What is Strategic HR? And why HR needs to love people, not balance sheets
This Academy focuses on improving capabilities related to strategic HR, so it makes sense to explain what we mean by this term.
Doing this is particularly important, since, despite HR’s effort to ‘be more strategic’ for quite a few decades now, there is still so little understanding, and so much misunderstanding around.
Lack of understanding (or perhaps, interest): I think that given the amount of ongoing discussion about strategic HR, and the lack of progress in doing more of it, many practitioners have abandoned the attempt to distinguish strategic and operational HR, and now simply, though understandably, just focus on doing the best job that they can.
Misunderstanding: for those practitioners who care about being strategic, I think this is mostly associated with being more closely attached to the rest of the business. Being a business person working in HR, rather than an HR person in the business. Being ‘at the table’, so we understand what the business is doing and can translate this into what we do in HR, ensuring line of sight between what we do in HR and what’s required in the rest of the business. And ensuring that everything we do in HR supports the business to achieve its objectives.
The mistake we make here is to assume that business strategy is something done in the rest of the business, and that by being associated with us also makes us more strategic somehow. But – if all we do is support the business, then we remain a support function, not a strategic player. Rather than supporting business strategy, we need to create People Based Business Strategy. Transformation of people, and the way they are managed, developed and organised in a way that creates competitive advantage for the business we operate within.
This opportunity to become truly strategic doesn’t come from getting ever closer to the business. But from really understanding people. How we can really ensure people learn and change effectively. How we can create environments in which people will be more able to motivate themselves. How we can increase the propensity of people to collaborate together. These are all big business questions, and we can make much more strategic impact by answering these than we can by supporting the rest of the business to improve business operations, get closer to customers or increase revenues. These are all important requirements, but we make most impact on them indirectly through what we do with people and organisation, than we can through more direct support.
Understanding Porter’s Five Forces model is great, but understanding my own Value Triangle, Value Chain and Value Matrix counts for much, much more.
So, we do need to understand the business, and to be interested in technology, data and analytics, but even more importantly, we need to understand people. Our key strategic skills and knowledge come from psychology, sociology and anthropology. From new insights provided by cognitive neuroscience and behavioural economics. And the key passion which brings us and sustains us in the profession needs to be passion for, a love for people.
I’ve posted previously about loving HR people who love people. About being frustrated by the growing proportion of HR people who seem to want to love business instead. Even a number of claims that HR people should love their balance sheets. Seriously! – do people do that? Any people, but particularly HR people???
Actually, this isn’t just a need for HR. One of the big points of failure in many organisations is line management. The big, strategic mistake we make here is to appoint people who don’t love people, who aren’t interested in people, who will never be competent or committed to manage people into management positions. HR does need to speak the language of people, but much more important than this is encouraging people in the business to speak the language of people. To understand the balance sheet but to love people, not a nice big retained profit.
I’ve written, spoken, trained, and consulted about the need for HR to love people for several decades now. (I’ve focused on helping HR become more strategic for this long, and have always seen the way to become more strategic to be to focus more on people.) However, this need to connect people and strategic HR has never been as clear as it is today.
Business is now much more people-centric. The main trends in business management over the last five to ten years have all been about people. Employee journey mapping, organisational design thinking, self management, agile, etc, etc. Even digital transformation has, or should have been mainly about people not technology. And look at the increasing focus on wellbeing during the pandemic.
Business now increasingly puts people first. If strategic HR doesn’t do this too, then there’s really little hope for the future of HR – or for the future of our organisations and businesses.
Strategic HR is still, is now even more important than it’s ever been before. And it comes from a love of people, and from insights about people. And yes, this needs to be in the context of the business. But fundamentally, it’s about people.
Jon Ingham
HR Strategist, Trainer and Learning Facilitator at the Jon Ingham Strategic HR Academy
