What is strategic human resource

management?
Strategic human resource management is the connection between
a company’s human resources and its strategies, objectives, and
goals. The aim of strategic human resource management is to:

 Advance flexibility, innovation, and competitive advantage.

 Develop a fit for purpose organizational culture.

 Improve business performance.

In order for strategic human resource management to be effective,

human resources (HR) must play a vital role as a strategic partner
when company policies are created and implemented. Strategic
HR can be demonstrated throughout different activities, such
as hiring, training, and rewarding employees.
Strategic HR involves looking at ways that human resources can
make a direct impact on a company’s growth. HR personnel need
to adopt a strategic approach to developing and retaining
employees to meet the needs of the company’s long-term plans.

HR issues can be a difficult hurdle to cross for many companies,

there are all kinds of different components that can confuse
business owners and cause them to make ineffective decisions
that slow down the operations for their employees as well as their
business.

To ensure that you never have to worry about being lost on HR

related issues again, click the download button below for
your one-page document of the 7 steps to strategic human
resource management.

Why is strategic human resource

management important?
Companies are more likely to be successful when all teams are
working towards the same objectives. Strategic HR carries out
analysis of employees and determines the actions required to
increase their value to the company. Strategic human resource
management also uses the results of this analysis to develop HR
techniques to address employee weaknesses.

The following are benefits of strategic human resource

management:

 Increased job satisfaction.

 Better work culture.

 Improved rates of customer satisfaction.

 Efficient resource management.

 A proactive approach to managing employees.

 Boost productivity.
Seven steps to strategic human
resource management
Strategic human resource management is key for the retention
and development of quality staff. It’s likely that employees will feel
valued and want to stay with a company that places a premium on
employee retention and engagement. Before you implement
strategic human resource management, you will need to create a
strategic HR planning process using the steps below:

1. Develop a thorough understanding of your company’s

objectives
2. Evaluate your HR capability
3. Analyze your current HR capacity in light of your goals
4. Estimate your company’s future HR requirements
5. Determine the tools required for employees to complete the
job
6. Implement the human resource management strategy
7. Evaluation and corrective action

1. Develop a thorough understanding of your company’s

objectives
Since the success of strategic HR is dependent on how well it
links to your company’s goals, you need to have a thorough
understanding of your aims, objectives, and mission. You’ll need
to be able to articulate both your short and long-term plans for
growth to the relevant HR personnel. Ensuring clear
communication of your company’s goals will make it easier for HR
personnel to formulate an effective resource management
strategy.

2. Evaluate your HR capability

Evaluating your current HR capabilities will enable you to

understand the employees you have and how they contribute to
fulfilling your goals and objectives. Additionally, you should also
undertake a skills inventory for every employee. Skills inventories
help you to discover which employees are experts in particular
areas.

It also helps you to identify the employees who have an interest in

being trained in a particular aspect of your company. A great time
to asses skills is during a performance review. However, the
traditional performance review is dying. Check out our guide on
how to conduct an efficient and results driven performance review
while obtaining the skills inventory you need from your employees!
 [Download] 9 Best Practices to Master the New Performance
Review

3. Analyze your current HR capacity in light of your goals

An assessment of your HR capacity will help you to recognize

barriers and implement a plan of action to capitalize on
opportunities and effectively deal with threats. Strategic HR
personnel will analyze the number of employees as well as
their skills and will work with senior leadership to identify ways to
better equip employees to serve the needs of your company.
4. Estimate your company’s future HR requirements

After an analysis of your company’s employees and skills has

been done in relation to your objectives, it’s time to forecast your
HR needs. The forecast should be done in relation to:
  Demand – A prediction needs to be made in relation to the
number of employees with the associated skills that will be
required in order for your company’s future needs to be met.

 Supply – Looks at the employees and skills that are

currently available to help your company achieve its strategic
goals.

Forecasting your company’s future HR requirements also

determines the following:

 New jobs and roles required to secure the future of the

company.

 Skills required by current employees to undertake the

responsibilities of new jobs and roles.

 Whether your employees’ expertise are being sufficiently

utilized.

 Whether current HR personnel and practices can

accommodate the company’s growth.

5. Determine the tools required for employees to complete the

job

HR personnel need to liaise with the appropriate departments to

find out how the tools used by employees impact on their ability to
perform their roles. For example, an audit of hardware and
software can be undertaken jointly with the I.T department to
identify gaps in tools that will facilitate a more organized
workforce.

For example, where a company employs hourly staff, it’s crucial to

utilize workforce management software. This software manages
important HR functions such as scheduling, holiday entitlement,
and sick leave management.

Deputy provides the functionality to effortlessly manage your

employees’ hours and time. This enables your employees to focus
on the tasks identified in the strategic HR plan that have a direct
impact on growing your company. Sign up for a free trial and see
how Deputy can support your strategic human resources
management.
6. Implement the human resource management strategy

After the analysis and forecast of your company’s HR

requirements have been completed, it’s time to start the process
of expanding your workforce and developing current workers to
equip your company for future growth. You can achieve the
implementation of your human resource management strategy by
doing the following:

 Start with the recruitment stage – At this point, HR

professionals begin searching for candidates who possess
skills that have been identified during the HR strategic
planning process.

 Organize a selection process – Interviews and other

selection criteria take place at this time. Interview questions
such as “what are your salary requirements?” and relevant
tests will be used to assess whether the candidate is suitable
to carry out the role.

 Begin hiring applicants – Your company will make the

candidate a job offer after all appropriate checks have been
carried out.

 Design onboarding and training – Employee

Onboarding is a key determining factor as to whether an
employee remains with a company. A comprehensive
onboarding and training package must be put in place to
 increase employee retention. Once you have onboard your
employees well, another important step to retaining them is
to keep them engaged! Easier said than done, but our guide
on employee engagement will help! You can download it by
clicking the button below:
[Download] The Employee Engagement eGuide

7. Evaluation and corrective action

HR personnel should decide on a timeline to carry out a strategic

HR management review. This review will track the progress made
and also identify areas for improvement. The review should be
measured against whether changes are helping your company to
achieve their goals. Corrective action must be taken if strategic
human resource management is failing to meet its objectives.

Strategic human resource management articles

Several articles have been written about strategic human resource

management to help companies to implement this process. Check
out two of our favourites below:
  Emerald Insight published an article about whether strategic
human resource management practices have an effect on
performance. The paper is based on research, which found
that training, development, and pay are the strategic human
resource management practices that had the greatest impact
on employee performance.
 Another strategic human resource management article,
published by Sage Journals, looks at whether there’s a
relationship between strategic human resource management
and organizational commitment.

Human resource strategies examples

With more than two million employees, Walmart is the world’s

largest employer. This retail giant places a premium on the role of
HR to drive and grow its business. The emphasis on the value of
employees has been evident from the start when Walmart’s
founder, Sam Walton, named the HR department the ‘people
division.’

HR Magazine uses Walmart as an example of how strategic

human resource management can be used to establish a
profitable company. The article provides details about how
Walmart aligns its seven overriding strategies (price, operations,
culture, key item/products, expenses, talent, and service) with
human resource strategic management, for example:
  Operational success is achieved because Walmart invests
in continuous training and learning for its employees.
Walmart also seeks to empower its employees to take
ownership of their work for more successful teamwork.

 Company culture is emphasized because Walmart

managers attend cultural training at the Walton Institute. The
Walmart culture is defined by managers having an
entrepreneurial mindset that encourages a problem-solving
approach. For tips on creating an amazing culture, download
our guide on creating a healthy multi-gen workforce below:
[Download] 10 Tips for Creating a Healthy Culture for a Multi-
Gen Workforce

 Connecting people to products is where everyone at

Walmart, irrespective of their position, has to focus on how to
provide a better customer experience. Part of Walmart’s HR
strategy is to train managers to make decisions in relation to
customers in their store as quickly as possible.

In addition to Walmart, Human Resources MBA compiled a list of

30 of the world’s most innovative HR departments. This list
contains examples of companies that use human resources
strategically to grow and strengthen their market position. These
companies include:

 FedEx has a ‘People-Service-Profit’ philosophy that

demonstrates its belief that. if employees are taken care of,
they’ll take care of customers in return. As part of fulfilling
 this slogan, FedEx undertakes a yearly survey and feedback
program where employees provide their opinions on different
aspects of the organization. The results are analyzed and,
where possible, action is taken to improve employee
conditions.

 Nissan uses a philosophy called kaizen to help its

employees to always keep striving to make improvements to
how they work. This approach starts during the recruitment
stage and new hires are encouraged to keep improving so
that they can stand out. Other strategic human resource
management practices at Nissan include leaders being given
the independence to hire and build their team.

 Alliance Boots GmbH is founded on the philosophy that

Boots employees are part of a family. Boots encourages a
stress-free work environment and assists managers in being
supportive of their teams. Boots values vocational education
and was one of the first companies to provide formal
accreditation for its employees.

Strategic HR services

Strategic human resource management is important for every

company. Your company doesn’t need to employ a specific
number of employees before you start to consider implementing
strategic human resource management principles. In fact, if you
have a plan to grow your business, you should be thinking about
linking this growth to strategic human resource management.

Some companies outsource this part of their business because

they don’t have an in-house HR function. Strategic human
resource services provide full-service HR functions including
developing a human resource management strategy. Strategic HR
services help to take away the burden of both operational and
strategic management to facilitate the growth of your business.

To facilitate your company’s future growth, you should use tools

and software that free up your time. Sign up for a free trial of
Deputy below to see how we can help you with the time-
consuming aspect of employee scheduling, so you have more
time to work on the strategic aspect of your business.