1. HR’s contribution to business
strategy
Dr. Sorab Sadri and Prof. Jayashree
Sadri

2. Understanding strategic
formulation
Not always as per textbook:
■ intended strategies
■ emergent strategies
■ political strategies
How does HR contribute:
■ operationalises business strategy
■ provides separate people thrust:
• connected with organisational aims
• disconnected: HR best practice model
■ is an integral part of business strategy

3. Types of linkage between
business & HR strategy
two way linkage:
mutual influence
passing ships:
independent HR
and business
strategies
integrative
business strategy
informs HR actions

4. Linking business & HR strategy
Factors that affect this linkage:
Planning process
■ formal or informal
■ deliberative or emergent
Degree and timing of HR involvement
Extent of challenge permitted
Legitimate areas for HR input
Extent of HR’s alignment with business -
broad objectives and current imperatives

5. Understanding the decision
making process
If decided by
formal processes
If matters are
settled beforehand
If real action
happens at
operational level
Get a seat at the
decision making
table
Build coalitions,
work to influence
outside meetings
Ensure you have
business partners
effective at BU
level

6. Stakeholder management
 board
 executive committee
 senior managers
 line managers
 team
leaders/supervisors
 employees
 employee
representatives
 external suppliers
 government bodies
 other agencies
 what is their stake?
 what are their goals?
 what are their
expectations?
 how will change affect
them?
 what do they know
already?
 what influence do
they have?
 what power do they
have?

7. Characteristics of strategic HR
A philosophy underpinning people
management
Seeing people as a competitive
resource

8. Making the case: what Human
Capital HR can deliver
Improved utilisation of talent
Higher productivity
Reduced costs
Better service delivery
Organisational integration
Aligned culture & organisational values
Greater employee engagement
Stronger employee proposition etc

9. Line
Managemen
t
Company
Culture
Employee
Commitment
Customer
satisfaction
with service
Customer
spending
intention
Change in
sales
Employee
Absence
Service-Profit-Chain Model

10. Characteristics of strategic HR
A philosophy underpinning people
management
Seeing people as a competitive
resource
A planning approach to resources
■ numbers
■ skills
■ potential
Adds long-term rather than short
term value
in line with
business need

11. Characteristics of strategic HR
Integrated – brings together
multifaceted activities

12. horizontal integration
vertical
integration
People management
integration
business
strategy
reward employee
relations
training
& devt
work
orgn
culture leadership
style

13. Characteristics of strategic HR
Integrated – brings together
multifaceted activities
Comprehensive – covers the entire
operation (at BU or corporate level)
High value added – focuses on business
critical issues
Builds social capital – helps sharing,
networking and relationships

14. Characteristics of strategic HR
Integrated – brings together
multifaceted activities
Comprehensive –covers the entire
operation (at BU or corporate level)
High value-added –focuses business
critical issues
Builds social capital – helps knowledge
sharing, networking and relationships
Anticipates change – through horizon
scanning and internal sensing

15. Connecting business & HR
strategies
Business
strategy
HR
strategy
Business
plans
Imple-
mentation
Monitor
Internal
drivers
External
drivers

16. How is people & business
alignment achieved
What is the
organisation’s big
idea?
What are the
business priorities?
What are the
people priorities?
How do they link?
Big
idea
Business
priorities
People
priorities

17. Establishing people priorities
What causes people to come to work,
be motivated and perform?
What stops them from
being effective?

18. A model of capability
ability:
skills, training
education
motivation:
engagement
involvement
application:
OD
product
market
strategy
access:
resourcing
recruitment
succession
DeploymentDevelopment
Individual capability
Organisational action

19. What are external influences?
Conduct environmental scanning:
what is the legal context
how tight/loose is the labour market
are the right skills available
at what price
what is the output from schools,
universities, etc
what are the political priorities

20. What is the state of the
current workforce?
What proportion is skilled for their current
and for future jobs?
What is its demographic shape?
How committed are employees?
■ attendance
■ productivity
■ staying or leaving
What are collective relationships like?
To what extent is employee potential being
harnessed?

21. What stops HR succeeding?
Human capital not recognised as a
source of advantage
Weak organisational leadership
Poor teamworking across organisation
Business strategy poorly defined
There is little forward planning
People resources assumed to be
unlimited, free or fully trained
Resources are hoarded & not shared

22. HR’s own problem areas
Obstacles to
success:
■ time
■ capacity
■ focus
■ capability
■ positioning
■ organisation

23. The ‘default’ operating model
BU
business partner
BU
business partner
BU
business partner
BU
business partner
BU
business partner
consultancy
pool
centres
of expertise
shared
services
Corporate HR

24. HR’s own problem areas
Obstacles to
success:
■ time
■ capacity
■ focus
■ capability
■ positioning
■ organisation
Relationships with
management not
working.
The villains:
■ HR – not letting go
■ the line – not
taking it up
■ senior mgt –
sending wrong
signals

25. Results
Inadequate HR service performance
Concentrating on low value tasks
HR policies are disjoined & inconsistent
They serve functional not organisational
needs
Weak functional leadership
Poor internal reputation
Human capital not exploited, developed

26. What should HR do?
Review your retention model
■ right level of wastage?
■ numbers, types, quality
Why do
they
leave?
Why do
they
join?
Construct a workforce plan
Establish the supply/demand balance
Are the right people, in right jobs?
Review your recruitment model
■ able to attract - all types?
■ brand
■ proposition

27. A strategic review of
recruitment and retention
Market availability
Organisational
impact
H
L
H L
Outsource
Commoditise
Attract &
retain

28. Different propositions for
different groups
Hire Exploit Fire
Attract RetainNurture

29. What should HR do? (2)
How well are employees aware of
■ the bigger picture?
■ their job?
■ what success looks like?
How do
you
know?
Are you able to motivate staff?
■ degree of engagement
■ what motivates them?
■ what demotivates them?
■ what impact does pay and performance
management have?

30. What should HR do? (3)
How skilled are line managers in
■ Appraising performance?
■ Giving feedback?
■ Developing skills?
How effectively are
■ Employees allocated to jobs?
■ How well are jobs/the organisation
structured?
■ Employees moved to meet business
needs?

31. What should HR do? (4)
What is the organisation’s
■ Ability to change/innovate
How good is the organisation’s
governance structure?
How strong (and respected) are the
organisational values, eg
■ On diversity?
■ Whistleblowing?
■ Meritocratic progression?

32. Measure people and HR
functional performance
Through for example
Critical success factors/areas
Key performance indicators
Service level reviews
Customer surveys
Employee attitude surveys
Process mapping/activity analysis
Audits/reviews (incl... quality)
Scorecards
Benchmarking

33. Improve measurement
HR
efficiency
People
Management
effectiveness
People
management
efficiency
HR
effectiveness

34. Examples of measures in multi
dimensional measurement
Process metrics
Ratios
Human Capital
Cost/Income
against
headcount
Strategic alignment
Functional positioning
Customerviews

35. internal external
business
performance
managing
people
business goals
HR policies
& practices
HCM
measuring
reporting acting
Human capital measuring & doing

36. … thank you