“Strategic” is THE buzzword in Corporate Human Resources. The need/quest/goal of every HR department, regardless of size or scope, is to be more “strategic” ~ we hear constantly about the inherent loss of HR’s value to the business because of “non-strategic” contributions. It’s not an exclusive desire of HR, but it certainly seems to be the validating characteristic HR desperately seeks for a stamp of approval.
It’s an expansive word bandied about in fairly liberal fashion, so what does “strategic” Human Resources actually mean? For a professional definition, what better source than the Human Resources Certification Institute? ~ after all, “Strategic Management” has been established (2001) as one of the key functions for certification for both PHR (Professional in Human Resources) and SPHR (Sr. Professional in Human Resources.) For your PHR, 12% of the questions will deal with Strategic Management, for the SPHR, 29% [subject to change at any time, reference www.hrci.org].
Strategic Management – “Big Picture” (fittingly, another innocuous, expansive term), knowledge of business & Operations; ensures the alignment of HR activities and organizational goals and also includes the establishment of HR effectiveness measurements (ignore the fact that we are asking HR to establish the “effectiveness” measures for HR.)
Reviewing the PHR/SPHR Certification Study Guide (Bogardus, 3rd Edition; 2009), what does “strategic management” mean to the HRCI? The list is daunting:
- Ability to interpret data from all internal business sources as it applies to organizational strategic plan
- Ability to interpret data from all external sources as it applies to organizational strategic plan
- Establish key internal relationships critical to organizational strategic planning
- Establish key external relationships critical to strategic planning
- Develop and utilize metrics to evaluate HR’s contributions*
- Develop/execute strategy for change management
- Align human capital plan (ugh, I hate that term) with strategic plan
- Develop/communicate organizational values, core behaviors
- Reinforce core behaviors via communication plan & coaching(?)
- Manage HR budget
- Provide information for overall organizational budget
- Develop policies and procedures
- Monitor legislative and regulatory for proposed changes, prepare to address/change/support these changes
- Participate in Enterprise Risk Mgmt.
- Vendor selection & selection processes
- Due diligence related to M&A, integration, “right-sizing” activities
- Application of technical tools, systems, advances in technology
I don’t know this HR person, do you? SWOT, PEST, Strat Plan, Communication Plan, Enterprise Risk, Budget responsibility….is this what the business leaders want from Human Resources? What if you were asked to narrow this list down to the 3 most critical strategic HR functions? What would they be?