5 Steps To Developing A Strategic HR Plan
Apr 18, · A Strategic HR Plan is a tool to help businesses align their organizational goals with their HR capabilities, and every business should have one in place to support the growth outlined in their strategic plan. If you haven’t developed a Strategic HR Plan for your business (or if you’re still not quite sure what it is!), don’t worry!Estimated Reading Time: 6 mins. Human resource strategy is an elaborate and systematic plan of action developed by a human resource department. This definition tells us that an HR strategy includes detailed pathways to implement HRM strategic plans and HR plans.
The most successful companies develop and implement an effective strategic plan to help them pursue their organizational goals. A Strategic HR Plan is a tool to help businesses align their organizational goals with their HR capabilitiesand every business should have one in place to support the growth outlined in their strategic plan.
A Strategic HR Plan helps organizations to align human resources to corporate strategy. It is an essential planning document built upon the corporate mission, vision, values and goals established in the strategic business plan.
It provides information on how the HR function will support the goals and strategies of the organization, while also ensuring that HR planning and practices are consistent. The ideal Strategic HR Plan outlines how the gaps between present and future capabilities will be addressed, enabling businesses to effectively pursue their company goals.
In most organizations, managers have a responsibility to fulfill expectations in the areas of corporate governance, transparency of policies, accountability and economic efficiency. For your business to be successful in these areas, you need to have the right people, with the right skills, in the right place, at the right time to carry out the strategy. It should also establish:. The process for developing a Strategic HR Plan begins by identifying where your organization is now in the life-cycle of an enterprise: the start-up stage, the growth stage, how to change the color of your bathtub mature stage or the decline stage.
Your Strategic HR Plan will be built upon the foundation of this strategic business plan. Ask questions like:. Compare your future HR needs from step 1 with your present HR capabilities from step 2, and identify any significant gaps that appear.
Gaps can develop in a number of areas including policies and procedures, capability, and resource allocation. Start with these questions:. Next, work to develop strategies that will address the gaps you identified in Step 3.
These gap strategies may affect:. Not all gaps will be of the same strategic importance, so you will need to set priorities for addressing them. For example, imagine you discovered a need to update your HR information system. Investing in a new system would provide you with employee progress data that you deemed essential for your future company goals.
Sharing the Strategic HR Plan with your senior leadership and those connected to the HR function of your organization is a crucial component of its success. The more your team understands and supports the plan, the more empowered they will be to help the company achieve its goals. At the very least, you should review the plan on an annual basis to verify that the goals on which the plan was based are still accurate and to make adjustments as needed.
Developing a comprehensive Strategic HR Plan is an essential investment into helping your company achieve its goals. Budgets are tight. What are you doing to help your bottom line? Our team talked to business leaders who have taken the step to outsource HR and provided real world insights and learnings in this free resource.
Learn more about how HR Outsourcing can impact your bottom line, and see if it is a good fit for your business. Amy provides workplace solutions to improve performance, reduce liability and increase profits. She is passionate about helping other entrepreneurs and business owners achieve success. Great Article. Its really informative and innovative. Thanks for sharing. Necessary cookies are absolutely essential for the website to function properly.
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It should also establish: HR practices that are consistent across the organization Training and skill development policies that are linked to strategy Succession planning processes that identify and minimize capability risks How do you create a Strategic HR Plan?
Ask questions like: What is the nature of our work? What type of culture will support productivity? What skills do we need to deliver results? Where are those skills and how are we tapping into them? How large is our organization? What systems and processes do we need? What risks are associated with this future? How are we doing against benchmarks? What are our strengths and weaknesses? Are there legislative requirements we need to consider? What are we doing well now, that we need to do more of in the future?
Where do the risks lie? What HR issues may prevent us from getting to the future? What current systems will support or hinder our progress?
Start with these questions: Where do significant gaps appear between the present and future? How can these gaps be classified? Step 4: Formulate Gap Strategies Next, work to develop strategies that will address the gaps you identified in Step 3.
Questions you can ask to help you determine the priority of your needs include: What are the top priorities? Where can we experience rapid progress? How do these strategies work with our budgets? What is the degree of change needed? Developing Your Plan Developing a comprehensive Strategic HR Plan is an essential investment into helping your company achieve its goals.
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The overall purpose of strategic HR planning is to: Ensure adequate human resources to meet the strategic goals and operational plans of your organization – the right people with the right skills at the right time Keep up with social, economic, legislative and technological trends that impact on human resources in your area and in the sector. The strategic plan is a vision for the organization for following several years (from 2 to 5 years). The strategic plan sets the priorities for the top management and HR role is a proper strategic planning in the area of HR Management. The HR Professionals have to be part of the strategic planning as employees will execute the strategic mission of the organization. Nov 20, · Strategic planning in human resources allows you to assess the needs of your overall organization for what services they most want and need from you. The assessment of your external environment and other HR functions in different organizations opens up the realm of possibilities for what your HR department can hope to datingusaforall.comted Reading Time: 4 mins.
Strategic HR planning is an important component of strategic HR management. It links HR management directly to the strategic plan of your organization. Most mid- to large sized organizations have a strategic plan that guides the organization in successfully meeting its mission. Organizations routinely complete financial plans to ensure they achieve organizational goals and while workforce plans are not as common, they are just as important. Even a small organization with as few as 10 staff can develop a strategic plan to guide decisions about the future.
Based on the strategic plan, an organization can develop a strategic HR plan that will allow to make HR management decisions to support the future direction of the organization. Strategic HR planning is also important from a budgetary point of view so that you can factor the costs of recruitment, training, etc. The strategic HR planning process has four steps:. Based on the organization's strategic plan, the first step in the strategic HR planning process is to assess the current HR capacity of the organization.
The knowledge, skills and abilities of your current staff need to be identified. This can be done by developing a skills inventory for each employee. The skills inventory should go beyond the skills needed for the particular position. List all skills each employee has demonstrated.
For example, recreational or volunteer activities may involve special skills that could be relevant to the organization. Education levels and certificates or additional training should also be included. An employee's performance assessment form can be reviewed to determine if the person is ready and willing to take on more responsibility and to look at the employee's current development plans. The next step is to forecast HR needs for the future based on the strategic goals of the organization.
Realistic forecasting of human resources involves estimating both demand and supply. Questions to be answered include:. When forecasting demands for HR, we must also assess the challenges that you will have in meeting your staffing need based on the external environment. The next step is to determine the gap between where your organization wants to be in the future and where you are now. The gap analysis includes identifying the number of staff and the skills and abilities required in the future in comparison to the current situation.
One should also look at all your organization's HR management practices to identify practices that could be improved or new practices needed to support the organization's capacity to move forward. There are five HR strategies for meeting your organization's needs in the future:.
Restructuring strategies. This strategy includes:. Attrition - Not replacing employees when they leave - is another way to reduce staff. The viability of this option depends on how urgently you need to reduce staff. It will mean that jobs performed in the organization will have to be reorganized so that essential work of the departing employee is covered. Careful assessment of the reorganized workloads of remaining employees should include an analysis of whether or not their new workloads will result in improved outcomes.
It is important to consider current labour market trends e. Sometimes existing workers may be willing to voluntarily reduce their hours, especially if the situation is temporary. Job sharing may be another option. The key to success is to ensure that employees are satisfied with the arrangement, that they confirm agreement to the new arrangement in writing, and that it meets the needs of the employer.
Excellent communication is a prerequisite for success. Training and development strategies. Recruitment strategies. For strategic HR planning, each time you recruit you should be looking at the requirements from a strategic perspective. Perhaps your organization has a need for a new fundraiser right now to plan special events as part of your fund raising plan.
However, if your organization is considering moving from fund raising through special events to planned giving, your recruitment strategy should be to find someone who can do both to align with the change that you plan for the future. Outsourcing strategies. Many organizations look outside their own staff pool and contract for certain skills. This is particularly helpful for accomplishing specific, specialized tasks that don't require ongoing full-time work.
Some organizations outsource HR activities, project work or bookkeeping. For example, payroll may be done by an external organization rather than a staff person, a short term project may be done using a consultant, or specific expertise such as legal advice may be purchase from an outside source. Each outsourcing decision has implications for meeting the organization's goals and should therefore be carefully assessed.
Collaboration strategies. Finally, the strategic HR planning process may lead to indirect strategies that go beyond your organization. By collaborating with other organizations you may have better success at dealing with a shortage of certain skills.
Types of collaboration could include:. Once the strategies for HR in your organization have been developed they should be documented in an HR plan. This is a brief document that states the key assumptions and the resulting strategies along with who has responsibility for the strategies and the timelines for implementation.
Once the HR strategic plan is complete the next step is to implement it:. It may seem like redundant step if everyone has been involved all the way along but it's always good to get final confirmation.
The strategic HR plan needs to be communicated throughout the organization. Your communication should include:. It is impossible to communicate too much but all too easy to communicate too little , especially when changes involve people.
However, the amount of detail should vary depending upon the audience. Ensure that the actions you are considering are compliant with existing laws, regulations and the constitution and bylaws of your organization.
Whether you are increasing or reducing the number of employees, there are implications for space and equipment, and on existing resources such as payroll and benefit plans. HR plans need to be updated on a regular basis. You will need to establish the information necessary to evaluate the success of the new plan. Benchmarks need to be selected and measured over time to determine if the plan is successful in achieving the desired objectives.
Human Resource Management. Search web. MBA Program Theories. Recent site activity. Navigation Sitemap. Site owners Khadiza Champa. Strategic HR management is defined as:. Integrating human resource management strategies and systems to achieve the overall mission, strategies, and success of the firm while meeting the needs of employees and other stakeholders. The strategic HR planning process : The strategic HR planning process has four steps: Assessing the current HR capacity Forecasting HR requirements Gap analysis Developing HR strategies to support organizational strategies Assessing current HR capacity : Based on the organization's strategic plan, the first step in the strategic HR planning process is to assess the current HR capacity of the organization.
Forecasting HR requirements The next step is to forecast HR needs for the future based on the strategic goals of the organization. Questions to be answered include: How many staff will be required to achieve the strategic goals of the organization?
What jobs will need to be filled? What skill sets will people need? How will the external environment impact on our HR needs?
Gap analysis The next step is to determine the gap between where your organization wants to be in the future and where you are now. Questions to be answered include: What new jobs will we need? What new skills will be required? Do our present employees have the required skills?
Are employees currently in positions that use their strengths? Are current HR management practices adequate for future needs?
Developing HR strategies to support organizational strategies There are five HR strategies for meeting your organization's needs in the future: Restructuring strategies Training and development strategies Recruitment strategies Outsourcing strategies Collaboration strategies 1. Restructuring strategies This strategy includes: Reducing staff either by termination or attrition Regrouping tasks to create well designed jobs Reorganizing work units to be more efficient Attrition - Not replacing employees when they leave - is another way to reduce staff.
Training and development strategies This strategy includes: Providing staff with training to take on new roles Providing current staff with development opportunities to prepare them for future jobs in your organization 3. Recruitment strategies This strategy includes: Recruiting new staff with the skill and abilities that your organization will need in the future Considering all the available options for strategically promoting job openings and encouraging suitable candidates to apply For strategic HR planning, each time you recruit you should be looking at the requirements from a strategic perspective.
Outsourcing strategies This strategy includes: Using external individuals or organizations to do some tasks Many organizations look outside their own staff pool and contract for certain skills. Collaboration strategies Finally, the strategic HR planning process may lead to indirect strategies that go beyond your organization. Types of collaboration could include: Working together to influence the types of courses offered by educational institutions Working with other organizations to prepare future leaders by sharing in the development of promising individuals Sharing the costs of training for groups of employees Allowing employees to visit other organizations to gain skills and insight.
Documenting the strategic HR plan Once the strategies for HR in your organization have been developed they should be documented in an HR plan. Implementing the strategic HR plan Once the HR strategic plan is complete the next step is to implement it: Agreement with the plan Ensure that the board chair, CEO and senior managers agree with the strategic HR plan.
Communication The strategic HR plan needs to be communicated throughout the organization. Your communication should include: How the plan ties to the organization's overall strategic plan What changes in HR management policies, practices, and activities will be made to support the strategic plan How any changes in HR management will impact on staff including a timeframe if appropriate How each individual member of staff can contribute to the plan How staff will be supported through any changes How the organization will be different in the future It is impossible to communicate too much but all too easy to communicate too little , especially when changes involve people.
Legislation and mandate Ensure that the actions you are considering are compliant with existing laws, regulations and the constitution and bylaws of your organization.
Organizational needs Whether you are increasing or reducing the number of employees, there are implications for space and equipment, and on existing resources such as payroll and benefit plans. Evaluation HR plans need to be updated on a regular basis.
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