5 Exemplary Ways to Develop a Strategic HR Plan

It’s no secret that a well-crafted strategic plan is a must-have for any successful business. However, even the most brilliant strategic plan may fall short if the human resources function isn’t in sync with it.

To overcome this challenge, a Strategic HR Plan can serve as a valuable tool for businesses to align their HR capabilities with their organizational objectives. This plan can help companies pave the way for growth and development while ensuring that HR practices are optimized to support the strategic plan.

If your business has not yet created a Strategic HR Plan or you’re unsure about what it entails, there’s no need to worry!

What is a Strategic HR Plan?

A Strategic HR Plan is a crucial tool that enables companies to align their human resources with their overall corporate strategy. It serves as a comprehensive roadmap that builds upon the organization’s mission, vision, values, and objectives established in the strategic business plan.

The plan lays out the ways in which the HR function will support the organization’s goals and strategies, while also ensuring that HR planning and practices are consistent with the company’s overall direction.

By identifying and addressing gaps between current and future HR capabilities, a well-crafted Strategic HR Plan enables businesses to pursue their objectives more effectively, ultimately leading to greater success.

Why is it Crucial to Develop a Strategic HR Plan?

The development of a Strategic HR Plan is crucial for businesses to meet their expectations of corporate governance, policy transparency, accountability, and economic efficiency.

To achieve success in these areas, it’s essential to have the right people with the right skills in the right positions, working towards fulfilling the overall business strategy.

A well-designed Strategic HR Plan ensures that the organization has the necessary capacity to execute its strategy while also providing the ability to track progress towards achieving its goals.

In addition to this, the plan should establish consistent HR practices across the organization, policies for employee training and skill development that are linked to the company’s strategic objectives, and processes for succession planning that minimize capability risks.

How to Create a Strategic HR Plan?

Creating a Strategic HR Plan involves a systematic approach that begins with identifying the current stage of your organization’s life-cycle, such as start-up, growth, maturity, or decline.

After determining your company’s current position, you must develop a clear vision of your business’s future and the strategies that will help you achieve your goals. The Strategic HR Plan should be aligned with the strategic business plan, providing a solid foundation for effective implementation.

By carefully considering the company’s current and future needs, resources, and goals, you can create a comprehensive Strategic HR Plan that outlines the necessary HR practices, policies, and programs to achieve business success.

Step 1: Identify Future HR Needs:

To identify the future HR needs of your organization, it’s important to use your business’s strategic plan as a guide. This involves asking critical questions such as:

• What is the nature of our work and how is it likely to evolve over time?
• What type of culture do we need to cultivate to support productivity and foster employee engagement?
• What specific skills and competencies are required to deliver the results outlined in our strategic plan?
• Where are we currently sourcing those skills, and how can we optimize our recruitment and retention strategies to ensure access to top talent?
• How large is our organization, and what systems and processes do we need to put in place to manage growth effectively?
• How can we align our employee training and development programs with our strategic goals to ensure that our staff has the necessary skills to deliver results?
• What risks are associated with our future HR needs, and how can we manage those risks proactively to avoid disruptions to our operations?

By answering these questions, you can gain a deeper understanding of your organization’s future HR needs and develop a comprehensive Strategic HR Plan that aligns with your business strategy.

Step 2: Look for Present HR Capabilities:

To develop a Strategic HR Plan that aligns with your business’s goals, you must first assess your present HR capabilities. This involves asking critical questions such as:

With the future in mind, what is our current HR capability, and how can we improve it to meet future needs?

• How do our current HR practices and policies compare to industry benchmarks, and where do we need to focus our efforts to close any gaps?
• What are our organization’s strengths and weaknesses in terms of HR management, and how can we leverage our strengths while addressing our weaknesses to achieve our strategic goals?
• Are there any legislative requirements or compliance issues that we need to consider as we develop our Strategic HR Plan?
• What are we doing well now, and how can we expand upon these successful practices in the future to drive business growth?
• Where do the key HR-related risks lie, and how can we mitigate them to minimize disruptions to our operations?
• What HR-related issues or challenges may prevent us from achieving our strategic objectives, and how can we address them proactively?
• How can we leverage our current HR systems and processes to support our progress toward our future goals, and what changes or improvements may be necessary to ensure their continued effectiveness?

By considering your organization’s present HR capabilities in light of your future needs and objectives, you can develop a Strategic HR Plan that addresses potential challenges and leverages opportunities for growth and success.

Step 3: Identify the Gaps Between Current Capabilities and Future Needs:

After assessing your future HR needs and present HR capabilities, it’s important to compare the two and identify any significant gaps that exist. This involves asking critical questions such as:

• Where are the major discrepancies between our future HR needs and our current HR capabilities?
• What specific areas are affected by these gaps, such as policies and procedures, workforce capability, or resource allocation?
• How can we classify these gaps in terms of their scope, severity, and impact on our ability to achieve our strategic goals?

By identifying and classifying the gaps between your present and future HR needs, you can develop targeted strategies to address these challenges and ensure that your organization has the HR resources it needs to succeed.

Step 4: Formulate Gap Strategies:

To bridge the gaps identified in Step 3, it’s important to develop targeted strategies that address your specific needs. These strategies may involve a range of HR functions, such as job design, staffing, performance management, compensation, training, employee relations, safety, and diversity.

Since not all gaps will have the same strategic importance, you will need to prioritize your efforts based on the most critical needs. For instance, if you discovered a need to upgrade your HR information system, it should be prioritized as an urgent requirement since it’s necessary to support your long-term strategic goals.

To determine your strategic priorities, consider questions such as:

• What are the most pressing needs to address first?
• Which strategies can be implemented quickly to generate early progress?
• How do these strategies align with our budget and resource constraints?
• What degree of change is needed to close the gaps and achieve our desired outcomes?

By establishing priorities and focusing on the most important areas, you can develop a comprehensive Strategic HR Plan that aligns with your overall business strategy and drives your organization towards success.

Step 5: Share the Plan & Monitor It:

To ensure the success of your Strategic HR Plan, it is important to share it with senior leaders and HR team members of your organization. This will enable them to understand and support the plan, which in turn will empower them to help the company achieve its goals.

Monitoring the progress of the plan and communicating successes or modifications to the team is also crucial. Reviewing the plan on an annual basis is recommended to verify that the goals are still accurate and to make any necessary adjustments.

The Conclusion

Creating a thorough Strategic HR Plan is a vital investment in the success of your company. By aligning your corporate mission with your business plan, this plan enables you to ensure that you have the capability to execute your strategy and achieve your organization’s goals.