Different HR Strategies
There are five types of HR strategies used to meet future organisational needs:
1. Restructuring strategies: Put in place to reduce staff through attrition or termination. Reducing, regrouping or reorganising staff.
2. Training and development strategies: Created to provide staff with training for new roles or development opportunities, preparing them for future jobs within the organisation.
3. Recruitment strategies: Includes recruiting new staff with skills needed in the organisation in the now and in the future.
4. Outsourcing strategies: Using externals to meet the goals of completing specific, specialised tasks, thus avoiding a full-time worker to complete them.
5. Collaboration strategies: Involves collaborating with other organisations similar to your own.
The most effective or rather most suitable is dependent on the findings collected from assessments made to analyse your organisation’s staffing needs.
In order to implement these strategies as part of the strategic plan, certain steps must be taken. Firstly, an agreement for the plan with all those in higher up places: the executive director, the board chair members and senior managers must be obtained. Once the plan has been accepted it then needs to be communicated throughout the entire organisation. It is up to you as the HR team to decide how much detail should be given. Although, it is important to remember that not giving enough information might result in a lack of understanding and much confusion. It goes without saying before the plan is fully implemented it must be in line with all existing regulations, laws and your organisation’s bylaws. Always keep the organisational needs in mind. Compensation such as payroll or benefit plans, as well as space and equipment are likely to be affected whether you are increasing or reducing your workforce. Lastly, determine how success will be measured. This way the plan can be properly evaluated and used as guidance for the next plan. After following through on all of this, the plan and the strategies chosen as an outcome of the plan will be fully implemented.
Real World Example of Successful Implementation of an HR Strategy
IKEA, the Swedish based retail chain which deals in furniture and house decor items has implemented various HR strategies to help forecast and create a strong workforce. One of their most successful implementations was a training and development strategy. Co-workers that had ‘mastered’ their current job role were encouraged to seek new challenges. IKEA also provided on-the-job training as well as traditional classroom courses, thus preparing their employees for future roles in the company. A wide range of web-based training activities for all aspects of IKEA operations was also provided to help integrate new employees. The innovative human resource management strategy IKEA used has helped build a strong and nurturing culture to meet their HR mission: “to give down-to-earth, straight-forward people the possibility to grow, both as individuals and in their professional roles, so that together we are strongly committed to creating a better everyday life for ourselves and our customers”. Having also resulted in IKEA's sustainable growth, their chosen strategy and use of various forecasting methods can be considered successful.
Methods of HR Forecasting
Many methods are useful for forecasting HR requirements. These forecasts are based on the company’s historical and estimated performance data such as sales and production numbers. Either quantitative or qualitative methods can be used.
Trend analysis, a quantitative method is one of the most commonly used for forecasting HR demand using business data. It is through trend analysis that companies can calculate their optimum number of employees needed. The analysis is carried out by plotting trends that affected employee numbers. Reoccurring/continuing trends affecting the number of staff needed in the future can be identified from this data and are used to anticipate figures for staff increase or reduction.
Gap analysis serves to identify competencies needed to achieve the company’s vision and competencies existing in current employees. Once these competencies are identified, the number of employees with those skills needed to meet the organisation’s service and productivity objectives are calculated. Any ‘gaps’ found (e.g. too few/too many staff with a particular skill) are used to either hire, train or outsource the employees needed.
There is no need to use every method that exists. Though using a few will help to ensure the reliability of your forecasts. Only using qualitative methods mean the forecasts made are likely to be subjective, which could then mean overestimations. Only using quantitative methods mean the forecasts are likely to be objective, which could then mean underestimations. Using an equal amount of qualitative and quantitative methods maintains a balance in the forecasts.
Each business has different HR requirements. Every HR team should ensure that all plans, strategies or goals are in line the organisation’s own goals and objectives. Having a firm understanding on your organisation’s needs, value and the future of the company itself provides a starting point from which a strategic plan can be made. Strategies can then me implemented to meet the set goals and objectives.
Forecast with care, utilise more than one method to help produce reliable figures, thus avoiding employing or terminating too many or too little staff.
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