THE STRATEGIC ROLE OF HR As people become the key competitive advantage in any industry especially banking, the human

resource (HR) development function will and should play a more strategic role. It should go beyond its mere administrative support function to operations and front line departments. Whether or not company views HR strategically may decide whether market share, sales, or profits would increase or not. An effective HR strategy becomes equally decisive as the companys marketing strategy. Technology too is changing HR roles. As industries, specifically the banking industry, and the way they compete become knowledge-based, HR performance indicators will shift from manpower and man-hours supplied to brainpower and brain hours delivered. The key result areas in people management will also shift from production and quantity to productivity and quality. Capability, measured in employee ideas generated and implemented, and productivity gained, will be more important than capacity, measured in man-hours available, man-hours lost, absenteeism, etc. What is strategic HR? How different is it from the conventional administrative HR? The current HR function is very much configured like the companys purchasing department. People, like parts and supplies, are requisitioned by user departments based on depletion and growth rates of their operations. Both resources are screened for quality control and cost or budget constraints. The only slight difference is that unlike purchased parts, people are trained or prepared before they are sent to the requisitioning parties which may train them further before actual deployment or usage. HR is also involved in the replacement, termination and retirement process of unusable people assets, much like the handling of depreciated equipment. In short, most HR systems exist only for replenishment and maintenance of a resource called people. Strategic HR does not abandon these administrative responsibilities. Otherwise, no other department in the company will carry out these operations-sustaining activities. But its main task is to participate in corporate strategy rather than support administration. Strategic HR is more proactive rather than reactive in its relationships with the other functional areas. It is more concerned about what its internal customers need in the future to compete globally. Strategic HR managers do not wait for instructions, requisition or complaints. It does its homework, does research on the future, and offers proactive solutions and strategic advice. Strategic HR is preventive rather than corrective or punitive. It is developmental in orientation. The conventional HR function is the dispenser or implementers of justice and protector of corporate assets. It views employees as resources not be wasted rather than strategic resources to be developed. Strategic HR aims to create a working environment conducive for employees to do things right the first time. It aims to prevent mistakes rather than punish them. Strategic HR is output driven rather than input oriented. For instance, training results are measured not in terms of training hours or number of trainees per year, but in terms of improvement in the trainee performance attributable to the training. Performance improvement can be in terms of productivity, efficiency, quality of work (defects), customer satisfaction or conversely, number of customer complaints received. Strategic HR personnel are concerned with these results as much as the operating departments it serves. In spite of the fact that output results are more difficult to measure than input deployed, strategic HR aims to find ways and means to directly and indirectly measure these more accurate metrics of its success and effectiveness. Strategic HR is mainly pre-occupied in molding the employees of the future today. For organizations to survive and excel in the future, its needs to develop or acquire employees who are multi-skilled, crossfunctional, empowered, team players. In addition, they have to have high emotional intelligence (EQ) and capable of thinking out of the box about the future. They should be capable not only of improving their

work, but reengineering or reinventing it if necessary. Front liners who are engaged in millions of moments of truth meeting customers, must have superior flexibility, resourcefulness, and excellent memories especially if their task requires greeting customers by their first or last names. Strategic HR keeps these employee attributes as its goals while conducting its basic processes of recruitment, training, job rotation, career pathing, and performance appraisal. Strategic HR aligns performance criteria systems with corporate goals and strategies rather than traditional functional concerns. It includes in performance criteria of both rank and file employees and managers those that will enable them to contribute to corporate goals. Most traditional HR performance appraisal systems basically gauge how well a subordinate satisfied his boss or superior during the appraisal period. This degree of satisfaction may or may not be related to how well the employee contributed to corporate goals. Most of the time, it does not. For this reason, conventional performance appraisal has become a highly politicized, controversial, wasteful exercise that creates more disharmony than teamwork in the organization. Strategic HR appraises people on the more relevant output performance like quality, productivity, internal and external customer satisfaction. If negative criteria are used, these become defects or rework, wastes, and internal and external customer complaints or returns. In banking, performance appraisal may include lost calls, closed accounts, queuing time, and clerical errors, ATM downtime, improvement projects. Strategic HR aims to change employee behavior and attitude by directly connecting his appraisal (and eventually his pay) to what actually matters to corporate performance and customer satisfaction. It puts less weight on nebulous criteria like teamwork, attendance, boss satisfaction, and neatness. HR is no longer a backroom or support function. It is in the forefront of corporate strategy, much like sales and marketing. It provides and determines competitiveness to an ever increasing degree. All other things being equal financial, physical, and product assets people will make the difference between two competing companies. Strategic HR can make this difference happen. Hr Function

Human Resources Employment This is one of the important tasks under human resource management. This is where you can commence the process of strategic HR management. The use of effective interview methods has the high possibility of getting the right person for the right job at the right. Formulation of Human Resources Policy The preparation of human resources policy is one of the major HR functions. Human resource manual can incorporate every aspect of Human Resource. You may want your HR Policy to also state the HR procedures. The contents can range from your chief executive officer's welcome statement, to the terms and conditions of employment, the code of ethics, employee salary and benefits, performance management, grievance procedures, disciplinary rules and procedures, and termination.

It can include the use of your organization's properties, the dress code, health and safety, and sexual harassment. You can determine how detailed the contents are. Preparation of the Human Resource Mission Statement The Mission Statement is very important in focusing the attention of your HR people on their role in improving their performance in order to help increase the productivity of your organization. Refer to the Vision Statement when formulating the Mission Statement of your organization. Find the answers to the question: "Why does my organization exist?" and "Why does HR exist?" Labor Laws Compliance Compliance with the relevant legislation is essential to ensure that you can carry out your HR functions with peace of mind. Dire consequences for organizations ensue when any provision of labor laws is flouted. This can include being dragged before the courts. This responsibility requires a good knowledge of the existing labor laws as well as amendments to it from time to time. As an HR professional, you can assist your organization in avoiding any court action. At the same time, you can see what are the changes required to continue aligning your people strategy to your corporate objectives under the new law. Human Resources Training and Development The training and development of people is intended to maintain or enhance skills, or to provide new skills to employees. Strategic training in functional and the core competencies is intended to assist your company achieve its core business targets. Employee Performance Management Employees' performance is monitored to see whether what they do and the quality of their performance contribute towards attaining the organizational objectives. To what extent are these making important contribution? Get feedback. This goes towards review of your strategic plan.

Employee Motivation Motivation of employees is intended to ensure continuance of performance to the level your organization expects. Try to learn the types of things what motivate people to perform well. Motivation theories such as that of Maslow's hierarchy of needs, provide insights into what motivates people. Employee Retention Retaining your employees, especially the good ones, is crucial. Finding quality people is difficult but to lose one is easy. It is also very costly to find a replacement. Sometimes, it is very difficult to find quality employees that fit your needs. Other HR Functions There are other important HR functions. Some of these could be sub-categories of those stated here. In all of these functions, try to find the "best fit" for each of these HR functions in your overall strategic plan. Changing Role of Human Resource The role of human resource is changing fast. Human resources have acquired a strategic position in organizational success. Thus, the main reason why many organizations are moving towards strategic human resource planning. Following in the footsteps of organizations that have embraced this new approach, your firm has the assurance that others had gone through the process. This positive act ensures that your human resources will play an important strategic role in the achievement of your organization's corporate objectives. Ensure that what your people do is in accord with your organization's business objectives in order to maintain high productivity and success.

HR strategic planning is a critical matter calling for the attention and

decision by the highest managerial level in your organization. This is one of the important 21st century HR issues that you and your management team need to tackle. You can get an idea what a human resource strategy is, HERE.

Effective planning by your top management team can ensure support throughout your organization to a large extent. Also obtain your board's endorsement. It is necessary that every key person including people in HR understands the importance of preparing strategic plan. Human Resource planning is one of the important activities of the HR Manager and HR professionals. When developing HR strategies you need to refer to your HR Mission Statement apart from the organization's overall objectives. Strategic HR Planning plays an Important Role in the Overall Strategic Business Planning Framework. Click HERE to read further information on this important matter. There are certain important aspects of HR management that are basic to understanding what are involved. Getting ready important HR-related forms will help you to maximize use of your time. Addressing Important Human Resource Matters Address all important aspects of HR, including but not limited to: Your Human Resource Objectives Human Resource Strategy HR Management Plan, and The HR Balanced Scorecard as an HR Performance Measurement Human Resource Strategy Make use of human resource strategy at the various stages of corporate development. See how your organization's Mission Statement can show the direction. More Information on HR and Mission Statement" at this link Strategies can range from functional strategy and capability strategy to results strategy. Functional strategy is the strategy you adopt to effectively carry out the HR activities under the HR function. Capability strategy refers to the action plan to develop the knowledge and skills of employees including HR people. When we talk about results strategy, we mean the strategy to align human resources to the "companies' overall business strategies."

The outcomes are measured to determine whether the HR plan is helping to achieve the business plan. The link to the business strategic plan is crucial to leverage the success of your organization through the optimal utilization of your people. You need people with effective leadership styles in the preparation of all your plans. HR Strategic Planning and Organizational Success Surely you have some form of human resource plan. Perhaps it is not in written form. Organizations started to implement and use strategy in HRM planning not too long ago. The aim is nothing less than finding the "best fit" between human resources and organizational business strategies. Try to understand some of the reasons why your plans sometimes fail.

Failure to understand customer's real needs and the reasons why Failure to predict changes in the business environment Not knowing the position of employees' competencies in meeting organizational needs No or weak senior management commitment Failure to follow the plan through to completion Inability to manage change Ineffective communication methods resulting in poor understanding, and thus, poor commitment by employees The strategies adopted are unrelated to the overall business plan

The last reason on the list is very critical. Do not plan for the sake of planning. The objective is to link, to align HR strategies to organizational objectives. This presumes that there is an organizational strategic plan in place. In your endeavors at HR strategic planning, keep reminding yourself of the need to link the strategic plan - that is, the step-by-step action plan - to the overall strategic plan of the organization. Simply put, focus on making a good HR plan. Re-engineering of HRM Understanding how to develop strategy is a motivation to progress to HR strategic planning.

You can use the services provided by human resources organizations to re-engineer human resource management in your organization. As a human resource professional, you are rightly positioned to help your organization succeed in this important endeavor. Planning Knowledge and Skills HR strategic planning is easier said than done. Skills and knowledge are required. Arrange for the relevant skills training in the absence of adequate internal expertise. Everyone in critical positions must undergo the necessary skill training. The training and knowledge acquisition on strategic planning must address the needs of every sector in your organization without exception. Update the planning skills and knowledge of your people from time to time. This includes HR strategic planning knowledge and skills. Strategize your employee training and development plan. Again, this means linking your employee training and development objectives to your organization's skills and knowledge needs. If you can find a good consultant, go ahead. Engage the consultant to ensure that everything goes according to plan. And even if you engage a consultant, on-going training is still very much required. Expertise transfer and employee ownership are some of critical factors to consider before engaging a consultant. But there is a another - and cheaper - way. It involves people from within the organization itself to take the necessary action. This requires managers to teach themselves how to carry out HR strategic planning. Many managers and supervisors look for answers at various times in the course of performing their responsibilities on how to manage people better. As a manager you may have read or heard about the need to use strategy in human resource management. You believe you know and understand. But when it comes to actually doing it, you are not too sure anymore. Here is a book about linking strategy to human resource management available at Amazon.com.
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