abilities to meet the company's needs.
4. Forecast future HR needs for your company
Once you have evaluated your current employees and skills in relation to your goals, it's time to predict your future HR requirements. This should be based on two factors:
- Demand: Make a prediction regarding the number of employees with the necessary skills needed to fulfil your company's future needs.
- Supply: Consider the employees and skills that are currently available to support your company's strategic objectives.
5. Identify the necessary tools for job completion
The HR team should work with relevant departments to understand the impact that the tools used by employees have on their job performance. A joint assessment of hardware and software with the IT department, for instance, can be done to uncover any missing tools that could improve the efficiency of the workforce.
6. Execute the HR management strategy
It is time to begin the process of expanding your workforce and enhancing the skills of existing employees. Once you have analysed and predicted the future HR needs of your company, you need to prepare for the future growth of your business.
You can implement the HRM strategy by doing the following:
- Begin the recruitment process
- Organise the selection process
- Start hiring applicants
- Arrange onboarding and training
7. Review and Adjustments
The human resource department should establish a schedule for conducting a strategic HR management evaluation. This evaluation will monitor the progress made and highlight areas for improvement. It should be measured against the company's goals and, if it is not meeting these objectives, necessary adjustments must be taken.
Remote Work and Strategic HR Management
Strategic human resource management (SHRM) is the process of aligning an organisation's HR policies, practices, and processes with its overall business strategy. With the rise of remote work and the increasing number of remote workers, SHRM has become an important aspect of organisations to ensure that they continue to meet their goals and objectives effectively.
Remote work has changed the traditional way of working, which has led to a shift in HR policies, practices, and processes. The HR department needs to ensure that remote workers have the necessary resources, tools, and support to perform their jobs effectively. HR personnel also need to ensure that remote workers are engaged and motivated, as well as assess their skills and competencies to match their needs with the organisation's goals.
In light of remote work, SHRM can also play a key role in estimating future HR requirements, identifying and implementing the necessary tools and processes to support remote workers, and evaluating and adjusting HR policies and practices to align with the changing needs of the organisation.
Therefore, the connection between remote workers with strategic human resource management lies in the need for organisations to align their HR policies, practices, and processes with their overall business strategy, taking into consideration the unique needs and challenges of remote workers.