HR vs Business Goals: What's Missing from Your Strategy?

Many businesses treat HR as a separate entity to the rest of the company, and this is a major mistake. Hiring, training and performance management are all seen as processes that need to run smoothly, but aren’t connected to the organization’s overall goals. Unfortunately, in a post-pandemic world this is no longer good enough.

Modern companies need to have HR baked into every aspect of their objectives. This is partly because the role many businesses play is changing. After talking to hundreds of top corporate leaders, McKinsey identified several “organizational imperatives” that separate successful companies from those that are not ready for the future. A big part of this is the firm's purpose.

Over 80% of top businesses believe it's important to have a purpose, but only 62% have a purpose statement and just 42% believe their purpose actually has an impact. This is a major problem, and can only be confronted at an HR level. McKinsey has identified a number of ways in which HR interacts with an organization’s goals, from hiring the right people to judging performance based on purpose-driven metrics.

In order to succeed, your business goals need to be aligned with your HR objectives. That could mean rethinking your strategy completely, but it’s important to ensure your HR and company targets are part of the same broader purpose.

What are your goals?

Does your organization have HR goals? Even if nothing is officially written down, you probably have a good idea of what you’re hoping your HR department will achieve. For example, Gartner research has found that the top priority for HR leaders in 2021 is building critical skills and competencies.

The data shows the number of skills required for the average job is increasing by 10% year on year, and around a third of the skills present in job adverts in 2017 are no longer relevant in 2021. Training and development to help grow the right abilities within your organization is essential to keep your business functional as time goes on.

You also need to consider how these will align with your business goals. For example, look at the areas your company intends to move into in the near future. What will your staffing situation need to look like to achieve these objectives? How will you need to train up your current employees? These need to be considered side-by-side wherever possible.

Make your recruitment more strategic

For some, combining business goals and recruitment strategy is just common sense. However, research suggests that while many companies are taking this approach, their leadership might be lagging behind. In the UK, for example, 65% of organizations utilize a strategic approach to recruitment, but just 48% report the CEO sees talent management as a top priority.

This is worrying, as one of the most important areas leadership needs to focus on is recruitment. Skills gaps are increasingly a problem for businesses, particularly in industries such as healthcare, business, finance and IT, and a CEO’s plans for their organization could easily hit a major roadblock if there is a talent shortage in the future.

HR must be involved in addressing this. One solution is training up current staff, but this can be unreliable. Another option is to utilize untapped talent groups like veterans or individuals with a criminal record. Many businesses avoid these groups, but research shows they regularly exceed expectations and have excellent retention rates.

Training for the future

Strategic training, much like recruitment, ensures your employees have the skills and abilities needed to help the business achieve its goals. You therefore need to have a clear understanding of what the company needs; providing general upskilling might be useful, but is not nearly as effective as a learning and development program geared towards specific objectives.

One element of this should be identifying employees who are under-trained and whose skills may be stagnating. For example, despite the pandemic forcing many to work from home, less than 50% of remote workers have received hard or soft skills training. This group cannot be neglected, particularly as COVID-19 has demonstrated how important it is to be able to perform jobs from home.

In order to meet your organization's goals, it might also be necessary to rethink your approach to training, particularly if a major re-skill is needed. Experiential learning is becoming more important, as well as allowing employers to be more flexible and adaptive. These are essential qualities for your learning and development program if you want to keep up with your business goals.