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Strategic Talent Management Requires Company-Wide Commitment

Monday, October 2, 2017
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When strategic HR initiatives are successfully put in play, they emerge as more holistic, business-driven HR actions that embrace leadership vision and department-by-department goals, according to a study by HR Certification Institute.

The HRCI study, Strategic HR Emerges as a Company-Wide Strategy, asked HR managers to rank the most important strategic HR initiatives they would implement, given the right support from senior as well as line management:

* Strategic hiring of candidates with skill sets that add to the future growth of the organization.

* Using compensation and benefits to add value to and invest in greater employee performance.

* Enhanced departmental employee performance tracking to identify low and high performers.

* Measuring HR performance by company-wide performance goals, not just HR metrics.

* HR working with senior organizational leadership to integrate mission and purpose across all divisions and job roles.

Such strategic HR practices are more future-focused and data-driven than tactical HR practices. They also require a great deal of C-suite and line-management involvement. When such HR initiatives are implemented, 88 percent of executives and line managers, collectively, say they are satisfied with the results. However, the HRCI research also finds that only one in three HR leaders report that strategic HR initiatives have been adopted at their organizations.

HR Challenges Are Management-Wide

At many organizations, executive leaders still don't believe in or see the value of their HR departments. However, those that do are more likely to be executives in charge of a high-performing company. Based on a June 2017 survey conducted by The Wall Street Journal in conjunction with HRCI, executives from high performing companies are more likely to believe the HR function/department:

* Has a strong understanding of the company's business(es), industry and overall strategy,

* Is perceived as a "strategic partner" to help drive talent strategies, and

* Is positioned to drive change, not impede it.

Another issue is that there often remains a lack of clarity about who is responsible for embracing strategic HR initiatives. Ask HR leaders and most say it is the C-suite's responsibility. Ask executives, and most believe the responsibility falls on HR leadership. Only 19 percent of line managers believe they have a role to play at all.

Also, HR is not always made a priority, especially at technology-based companies that emerge from startup to market leadership (often with disastrous results, such as has been recently reported at Uber). At fast-growing companies, more than 60 percent of managers believe that "technology has eliminated much of the need to have full-time HR professionals on staff," according to a June study by Inc. and HRCI. At 75 percent of fast-growing companies, the most senior HR professional is either a director or manager. Just 13 percent have a CHRO title and only 11 percent are vice presidents.

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HR at a Major Crossroads

HR can no longer be viewed as an afterthought or as an isolated business challenge. The reality: Courage and conviction are needed from all business parties to step out of comfort zones and take on more strategic talent management responsibilities.

Through stronger, company-wide commitment, HR initiatives become more value-added. For example: Is the performance management system working for every department? Do business leaders really understand and value HR? Do supervisors really understand how to interview and hire the best employees? Does HR understand the business?

Some HR staples such as reducing risk and ensuring compliance, for example will always be a top concern and a major role for HR practitioners, but the profession can no longer just rely on risk reduction, old processes for filling positions without an eye to the future, employee satisfaction surveys without analysis for change, or compensation and benefits administration that is not linked to culture and employee engagement.

The HR profession and the next generation of talent-management strategies are at a major crossroads. Moving to ditch the status quo in favor of more strategic HR approaches requires a careful mix of consulting and technological approaches with in-house strategies. While outsourced solutions play an important role, business leaders will continue to ask more of HR leaders to provide strategic, analytically based views and decisions that unlock employee potential and maximize business results.

In this effort, HR and business leaders are faced with many new questions. What is the right mix of HR technology, HR outsourcing and in-house HR expertise that adds the most strategic value? How can the C-suite, line management and HR work better together to drive business outcomes? How can HR better address the needs of both internal and external stakeholders?

The companies with the best answer to these questions, led by competent HR leaders, will be the winners.

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