Three new opportunities in Strategic HR

Yes, yet another article on the need for HR to be more strategic! But does anyone still read articles like this any more? After all, we’ve been seeing much of the same advice being trotted out time and time again for over twenty years.

But wait! There is new insight here. We still need to be more strategic. And it’s generally admitted that we’ve still got a long way to go. So if what we’ve been doing isn’t working, then maybe it’s time to try something new?

Here are my top three fairly unconventional but completely serious suggestions for new ways of creating strategic impacts in the businesses we work within.

1. Focus on your people, not just the business

Most HR practitioners still see being more strategic as getting closer to their business.  I often hear that HR people want to support employees better but think this will make them less strategic if they do. No! We don’t do sales, marketing, finance or supply chain. People are at the heart of what we do. And they should be at the centre of our agenda too.

Plus we’re extremely fortunate that people are now at the centre of the business agenda as well. ‘People are the most important asset’ has become a reality for many businesses and their advisors. For example, McKinsey’s focus on organisation health is fundamentally a response to the realisation that competitive advantage comes as much from what we do inside a firm as the products and services it provides outside. Our agenda is also the business agenda now.

In this new environment, many businesses are furiously trying to become more people centric: moving from profit to purpose; hierarchies to agile working; jobs to roles; processes to experiences, etc. But often it’s the business behind these changes, not HR. I think there’s an increasing risk that if businesses continue to prioritise people and we continue to emphasise commercial and analytical HR, we and the rest of the business will pass each other like ships in the night. And we’ll end up with HR doing more accurate calculations but IT or Finance being given responsibility for passion, creativity, relatedness and everything else which flows from people and drives success in today’s business world.

So capabilities like business savvy are important, but the real skills which drive our success are ones from psychology, sociology and anthropology, and insights from neuroscience, behavioural economics and other fields which help us understand and influence the way people work.

2. Organise, don’t just manage your people better

Better knowledge, understanding and insight into people, in general and more specifically the people within a particular firm, helps us manage and develop people better. People are at the heart of competitive advantage, so managing and developing them better makes a strategic difference too. But there’s even more that we can do.

In most businesses, the real barrier to effective performance isn’t just our people, it’s the way we organise people to work together. This is partly about the organisation architecture – the more formal aspect of the organisation, including its structures and processes. We need to flatten our organisations to help people make broader contributions to the work which is taking place around them. But we also need to focus people on the right things, balancing traditional vertical hierarchies with opportunities to work in horizontal teams, and to come together in communities and networks.

And we need to invest in what I call the organisation society – the more informal side of our organisations which is based on the way people connect together, the relationships they form and the conversations that they have. Organisation development is probably the most important of all of our roles, though we also need to complement this with strengths in other fields such as community management, experience design, and both digital and physical workplace design.

3. Lead the business, don’t just support it

People and the organisation are strategically important, so to make a strategic contribution we need to improve the qualities, attributes or value of people and the organisation, including the connections between the people working in the organisation (ie human, organisation and social capital).

Yes, this needs to be done in the context of the business, but it shouldn’t just be driven by the needs of the business. Too much time goes into seeking to align HR with the rest of the business so that everything we do supports what the business needs. But if all we do is support the business then we are well and truly still just a support function.

Being truly strategic has to be about creating new strategic value through what we do with people. It is about creating people based business strategy, not about assuming that strategic value is all in the rest of the business and our role is to support the business in achieving it.

So yes, we do need to support the rest of the business and help ensure it is able to achieve its objectives, whether these are about operations, customers or its financial success. But we also need to provide new opportunities for success based on what people could do.

This is about going to our business executive, or the leaders of the business unit we support and enable, and explaining what qualities in the people and the organisation we think we could enhance, and asking the executive whether this would be useful for them? Whether these would enable the firm to be more productive, to sell more products, or attract new customers, etc. Doing this means that we are able to inform the business strategy, not just support it.

We still need to be able to implement these people based business strategies. Execution is just as important as the right strategy. But unless we develop our strategies based on a deep insight into our people we are never going to be able to capture the business opportunities inherent in this new people based age.

And we’ll continue to see more articles about HR not being strategic being published over the next twenty years!

Jon Ingham is a people and organisation strategy consultant who helps companies innovate their management approaches responding to changes in the world of work and also to tie more closely to their own strategic needs. Much of his work is informed by a strong belief in the potential offered from a smarter investment in people and the consequent opportunity to create new value for a business. He also writes about the future of work, including in his new book, ‘The Social Organization’ which suggests we need to focus on the relationships between people as well as the individuals themselves. Jon has previously worked as a chemical engineer, an IT consultant, and an international HR director. He has BA in Psychology, a Masters in Engineering and an MBA. He has frequently been recognised a leading influencer in HR.

Jon Ingham