Strategic Human Resource Management Guide 2023

Strategic Human Resource Management (SHRM) is a critical but often overlooked element of the way that companies organise themselves and their employees. It is a way to ensure that the organisation's human resources are used to support its business goals. Imagine SHRM as an instrument that connects HR and the company's objectives. With SHRM, businesses can better align and manage employee performance and development and develop policies and programs that align with the company's overall strategy.

What is Strategic Human Resources?

The goal of SHRM is to develop strategies and plans that match the company's overall business strategy. The primary distinction between strategic human resources and human resources is that the latter is focused on the day-to-day management and operations of employees. While strategic human resources concentrate on the ways employees can help achieve the company's overall objectives. This implies the SHRM must first be aware of the company's business objectives and then develop policies and programs that align with these goals.

A few common examples of SHRM policies and programs include:

• People Management Strategy: the single key point where the business objectives and the people objectives intersect.
• Performance Management: Creating methods to monitor and improve the performance of employees. 
• Development and Training: Identifying the needs of employees for growth and providing them with training and resources to assist them in their development.
• Benefits and compensation: Designing benefits and compensation programs to attract and retain employees.
• Relations with employees: Managing the employee relationship to create a positive environment for employees.

These are only a few examples of policies and programs that could be included in SHRM. The specific policies and programs will differ depending on the company's goals and its employees' requirements.

Why is Strategic Human Resource Management essential?

SHRM is essential as it assists businesses in achieving their objectives. By coordinating HR programs and policies with the company's business plan, SHRM can assist businesses in improving employee performance and workforce development and fostering a positive work environment. SHRM can also help companies cut costs by reducing turnover and increasing productivity.

 

• Enhance employee performance: SHRM can assist companies in improving their performance by developing processes to track and enhance efficiency. 

• Workforce development: SHRM can assist companies in developing the workforce by identifying the employees needing to develop and offering training and tools to help them grow. 

• Create a positive work environment: SHRM can assist businesses in creating an atmosphere that promotes positive work by regulating employee relations. 

• Reduce turnover SHRM can assist businesses in reducing turnover by creating plans for benefits and compensation that draw and keep employees. 

• Increase productivity: SHRM can help companies increase productivity by enhancing employee performance while creating a more positive workplace.

Five steps to Strategic Human Resources

Once you've figured out what SHRM is and its importance, you may wonder how to get started. It's about knowing the objectives of your business along with its strengths, future requirements, and resources.

Then, you put your plan in motion, after which you can reassess and pivot, in the event of a need.

Here are the five steps to a strategic human resources plan:

Be aware of your company's objectives and capabilities

The first step in Strategic Human Resource Management is to know your company's objectives and capabilities. If you understand your company's objectives and know how to communicate them clearly, you'll have a much easier time with policies and programs that help achieve them. Also, you'll be able to evaluate the effectiveness of your SHRM initiatives more and adjust them according to the needs.

Ask yourself some of the questions below:

• What are the company's long-term objectives?
• What are the company's strengths and weaknesses? 
• What resources do you and your company currently have?
• What are the skills your current workforce has?
• Are there any gaps in talent or skills?

These questions can help you determine the company's goals and capabilities and how SHRM could assist you in achieving those goals.

Forecast future needs

Once you have an understanding of your business's goals and capabilities, it is time to anticipate future requirements. To ensure that your business's future is secure, it is essential to determine the number of employees with the necessary skills and then compare that number to your company's current workforce. This will enable you to identify the skills your business will require in the coming years and how you can develop the skills of your workforce.

 Ask yourself some of the questions below:

 What are the skills your business requires in the near future?

• How many people with these qualifications will you require?
• How does it compare to the current workforce?

 If you can answer these questions, you'll be able to determine what capabilities your business will require in the coming years and how you can build a workforce with those capabilities.

Find out the resources needed to achieve company goals 

Once you have identified your company's goals and forecasted future requirements, you must identify the resources required to meet those objectives. This involves determining the human, financial, and physical resources needed. 

Ask yourself some of the questions below:

• How much financial capital do you need to reach your company's goals?
• What kind of human resources do you require to accomplish your company's objectives?
• How many physical resources do you require to accomplish the company's objectives?

To identify which resources you need, do an audit of both your external and internal resources. This will give you an idea of the resources to accomplish your goals and the areas in which you'll require additional resources.

If, for instance, you're seeking to increase the size of your team, then you might have to invest in hiring programs. Or, after conducting a needs assessment, you might discover that your existing workforce doesn't have the required skills to meet your company's objectives; therefore, you'll need to invest in training programs.

Another scenario is when you're looking to launch your new product. In this scenario, you'll have to think about the financial resources needed for the development and marketing of the product and the physical resources needed for its production. Also, you'll need to think about the skills and talents of your team when the time comes to launch the new product. Do you have the appropriate individuals to bring your product to the market? Do they have the skills needed to do so?

Execute your plan

 

After you've established your company's future goals, forecasted your future needs and gathered the necessary resources to reach the goals, it's now an ideal time to start putting your SHRM strategy in place. Many companies begin by sourcing the right candidates, training and development, and finally, performance management. This will differ in accordance with your company's specific requirements.

 

In the event that you already have a huge talent pool, it is possible that you would prefer to develop the skills of your current employees before bringing on new talent. Once you've satisfied that resource, you may discover that you still need workforce planning. If this is the case, you'll need to establish clear expectations and skills requirements before making a hiring decision.

 

When you've decided to hire new talent, you must ensure a well-organized onboarding procedure. This will ensure that new hires are prepared for success and aware of what's expected from them. After you've welcomed new employees to the fold, you must focus on developing them. This means the training program and opportunities to grow professionally. Offering these opportunities will make it possible to keep top talent in the company and ensure they remain engaged in their job.

 

Finally, the performance management. This involves making clear expectations, offering feedback, and reviewing performance. Performance management is an essential component of SHRM since it ensures that your workforce is meeting expectations and helps improve your business's bottom line.

 

Here are some points to be aware of while implementing your SHRM plan:

 

• Create realistic objectives and deadlines: Trying to do too much in the shortest amount of time may cause stress and can lead to errors.

• Get buy-in from upper management: If the upper management isn't on board with your SHRM program, it won't be easy to get everyone else on board.

• Communicate with your employees: Employees need to know the objectives of the SHRM program and the way it affects their work. This will assist in getting them on board and ensuring they are working towards the same goals.

• Be prepared to modify your strategy: Like all strategies, there are times when things don't happen as planned. Make changes to ensure you're in the right direction to meet the company's objectives.  

Assess and pivot

After you've implemented your SHRM plan, evaluating the progress is crucial. It's important to determine what's working well and what's not. Based on the results, you should make changes to your strategy. For instance, you could alter your recruitment strategy if you don't observe the desired outcomes. If you're finding that your training programs aren't efficient, you might need to change them too.

 

It's also essential to keep in mind that your SHRM program is not just a once-off thing. As your business grows and evolves, so will your SHRM requirements. It's, therefore, important to review your SHRM strategy frequently to ensure its up-to-date and effective.

Bottom Line

Human resource planning is an important method that helps businesses achieve their goals by better managing their workforce. By establishing the SHRM plan, companies will be able to ensure the best employees are in place to meet their objectives. While creating a SHRM plan is laborious, the benefits outweigh the cost. A well-designed SHRM program helps you reach the company's objectives and objectives, but it can also aid in keeping top talent and keep employees interested in their jobs. HBA Consulting, one of the best HR consulting firms in Australia can help your organisation if you need any outside support in Strategic Human Resource Management,