HR Strategy in 4 steps

How often do you hear employees say that the HR strategy is not clear or too vague? And why is translating ambitions into a clear and concrete strategic plan so difficult? The difficulty is in the approach that you apply in setting up the HR-strategy. Meant as a grip hold for HR-professionals, this article sets out 4 simple steps that increase the added value of the HR strategy: ambition, diagnosis, focus and realisation.

1. Ambition: connect with goals & most important HR-challenges

What is strategy exactly? It is often referred to as conceptual, vague and abstract phrases that say what about a desirable future perspective. The latter is correct. In fact, a strategy should be a concrete plan for overcoming difficulties and obstacles; a concrete response to a challenge. In order to create a good HR strategy, first you must ensure that the general business objectives are set. This should contribute to the HR strategy. In addition, determining key HR challenges is crucial. Processes, structure, people, leadership and culture are important elements in this. The diagnostic HC Bridge Framework of Boudreau & Ramstad can provide guidance on this. Setting the ambition by naming objectives and challenges provides the common starting point for the further implementation process of the HR strategy.

2. Analysis: externally & internally

Step 2 is to perform an external and internal analysis. The combination of diverging and converging is of great importance here. First, you make the external analysis, which results in concrete insights into current trends and other environmental factors that (might) influence the company in the near future. Leaders in industry, start-ups and other market innovators, networks and market surveys are helpful sources. To diverge is of importance here, as opportunities and challenges are analysed. The internal analysis will expose organisational strengths and weaknesses through the use of both quantitative and qualitative information. Targeted data analysis can provide surprising and enlightening insights. Based on these insights, results from the external and internal analysis can be combined. To converge is important at this stage, in order to make the possible impact on your specific HR organization as concrete as possible.

3. Focus: priorities & action plan

During this stage, it is important to prioritise and focus on the previously identified critical challenges. A good way to make strategic choices is by defining the ‘must do’s’ and ‘must have’s’: components that the HR services have to offer and what standards the HR-strategy has to keep. Ask critical questions that trigger to make the right long-term choices. An article that can be very useful is ’10 timeless tests to challenge your strategy‘. The next step is the hardest, but crucial: prioritising. Often, this is done based on the availability of budget and/or FTEs. On this basis, concrete actions can then be appointed and planned in a strategic action plan. Following these steps provides strategic, action-oriented planning, which assures having a clear focus on the right steps to be taken.