Building A Better Human Capital Strategy
Your organization probably has an overarching business strategy, a slew of long-term company goals, and a detailed roadmap to achieve all of it. But does it have a strategy to identify the people—and all of their skill sets and expertise—that you’re going to need to execute that strategy and realize that vision? In other words, you know the end goal, you know the journey, you know the milestones along the way—but do you know who’s actually going to take your organization there? That’s the premise of a human capital strategy.
What Exactly Is A Human Capital Strategy?
Human Resources MBA defines the human capital strategy as “the development of strategies to recruit the best available talent, develop career plans for employees, mentor and coach the employees, motivate employees to deliver their best at all times, and develop performance management strategies.”
In short, it’s the people plan. Just like how casting directors carefully select the actors that will be putting on the show, your organization will use human capital management to evaluate, recruit, and train the candidates that will be powering it forward.
This article will delineate a few ways to help you build a better human capital strategy. To be clear, this is not a quick-and-dirty formula or a cheat sheet. Cheat sheets don’t exist for integrated strategies of this scale. Instead, we’ll break down how to start thinking about human capital, and how to view your HR team—the front lines of your human capital strategy—as a proactive player in your organization’s long-term vision
Starting With The Business Strategy
A human capital strategy is borne from the business strategy. The latter is what you want to achieve, the former is who you need to achieve it. That’s a fairly simplistic reading, especially because business strategies have an enormous scope, spanning multiple departments, systems and processes. It’s a massive amount of ground to cover, and deriving a human capital strategy from that business strategy means honing in on only the relevant information and ignoring the noise.
That typically starts with taking a 10,000-foot view of the company, looking at the org chart through a lens that focuses on the broader goals of each subsection. For example, maybe one of your business goals is to have an X increase in sales per year, and you know that the salesforce needs to be technically trained in your CRM and familiar with a specific industry to achieve that. On the other hand, your customer service team will need an entirely separate skill set and qualifications.
Simultaneously, you can examine your current human capital management from a more in-the-weeds perspective, zooming in on departments and focusing on specific employee groups. For example, your sales force may be composed of subgroups that each face entirely different challenges (depending on how the sales department is structured). Those subgroups could be anything—salespeople by region, senior managers, subject matter experts—whatever it is, they’ll have their own role to play in the human capital strategy. It may seem obvious that what makes a successful manager is different than what makes a successful worker, but companies without a human capital strategy often can’t codify this distinction.
Investing In What You Already Have
A human capital strategy doesn’t just mean identifying gaps in your org chart and determining who to target for recruitment. It also means investing in the human capital your organization already has. This is where expert human resources management comes in. In a broader, more general sense, HR leadership can increase employee engagement, and therefore performance: a recent Gallup poll found that more engaged teams resulted in a 21% greater profitability for the organization.
But qualified HR experts also understand how to execute a human capital strategy in a more specialized sense. For example, if an employee or several employees have a particular skill set—say, one that could serve your organization’s expansion into a new market or core capability—smart HR professionals can identify and cultivate that skill through training and mentorship. In short, the key to getting the most out of your current human capital is to arm yourself with a human resource team that can maximize that potential.
Filling In The Gaps
I’ve already mentioned that this article can’t create a tailored plan to build a human capital strategy, but the human resource professionals who can aren’t difficult to find—reach out to Interim and learn how our strategic human resource planning can help you fill in the gaps and staff an HR team that can execute your company’s vision.