How To Use HR As A Competitive Advantage

by | April 15, 2014

Blog written by Trevor Norcross, Integrated Rewards.

I always seem to see a few articles that question the effectiveness of Human Resource functions. These articles often take the position that HR does not add value or drive business results. At the same time I see posts from HR practitioner asking how to get a seat at the table. If you have to ask for a seat at the table you have not proven your ability to operate at that level. As with any function, HR has significant business impact and can add strategic value to the business. So how do you, as a business leader, make sure your company is getting the most out of HR?

It starts at the top

First, the leadership team has to understand the value strategic HR can provide. If they do not they will likely not invest the time or resources to identify the right employees/partners to get the most out of the function. If the leadership team believes HR is an administrative compliance orientated function that is what they will hire. This is not an issue with HR as a discipline, it is an issue with the expectation.

It’s all about the workforce strategy

It’s easy to find a search firm that will find candidates, a compensation consultant to design a sales commission plan, or a trainer to deliver a training program, but if you don’t have a workforce strategy you won’t be able to take full advantage of their capabilities.

A workforce strategy takes into account your specific industry, business model, product lifecycle, go-to market strategy, competitive advantage and just as important your leadership, leadership style, desired culture, values, and much more. This is the best way an HR team or consultant can design and help you implement programs that will really drive the results of your company. Without this, an HR team or consultant can design and implement programs that will help but it may only get you to a 4-5 on an exponential scale to 10. Getting to a 9-10 on this scale is like Finance working with a tax consultant who identifies a tax strategy that saves you hundreds of thousands/millions of dollars because they understand your business model and financial structure. With a workforce strategy you will be hiring employees that fit your culture, are motivated by your performance management and reward programs, get the most out of your training and development approach, most importantly fit in so your company has more time to focus on its customers.

What does this look like?

If you have a workforce strategy in place your talent acquisition resource will not only know what skills you are looking for but also what type of personality is best suited to succeed in your culture. This will reduce the number of times you hire someone with the right skills but wrong fit. Having the wrong person can lead to disruption with the rest of your team and sidetrack them with interpersonal issues. If you want to build a culture that relies on teamwork and collaboration your talent acquisition resource will know not to present a candidate that operates as a “lone wolf” even if their skills are a fit.

Your total rewards team will be able to design rewards strategies and performance management programs that are aligned with and support your workforce strategy and culture. There is not one way to design rewards programs so it is very important to understand the culture you are looking to support. If you want to build a culture that relies on teamwork and collaboration you will be best served by programs that are less reliant on individual rewards and more reliant of team based rewards.

Your training and development programs can be designed to support your workforce strategy as well. This could be incorporated into the type of training by supporting team based learning with collaborative learning exercises and programs that develop these skills. In short, you can develop a holistic approach that is authentically aligned with your companies goals and culture and not just a patchwork of conflicting programs that work against each other.

Designing HR programs takes skill but it is not the difficult part. The difference between effective strategically aligned HR programs that leads to a competitive advantage and HR programs that are a patchwork of programs is whether there is a workforce strategy to align with.

What do you think? Can the biggest expense/investment in most companies be fully optimized without a workforce strategy?

About Trevor Norcross, President, Integrated Rewards Consulting Group

Trevor Norcross is founder and President of Integrated Rewards Consulting Group, providing global rewards consulting services to a wide variety of industries and non-profit organizations. He was a leading contributor for two granted patents with a third patent pending. He is passionate about the impact rewards can have on business success and believes in providing innovative solutions designed specifically for each company.