More than half of all organizations have HR services that do not connect to fundamental business issues. Even more disturbing is that according to Brandon Hall Group’s research, less than 15% can draw a straight line from their HR service to overall business goals.
What best describes the overall maturity of HR service delivery at your organization?
There are many challenges to creating a more business-minded HR service-delivery model, but one of the most common is a lack of HR governance systems in most organizations. Without oversight, feedback and accountability, it is difficult to tell what progress is being made in tying common HR metrics to business KPIs — or even if those metrics should have been used in the first place.
Because HR touches every employee in an organization, the impact on any business initiative is significant if tactical HR service is not correctly aligned. Diversity and inclusion initiatives must prove their impact, rewards and recognition have to be budgeted for correctly based on their effect on business outcomes and compensation should be directly tied to how specific roles impact business outcomes. These types of everyday HR activities are mostly being done in the dark, with no true data that shows how the different processes connect.
For an organization to connect the dots between HR service and business outcomes, they must first decide what their specific business needs are.
Key questions organizations should address include:
- Who is held accountable for making sure HR is aligned with business priorities?
- How will you measure the impact of HR service delivery at your organization?
- What constraints in terms of time, budget or other resources is your HR group working within?
- What is the HR service model most likely to work at your organization?
- Which lines of business stand to gain most from improved HR service delivery?
Brandon Hall Group POV
For many organizations, connecting tactical HR activities with business outcomes is something they have been working on for decades. This is because HR traditionally has been reactive, responding to internal issues, changing markets and shifting regulations. Reactive HR and tactical processes should still exist, of course, but with the advent of automated systems and improved processes, change is due. As with any major change-management process, a plan should be created that outlines the strategy, goals and implementation of business-aligned HR activities. That business plan should have:
- Current business conditions
- Current and future needs of the business
- SWOT analysis (Strength, Weakness, Opportunities, Threats)
- Case for change
- Goals and objectives
ο Action plan for achieving each goal or objective
ο Measuring progress toward each goal or objective
- Governance model
As mentioned in the complications section, many organizations report that either they have no HR service governance or it’s poor and inconsistent. Tactical HR services should be reviewed and adjusted as needed to ensure policies are designed and deployed that support business outcomes rather than simply completing HR goals.
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