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Blog Human Resources
6 Steps to Create a Strategic HR Plan [With Templates]
By Jessie Strongitharm , Aug 25, 2022
The backbone of any successful business is the people and processes behind it — that’s why creating a human resources (HR) plan is key. This strategic document drives your business forward by evaluating where your workforce is at, and comparing it to future needs.
Without an HR plan, organizations can suffer from issues that would have otherwise been avoided. From productivity pitfalls to costly employee turnover, there’s no shortage of risks you can sidestep if you do human resource planning in advance.
Not sure where to start? No worries. I’ve outlined six steps you can take to create an effective HR plan that ensures your organization is well-staffed and well-served. You’ll also find a variety of HR templates that you can customize in just a few clicks — no design expertise required.
Click to jump ahead:
What is human resource planning.
- Assess employees’ current skill levels
- Forecast your labor needs based on available information
- Revisit your organizational design
- Outline how you will manage, motivate and retain talent
- Align your workforce planning with your budget
- Establish KPIs for your human resource planning objectives
Human resource planning is the process of considering the current and future “people needs” of an organization.
This involves evaluating an organization’s workforce structure and protocols to ensure operational goals are met, productivity stays high and future demands for labor and talent can be fulfilled.
The result of this process is the creation of an HR plan, which typically takes the form of a written document. These documents tend to follow a similar structure to most strategic business plans and are created on an annual basis, by HR managers or company leaders.
Check out the template below for an example.
This eye-catching, one-page HR Strategic Plan Template offers a concise summary of your human resource planning efforts, so you can easily share info with colleagues.
Just swap out the text and visual assets for those of your choosing in Venngage’s editor , and you’re off to the races.
Return to Table of Contents
Start creating a strategic HR plan in 6 steps
Ready to create a strategic plan for the human resources that power your business? Here are six steps to help you succeed at the human resource planning process.
- Assess current employees’ skill levels
The first step to creating a future-forward HR plan is to assess employees’ current skill sets, and compare them to your operational needs moving forward. This will help you identify gaps and inform any hiring of new employees.
Employees’ skill levels can be assessed by reviewing their work history, hard and soft skills and professional growth over time.
Using a matrix is a great way to understand where the skill gaps in your current workforce exist. Below is an example that describes the skills needed for different marketing roles.
Don’t need it for marketing specifically? No worries — you can fully customize this template by swapping in your own text to examine any human resource gaps.
Another way to assess skills is by giving employees a questionnaire they can fill out. This Employee Competency Assessment Template does just that.
Based on the information collected, you’ll get a sense of what positions best suit each individual, and whether any upskilling or hiring is required.
Next in your strategic strategic HR management plan, you’ll want to consider the future. This involves accounting for any upcoming changes to your workforce, so operations can continue without error.
When forecasting labor needs, the following should be considered:
- Planned promotions
- Upcoming retirements
- Layoffs
- Personnel transfers
- Extended leaves of absence (i.e. maternity/paternity leave)
Beyond those, it’s a good idea to assess the impact of external conditions on your labor needs during your human resource planning. For example, new technological developments may decrease the amount of employees you require to operate your business.
Organizational design is the process of structuring the way a business operates so it can best achieve its goals. This is hugely important when it comes to your human resource planning process!
With a clear understanding of your organization’s strategic objectives in mind, reviewing your organizational design allows you to understand the staffing requirements you’ll need to succeed at them. This means taking into account your organizational structure and chains of command, as well as how work gets done and the way information flows.
From there, you’ll be able to see which departments need more team members so it can accomplish the organization’s objectives.
An easy way to get started is by using an organizational flow chart.
With its color coding and layout, even a new manager can quickly look at this chart to identify the people responsible for leading teams and making decisions.
And if there are any changes, it’s easy to to reflect them in the chart itself. All you need to do is customize the text and visual assets in Venngage’s Chart Maker as desired.
Not quite your style? There’s plenty of other organizational chart templates to choose from.
Here’s an organizational chart that’s perfect for small businesses that have limited employees. One quick look, and you’re good to go.
The bottom line is, no matter how big or small your business may be, you should always revisit your organizational design to optimize your workforce management and business operations.
Related: Types of Organizational Structure [+ Visualization Tips]
In this day and age, it’s a known fact that companies must provide more than just a paycheque to attract and retain talent, and encourage growth.
It’s true — studies have shown employees are more engaged in their work when they feel it is meaningful, fulfilling and slightly challenging. So your human resource plan should consider how to inspire such feelings, and what actions you can take to motivate employees to stay. (Hint: a strong HR training and development program is key.)
The talent management infographic template below is a great way to begin.
Using this process chart , you can detail the steps you’ll take to retain the talent you have. Reference it as needed in your human resource planning.
Another great way to keep staff motivated and geared towards their professional growth is by coming up with ideas for employee development . Facilitating a company culture that champions continuous learning guarantees your team will feel supported and challenged in all the right ways.
The two employee development plan templates below will help you do just that.
Though both templates are geared towards healthcare organizations, it’s easy to customize their content in Venngage to promote the continuous learning and development of employees in any industry.
As a result, your employees will be able to reach their full potential, while simultaneously supporting the long-term goals of your organization.
Related: 6 Employee Development Ideas for Efficient Training
Let’s face it, human resources ain’t cheap.
Meaning, if you struggle at organizing and monitoring your HR budget, you’re bound to overspend on your initiatives —and no financially savvy business wants that.
That’s why I recommend including financial information in your HR planning process, so you can reference your budget and expenses as needed. This ensures you’ll be able to stay within range as you work towards achieving your strategic goals for human capital .
Plus, you don’t need to use one that contains walls of text and wack-loads numbers. Check out the clean and cheery option below — it’s as easy to fill out as it is to understand.
And if you’re looking to compare a forecasted budget to previous annual spending when strategizing your HR budget, the Budget Comparison Infographic Template below will help.
The bar graph is a great data visualization of annual expenses, organized by category. Just add (or import) any values to Venngage’s editor, swap out the text, and you’re ready to compare with ease.
Related: 10+ Expense Report Templates You Can Edit Easily
Measurable results are important when it comes to your HR planning processes, because they indicate whether your strategy is working or not.
Keeping those metrics in mind, your company can make adjustments and improve upon any future plans — AKA strategize for future success in business. That’s why your human resource plan should include info re: the specific key performance indicators (KPI) you’ll be measuring.
KPIs are established to help determine if HR strategies and plans are working. Much like those used for evaluating the performance of marketing or sales plan , KPIs for human resources are measurable results that indicate an organization’s success at achieving predetermined goals.
These may take the form of headcounts, turnover rates, demographic information, time to hire and employee satisfaction scores.
Here’s one employee satisfaction survey you can use to understand your workforce better.
When you’re ready to organize those HR KPIs in a document, the recruiting template below is perfect for keeping tabs at a glance.
Related: 10+ Customizable HR Report Templates & Examples
How do I make an HR plan?
After you’ve collected the data you need, you’ll want to convey this info in an engaging, professional manner for easy referencing and sharing amongst colleagues. Given this, using Venngage is the best route to go.
Here are the simple steps to help you bring an actionable HR plan to life:
- Outline the information you would like to include in your strategic hr plan
- Pick the human resource planning templates that best suits your needs
- Customize the templates’ text and visual assets so they speak to your organization
- Apply your company’s brand guidelines with a few clicks using Venngage’s automated branding feature, My Brand Kit
- Download and share as desired
Note: sharing is available free-of-charge. However, the option to download your creations and access features like My Brand Kit and Team Collaboration are available with a Business plan .
FAQ about HR plans
How long should an hr plan be .
There are no hard and fast rules when it comes to the length of an HR plan. That being said, if you’re going to share it with colleagues, you probably don’t want to create a 20+ page document. One to five pages should suffice.
Try to be as concise as possible when relaying the facts, and use data visualizations wherever possible to save room.
Do I need an HR contingency plan?
In the same way creating an HR plan is a proactive move that helps your organization account for future needs, it’s a good idea to devise an HR contingency plan. This ensures there’s a back-up plan in place should your initiatives not go as expected.
For example, if you’ve identified that you need five new hires to keep up with consumer demand, but the talent pool is lacking, a contingency plan could house suggestions for restructuring your workforce to mitigate this.
In other words, it’s best-practice to hope for the best, but prepare for the worst.
Is an HR plan different from an employee development plan?
Yes. While an HR plan is a strategic document describing how an organization addresses its personnel-related needs at a high-level, an employee development plan outlines the processes needed to help an individual achieve their professional goals.
Even though the human resource planning process may involve outlining some employee development tactics, it is not unique to each employee as in the case of an employee development plan.
Make your HR planning processes effortless
You don’t need a crystal ball to feel confident about your people moving forward. With a solid HR plan and strategy in place, you’ll prime your workforce — and all business endeavors — to succeed in even the most competitive of markets.
Just remember this: human resources planning, and creating strategic business plans in general, doesn’t have to be exhausting.
With Venngage’s huge selection of professionally-designed templates and easy-to-use editor, all it takes is a few minutes to produce a polished document perfect for all your needs. Sign up for free today !
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Management and Human Resources Business Plans
The management portion of your business plan, the hr portion of your business plan, frequently asked questions (faqs).
As a startup, it’s never easy to come up with a business plan, let alone the management and human resources sections of a business plan. Despite that, it’s important that you start your business plan for human resources as soon as possible. Doing so gives your management goals a plan that will guide you and keep your business on track as it grows.
The key components of your human resources business plan should include your organizational structure, the philosophy and needs of your HR department, the number of employees you want to hire, how you plan to manage them, and all the estimated costs related with personnel.
You’ll want to start your HR business plan by outlining your own managerial experience and skills as well as those of your team. Highlight the roles of each member of your team, and any particular areas of strength or deficiency in your personnel lineup. For example, your HR team may be strong in compliance and conflict resolution but weak in hiring.
Don't worry if you don’t have a complete team in place when you write your HR business plan. Simply use this section to outline the organizational structure along with job descriptions, how you plan to recruit key team members, and what their responsibilities will be.
This section should look like a pyramid with you at the top and will likely have lateral positions. Be as specific as possible when defining an employee's responsibilities because this is what will drive your business.
Do You Need an HR Manager?
If you’re a solo practitioner, you may not think of including an HR manager in your management business plan. However, if you expect to hire non-managerial employees (such as salespeople or clerical workers), you should consider recruiting a human resources manager.
If hiring a human resources manager can’t be done, consider a human resources consultant. Human resource management requires an immense amount of time and paperwork, and an experienced HR consultant will be able to quickly get your payroll and benefits program up and running, affording you more time to concentrate on growing the business. Human resource responsibilities should include:
- Handling FICA and unemployment taxes and paperwork
- Ensuring compliance with the Family and Medical Leave Act
- Staying on top of IRS filings
There are plenty of companies that offer HR management platforms tailored to each business's needs. Research these companies and be sure to include their estimated cost in your HR business plan.
When you develop the HR portion of your business plan, begin by including a brief overview of your HR strategy. Investors may be curious about how your payroll will be handled and the associated costs of administering it, as well as the type of corporate culture you plan to create. Specific items to highlight in the HR section include:
- Payscale: Show the salaries for managers and non-managers based on the market for those jobs.
- Vacation time: Describe your vacation-time policy. How much time do employees get? How quickly does it accrue? Vacation time is not required by law, but most firms offer vacation time to stay competitive and keep employees refreshed.
- Insurance: Health insurance is a common staple benefit, although skyrocketing prices have forced many firms to cut back on this benefit. If you can’t afford a health plan, look into subsidizing one with employees paying the rest. Alternatively, inquire if a professional insurance representative can help you get a bulk rate.
- Additional benefits: Other things to consider include life insurance, a 401(k) and matching funds, bereavement leave, religious and floating holidays, and a bonus structure, if applicable.
In addition to the key elements above, it helps to have a framework from which to build your HR business plan. Here’s a basic outline that can help you get started:
- Figure out what your human resources department would need.
- Determine a strategy for recruiting talent.
- Formulate your hiring process.
- Develop a training program for new employees.
- Determine how much you want to pay your team (this is a good spot for payscale info)
- Create performance standards
It may be overwhelming to contemplate these benefits and their costs in the early stages of setting up your business, but in a competitive labor market, your firm needs to offer enough to entice qualified people and, more importantly, to keep them happy.
Consider revisiting your management and HR business plans every couple of years to see if you need to create action steps to refine your processes.
What should be in an HR business plan?
An HR business plan should include a mix of the steps you plan to take to launch an effective HR department, as well as specifics about how you plan to handle time off, insurance, and other benefits you plan to offer.
How do I write a human resources plan?
It helps to start with a simple framework. Try to break the plan down into sections: HR needs, recruitment, hiring, training, pay, and performance reviews. From there, incorporate other aspects of HR, like benefits and promotions.
U.S. Chamber of Commerce. " Does Your Small Business Need an HR Department? "
University of Minnesota. “ Human Resources Management: 2.2 Writing the HRM Plan .”
Mecklenburg County, North Carolina. “ FY 2020-2022 Strategic Business Plan: Human Resources .”
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HR Business Plan Template: Everything You Need to Know
With an HR business plan template, you can help your company recruit new employees, retain existing employees, and guide the development of the workforce. 4 min read
With an HR business plan template, you can help your company recruit new employees, retain existing employees, and guide the development of the workforce so that you collectively meet your business objectives, regardless of any changes in the industry or economy.
When creating your HR business plan, you need to perform a needs analysis of your workplace to tailor the plan to your company's requirements. You'll also need to learn about the industry standards for your field to make sure you're competitive.
Without such a plan in place, your workers will feel unprepared and won't know how to work towards your company's overall goals.
Steps for Developing a Human Resources Department Business Plan
There are several steps to creating an HR business plan. They include:
- Clarify the requirements . While you might be tempted to create a detailed plan that encompasses the entire company's next 10 years, hold off. Always talk with your boss to see how much detail he or she would like in the plan. This will save you time and help streamline the process. However, there's no harm in creating your own personalized strategic plan for your specific department.
- Read through the HR job descriptions . The HR department typically has employees such as HR assistants, HR generalists, and an HR director . Read through the job descriptions for each worker in the department and see what kind of duties are missing. Brainstorm additional functions that each job role could provide to the company.
- Curate your list . Take the different functions you've brainstormed and compare them to what each member of the HR department is already doing. Are there functions you could add or subtract from each employee for more productivity? You don't have to go into detail here, but just think about how you could improve each role.
- Schedule a meeting with the executives . Before you make any changes, you'll obviously need to get input and approval from the company's executives. They may have more feedback on how the HR department can provide additional services and support the company's overall goals and mission.
- Create a feedback form . Come up with a list of questions to ask leadership about HR's role in the company and provide it to them in advance of the meeting so they have time to think it over and talk with their staff. You may even want to provide a rating and ranking format for the questions, as this will make their responses easy to understand and implement. Overall, this is a key process to understanding what management and employees want and need from the HR department.
- Look at external resources . While the internal information you're collecting is the most important, it also doesn't hurt to take a look at data from professional organizations and websites, such as the Society for Human Resource Management , The Balance , or HR Magazine . You can also ask colleagues from other local organizations for tips on creating your business plan.
- Use this information to make a plan . With your ideas, feedback from executives, and tips from external resources, you should have a clear idea of what your plan should look like. The things that are missing from the HR department should now be clear, and this should guide you on what to focus on to improve HR's contribution to the company.
- Identify goals for this year and next . While your plan can have long-term goals, keep the majority of them a little bit shorter in scope to see how things work out. This gives you the chance to reorganize and restructure if things aren't going right. Consider creating a list of accomplishments you can reach for the end of this year and into the next.
A Real Life Example
If you're seeking more guidance on how to create a successful HR business plan, look to Starbucks as an example.
As the world's largest coffee chain, Starbucks had $21.3 billion in sales in 2016.
Despite these massive numbers, Starbucks maintains the same approach to their human resources department. All of the HR planning is guided by the company's organizational strategy and brand.
Their strategy is to use specific interview techniques when hiring new employees. This lets them identify potential leaders and place them in a "New Partner Orientation and Immersion" training program. With this system, Starbucks has achieved the lowest employee turnover rate in the quick-service restaurant industry.
Starbucks also offers numerous employee perks and dedicates a lot of time to employee training through an online portal that teaches employees essential job skills.
If you need help with your HR business plan template, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.
Hire the top business lawyers and save up to 60% on legal fees
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5 Steps To Developing A Strategic HR Plan
Apr 18, 2018 | Blog
You’ve heard it before, and you’ll hear it again – every business needs a strategic plan.
The most successful companies develop and implement an effective strategic plan to help them pursue their organizational goals. But, even the best strategic plan won’t be very effective if the human resources function isn’t in alignment with it.
A Strategic HR Plan is a tool to help businesses align their organizational goals with their HR capabilities , and every business should have one in place to support the growth outlined in their strategic plan.
If you haven’t developed a Strategic HR Plan for your business (or if you’re still not quite sure what it is!), don’t worry!
Below we share our 5 Steps To Developing A Strategic HR Plan to help you effectively support and achieve your organization’s strategic goals.
If you’re interested in learning more about developing a Strategic HR Plan or a Strategic Plan for your business, schedule an appointment with one of our HR professionals or give us a call at 877-753-0970 .
What is a Strategic HR Plan?
A Strategic HR Plan helps organizations to align human resources to corporate strategy. It is an essential planning document built upon the corporate mission, vision, values, and goals established in the strategic business plan.
It provides information on how the HR function will support the goals and strategies of the organization, while also ensuring that HR planning and practices are consistent.
The ideal Strategic HR Plan outlines how the gaps between present and future capabilities will be addressed, enabling businesses to effectively pursue their company goals.
Why develop a Strategic HR Plan?
In most organizations, managers have a responsibility to fulfill expectations in the areas of corporate governance, transparency of policies, accountability, and economic efficiency.
For your business to be successful in these areas, you need to have the right people, with the right skills, in the right place, at the right time to carry out the strategy.
A comprehensive Strategic HR Plan will ensure that you have the capacity to deliver on strategy and the ability to monitor progress towards your organization’s goals. It should also establish:
- HR practices that are consistent across the organization
- Training and skill development policies that are linked to strategy
- Succession planning processes that identify and minimize capability risks
How do you create a Strategic HR Plan?
The process for developing a Strategic HR Plan begins by identifying where your organization is now in the life-cycle of an enterprise: the start-up stage, the growth stage, the mature stage, or the decline stage.
Once you’ve decided where your company is today, formulate a clear picture of your company’s future along with ways to get there. Your Strategic HR Plan will be built upon the foundation of this strategic business plan.
Step 1: Identify Future HR Needs
Using your business’ strategic plan as a guide, identify the future HR needs of the organization. Ask questions like:
- What is the nature of our work?
- What type of culture will support productivity?
- What skills do we need to deliver results?
- Where are those skills and how are we tapping into them?
- How large is our organization?
- What systems and processes do we need?
- How are we making sure peoples’ skills match our needs?
- What risks are associated with this future?
Step 2: Consider Present HR Capabilities
Now consider your company’s present HR situation by asking questions like:
- With the future in mind, what is our current capability?
- How are we doing against benchmarks?
- What are our strengths and weaknesses?
- Are there legislative requirements we need to consider?
- What are we doing well now, that we need to do more of in the future?
- Where do the risks lie?
- What HR issues may prevent us from getting to the future?
- What current systems will support or hinder our progress?
Step 3: Identify Gaps Between Future Needs & Present Capability
Compare your future HR needs from step 1 with your present HR capabilities from step 2, and identify any significant gaps that appear.
Gaps can develop in a number of areas including policies and procedures, capability, and resource allocation. Start with these questions:
- Where do significant gaps appear between the present and future?
- How can these gaps be classified?
Step 4: Formulate Gap Strategies
Next, work to develop strategies that will address the gaps you identified in Step 3. These gap strategies may affect:
- Job/Work Design
- Selection/Staffing
- Performance Management
- Compensation/Rewards
- Training/Development
- Employee Relations
- Safety and Health
- Workforce Diversity
Not all gaps will be of the same strategic importance, so you will need to set priorities for addressing them.
For example, imagine you discovered a need to update your HR information system. Investing in a new system would provide you with employee progress data that you deemed essential for your future company goals.
The need for an upgraded HR information system should be prioritized as urgent because it’s necessary to succeed in your long-term strategic plan.
Questions you can ask to help you determine the priority of your needs include:
- What are the top priorities?
- Where can we experience rapid progress?
- How do these strategies work with our budgets?
- What is the degree of change needed?
Step 5: Share & Monitor The Plan
Sharing the Strategic HR Plan with your senior leadership and those connected to the HR function of your organization is a crucial component of its success. The more your team understands and supports the plan, the more empowered they will be to help the company achieve its goals.
It’s also important to monitor the progress of the Strategic HR Plan you develop and to communicate successes or modifications to your team.
At the very least, you should review the plan on an annual basis to verify that the goals on which the plan was based are still accurate and to make adjustments as needed.
Developing Your Plan
Developing a comprehensive Strategic HR Plan is an essential investment in helping your company achieve its goals.
A Strategic HR Plan aligns your corporate mission with your business plan, ensuring you have the capacity to deliver on strategy as you pursue your organization’s goals.
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What is an HR Business Partner and What Do They Do?
Industry Advice Management
Many large companies are enhancing their human resources departments by hiring an HR business partner. Individuals in this role work with executive leadership to ensure that an organization’s strategies for acquiring talent and retaining employees align with overall business goals for transformation and growth.
Success as an HR business partner means knowing the ins and outs of how a business works and what it needs to hit its financial and operational goals. At the same time, these professionals must immerse themselves in the principles of recruiting, managing, and supporting employees. The role places a much higher emphasis on strategy development than other job titles within the HR department, and it also comes with a unique set of responsibilities and skills.
If you’re looking to advance your career in human resources management , read on to see if the role of an HR business partner may be right for you.
What is an HR Business Partner?
An HR business partner is a senior professional focused on using human resources to help a business unit succeed. In dealing with hiring, for example, an HR business partner may work with executives and business unit leaders to develop a plan for what types of candidates to recruit, interview, and hire to increase diversity or bring new skill sets into the company.
According to the Society for Human Resource Management, there are some notable differences between the role of HR business partner and other HR roles, like HR manager or director.
- The HR director serves in an executive position and creates policies in areas such as productivity, discipline, benefits, payroll, and compliance. In the hiring example, the HR director would be responsible for reviewing the organization’s salary and benefits structure in the context of the overall budget.
- The HR manager has day-to-day responsibility for enforcing human resources policy. During hiring, an HR manager would help business units decide which candidate to hire for a given role.
Because HR business partners are expected to take on a strategic role, they tend to command a higher salary than other human resources roles. Estimates for an HR business partner’s average annual salary range from $85,000 to $103,000 , compared to a range of $71,000 to $78,000 for an HR manager and $53,000 to $58,000 for an HR generalist. However, both Glassdoor and Indeed estimate an HR director’s annual salary to be higher, at $98,000, along with the potential for an annual bonus of up to $10,000.
Interested in becoming a strategic business partner in your organization?
Learn more about earning an advanced degree in Human Resources Management
Job Responsibilities of an HR Business Partner
The consultancy McKinsey stresses the importance of making the HR business partner role a purely strategic one. Instead of dealing with transactional and operational issues such as managing personnel, executing strategy, or addressing employees’ day-to-day needs, the most successful HR business partners are given the latitude to focus on large-scale business initiatives such as talent acquisition.
In essence, the HR business partner is an adviser and consultant to business leaders on issues pertaining to human resources. It’s important for individuals in this role to fully understand short- and long-term strategic goals for the business, and to interpret the role that HR can play in helping to achieve these outcomes and drive value to the business.
Indeed notes a number of core responsibilities for someone in an HR business partner role:
- Work with executive leadership to determine business needs and collaborate with HR (including external recruiters) to help meet these needs
- Compare business goals and objectives to the current structure of business units and distribution of roles
- Identify new roles and/or existing job openings that must be filled to enable the business to meet its goals
- Lead the hiring process for high-priority roles, from writing the job description to screening and interviewing candidates
- Monitor the HR budget and advocate for the redistribution of funding of salaries to high-priority roles or departments as needed
Making the shift from tactical and operational work to strategic planning can be challenging, notes the research firm Gartner. If the role of the HR business partner is poorly defined, or if there are limited resources for HR managers, then an individual in an HR business manager role may spend the bulk of their day addressing day-to-day employee issues and have little time for strategic planning.
That said, HR business partners who are empowered to take on a strategic role can make a difference throughout an organization. According to Gartner data , high-performing HR business partners can improve employee performance by up to 22 percent, employee retention by up to 24 percent, revenue by up to 7 percent, and profit by up to 9 percent.
10 Key Skills of a Successful HR Business Partner
The role of an HR business partner is largely strategic in nature, and it requires frequent collaboration with executives and business leaders. As a result, the skills required to achieve success in the role focus on decision-making, communication, and leadership.
1. Proficiency with Digital Tools
HR business partners have a wide range of software products at their disposal to help develop and communicate HR strategy, manage individuals and teams, and track spending. The list includes business intelligence, decision support, data visualization, and online communities that facilitate information sharing.
2. Ability to Leverage Artificial Intelligence
Data analysis can help HR departments with tasks such as evaluating job candidates, assessing staffing needs, and monitoring productivity and other job performance metrics. As Human Resource Executive points out , data analysis plays an important role in strategic planning—especially in an uncertain market.
3. Cross-Cultural Competence
Multinational companies compete on a global scale for talent, both in their field offices and at their headquarters. Effective HR business partners have a keen sense of cultural awareness in the areas where an organization operates; this includes an understanding of different labor laws, business practices, and compensation structures.
4. Knowledge of the Business
It’s expected that HR business partners have a background in the principles of human resources management. But success in the role also requires learning how the organization operates: What are the core business functions, how do the business units interact, what is the organizational chart, and so on. This familiarity is critical for earning the respect and confidence of business leaders, especially in an environment where major changes are anticipated.
5. Project and People Management Skills
An HR business partner should be comfortable with tasks such as developing a project scope statement , managing resources and stakeholders, and communicating in large and small groups. Experience leading teams with remote and/or international contributors is a plus.
6. Effective in Addressing Change and Transformation
In aligning business objectives with personnel decisions, HR business partners frequently advocate that organizations change the way they do things—sometimes radically. It’s important to identify these large-scale changes well in advance and develop strategic plans for managing changes with the least disruptive impact to the organization and its employees.
7. Ability to Identify and Develop Leaders
In addition to becoming leaders themselves, it’s imperative that HR business partners develop leaders within an organization and, when necessary, identify external candidates for leadership roles. All leaders should be evaluated based on how their expertise and performance align with overall business objectives.
8. Exceptional Networking and Relationship-Building Acumen
Within an organization, an HR business partner needs to be comfortable speaking with business leaders with various backgrounds, both to understand the needs of their business units and to build rapport with key decision-makers over time. Outside an organization, the HR business partner should build a network of human resources peers who can provide professional advice and a network of individuals who would add value to the company as potential hires.
9. Ability to Maintain Confidentiality When Necessary
Just as employees are able to trust HR managers with confidential information, leaders need to be able to trust HR business partners with sensitive or “insider” information about business operations or financial performance, according to Human Resource Executive . Business leaders have to be comfortable sharing this information for strategic planning purposes while knowing that it won’t negatively impact their own job performance.
10. Effective Communication Skills among Diverse Audiences
Individuals in HR business partner roles must be adept at communicating in many situations, ranging from executive presentations to negotiations to the occasional conflict or crisis scenario. For today’s businesses, intercultural and digital communication experience is a must-have as well. Finally, being willing to say “No” to executives when necessary, and to present well-thought alternative proposals, is an important skill as an HR business partner advocates for change.
Becoming an HR Business Partner
The Master of Science in Human Resources Management program at Northeastern University’s College of Professional Studies focuses on the trends that are shaping the HR industry today, from the use of technology to the importance of global and cross-cultural perspectives. Students learn how the field of human resources is evolving and how the HR business partner serves as the connection between an organization’s strategy and the people who execute that strategy in their day-to-day work. Explore our program page to learn more.
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What is an HR Business Partner?
by DP Taylor | Updated Aug. 5, 2022 - First published on May 18, 2022
Image source: Getty Images
As a business owner, you understand the importance of workforce planning . But it’s not easy. There’s no crystal ball you can look into that will tell you what positions you need to maximize efficiency as an organization and where you will find the employees best suited to fill them.
Strategic human resource management is about more than just determining how big your employees’ raise will be each year or how you should manage absences .
If you're not creating an HR strategy that incorporates the business interests of your organization, it's going to harm your business in the end. That's where an HR business partner comes in.
However, you shouldn’t necessarily run out and hire an expensive HR business partner and hand over the keys. In some circumstances, you wouldn't want one. This guide will help you understand what an HR business partner does, and in what situations you would want to go out and get one.
Overview: What is an HR business partner?
A human resources business partner is simply an HR professional who develops a comprehensive HR strategy that aligns with an organization's goals. Put differently, this individual works with the leadership to discuss what the company is trying to achieve and then attempts to mold the current HR strategy to support that.
Although the name suggests that an HR business partner is some outsourced professional who comes in with an outsider's perspective, in reality they are typically senior HR professionals who already work within the organization and have a deep understanding of what is needed to make the company successful.
HR business partner vs. HR manager: what’s the difference?
There is some overlap between an HR business partner and an HR manager. They both are in charge of human resource planning and charting out HR strategies to achieve productive organizational change .
However, HR business partners tend to work at a higher level than HR managers do, and may have more business expertise as well. You might say that an HR business partner’s role deals with the overall strategy of a company, while an HR manager handles the day-to-day concerns and ensures everything is running smoothly.
What is an HR business partner responsible for?
There are many possible duties that may fall under an HR business partner’s job description, depending on the company and the situation. However, these three best describe what most of these individuals will be doing in that role.
1. Developing an overarching HR strategy
An HR business partner develops the various strategies and policies governing an organization in alignment with that organization's goals.
This strategy may be centered around boosting worker productivity, changing the compensation and benefits structure, or simply realigning the current workforce in a more efficient way. They can also tell you what organizational structure types are best suited for your business .
2. Evaluating and managing staff
It's one thing to craft an overall strategy, but another to put in place a realistic plan to make that happen. An HR business partner must evaluate the staff and come up with a plan to manage them in a way that will ensure the organization achieves the goals set forth in the HR strategy.
They might also develop an onboarding checklist to smooth the transition for a new employee -- after all, one survey found that 53% of HR professionals found that a better onboarding experience meant better employee engagement.
3. Improving recruitment
A vital part of any HR strategy involves talent management and talent acquisition . An HR business partner must be capable of bringing in excellent new employees who can help take the organization to the next level.
The partner should meet with department heads and evaluate current recruitment efforts in order to come up with a plan that will ensure the organization is able to fill all of the positions that the HR strategy calls for.
The individual should also be able to improve employee retention and reduce your turnover rate so the good workers you bring in don’t bolt for better opportunities after just a year or two.
Should you use an HR business partner or HR software?
This may seem like a strange question, because obviously no HR software can do the job of an HR business partner. But the truth is that sometimes it doesn't make sense to hire an HR business partner, when with some HR software, you can act as the HR business partner yourself.
Both options come with pros and cons, so it's important to break down how to know which to choose.
1. When an HR business partner makes sense
An HR business partner is absolutely vital if you are dealing with any of the following four situations:
- You have a large workforce: When you have a large workforce, you face a major risk that some serious inefficiencies may creep in without your noticing. You may have too few people working a production line, for example, causing products to take longer to get to retailers and ultimately resulting in lower output. An HR business partner can take a deep dive into your current workforce and find inefficiencies that can lead to tremendous, long-lasting increases in efficiency.
- You've hit a rut and want to grow: Perhaps you're not a huge company yet, but you want to grow. The problem is, you feel like you've plateaued lately, and the analytics on your team shows that you aren’t increasing sales. It can be tempting to think in these circumstances that maybe this is the best you can do. This is an ideal time to bring in an HR business partner to look at whether a new HR strategy could help you get over the hump.
- Your HR department feels disconnected from the business side: Sometimes, your HR department gets bogged down in rules and administrative stuff, and it loses sight of the business side. An HR business partner can get your HR department focused on improving the bottom line rather than obsessing over when employees arrive at the office.
- You just feel lost: If you have no background in HR, it can be frustrating trying to implement a sound HR strategy. If you just feel lost on how to go about managing your employees, it's time to bring in a professional who can take into account the business side as well.
2. When you should use HR software
If any of the following three situations apply to you, it's time to get some HR software :
- You have a small staff: If you’re managing a team of, say, 10 employees, doing extensive workforce planning and taking on an HR business partner salary is probably overkill. If you expect to expand at an explosive pace soon, that’s one thing, and it may be wise to bring in an HR business partner before that happens so you aren’t scrambling. But if you’re tiny and your growth is relatively steady, you’re probably better off just getting some HR software and doing it yourself. It might be wise to get some training in HR first, though.
- You have HR experience: Even if you’re managing a somewhat larger team, if you have HR experience and are confident in your ability to plan out the HR side with a business perspective, you might be able to simply use software to do it on your own. After your workforce reaches a certain size, it’s probably best to spring for an HR business partner regardless so you can focus on other things, but in the early stages of your company it may make more sense to do it yourself if you have some background in HR.
- You are a business: OK, the bottom line is all businesses need HR software, even if you do end up hiring an HR business partner. That individual will need access to data on your organization’s workforce analytics and HR metrics in order to come to conclusions about how your resources should be allocated.
Now’s the time to take the next step
The hiring process can be intimidating for anyone who runs a business. Employees are likely your biggest expense, and you want to make sure you are spending your money wisely.
An HR business partner can help make sure you are hiring the right people for the right positions. They’ll also help identify what positions you need, what positions need to be created, and what positions need to be moved or eliminated.
Now is the time to set aside some time to review your current HR strategy. Is it something you can handle yourself, or would you be better served by a professional HR business partner to help guide you and your business? Only you can answer that question.
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HR Business Plan: What Is It And What Are Its Steps?
Every company that has an HR department needs an HR business plan. Without it, you will have inconsistencies when you deal with your employees.
Human resources manage the relationship between your company and its employees. Due to this, it is only natural for human resources to have their own plan of approach to their tasks.
Key Takeaways:
An HR business plan is the strategic approach of the human resources department.
The HR business plan should clarify responsibilities, organize its processes, and create performance standards in which to gauge its success.
First assess the current HR situation, then establish goals and strategies to enact those goals for the HR department.
Make sure your HR strategies comply with legal requirements.
What Is A HR Business Plan?
An HR business plan is a strategic approach your human resource department will follow to accomplish its goals.
Like all business plans, an HR business plan needs to define its objectives, organize systems of measured success, and incorporate a flexible framework. A robust plan can adapt to new scenarios and still focus on its long-term aims.
Though this will vary by company, in general, every HR business plan will want to:
Clarify roles and responsibilities. Focus on the roles and responsibilities of the department and its members. You want to understand the job descriptions of each member of the human resource department. Then decide what the overall purpose of the department is and connect it back to each member. Be aware of any conflicting or contradictory agendas and seek to streamline.
Design and organize processes. Human resources helps hire, train, onboard, and terminate staff. There should be well-detailed plans for each process that keeps the human resources department prepared for any scenario.
Address compensation and benefits. Human resources manages the implementation of benefits and compensation. Therefore, the department’s plan must discuss how this will be handled.
Comply with legal requirements. The human resource department needs to be well-versed in the legal requirements and protections of the employees. The plan should provide a clear compliance with the law.
Create performance standards. A business plan is useless unless it can be evaluated against measures of success. It helps to provide metrics with results to be more objective in analysis.
Tie in to overall business plan. The HR business plan needs to complement the overarching business plan of the company. Avoid any policies or procedures that conflict with the overall business plan.
A human resource business plan will develop these points into a coherent strategy.
Steps To Develop A HR Business Plan
Assess current human resource situation. Before a plan is made, the human resources department and the company executives need to know what they have already. Your company should evaluate the roles and responsibilities of its human resource staff. You will want to see if anything is missing or if there is anything that is expendable.
Establish goals for human resource department. Now that you know what you’re working with, it is time now to think about what you want the human resource department to accomplish. Use the roles and responsibilities you just clarified to arrange practical benchmarks you want the department to make. Make sure goals do not interfere with one another but build toward an overall objective.
Create strategies to enact goals. Once you have your goals in place, it is time to build strategies to accomplish those goals. These strategies should work in tandem, so make sure each one has a logical progression. Like the goals, you do not want your strategies to interfere with one another but instead build towards an overall objective.
Evaluate business plan. Once you enact the plan, you need to make sure you accomplish your goals. Have a feedback system put in place where you can measure the success and failures of your plan. Come up with contingency plans in case your initial plans need to be re-evaluated.
Why Have A Human Resource Business Plan
An HR business plan is needed to establish long-term success with your employees.
Your plan gives focuses on the roles and responsibilities of the department. Human resources play a critical role in the hiring, training, and retention of staff. A business plan will clarify these procedures.
A HR business plan also provides consistency in the implementation of benefits and managing the welfare of the employees.
The human resource business plan empowers the department to perform at its best. In turn, it will help employees be equipped and compensated to perform at their best.
Without a HR business plan, your company is at risk conflicted and contradictory procedures that impede growth and success.
Conor McMahon is a writer for Zippia, with previous experience in the nonprofit, customer service, and technical support industries. He has a degree in Music Industry from Northeastern University and in his free time he plays guitar with his friends. Conor enjoys creative writing between his work doing professional content creation and technical documentation.
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Prepare Your Annual HR Plan for 2022
Each year, it is important to create an annual HR plan to guide your people team or human resources department. However, in 2022, it is even more important for HR departments to take into account recent changes , and develop a sound hr strategic plan to take their teams to the next level.
More important than the details of the plan itself is to make sure the company’s mission and vision are reflected within your annual HR plan for 2022. Without clear objectives and a path to achieve them, you may fall short in reaching your company’s goals.
A highly focused and clearly communicated annual HR plan helps to guarantee your HR objectives will be met.
In this article, we will cover the ins and outs of yearly HR planning and provide the key steps to reach your HR goals.
Table of Contents
What is Meant by HR Planning ?
The purpose of a human resources plan is to analyze and evaluate all the elements related to the human resources policy for the coming year.
Everything from staff dynamics, organizational structure , and working conditions to the hiring process and onboarding of new employees .
As there are many aspects of an HR annual work plan, it’s important to first understand the company environment within which you work, as this will greatly affect the HR plan you create. Once you evaluate the company environment, you can then move forward with creating a successful HR plan of action.
Prepare your annual business plan for HR in 2022 and reach all of your objectives.
Map Out Your Annual HR Plan: Evaluate the Company Environment
At the beginning of the year, companies establish a strategic plan, dependent heavily on the human resources department, where the key annual objectives are set. In order to develop a successful annual HR plan, it’s important to take into consideration the company’s policies and procedures , as well as the employee handbook . That way, you can rest assured that the goals and plans of the company are aligned with those of HR.
To reach your HR objectives, you must first know the answers to the following questions:
What Can We Improve on From Last Year’s Annual HR Planning?
Success is simply the result of many failures and tried attempts, all put together. Identifying past struggles and using them as fuel to propel you forward is what leads to success and improvement.
What Expected Challenges Can I Include in My Yearly HR Plan?
When you know what’s coming, you can better adapt and take advantage of the changes, rather than let them take advantage of you. Consider learning about change management techniques to stay in control through the ups and downs. Analyzing the potential challenges is fundamental for preparing your team for what’s ahead. Also, knowing which changes, events and activities are taking place in the coming months, and how they will likely influence your team, allows you to better manage what lies ahead.
What Areas Within the Company Should I Plan to Improve?
Constant evaluation of the state of the company and its staff is crucial to coming up with solutions to improve. With Factorial, for example, you can create human resources reports that display a graphical vision of the company, outlining the required areas of improvement. If used correctly, these charts can also allow you to make visual conclusions about things such as the turnover rate or employee motivation.
Identifying key areas of improvement is one of the stepping stones to a successful large or small business HR plan.
As a result, reaching your yearly objectives is easy when you take the proper steps to first analyze the company’s environment and what you are working with . Clear communication between the human resources department and the company’s management is vital to creating a solid base for your annual human resources plan.
Define Your Annual HR Plan Goals & Objectives
The objectives of the company’s strategic plan are called long-term objectives . These types of objectives help measure the reach and success of the human resources plan. Generally speaking, they can be divided into two categories:
- Explicit Objectives : Focus on attracting and retaining talent, employee motivation, and improving employee engagement. To set explicit objectives in your annual HR operating plan you have to consider employee experience, the onboarding process, career plans, etc.
- Implicit Objectives: Follow the company’s philosophy and help form the company culture. They show the power of the HR department and how it can help improve productivity. In addition, these objectives focus on the work environment and quality of life for the employees while maintaining all labor regulations.
Organize Your Annual HR Planning: Set Team Responsibilities
Once the objectives are clear, both for the company and for the human resources department, it’s time to create your HR plan by reviewing the team responsibilities. Keep in mind, a thorough analysis of what each department will do in order to contribute to achieving the 2022 HR goals is necessary before moving forward.
Following this, the first step in the HR action plan 2022, is to assign a person who will be in charge of creating and implementing the HR plan . For smaller companies, this person will probably be the CEO. In slightly larger businesses, the person responsible is normally the same one who handles all of the human resources-related tasks. Medium-sized companies will look to their HR team; with every member delegated to a specific task, each corresponding with a goal.
Human resources organizational charts are a great way to visually see who is responsible for what, and who reports to who in the company. Using this type of chart is incredibly helpful for your staff planning. They can be also useful to ensure that the HR management to HR employee ratio is in check. Try using a free organizational chart template to have a clear picture of your company’s structure.
These charts are great for displaying the following:
- The structural hierarchy of the company : Directors, managers, intermediate profiles, employees, etc.
- The departments within the company : Marketing, sales, product, human resources, etc.
- Positions to fill : If there are any gaps in the company structure, the organizational chart will make them clear.
Annual HR Staff Planning: Identify Open Positions
Thanks to the organizational chart you can clearly see how many people you need to hire and for which positions. If you want to achieve your objectives for the coming year, you’ll need to have the right team in place.
In your HR plan you will define:
- Which positions are open – Write a detailed description of all the positions to be filled, including the corresponding department, responsibilities, functions, where they fit in the hierarchy, and their workload.
- Define the ideal profile – Here you’ll have to specify the profile of the candidate you are interested in hiring. Clearly outline the level of education you are looking for, the experience level, and the skills required. Based on this, you can decide whether to recruit from within the company if there is an employee that fits the desired profile.
Clearly defining the above details, are important steps to take in your HR plan. Therefore, allow yourself the time to study and analyze your company at each stage of the HR plan creation process.
Start Planning with a Defined HR Policy
Your updated human resources policy must meet the standards and demands of the general HR and strategic plan. The hr policy will also include guides for the HR department, including, but not limited to:
Hiring Guide
The main purpose of the hiring guide is to assist the HR manager in hiring and onboarding. This guide serves to outline the roles and responsibilities of the employees you are looking to hire. It should contain information on the types of contracts for each position as well. Also, including an HR annual training plan template in your hiring guide is beneficial.
Note: As an HR manager, you will need to decide whether the hiring process will be outsourced or handled within the company. If hiring is done from inside the company , a strategic onboarding process must be established to ensure successful recruitment and retention.
Compensation Guide
With every new contract you plan on offering, you need to state the details of each. For example, the salary amount, benefits, and economic bonuses. Make sure that what is offered in your compensation guide is in line with your overall Human Resources budget.
Workplace Satisfaction Guide Personal
Taking care of new hires is important, but don’t forget about your veteran employees. Long-term employees need to feel continually valued and supported as well. In your HR plan, you should invest part of your budget for the personal and professional development of each employee in the team.
Investing in employee wellbeing creates greater workplace satisfaction. Providing employees with the right personal development tools for success is key. Employees that feel supported display greater motivation for achieving their own goals and career aspirations.
Company Guide
Inside the HR policy, you should think about including a practical guide from the company. Contained in this guide, would be the company vision and mission, proper conduct guides, and conflict resolution codes
Build Your Annual HR Plan 2022
Now that you’ve gone through all the previous steps, you’re ready to build the best HR plan for 2022.
As you can see, creating the ideal HR plan for 2022 takes time and effort to compile . Unfortunately, a high percentage of small and medium-sized businesses simply don’t have the personnel to create a dynamic HR plan.
Save time creating your Annual HR plan with Factorial!
A solid HR plan is fundamental to achieving company goals. If you don’t have the correct tools to do the job, you’ll end up exhausting yourself creating a plan that will miss the mark in the end.
With Factorial, you can create your human resources plan for 2022 with ease. Build your organizational chart , fast and easy, and see who is in charge of what at a glance. Decide which departments need more assistance or restructuring.
Furthermore, Factorial gives you access to all kinds of human resources reports. These reports help you analyze the state of your company, allowing you to more effectively create the most successful HR plan for the coming year!
Are you looking for a little extra support to streamline your HR processes?
Simplify your HR processes with Factorial
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“Unfortunately, a high percentage of small and medium-sized businesses simply don’t have the personal to create a dynamic HR plan.”
‘personal’ should be ‘personnel’, unless I am mistaken?
A great article otherwise!
Thanks Trudy!
Post more! Seriously, I am really digging what you have written so far. I’ve scanned your blog right now for more things to read.
Thanks , this piece was indeed very useful.
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What Is Strategic HR Planning? A Guide for Your Business
- What is strategic HR planning?
- What are the benefits of strategic HR?
- An overview of the strategic HR planning process
/ Was this article helpful to you?
Strategic hr planning helps your organization work together to achieve business goals. learn all about strategic hr below..
Historically, the human resources function has been more administrative than strategic. But today, almost every leading global company’s HR department is involved in future planning and strategic decision-making.
According to SHRM , however, HR professionals in small to midsize organizations are not involved in organizational strategic planning. And even more concerning, Gartner found that only a little over a third of organizations find their HR function to be effective at strategic planning ( full source available to clients ).
If you’re a part of the remaining majority that’s behind the curve, this guide is for you.
In it, we’ll explain what strategic HR is, its long-term benefits, and provide an overview of the process in order to help you, an HR leader, put your organization on a path to sustainable success.
1. What is strategic HR planning?
Gartner defines strategic HR planning like this: “HR leaders plan for business risks and opportunities by prioritizing and allocating resources to HR initiatives.”
When put into action, this includes:
Aligning business and HR strategies
Defining HR priorities relative to critical business initiatives
Adjusting the execution of initiatives as business conditions change
With a traditional human resource management strategy, actions taken by the HR department are often reactive. For example, recruiters will focus on backfilling roles that become open due to turnover, or answering employees’ questions about benefits or compensation as they arise.
Strategic human resource management is more anticipatory. For instance, instead of waiting for questions to be asked or workers to leave their roles, HR professionals may develop a self-service employee knowledge base or start an initiative to improve their employees’ job satisfaction.
Put simply, strategic HR helps plan for the future of the organization, rather than just support the present.
2. What are the benefits of strategic HR?
Businesses that practice strategic HR experience a variety of benefits, including:
Better alignment between HR strategy and business strategy: The number one benefit of strategic HR planning is that the HR department is actively involved in helping achieve business goals. For example, if your business has a goal to improve efficiency, HR will support this by looking for opportunities to automate workflows and analyzing information on employee productivity and attendance .
Well-thought-out hiring initiatives: Workforce planning is an element of strategic HR that anticipates your organization’s hiring needs over the next two to five years. This allows your team to make better decisions about how to effectively use the talent you have, as well as what sort of resources should be allocated to recruiting efforts and when.
More effective training and development programs: Planning training and development initiatives that align with business goals is another important aspect of a strategic HR approach. For instance, if it becomes clear through workforce planning that a handful of senior leaders are set to retire in the next few years, you can invest in a leadership development program in order to prepare current employees with high potential to step into those roles.
3. An overview of the strategic HR planning process
Start by defining organizational goals
It’s best to know where you’re headed before starting the journey, which is why the first step in strategic HR is to define your organization’s most pressing business goals. Whether it be improving customer service or branching out into new markets, work with department heads and C-level leaders to outline your organization’s primary goals over the next one to three years.
Evaluate your current team’s capabilities
The next step of strategic HR planning is to audit your workforce. The purpose of this audit is to gain an sense of the skills and potential of your current employees, including the HR department itself.
HR analytics software can help you collect and analyze information such as the headcount, distribution of skills, development potential, and age demographics of your current employees. Check out the 2021 Capterra Shortlist for an overview of the best HR analytics tools on the market right now.
Forecast future HR needs
Knowing your organization’s future goals and the state of your current workforce, the next step is to brainstorm into the future with your HR team. To keep this brainstorm on track, focus on answering the following questions:
Which high priority skills do we need to acquire over the next few years?
Are there current employees that we can train as a means to acquire new skills?
Should we increase or decrease our headcount? By how much?
Which company-wide HR initiatives would be the most beneficial considering our organization’s goals (e.g. improving employee engagement, establishing an employee well-being program, increasing productivity , capturing employee referrals, etc.)?
Conducting a skills gap analysis will help you answer some of the above questions. Check out " A Better Way To Do a Skills Gap Analysis " for an overview of the process and advice for how to execute each step.
Create a plan of action
Next, it’s time to develop a plan of action based on your forecasted HR needs. The specific steps your team needs to take will depend on how you answered the questions in step three. For example, if you determine that you will need to significantly increase headcount over the next few years, your team should begin to draft a timeline of open positions and target dates for when to fill them.
Is upskilling a part of your plan of action? These resources may help:
Small Businesses Need to Own Upskilling Their Workforce
3 LMS Features That Help with Upskilling Employees
Continuously monitor your strategy’s success
Strategic HR is an ongoing effort, but that doesn’t mean you shouldn’t measure the impact of your actions. The metrics you use to judge your success will vary depending on the focus of your plan; for instance, if your team launched an employee engagement initiative, you can compare absenteeism, voluntary turnover, and productivity metrics to their pre-initiative rates to give you an idea of how effective your initiative was.
Investing in business intelligence or HR analytics software will make tracking these metrics easy. These tools can be used to create custom dashboards that populate with real-time data and build reports that you can share with stakeholders.
Before you go, bookmark these resources
In the world of HR, there’s always more to learn. Lucky for you, we’re always working on new research and resources that help your team stay up to date.
Head to our talent management blog to find more content like this guide. Here are some recent titles that might spark your interest:
3 Effective, Innovative HR Practices You Can Adopt Today
3 Surefire Predictions for the Future of Talent Management
About the Author
Sierra Rogers
Sierra Rogers is a senior content writer at Capterra, covering human resources, eLearning, and nonprofits with expertise in recruiting and learning and development strategies. With a background in the tech and fashion industries, she has extensive experience keeping her finger on the pulse of the latest trends and reporting on how they impact our world. Sierra enjoys cooking and dining out, collecting vintage designer goods, and spending time with her pets at home in Austin, Texas.
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The Role HR takes in Business Planning
By: Adam | Published on: Mar 29, 2019 | Categories: Featured , HR Strategy | 0 comments
HR and Business Planning
What is a HR Business Plan?
A HR Business Plan defines how a company is going to operate and develop over a given period of time.
It focuses on the elements of how to make a profit and identifies the risks which may prevent this. But don’t be fooled into thinking this is a one off process…. HR Business planning is ongoing!
This includes constant tweaks and changes depending on what is working and what isn’t. It is also the anticipation and preparation for changes that might need implementing as the plan progresses.
That change may come about through many things. Some examples you might experience are:
- Altering markets
- The need for new technology and product development
- Global pandemics!
Failing to plan is not an option!
60% of start-ups will fail within their first five years. The reason?
Most of their time is concentrated on their product and what’s immediately in front of them ( the urgent ).
They don’t place enough importance on what’s going on around them. Or how they should be ready to respond ( the important ).
What’s going on around them can be regarding an internal market as well as an external one.
The HR Business Plan
The Business Plan is a dynamic document that should ask challenging questions.
It should be reviewed on a regular basis with the company’s strategic objectives and goals in mind.
Long term objective and goals will be under constant scrutiny. This is to ensure that they are on target, remain relevant in a fluctuating market and are culturally robust.
Good HR business planning is about making smart choices in order to sustain the strategic vision.
But one significant reason for failure is that the business concentrates on a set of goal which is too narrow. Examples of this include:
- Product or service based
The key omission is often planning for the people who are going to make the business succeed.
The Role of HR Business Planning
This is where HR plays a vital role. It should work alongside key senior staff to ensure that plans include areas of HR involvement and participation.
Aligning the HR function with the business plan will ensure that the full potential of staff members is realised.
Visions and Values
In the business planning process, HR ensures that executive focus includes the heart and core of the business. This is its vision and values.
The HR professional position aligns the business’ vision and values as a solid foundation for strategy. This guarantees they are highlighted in strategy discussions!
It also ensures that it is the values of the business that drives people’s motivations and behaviours.
The HR professional demonstrates the importance of business culture. They also highlight how a dysfunctional culture can disable even the best of strategies.
HR is the only function with a business-wide view of employee performance, productivity and effectiveness.
Financial goals are usually the top priority, sometimes being the only priority. However, the HR professional can demonstrate how the attraction, retention and use of the most talented people can enhance secure financial rewards.
This is particularly when centred around a culture that is aligned to a progressive vision and strategy. Naturally, this is when addressed up front in the HR business plan.
Three Key Elements of HR in the Planning Process
1. resource planning.
Once the business goals are set, it is people involved who will carry them out. So, having the right people in the right roles at the right time is key.
A resource plan is the people equivalent of a financial forecast. Consider these questions:
- When will the business require more people?
- Of what type and skill-set?
- Where will you find them and how will you recruit them?
- How long before you need them do you need to commence your recruitment activities to ensure they are in place, inducted, fully trained and ready to go?
- Do you anticipate losing people over the period of a resource plan?
Staff may resign, retire or go on maternity leave. All of which will have an impact on the numbers and types of roles you need to recruit for.
The HR professional will be able to define every aspect of the process for hiring the right people. They will:
- Working with management to define the profile of the role
- Compose the specification of the person who will best fulfil the role
- Dictate how and where to advertise
- Know what to put in an advertisement to attract suitable candidates
- Define and structure interviews so that the best person may be selected.
HR can also ensure that before any hiring process begins, the hiring fits with the long-term HR business plan.
This ensures that the role is not just a knee-jerk reaction to a stressful period of overload.
Or one that will not become quickly redundant as the business stabilises, grows and changes
2. Organisational Design and Development
Psychological studies from as far back as the 1930’s have revealed that organisational structures and processes can influence the behaviour and motivation of a workforce.
In the modern era, the objectives of Organisational Design (OD) are twofold
- To put in place structures and processes that will increase operational efficiency and success, decrease risk and improve problem solving
- To create structures and processes that increase trust, motivation and commitment in the workforce, enabling better problem solving by confronting and managing problems through worker enablement and co-operation.
HR has a unique role here. It is involved in the creation and development of what the design of the organisation is and should be on a company-wide issue.
HR, with its whole-company overview can ensure that the creation of new systems and processes in one area are likely to have an impact on other related areas.
The HR professional will put forward people-based strategies to guarantee the consistency of the alterations across the organisation.
3. Training and Development
OD is likely to include the need for some new roles and changes to others. Therefore, training and development are guaranteed to be needed as part of the strategic growth process.
The HR business plan is likely to be looking at where the organisation will be in 5 -10 years’ time. HR can ask if the workforce is acquiring sufficient skills to meet the growing demands that company’s a business’ growth.
A CIPD study revealed that 49% of respondents believed that they were either underused or over-skilled for the roles they were carrying out.
More significantly, those who felt that their skills were suited to their role were more likely to have job satisfaction (74%). At the end of the study, CIPD said:
Individuals who report using their skills fully in the workplace have higher levels of job satisfaction, earn more and are more resilient to change, while businesses benefit from a more productive workforce and increased profitability.
So, it’s going to be the HR professional who can speak authoritatively on the need for a strategic approach to training and development. This is part of HR business planning and will provide input to help the business achieve its goals effectively.
The HR professional, with access to objective data, is best placed to offer insightful ideas and plans on how to support the people aspect of the business plan.
If HR is allowed to be a key influencer in the business, they can solicit ideas, suggestions and feedback from both management and employees about both input and execution of strategy.
To Conclude on the Role HR Takes in Business Planning
HR’s key functions are all-important to the business planning process.
A shrewd organisation will realise this and make sure that a ‘plan for people’ plays a role of equal importance alongside the other facets of HR business planning.
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Human resource (HR) strategy maximizes the potential of an organization’s human capital so it can achieve its broader business objectives. For some employers, however, transitioning HR from a purely transactional function to a strategic one can be challenging. But considering the competitive advantages enjoyed by talent-driven organizations, it’s an obstacle worth overcoming.
What is an HR strategy?
HR strategy is a roadmap for solving an organization’s biggest challenges with people-centric solutions. This approach requires HR input during policy creation and elevates the importance of recruitment , talent management , compensation, succession planning and corporate culture.
Why is HR strategy important?
Without strategy behind it, HR remains an administrative function and business growth may be hindered. Consider, for instance, two different companies that would like to expand into new markets.
One of them is strategic and gives HR a seat at the table from the very beginning. It researches locations that would be the most advantageous from an employment standpoint and then develops a long-term plan for networking highly-qualified, passive candidates in the chosen regions.
The other company takes transactional approaches to solving problems. Instead of including HR in its expansion discussions, it delegates a hiring manager to recruit candidates without knowing if the desired talent exists in that market or if the employment rules add a significant number of unexpected obstacles.
As the first example shows, when HR is involved and integrated at many levels of an organization, it can create a powerful advantage.
How to create a human resource strategy
Creating an HR strategy means taking a hard look at an organization’s strengths, weakness, opportunities and threats – a process also known as a SWOT analysis. Every business is different, but most follow these steps:
- Understand the business and its objectives Talk to people throughout the organization to gain a full understanding of the business’s past achievements, the products or services that it offers today, and what it hopes to accomplish in the future.
- Evaluate employee skillsets Review employee performance, resumes, project history and continuing education to assess the collective workforce skill level.
- Conduct a gap analysis Determine if employees have what they need to maximize their productivity or if investments in additional resources are necessary.
- Assess talent strategy Regularly auditing compensation, benefits, work environments and employee engagement can help employers compete for new talent and retain valued workforce members.
- Develop existing employees If any employees appear ready for new challenges or have skills outside their current role, create a development plan that will allow them grow to with the business.
- Limit turnover Get to the root cause of why people leave an organization and create a comprehensive plan to address the problem and prevent labor shortages.
- Plan ahead for succession Knowing which employees can easily fill other positions, should they become vacant, helps lessen disruptions when someone abruptly leaves the organization.
- Rely on analytics Compensation history, turnover rates, employee engagement and other HR metrics can guide strategic decisions.
- Create a mission and vision statement Mission and vision statements summarize the HR strategy and serve as a litmus test for all policies and decisions thereafter.
What are the benefits of strategic human resources planning?
One of the primary benefits of syncing HR strategy with broader business initiatives is that it helps organizations allocate budgets in ways that will maximize their return on investment (ROI). Employers who take this approach to HR, may also be able to:
- Reduce turnover
- Improve employee engagement
- Enhance productivity
- Attract superior talent
- Enact better policies
- Minimize business disruptions
Best practices for implementing an HR strategy
Everyone has fires to put out, which is why being proactive rather than reactive in the workplace does not always come naturally. The good news, however, is that HR experts have perfected some tried and true methods for implementing strategy effectively. Best practices are to:
- Involve key stakeholders Strategy requires collaboration. HR professionals should be involved from the beginning and managers and other senior leaders should sign-off on the plan.
- Know the budget Without funds to support it, HR strategy quickly becomes pie in the sky. Focus on initiatives that realistically fit within the organization’s budget.
- Remember the basics Do not overlook administrative responsibilities in favor of strategy. A compliance violation will derail any plan, no matter how grand it is.
- Recognize transactional solutions The quickest answer to a problem may not always be optimal in the long run. Make it a habit of acting strategically in every endeavor.
- Monitor and adjust the strategy Measure the strategy’s effectiveness over time with key performance indicators (KPIs). If something’s not achieving the desired results, revise it accordingly.
Frequently asked questions
What are strategic hr functions.
Examples of strategic HR functions include compensation planning, recruitment, succession planning and employee development.
What are four human resource strategies?
- Limit transactional problem solving
- Be proactive, rather than reactive
- Provide people-centric solutions to large-scale challenges
- Connect people who can solve each other’s problems
What are the types of HR strategy?
There are essentially two types of HR strategies – those that are overarching and those that are specific. Overarching strategies apply to the management of an organization’s people as a whole, while specific strategies address subsets of HR, like talent management or recruitment.
How do you develop a strategic HR plan?
A strategic HR plan can be created by thoroughly evaluating an organization’s strengths, weaknesses, opportunities and threats. This is known as a SWOT analysis. Once employers know this information, they can create realistic goals that account for what they do well and where they need improvement .
This article offers practical information concerning the subject matter and is provided with the understanding that ADP is not rendering legal or tax advice or other professional services.
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SAP Vs. Oracle (2023 Comparison)
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Updated: Feb 28, 2023, 1:00pm
Table of Contents
Sap vs. oracle: at a glance, how the companies stack up, cost of sap vs. oracle.
- Customer Reviews & Reputation
Top SAP and Oracle Alternatives
Bottom line, frequently asked questions (faqs).
Enterprise resource planning (ERP) is a fully inclusive software system that can streamline every aspect of your business. ERP software, such as those from SAP and Oracle, can increase productivity by gathering the necessary data from numerous sources in one easy-to-visualize space. The software can help manage products from inventory to supply chain to pricing and can aid in the HR department with employee resources, retention and training.
If you’ve spent any time researching the best ERP systems , you’ve likely already come across SAP and Oracle, two monoliths in the ERP software world. But how do you choose between these two major tech companies, especially when both offerings seem so similar. We’ve broken down the differences between the two companies and laid out why one might be a better fit than the other for your business.
Almost as long as commercial software has been available to businesses, ERP software has also been around in some form. ERP technology has long been a cornerstone of both SAP and Oracle’s efforts to bring together financial records for enterprise businesses.
It can be hard to tell the difference between SAP vs. Oracle ERP from the outside because the ERP software market appears, at least at first glance, fairly homogeneous. In addition to consolidating and streamlining internal business processes, both these systems integrate sales departments, manufacturing and supply chains for financial accounting. Furthermore, they each provide centralized databases for the entire enterprise to refer to when making critical business decisions, acting as a single source of truth. As a result of this centralized database, enterprise corporations are able to increase their use of business intelligence software as financial data across the company is stored in one place.
Although both SAP and Oracle claim to have solutions for all sizes of businesses seeking growth, the price tag may be prohibitive if not impossible for a smaller or medium-sized company. For rapidly expanding businesses with lots of moving parts, including procurement, supply chain and multiple locations, the software is worth the money.
Although both SAP and Oracle’s focus is primarily on enterprise companies, a closer look at each business’ ERP offerings and deeper dives into SAP’s Business One and Oracle’s Fusion Cloud ERP reveals both can also tailor well to smaller business sizes.
Quote-based (reportedly starts around $108 per user per month)
Artificial intelligence
Integrates with the SAP HANA platform
Standout features
Customizable to all kinds of business and multi language and multi currency support
First launched by five former IBM employees in 1972, SAP has grown into one of the largest business software players in the industry. SAP’s products are designed to help businesses efficiently centralize and streamline key processes and data to make smarter, better decisions in real-time, mitigate and manage risk and drive more profitable growth.
SAP’s HANA computing platform is one of the most powerful of its kind and it is upon this platform that SAP’s Business One ERP software is based. With customers as big as Microsoft, as niche as Carhartt and as small as the Great Lakes Cheese Company, SAP has software options for any kind of business.
- Free 14-day trial
- Both cloud and on-site deployment available
- Offers both extensive customization options
- Includes benefits administration module and numerous software integrations
- Lacks transparent pricing
- No supply chain management features
- Lower user reviews on Capterra and no Better Business Bureau (BBB) rating
Quote-based (reportedly starts at $625 per month)
AI-based risk management and mitigation
Reviewers highlight as great option for financial and resource management
Another early Silicon Valley startup, Oracle was first formed as Software Development Laboratories in 1977. As with SAP, the company has grown into one of the largest and most ubiquitous of business software players in the game with hundreds of thousands of customers big and small using various Oracle products to maximize profits and streamline business operations.
Oracle is fully cloud-based, meaning customization, updates and support are all quicker and easier than an on-site system. While this may mean it’s not an ideal option for compliance-heavy industries, businesses from Chipotle to Spotify to Red Bull Racing have all used the Oracle Cloud to develop, expand and succeed.
- Highly ranked by businesses big and small in 2022 TrustRadius report
- Comprehensive financial suite with strong budgeting, pricing and accounting
- Integrates with other Oracle Cloud applications to provide cohesive view of all parts of a business
- Pricing is not publicly available
- Does not offer on-premises deployment
- Fewer customer relationship management (CRM) features
A high degree of financial focus is evident in both SAP’s and Oracle’s ERP offerings. Accounting and reconciliation-based financial software are common features and present the ability to simplify recordkeeping, consolidate across departments and locations and integrate sales and procurement across entire supply chains.
In addition to supporting multiple currencies and languages, both software provide regulatory compliance settings and forms as well as real-time data management. To facilitate faster analysis of diverse financial records and increase revenue, these features also incorporate advanced computing capabilities, such as AI and machine learning (ML).
Deployment Options
Both SAP and Oracle offer cloud-based deployment options, but only SAP offers an on-premises solution. Oracle’s entirely cloud-based deployment means customizations, integrations and new features and tools can be added or updated relatively easily and quickly. Some industries may require on-site deployments for compliance reasons despite recent reports by the White House and the National Science and Technology Council about the success of cloud-based computing.
Accounting features, such as A/P. A/R and fixed asset management are offered by both SAP and Oracle ERP systems.
With Oracle, financial management and reporting are made more reliable and governance, risk management and compliance (GRC) requirements are incorporated. Oracle is proud of its risk management solutions, which help to enforce enterprise-wide compliance and automate some industry-specific compliance requirements.
However, SAP’s risk management tools can still help your business identify and better understand risk factors and prevent cash leakage as well as enforce policies.
With Oracle ERP, you can implement tools based on common processes. For example, the Asset Management to Retirement module covers the entire lifecycle of an asset, from acquisition to amortization to disposal. A point-of-sale (POS) approach is also used in “Transaction to Cash Position,” integrating it with long-term financial information.
SAP’s software contains relatively basic budgeting capabilities, such as managing and executing general planning, however, Oracle’s ERP system is significantly better.
Oracle offers a specialized tool called “Asset Lifecycle Management,” which enables you to utilize the financial potential of your equipment and other facilities as well as handle typical budgeting needs for businesses.
When it comes to pricing, Oracle’s offerings outdo SAP’s basic features as well. With Oracle, you can adjust your base prices based on market segment, currency, exchange rate and more. It can also manage profit margins, rebates and discounts using set guidelines.
In terms of HR management SAP offers a plethora of additional tools beyond what Oracle brings to the table. Several HR functions may be managed by SAP and users are able to find critical information about them all in one place. In addition, employees can access and update their information through a dedicated portal.
In addition to payroll, SAP ERP software provides e-recruiting functionality that helps companies retain employees and reduce turnover.
Even though Oracle’s reporting capabilities aren’t as robust as SAPs, the visual representations allow for quick communication. If you’re looking to make more HR decisions based on data, this aspect could be especially important to you. By visualizing your company’s data, you will be able to see the history and future of your company quickly.
With Oracle, you can plan campaigns and budgets on a single platform while SAP offers cross-functional processes relating to finance, procurement and marketing.
SAP’s Customer Account Management tools can help your business with nearly every aspect involving the customer. Providing access to your customers’ histories allows you to deal with lead generation more effectively. Additionally, this tool integrates with marketing, sales and finance, giving you a complete picture of your customer’s history with the business and potential ongoing needs. With more knowledge of your customers, you can market in context and use smarter selling strategies.
Sales-order management gets high marks from us for both solutions. SAP casts a wide net and supports distributors of every size and across every industry segment. Oracle’s strengths are its reporting and data features.
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Both SAP and Oracle integrate AI, machine learning and automation into their software but each uses these tools in different ways. SAP’s HANA computing platform, first introduced in 2008, essentially drives all of SAPs offerings providing automation, predictive analytics and machine learning tools throughout SAP’s products.
Oracle’s software features the use of AI and ML as well as with tools, such as Supply Chain Finance, Accounts Payable and more driven by embedded AI. Oracle offers analytics and big data tools that use natural language processing to aid managers with database searching and analysis.
In addition to its platform being built on HANA, SAP also offers an AI-driven digital assistant called “CoPilot,” which helps individuals access the deep analytics and data without requiring a human brain to dig through old reports.
Neither SAP nor Oracle offer public pricing, which makes it difficult to determine exactly how much either solution will cost your business to implement. A customized package with full implementation and support could be as high as a five- to six-figure investment, depending on the size and scope of your business while a one-user subscription to SAP’s cloud-based model is between $100 and $150 a month.
SEIDOR, a trusted local partner of SAP, lists SAP’s Cloud Hosted Professional Plan at $132 per user, per month, and the SAP Business One Perpetual License at $3,213 per user.
Oracle’s Fusion Cloud Service costs between $150 and $200 per user, per month, based on its Global Price List released in December 2022, although these costs may change based on additional customizations, integrations, add-on software or other user or company-specific implementations required for your business.
Customer Reviews & Reputation
Both SAP and Oracle receive mixed reviews when it comes to customer feedback, but both maintain strong reputations as the forefront of the ERP market—especially for larger, enterprise-sized companies.
It’s worth noting that reviews for these types of larger enterprise products may not be reliable, as those using the software for larger operations likely communicate concerns directly with dedicated sales teams or through relationships with the company instead of via online platforms. Those who interact with the software on a daily basis will likely complain to or endorse the software to management personnel at a company instead of making their feelings known online.
Oracle Fusion Cloud receives strong reviews in “ease-of-use,” “customer support,” “value for money” and “functionality” with users noting that it is easy to integrate third party applications.
SAP also receives great feedback in similar categories and users appreciate that SAP Business One is affordable, easy to use and designed for small businesses. Other users also note the adaptability of SAP’s CRM data and tools, which make it easy to use for a variety of businesses.
While SAP and Oracle are great options for those businesses especially centered on financials, other ERP software may be better suited to your company whether due to the size or focus of your business.
Top alternatives to SAP and Oracle include Microsoft Dynamics 365, Katana Manufacturing ERP and Cougar Mountain Denali Summit. If you are looking specifically for inventory management, check out our Best Inventory Management Software reviews. For those businesses looking for supply chain management support, we’ve prepared a review of the Best Supply Chain Management Software .
ERP software can be a game changer for businesses of many sizes. The solutions these software offer drive better decision-making and help organize and control data to provide management with the tools needed to keep things running smoothly. In most categories, we found that Oracle had the stronger features but, at the end of the day, SAP’s Business One Professional takes the win when it comes to overall ERP systems.
Who is SAP Best For?
SAP is our top choice and ranks so highly thanks in part to its offerings of both on-premises installations and cloud-based deployments. With both options, SAP’s ERP software can be used by any businesses from compliance-heavy medical practices to the smallest, most remote companies.
Who is Oracle Best For?
Oracle is an excellent choice for those businesses looking for cloud-based deployments only. Businesses that need feature-rich software with lots of customization and integrations will find Oracle’s Fusion Cloud ERP gives them everything they need and more when it comes to highly -specialized functionality.
What are the different types of ERPs?
In general, there are three different types of ERP systems: Cloud-based, on-premise and hybrid solutions. Many other classifications exist, but the primary division among ERP systems involves implementation. For more insight, check out these ERP system examples .
How do ERP systems work?
ERP systems comprise integrated modules or applications connected with a shared database. You can choose the modules relevant to your business’ needs. For more information, check out our comprehensive breakdown answering the question of what is ERP .
What are the most common ERP modules?
Each ERP system features its own set of modules. The most common ones, however, include finance, manufacturing, procurement, inventory management, warehouse management and CRM.
What are the benefits of an ERP system?
An ERP system offers greater productivity and potential by streamlining and automating core business functions and reporting, helping businesses more quickly gather, process and act on data using real-time insights. ERP systems also help improve risk management.
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Chauncey grew up on a farm in rural northern California. At 18 he ran away and saw the world with a backpack and a credit card, discovering that the true value of any point or mile is the experience it facilitates. He remains most at home on a tractor, but has learned that opportunity is where he finds it and discomfort is more interesting than complacency.
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What Is HR Strategy? And How Can You Best Execute It?
Human resources (hr) strategy defines which hr and workforce practices and activities to pursue and improve to deliver outcomes that will drive enterprise business goals., table of contents, how do you align hr strategy with business goals, what is needed to execute your hr strategy, how do future of work trends affect hr strategy, when is it time to update your hr strategy, what is the role of workforce planning in hr strategy, how do capabilities and skills fit into hr strategy, how does technology fit into hr strategy, additional resources for chros and their teams.
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The highly volatile business environment puts the HR function under enormous pressure to identify strategies that drive enterprise success. The chief human resources officer (CHRO) must break down business goals into strategic implications, but they must also then define priorities that realign HR function service delivery to create business value.
For process, follow these five steps to create an effective human resources strategy that supports enterprise business goals:
- Understand your organization’s mission, strategy and business goals.
- Identify the capabilities and skills necessary to achieve those goals.
- Evaluate the current capabilities and skills of your talent and the HR function, and identify gaps between the current state and future needs of the organization.
- Develop HR goals to resolve gaps and establish criteria for measuring successful strategy execution.
- Communicate the HR strategy.
This strategy will drive the strategic plan and any HR transformation initiatives required to move the HR function from its current to its future desired state. To do this successfully, you will need to:
- Understand how well your functional capabilities and the HR operating model are performing in their current state
- Identify next steps and resources required for short-, mid-and long-term plans
- Ensure continuous alignment of strategy and resources to capture market opportunities and respond to volatility as needed
Also needed are mechanisms to ensure the strategy can respond effectively to change (see “ When is it time to update the HR strategy? ”).
Setting strategy is only the first step; turning it into a strategic HR plan that you successfully execute is far more challenging. The process fails for a number of reasons, including lack of visibility into business goals and inadequately defined measures for success. The volatile conditions in recent years also require measures to keep the strategy aligned as business needs change. Being programmatic helps to ensure that relevant strategy is executed effectively.
Align with business strategy
Human resources strategy should always respond to business strategy; it also should align both upward (with business priorities) and downward (with functional priorities). In a world where talent is increasingly seen as an organizational priority, HR strategy should inform and influence business strategy.
Establish goals as part of the strategy
Consider what constitutes long-term success for your HR function and how to prioritize goals to support enterprise strategy. Perhaps create a prioritized list of initiatives and goals, and evaluate the gaps between the current state and your most critical initiatives.
Set criteria for measuring successful strategy execution and adaptation
Once you’ve developed goals, identify four to seven key performance measures that describe the current level of performance of the HR function. Make sure these measures are specific, quantifiable and clearly tied to the desired performance, and use those same indicators to measure performance in the future.
Craft a clear and concise statement that captures the core of the strategy and summarizes the key objectives on which the HR function will focus over the next year. This empowers your organization’s HR professionals and employees to contribute positively to enterprise objectives. Tailor the communication to each stakeholder group to provide employees with direction for their decision making.
It has always been critical for CHROs to prepare their organizations for the future of work (changes in how work gets done, influenced by technological, generational and social shifts). But the pandemic era has reinvented the future of work in new and unexpected ways — from increasing demands for a more human-centric employee value proposition and more seamless employee experience to tough-to-diagnose employee turnover.
In 2022, several key trends will require a strategic response from HR leaders. They include:
- The growing likelihood that elevated turnover levels could become the norm, turning the Great Resignation into the Sustained Resignation
- The ongoing challenge to affect hybrid work models to the benefit of both employers and employees
- The need to offer a more human and purpose-driven employment deal to respond to peoples’ increased demands for more personal value and purpose from both life and wor
- Fairness and equity becoming the defining issues for many organizations, including who has access to flexible work conditions
Given the growing volume of future-of-work-reinvented trends, HR leaders need to shortlist the most important ones on which to focus when developing HR strategies. This requires a three-step trends analysis:
- Identify : Recognize trends that could affect how, when and where work is done; who or what does work; or even what work means in the near future.
- Interpret : Understand the relevance and implication of a future of work trend to your organization.
- Prioritize : Involve diverse stakeholders for an inclusive process of selecting key parameters. Ensure buy-in by prioritizing trends based on objective evaluation and a comprehensive analysis.
Adapting to the rapidly evolving COVID-19 situation has required C-suite leaders to regularly revisit and adapt their HR strategies and tactics to track changes in business strategy and ensure their organizations’ survival and growth.
The days when strategic planning was a once-a-year, set-it-and-forget exercise are over. Today’s rapidly changing business environment requires HR strategies to adapt. Gartner research shows:
Most organizations (66%) say the top barrier to effective strategic planning is the lack of integration with business needs.
38% of HR leaders state that their HR strategic planning process is not aligned to the business strategic planning calendar, and changes are not triggered by shifts in the business plans.
58% of organizations point to the lack of relevant metrics to track progress as one of the top barriers to effective strategic planning.
Only 28% of HR leaders report reviewing their strategies more than once per year, and only 12% change them more than once per year.
To respond to changes as they happen and avoid wasting time on strategic planning, CHROs should identify external and internal triggers for strategic review and monitor them continuously. To do this:
Talk with relevant stakeholders to identify business-, management- and function-driven strategy triggers for your organization
Use this preemptive identification of triggers to act quickly when they occur instead of falling behind the rest of the business
Once triggers are established, proactively monitor business changes to ensure the function can meet business needs as efficiently as possible and improve overall business outcomes
Workforce planning is the process by which HR leaders generate a forecast that projects the future workforce needs of their organizations. Especially now, workforce and business trends are impacting leaders’ expectations about workforce planning approaches and outcomes.
For example, digital business transformation often changes critical skills needs, as well as planning and budgeting cycles. This is especially the case as HR adopts tactics more common to IT, such as agile methodologies and multidisciplinary fusion teams . HR’s increased use of technology solutions will similarly impact budgets and staffing to capitalize on innovations (see “ How does technology fit into HR strategy ?”).
New ways of working demand new talent profiles across all business units. Strategic human resources management will incorporate more granular information about worker skills, capabilities, knowledge and experiences to respond to those needs.
Five types of workforce planning
- Workforce optimization : How do we optimize the assignment and distribution of tasks and processes to improve capacity utilization, productivity and other business outcomes?
- Workforce scheduling optimization : How do we optimize workforce schedules to meet compliance and fair scheduling needs while ensuring that we can hit business targets?
Operational workforce planning : How do we plan for the right number and types of workforce resources to hit projected business targets and make sure we are executing on that plan?
- Organization modeling and transformation management : How do we align resources to our new organization structure following a significant transformation (for instance, restructuring, merger and acquisition, divestiture and reduction in force)?
- Strategic workforce planning : What are the workforce implications of our organization’s short- and long-term strategy? Will we have the right resources? If not, how could we get them?
Goals of workforce planning include:
- Aligning talent planning with the strategic business plan
- Identifying key workforce risks in the short, medium and long term
- Creating a talent strategy to mitigate potential workforce risks
- Mapping out critical skills needed in existing roles
- Ensuring talent readiness for future business needs
- Filling current and projected talent gaps
- Recruiting future talent for the organization
- Preventing attrition
It’s important for CHROs to make sure they and their HR leaders carve out time and resources to conduct workforce planning effectively as few organizations have specific roles or teams dedicated to these efforts. Larger organizations might benefit from specialist full-time employees in a dedicated role.
Six key steps in strategic workforce planning
- Prepare : Figure out the what, who, where and when.
- Understand business strategy : Identify strategic priorities, analyze emerging trends, translate priorities and trends into workforce capability needs and prioritize workforce capabilities.
- Diagnose and analyze risks : Focus on strategy execution and prioritizing critical capabilities.
- Develop a high-level plan : Create a high-level roadmap to address capability risks.
- Prepare to execute : Document and communicate the workforce plan, and establish triggers for reevaluating it.
- Monitor the plan : Measure, adapt and evolve the plan.
As part of strategic workforce planning, it is essential for HR leaders to identify whether the organization has the capabilities and skills it needs to achieve its business goals. It’s also critical to incorporate plans to address skills needs directly into HR strategies.
Skills are a foundational element for managing the workforce within any industry. Improving and automating the detection and assessment of skills enables significantly greater organizational agility. Especially in times of uncertainty, or when competition is fierce, organizations with better data on skills can adapt more quickly by more accurately identifying which opportunities are feasible immediately, and which require more investment over time.
Gartner research shows that headed into 2022, building critical skills and competencies was a priority for 59% of HR leaders — and the challenge remains complex. Gartner TalentNeuron™ data finds that the total number of skills required for a single job is increasing at 6.3% annually.
Many of today’s new and emerging skills are also difficult to obtain, so HR leaders first need a way to sense shifts in skills needs dynamically. This allows them to:
Anticipate needs as they occur , rather than trying to predict the future, and adapt to those shifts in an iterative, course-corrective way
Develop skills at the time of need by identifying and implementing skills accelerators — strategies that leverage existing resources (e.g., content, people and skills adjacencies ) to develop new skills solutions at speed
Enable employees to make skills decisions dynamically , such as by creating channels for them and the organization to exchange skills information for mutually beneficial and flexible skills development
Prioritizing skills according to enterprise goals will help HR leaders understand the key talent issues they will need to tackle. For example, with the COVID-19 response accelerating the speed and scale of digital transformation, many organizations lack the digital skills required to succeed.
Most organizations will need to deploy multiple talent strategies to acquire hard-to-find critical skills. This involves combining build, buy, borrow, rent and other strategies depending on the particular needs and circumstances.
All processes related to workforce planning use data and analytics intensively, making labor market intelligence and talent analytics (also known as HR analytics, workforce analytics and people analytics) critical for HR leaders to use in:
Forecasting the future workforce
Creating long- and short-term sourcing plans
Pinpointing emerging roles and skills and identifying skills gaps
Analyzing competitor hiring trends
Discovering new competition for key talent
Understanding market disruptors
Pandemic-accelerated trends continue to transform how organizations acquire, develop, motivate, reward, serve and manage talent. Technology has emerged as an essential tool in responding to uncertainty and creating a more human-centric but adaptive and composable organization. HR technology, in shaping employee experience and driving business productivity, is therefore an increasingly critical component of successful HR strategy.
Increasingly, designers of human capital management (HCM) applications aim to improve the candidate, worker, learner and manager experiences, while acknowledging that most employees spend relatively little time using these applications. Many applications have a conversational user interface or use insights from behavioral science disciplines to engage users, influence behaviors and contribute to improvements in organizational culture. Continuous learning, listening, feedback and performance management are also becoming necessary to support hybrid and agile ways of working. HR technology shapes employee experience and impacts business productivity.
But amid continual hype around technology trends, HR leaders must understand their own needs and capabilities as they plan to add technologies within HR processes and existing applications. Aim to improve the employee experience by resisting one-size-fits-all solutions, and instead deploy flexible, human-centric HR processes and tools to meet diverse workforce needs.
The core functional pillars of human capital management (HCM) applications are:
Administrative HR : Core HR organizational and employee data management, employment life cycle processes, transactional employee and manager self-service benefits and payroll administration
- Talent management : Recruiting, onboarding, performance management, compensation allocation, career and succession planning, learning and development, and workforce planning
- Workforce management : Time capture, absence management, scheduling, task and activity tracking, budgeting and forecasting
- Integrated HR service management : Content delivery via a portal and knowledge management capabilities for employees and managers, which may include case management (ticketing/routing), business process management tools and digital document management
Innovation in the HCM technology market is driven by:
- Technological advances, including artificial intelligence , augmented reality and virtual reality
- Increased focus on skills management, as existing HR applications do not support current business requirements
- Wider macro and social developments surrounding the nature and evolution of work practices and policies, such as the increasing importance of diversity, equity and inclusion, automation, remote working and the growth of the gig economy
To support ongoing pandemic responses and prepare for subsequent economic uncertainty, the following technologies have attracted renewed interest:
- Internal talent marketplaces
- Ontology-based skills graphs
- Voice of employee
- Learning experience platforms
- Workforce planning and modeling
Prioritize Roles & Skills to Fight the War for Talent
The top 5 hr trends and priorities for 2022, leadership vision for 2022: chief hr officer, chro global leadership board, 11 trends that will shape work in 2022 and beyond, gartner reimaginehr conference.
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Human Resource Planning: Definition, Objectives, And Steps
- Employee Management , Templates & Guides
Human resource planning is an essential part of every successful business. Unfortunately, many managers neglect this vital practice for other, easier tasks because they don’t understand what this type of planning requires.
Other times, managers may not understand how pivotal human resource planning is to their long-term corporate strategy and the ultimate success of their business.
That’s where Sling can help. In this article, we define human resource planning, outline its objectives, and provide a step-by-step guide to implementing this crucial practice in your business.
Table Of Contents
Human Resource Planning Defined
Human resource planning objectives, hrp vs. shrm, hrp and organizational strategy, steps in human resource planning, why human resource planning is important, challenges of human resource planning, scheduling and communication for effective hrp.
Human resource planning (or HRP for short) is the ongoing process of systematically planning ahead to optimize and maximize your business’s most valuable asset — high-quality employees .
When you incorporate HRP into every aspect of your strategy — functional , business , or organizational — you streamline the process of creating the best fit between available jobs and available employees. All while avoiding a shortage or surplus in your workforce.
As simple as that may sound, there’s more to human resource planning than setting up a system and implementing it in your organization.
The objectives of HRP are very specific and can mean the difference between success or stagnation. We’ll discuss those objectives in the next section.
As we mentioned earlier, human resource planning is about matching the right employees with the right jobs in your business.
You can do this while interviewing prospective employees, or even during the performance review of a long-time team member who is reaching out for more responsibility.
While matching employees to jobs is a big part of human resource planning, the goals of HRP don’t stop there. Other HRP objectives include:
- Adapting to rapid technology changes
- Powering product innovation
- Adjusting to a more globalized economy
- Preparing for generational and cultural shifts
- Anticipating job and skill changes
- Facilitating growth
- Improving business operations
- Mitigating risk
- Preventing talent shortage or surplus
- Complying with local, state, and federal regulations
- Implementing a successful onboarding process
As you can see, HRP is integral to the successful operation of your business and its growth over both the short- and long-term.
Because this process is connected to every aspect of your business , you may feel overwhelmed by the prospect of creating a new HRP strategy.
Don’t let this prevent you from implementing a system that can revolutionize the way your business operates — both now and in the future .
Keep in mind that human resource planning doesn’t have to address all of the objectives on this list from the moment it goes into effect. Start small and expand into different areas once you’ve addressed one or two objectives.
Later on in this article, we discuss a step-by-step method for producing a human resource planning strategy for your business.
But, first, let’s take a moment to discuss one of the most-confused aspects of human resource planning: how it differs from strategic human resource management.
Before we delve into the minutiae of human resources , let’s put the two relevant definitions side-by-side to see how they compare.
Human Resource Planning : HRP is the ongoing process of systematically planning ahead to optimize and maximize your business’s most valuable asset — high-quality employees.
Strategic Human Resource Management : SHRM is a holistic approach to assembling the best team for your business’s growth and success.
At first glance, it may appear that human resource planning is the same thing as strategic human resource management under a different name. They seem so similar because one is actually part of the other.
In this case, HRP is a small part of SHRM. Viewed from a different perspective, SHRM contains and governs HRP.
It’s very much like a set of nesting dolls: the smallest one (HRP) fits nicely into the next largest (SHRM), which, in turn, fits into the next largest, and so on.
For practical purposes, it helps to think about human resource planning as the frontline, boots-on-the-ground application, while strategic human resource management is the guiding principle behind those applications.
In other words, SHRM is the why to HRP’s what.
Another way to think about SHRM and HRP is to view your business as a large, complicated machine.
Human resource planning is one component (a gear, for example) that works with other similar components (e.g., production, logistics, shipping, management, etc.) to keep the machine running.
Strategic human resource management, on the other hand, takes a step back and analyzes the machine itself.
SHRM looks at the performance of each component (each department in your business), how they work together to make everything run smoothly, and what the business as a whole can do to improve.
Let’s return, for a moment, to the example of the nesting dolls mentioned earlier.
We established that human resource planning is the smallest doll and that strategic human resource management is the next largest doll. But what comes after that?
What’s the next largest doll in the series? Organizational strategy.
Organizational strategy , at its most basic, is a plan that specifies how your business will allocate resources to support infrastructure, production, marketing, inventory , and other business activities.
How does this affect human resource planning? Organizational strategy directs strategic human resource management directs human resource planning.
In many ways, the strategy side of your business mirrors the relationship between SHRM and HRP.
Organizational strategy is subdivided into three distinct categories: corporate strategy, business strategy, and functional strategy. Just like SHRM and HRP, each level is a part of the one above it.
Corporate level strategy is the main purpose of your business — it’s the destination toward which your business is moving.
Business level strategy is the bridge between corporate level strategy and much of the “boots-on-the-ground” activity that occurs in functional level strategy.
Functional level strategy is the specific actions and benchmarks you assign to departments and individuals that move your business toward the goals created by your corporate level strategy. They are a direct offshoot of your business level strategies.
With those categories in mind, we start to see the bigger picture of your business. SHRM is a component of your business level strategy, while HRP is a component of your functional level strategy.
Now that you understand the theory behind human resource planning, let’s focus our attention on the practice itself.
1) Analyze Organizational Strategy
Any successful workforce-management program — including human resource planning — is a direct offshoot of your business’s organizational strategy.
Therefore, you should always start your HRP process by analyzing the goals and plans of your organization. With those strategies in mind, you can then move on to crafting a general human resources mission statement.
From there, you can work your way through the various departments in your business to address issues such as:
- Recruitment
- Employee relations
When you have that information written down, you can craft a human resource plan to help your business reach and maintain its goals.
2) Inventory Current Human Resources
After analyzing your organizational strategy, it’s time to take stock of your business’s current human resources.
In the process, it’s beneficial to investigate such variables as:
- Total number of team members you employ
- Who works in what department
- Skills of each employee
- Performance reviews
- Team and individual potential
With that data in hand, you then make sure that your existing workforce is large enough and skilled enough to cover current demands before moving on to the next step in this guide.
3) Forecast The Future Of Your Workforce
Step three is all about planning, prediction, and preparing for the future.
Guided by your organizational strategy and your current employee data, do your best to forecast what the future of your workforce will look like. Be sure to incorporate any goals and plans into your forecast.
Examine variables such as:
- New product offerings
- New services
- A second (or third) location
- Labor costs
- Vendor and supplier relations
- Cost of goods sold
A forecast of this type, coupled with the workforce data from step two, gives you an accurate picture of where your business is right now and where you want it to be five, 10, even 15 years down the road.
4) Estimate Gaps
Armed with the information you’ve produced so far, you can now estimate whether or not there are any gaps in your human resource strategy.
Will you need more employees to get your business from the present to where you want it to be in the future? If so, how many? Will you need fewer employees? If so, how many?
Does your forecast call for a reallocation or redistribution of current team members? If so, how would you go about doing this?
Once you’ve estimated the gaps between your current and future workforce numbers, you can move on to step five, where all the planning and brainstorming comes to fruition.
5) Formulate An Action Plan
Formulating an action plan is where the rubber meets the road, so to speak.
Your action plan should take into account all the analysis that came before it — organizational strategies, current HR inventory, HR forecast, and gaps between present and future — to create a step-by-step system for taking your business from point A to point B.
The action plan will be different for every business. Some businesses may need to begin recruiting and training . Other businesses may need to promote or transition their existing workforce.
Still other businesses may need to develop a retirement program or a redeployment process to deal with surplus employees.
When crafting your plan, start with the theoretical — evolve from X to Y — and then move on to actionable steps that your HR department can take — hire and retain two new team members every year, for example — to transform the theory into reality.
With these steps in mind, you can implement a successful human resource planning system into your business, no matter how many employees you have.
As you go about implementing your business’s HRP, don’t neglect the foundation of all good employer/employee relations: scheduling and communication. We’ll discuss this topic at the end of the article.
6) Integrate With The Rest Of The Company
Now that you’ve got an action plan, your human resource planning efforts will start to yield results.
That said, the integration stage is the most difficult of the entire process, so be ready for some speed bumps.
Without proper preparation — and even with proper preparation, in some cases — both management and frontline employees may show resistance to the proposed changes.
In addition, all departments within your business work together in one way or another (even if it doesn’t at first appear so). This makes the integration phase challenging on many levels.
One of the best ways to integrate human resource planning into the rest of the company is to start with the recruitment , hiring , and training practices in your business.
Once you’ve brought in new, high-potential employees and have begun funneling them into the various departments, you can start to make other changes to accommodate these new hires.
Integrating slowly and pairing the changes with new employees who will further the goals and productivity of each department makes putting your new human resource planning into place much easier.
7) Monitor, Evaluate, And Adjust
The final step in human resource planning is to monitor the new practices, evaluate them for their effectiveness, and adjust as necessary.
In addition to monitoring each department and your business as a whole, it’s also beneficial to zoom in on how any changes made affect the individual employee.
To take the pulse of the front-line worker, include questions about your human resource planning during mid-year reviews and performance appraisals . You can even ask for their opinion when you have them complete an employee self-evaluation .
Monitoring and evaluating in this way will help you get a detailed view of how any new policies, procedures, and practices affect the men and women in the trenches.
Once you have all the information you need, you can then take steps to adjust your human resource planning accordingly.
For that, it’s best to return to the top of this list and start again at step one, incorporating what you learned from the previous run-through.
In essence, then, you can view this list as less of a straight line and more of a circle, with step seven leading directly back into step one. As such, your HRP should be in a constant state of development.
Your business can function without HRP, and, yes, it can be a challenge to get the plans in place, but the benefits far outweigh the drawbacks.
Among other things, HRP can help your business:
- Anticipate workforce needs in a changing market
- Plan for short-term and long-term growth
- Improve operations
- Facilitate staffing changes
- Avoid talent shortage
- Stay ahead of the technology curve
- Remain agile as the market evolves
- Maintain compliance with government laws and regulations
Human capital management is one of the most important parts of your business. HRP helps you maximize that potential.
As beneficial and powerful as human resource planning is, it is not without its drawbacks and challenges.
For one thing, HRP relies on forecasting, which is an imperfect art and is never — and can never be — 100% accurate.
Similarly, you can never account for the ambiguity in the market and the rapid change that could come out of nowhere.
There may be some error when you forecast the future of your workforce. That error will affect the other steps on this list for the good or the bad (depending on how accurate your forecast is).
Realistically, though, that can’t be helped and all you can do is give it your best shot. If you discover errors in your forecasting, you can always return to step one and start the process over with the new information.
Other challenges of the human resource planning process include:
- Resistant workforce
- Inefficient information systems
- Overall cost
- Time and effort
That said, when you are aware of these challenges going in, you can take steps to overcome them right away so that you can get to the benefits sooner.
Scheduling and communication are key components of an effective human resource planning process.
Your team’s schedule is the cornerstone on which you build their work experience. If the schedule doesn’t satisfy all parties — employees and management alike — your business suffers.
Similarly, clear communication with all your employees fosters a strong team and keeps everyone in the loop about employee performance, inventory, standard operating procedures , customer satisfaction , and your business as a whole.
In the 21st century, the best schedules are created and the best communication maintained with help from dedicated software like Sling .
Whether your business has one shift or three, offers flextime or a compressed workweek , or works a 9-to-5 work schedule or a 9/80 work schedule , Sling can help simplify the schedule-creation process.
And with advanced communication features built in, Sling is the only tool you’ll ever need to keep your employees informed about your business and connected with each other.
In fact, we developed the Sling app to streamline communication as well as make scheduling, tracking labor, finding substitutes, assigning tasks, and building employee engagement extremely simple.
There are so many ways Sling can help improve your human resource planning that we don’t have room to talk about them here. So instead of reading about it, why not try it out?
Sign up for a free account and see for yourself how Sling can help you implement the necessary strategies to make your team and your business successful.
For more free resources to help you manage your business better, organize and schedule your team, and track and calculate labor costs, visit GetSling.com today.
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What Is a Business Plan?
Understanding business plans, how to write a business plan, elements of a business plan, special considerations.
- Business Plan FAQs
- Investopedia
Business Plan: What It Is, What's Included, and How To Write One
Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and behavioral finance. Adam received his master's in economics from The New School for Social Research and his Ph.D. from the University of Wisconsin-Madison in sociology. He is a CFA charterholder as well as holding FINRA Series 7, 55 & 63 licenses. He currently researches and teaches economic sociology and the social studies of finance at the Hebrew University in Jerusalem.
:max_bytes(150000):strip_icc():format(webp)/adam_hayes-5bfc262a46e0fb005118b414.jpg "what is an hr business plan")
Investopedia / Ryan Oakley
A business plan is a document that defines in detail a company's objectives and how it plans to achieve its goals. A business plan lays out a written road map for the firm from marketing , financial, and operational standpoints. Both startups and established companies use business plans.
A business plan is an important document aimed at a company's external and internal audiences. For instance, a business plan is used to attract investment before a company has established a proven track record. It can also help to secure lending from financial institutions.
Furthermore, a business plan can serve to keep a company's executive team on the same page about strategic action items and on target for meeting established goals.
Although they're especially useful for new businesses, every company should have a business plan. Ideally, the plan is reviewed and updated periodically to reflect goals that have been met or have changed. Sometimes, a new business plan is created for an established business that has decided to move in a new direction.
Key Takeaways
- A business plan is a document describing a company's core business activities and how it plans to achieve its goals.
- Startup companies use business plans to get off the ground and attract outside investors.
- A business plan can also be used as an internal guide to keep an executive team focused on and working toward short- and long-term objectives.
- Businesses may create a lengthier traditional business plan or a shorter lean startup business plan.
- Good business plans should include an executive summary and sections on products and services, marketing strategy and analysis, financial planning, and a budget.
Want Funding? You Need a Business Plan
A business plan is a fundamental document that any new business should have in place prior to beginning operations. Indeed, banks and venture capital firms often require a viable business plan before considering whether they'll provide capital to new businesses.
Operating without a business plan usually is not a good idea. In fact, very few companies are able to last very long without one. There are benefits to creating (and sticking to) a good business plan. These include being able to think through ideas before investing too much money in them and working through potential obstacles to success.
A good business plan should outline all the projected costs and possible pitfalls of each decision a company makes. Business plans, even among competitors in the same industry, are rarely identical. However, they can have the same basic elements, such as an executive summary of the business and detailed descriptions of its operations, products and services, and financial projections. A plan also states how the business intends to achieve its goals.
While it's a good idea to give as much detail as possible, it's also important that a plan be concise to keep a reader's attention to the end.
A well-considered and well-written business plan can be of enormous value to a company. While there are templates that you can use to write a business plan, try to avoid producing a generic result. The plan should include an overview and, if possible, details of the industry of which the business will be a part. It should explain how the business will distinguish itself from its competitors.
Start with the essential structure: an executive summary, company description, market analysis, product or service description, marketing strategy, financial projections, and appendix (which include documents and data that support the main sections). These sections or elements of a business plan are outlined below.
When you write your business plan, you don’t have to strictly follow a particular business plan outline or template. Use only those sections that make the most sense for your particular business and its needs.
Traditional business plans use some combination of the sections below. Your plan might also include any funding requests you're making. Regardless, try to keep the main body of your plan to around 15-25 pages.
The length of a business plan varies greatly from business to business. Consider fitting the basic information into a 15- to 25-page document. Then, other crucial elements that take up a lot of space—such as applications for patents—can be referenced in the main document and included as appendices.
As mentioned above, no two business plans are the same. Nonetheless, they tend to have the same elements. Below are some of the common and key parts of a business plan.
- Executive summary: This section outlines the company and includes the mission statement along with any information about the company's leadership, employees, operations, and location.
- Products and services: Here, the company can outline the products and services it will offer, and may also include pricing, product lifespan, and benefits to the consumer. Other factors that may go into this section include production and manufacturing processes, any patents the company may have, as well as proprietary technology . Information about research and development (R&D) can also be included here.
- Market analysis: A firm needs a good handle on its industry as well as its target market. This section of the plan will detail a company's competition and how the company fits in the industry, along with its relative strengths and weaknesses. It will also describe the expected consumer demand for a company's products or services and how easy or difficult it may be to grab market share from incumbents.
- Marketing strategy: This section describes how the company will attract and keep its customer base and how it intends to reach the consumer. A clear distribution channel must be outlined. The section also spells out advertising and marketing campaign plans and the types of media those campaigns will use.
- Financial planning: This section should include a company's financial planning and projections. Financial statements, balance sheets, and other financial information may be included for established businesses. New businesses will include targets and estimates for the first few years plus a description of potential investors.
- Budget: Every company needs to have a budget in place. This section should include costs related to staffing, development, manufacturing, marketing, and any other expenses related to the business.
Unique Business Plans Help
The best business plans aren't generic ones created from easily accessed templates. A company should entice readers with a plan that demonstrates its singularity and potential for success.
Types of Business Plans
Business plans help companies identify their objectives and remain on track to meet goals. They can help companies start, manage themselves, and grow once up and running. They also act as a means to attract lenders and investors.
Although there is no right or wrong business plan, they can fall into two different categories—traditional or lean startup. According to the Small Business Administration (SBA) , the traditional business plan is the most common. It contains a lot of detail in each section. These tend to be longer than the lean startup plan and require more work.
Lean startup business plans, on the other hand, use an abbreviated structure that highlights key elements. These business plans aren't as common in the business world because they're short—as short as one page—and lack detail. If a company uses this kind of plan, it should be prepared to provide more detail if an investor or lender requests it.
Financial Projections
A complete business plan must include a set of financial projections for the business. These forward-looking financial statements are often called pro-forma financial statements or simply the " pro-formas ." They include an overall budget, current and projected financing needs, a market analysis, and the company's marketing strategy.
Other Considerations for a Business Plan
A major reason for a business plan is to give owners a clear picture of objectives, goals, resources, potential costs, and drawbacks of certain business decisions. A business plan should help them modify their structures before implementing their ideas. It also allows owners to project the type of financing required to get their businesses up and running.
If there are any especially interesting aspects of the business, they should be highlighted and used to attract financing, if needed. For example, Tesla Motors' electric car business essentially began only as a business plan.
Importantly, a business plan shouldn't be a static document. As a business grows and changes, so too should the business plan. An annual review of the company and its plan allows an entrepreneur or group of owners to update the plan, based on successes, setbacks, and other new information. It provides an opportunity to size up the plan's ability to help the company grow.
Think of the business plan as a living document that evolves with your business.
A business plan is a document created by a company that describes the company's goals, operations, industry standing, marketing objectives, and financial projections. The information it contains can be a helpful guide in running the company. What's more, it can be a valuable tool to attract investors and obtain financing from financial institutions.
Why Do Business Plans Fail?
Even if you have a good business plan, your company can still fail, especially if you do not stick to the plan! Having strong leadership with focus on the plan is always a good strategy. Even when following the plan, if you had poor assumptions going into your projections, you can be caught with cash flow shortages and out of control budgets. Markets and the economy can also change. Without flexibility built in to your business plan, you may be unable to pivot to a new course as needed.
What Does a Lean Startup Business Plan Include?
The lean startup business plan is an option when a company prefers a quick explanation of its business. The company may feel that it doesn't have a lot of information to provide since it's just getting started.
Sections can include: a value proposition, a company's major activities and advantages, resources such as staff, intellectual property, and capital, a list of partnerships, customer segments, and revenue sources.
Small Business Administration. " Write Your Business Plan ."
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4 steps to strategic human resource planning
Reading time: about 7 min
4 steps to strategic human resources planning
- Assess current HR capacity
- Forecast HR requirements
- Develop talent strategies
- Review and evaluate
It’s easy to understand the importance of the human resource management planning process—the process by which organizations determine how to properly staff to meet business needs and customer demands. But despite its obvious importance, many organizations do not have a strategic human resource planning process in place, with many HR professionals reporting their departments need to improve strategic alignment.
If you’ve considered developing an HR planning process, you’re in the right place. This article will explain what human resource planning entails and how to document your strategic plan. With this knowledge under your belt, you’ll be filling positions and growing as a company in no time.
Introduction to strategic human resource planning
In order to improve the strategic alignment of staff and other resources, it’s essential to understand how to create a strategic HR planning process. At its most basic level, strategic human resource planning ensures adequate staffing to meet your organization’s operational goals, matching the right people with the right skills at the right time.
It’s important to ask where your organization stands currently and where it is going for your plan to remain flexible. Each company’s plan will look slightly different depending on its current and future needs, but there is a basic structure that you can follow to ensure you’re on the right track.
The strategic human resource planning process begins with an assessment of your current staff, evaluating whether it fits the organization’s needs. After that, you can move on to forecasting future staffing needs based on business goals. From there, you’ll need to align your organization’s strategy with employment planning and implement a plan to not only to hire new employees but also to retain and properly train the new hires—and your current employees—based on business changes.
Read on to understand human resource planning in more detail.
1. Assess current HR capacity
The first step in the human resource planning process is to assess your current staff. Before making any moves to hire new employees for your organization, it’s important to understand the talent you already have at your disposal. Develop a skills inventory for each of your current employees.
You can do this in a number of ways, such as asking employees to self-evaluate with a questionnaire, looking over past performance reviews, or using an approach that combines the two. Use the template below to visualize that data.
2. Forecast HR requirements
Once you have a full inventory of the resources you already have at your disposal, it’s time to begin forecasting future needs. Will your company need to grow its human resources in number? Will you need to stick to your current staff but improve their productivity through efficiency or new skills training? Are there potential employees available in the marketplace?
It is important to assess both your company’s demand for qualified employees and the supply of those employees either within the organization or outside of it. You’ll need to carefully manage that supply and demand.
Demand forecasting
Demand forecasting is the detailed process of determining future human resources needs in terms of quantity—the number of employees needed—and quality—the caliber of talent required to meet the company's current and future needs.
Supply forecasting
Supply forecasting determines the current resources available to meet the demands. With your previous skills inventory, you’ll know which employees in your organization are available to meet your current demand. You’ll also want to look outside of the organization for potential hires that can meet the needs not fulfilled by employees already present in the organization.
Matching demand and supply
Matching the demand and supply is where the hiring process gets tricky—and where the rest of the human resources management planning process comes into place. You’ll develop a plan to link your organization’s demand for quality staff with the supply available in the market. You can achieve this by training current employees, hiring new employees, or combining the two approaches.
3. Develop talent strategies
After determining your company’s staffing needs by assessing your current HR capacity and forecasting supply and demand, it’s time to begin the process of developing and adding talent. Talent development is a crucial part of the strategic human resources management process.
Recruitment
In the recruitment phase of the talent development process , you begin the search for applicants that match the skills your company needs. This phase can involve posting on job websites, searching social networks like LinkedIn for qualified potential employees, and encouraging current employees to recommend people they know who might be a good fit.
Once you have connected with a pool of qualified applicants, conduct interviews and skills evaluations to determine the best fit for your organization. If you have properly forecasted supply and demand, you should have no trouble finding the right people for the right roles.
Decide the final candidates for the open positions and extend offers.
Training and development
After hiring your new employees, it's time to bring them on board. Organize training to get them up to speed on your company’s procedures. Encourage them to continue to develop their skills to fit your company’s needs as they change. Find more ideas on how to develop your own employee onboarding process , and then get started with this onboarding timeline template.
Employee remuneration and benefits administration
Keep your current employees and new hires happy by offering competitive salary and benefit packages and by properly rewarding employees who go above and beyond. Retaining good employees will save your company a lot of time and money in the long run.
Performance management
Institute regular performance reviews for all employees. Identify successes and areas of improvement. Keep employees performing well with incentives for good performance.
Employee relations
A strong company culture is integral in attracting top talent. Beyond that, make sure your company is maintaining a safe work environment for all, focusing on employee health, safety, and quality of work life.
4. Review and evaluate
Once your human resource process plan has been in place for a set amount of time, you can evaluate whether the plan has helped the company to achieve its goals in factors like production, profit, employee retention, and employee satisfaction. If everything is running smoothly, continue with the plan, but if there are roadblocks along the way, you can always change up different aspects to better suit your company’s needs.
Why document your strategic HR plan
Now that you know the steps to strategic human resource planning, it's time to adapt those steps to your own organization and determine how to execute.
There are a number of reasons to document your strategic human resources plan, particularly in a visual format like a flowchart. Through documentation, you standardize the process, enabling repeated success. Documentation also allows for better evaluation, so you know what parts of your plan need work. In addition, a properly documented plan allows you to better communicate the plan throughout the organization, including how everyone, from the top down, can contribute to make sure the plan works.
Document every step of the process, from beginning to end, and find room for improvement in your human resources process along the way.
Start creating your own strategic human resource plan with this template.
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Together, we own our company, our future, and our shared success.
As an employee-owned company, our people are Black & Veatch. We put them at the center of everything we do and empower them to grow, explore new possibilities and use their diverse talents and perspectives to solve humanity's biggest challenges in an ever-evolving world. With over 100 years of innovation in sustainable infrastructure and our expertise in engineering, procurement, consulting and construction, together we are building a world of difference.
Company : Black & Veatch Corporation
Req Id : 95877
Opportunity Type : Staff
Relocation eligible : No
Full time/Part time : Full-Time
Project Only Hire : No
Visa Sponsorship Available: No
At Black & Veatch, you own your career with purpose and meaning. You are empowered to grow and explore new possibilities at every step of your career journey. Bring your big ideas knowing you are safe to be who you are and speak up with concerns or questions and put your diverse talents and perspectives to use.
In this role, you will have the opportunity to:
- Develop and Execute Human Resources (HR) Strategies to support leadership in achievement of business objectives
- Provide executive level HR consultation
- Consult and execute on various HR cyclical activities (Pay Planning, Succession Planning, Performance Review, etc)
- Coordinates with COEs and other specialist to execute strategy within assigned client base
- Work collaboratively across parts of BV leadership within the business and HR
As part of BV Business Enablement, you will be part of the critical and forward-thinking group that enables our people, projects, and businesses to be as successful as possible by providing creative solutions. Functions in this group include CIO/Global Information Technology, Diode, ESH&S, Finance, Human Resources, Legal, Risk Management, and Government Affairs and Real Estate and Building Services.
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- Strong knowledge of HR programs, policies and procedures understanding of Human Resource Information System(s) Excellent problem-solving skills (identify, analyze, research, evaluate, resolve) Ability to manage several projects of functional areas concurrently
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What is human resource planning? Human resource planning is the process of considering the current and future "people needs" of an organization. This involves evaluating an organization's workforce structure and protocols to ensure operational goals are met, productivity stays high and future demands for labor and talent can be fulfilled.
An HR business plan should include a mix of the steps you plan to take to launch an effective HR department, as well as specifics about how you plan to handle time off, insurance, and other benefits you plan to offer. How do I write a human resources plan? It helps to start with a simple framework.
Human Resources Defined. Human resources is responsible for recruiting, onboarding, training and managing an employee from their job application to final severance. This end-to-end management of ...
The HR planning process allows companies to recruit, hire, train and monitor the proper number of skilled employees to help an organization operate successfully. HR planning has many potential benefits, like increased productivity and adaptability.
A business plan is designed to outline the goals and processes for the business as a whole. It does not take into account how things should be managed by various departments.
All of the HR planning is guided by the company's organizational strategy and brand. Their strategy is to use specific interview techniques when hiring new employees. This lets them identify potential leaders and place them in a "New Partner Orientation and Immersion" training program.
What is a Strategic HR Plan? A Strategic HR Plan helps organizations to align human resources to corporate strategy. It is an essential planning document built upon the corporate mission, vision, values, and goals established in the strategic business plan.
A HR business plan is a detailed plan that outlines the different tools and strategies needed to implement effective HR policies in a company or organization. This can cover a broad range of areas specific to human resources, including talent management and compensation.
The role of an HR business partner is largely strategic in nature, and it requires frequent collaboration with executives and business leaders. As a result, the skills required to achieve success in the role focus on decision-making, communication, and leadership. 1. Proficiency with Digital Tools
2. Evaluating and managing staff. It's one thing to craft an overall strategy, but another to put in place a realistic plan to make that happen. An HR business partner must evaluate the staff and ...
An HR business plan is a strategic approach your human resource department will follow to accomplish its goals. Like all business plans, an HR business plan needs to define its objectives, organize systems of measured success, and incorporate a flexible framework. A robust plan can adapt to new scenarios and still focus on its long-term aims.
What is human resource planning? Human resource planning is the process by which members of the HR department identify current and future hiring or training needs. The purpose of human resource planning is to make sure that a business has the right type of talent spread throughout its departments.
The purpose of a human resources plan is to analyze and evaluate all the elements related to the human resources policy for the coming year. Everything from staff dynamics, organizational structure, and working conditions to the hiring process and onboarding of new employees.
Human resource planning (HRP) is the continuous process of systematic planning to achieve optimum use of an organization's most valuable asset—quality employees. Human resources planning...
2. What are the benefits of strategic HR? Businesses that practice strategic HR experience a variety of benefits, including: Better alignment between HR strategy and business strategy: The number one benefit of strategic HR planning is that the HR department is actively involved in helping achieve business goals. For example, if your business has a goal to improve efficiency, HR will support ...
A HR Business Plan defines how a company is going to operate and develop over a given period of time. It focuses on the elements of how to make a profit and identifies the risks which may prevent this. But don't be fooled into thinking this is a one off process…. HR Business planning is ongoing!
How to create a human resource strategy. Creating an HR strategy means taking a hard look at an organization's strengths, weakness, opportunities and threats - a process also known as a SWOT analysis. Every business is different, but most follow these steps: Understand the business and its objectives. Talk to people throughout the ...
What is HR planning? HR planning involves the HR department of an organisation analysing future requirements for training existing employees or hiring new ones. Planning in HR is important for making sure there's an accumulation of a wide variety of talented employees throughout all departments.
Enterprise resource planning (ERP) is a fully inclusive software system that can streamline every aspect of your business. ERP software, such as those from SAP and Oracle, can increase ...
Communicate the HR strategy. This strategy will drive the strategic plan and any HR transformation initiatives required to move the HR function from its current to its future desired state. To do this successfully, you will need to: Understand how well your functional capabilities and the HR operating model are performing in their current state ...
Human Resource Planning: HRP is the ongoing process of systematically planning ahead to optimize and maximize your business's most valuable asset — high-quality employees. Strategic Human Resource Management: SHRM is a holistic approach to assembling the best team for your business's growth and success.
Business Plan: A business plan is a written document that describes in detail how a business, usually a new one, is going to achieve its goals. A business plan lays out a written plan from a ...
4 steps to strategic human resources planning. Assess current HR capacity. Forecast HR requirements. Develop talent strategies. Review and evaluate. It's easy to understand the importance of the human resource management planning process—the process by which organizations determine how to properly staff to meet business needs and customer ...
Develop and Execute Human Resources (HR) Strategies to support leadership in achievement of business objectives. Provide executive level HR consultation. Consult and execute on various HR cyclical activities (Pay Planning, Succession Planning, Performance Review, etc) Coordinates with COEs and other specialist to execute strategy within ...
May 2022: The Small Business Owner's HR, Benefits, Payroll, and Tax Compliance Deadlines Finances and Taxes Can a health reimbursement account (HRA) reimburse health share plan donations? IRC Section 213 governs which types of expenses and health insurance premiums can be reimbursed through an HRA. An insurance company does not offer HSPs, so ...