A Comprehensive Guide to Developing an HR Strategic Plan
An HR strategic plan solidifies and documents your HR strategy. For the entire organization to engage with the HR strategy, they must understand how it’s being played out. An HR strategic plan turns your HR strategy from an abstract concept into a concrete road map for HR and organizational success.
This article discusses what an HR strategic plan is, why you need one, and how to create one.
Contents
What is an HR strategic plan?
Why do you need an HR strategic plan?
What should be in an HR strategic plan?
Developing an HR strategic plan: 7 steps
HR strategic plan examples
FAQ
What is an HR strategic plan?
An HR strategic plan converts an HR strategy into a single written document. This document is a summary of the strategy so all stakeholders can understand it and put their efforts toward executing it.
This plan outlines specific HR goals, key HR initiatives, and priorities, aligning them with the overall business objectives. It serves as a guide for HR activities, ensuring they contribute effectively to the company’s growth and adapt to changing business environments.
HR leaders will typically collaborate with organizational leadership to formulate this plan, which describes how the HR strategy will affect operations and processes. It outlines the resources needed and actions that will take place to carry out the strategy and measure its progress.
Why do you need an HR strategic plan?
An HR strategic plan keeps everyone centered on the HR strategy. It takes the strategy from an idea to something tangible that is implemented throughout day-to-day procedures.
An HR strategic plan can benefit an organization in the following ways:
- HR’s focus stays on the predetermined priorities
- Company leadership is already included and on board
- Internal customers have a clear picture of what HR is working on
- Goal setting and tracking are in place
- Resources are allocated appropriately because capacity has been determined
- HR teams understand where they’re headed and can become more engaged in their work
- Creating accountability for the HR strategy.
What should be in an HR strategic plan?
An HR strategic plan should cover the HR goals and how they align with the organization’s business objectives. It should also be a road map for implementing HR initiatives that support these goals.
Here is an overview of the key components of an effective HR strategic plan:
- HR mission and vision statements: It’s important to start by stating the plan’s direction. The vision statement declares HR’s purpose and destination, and the mission illustrates how it will get there.
- Organizational values and goals: Since an HR strategic plan must be linked to the organization’s aspirations, you should include the wording of official organizational values and goals.
- HR objectives and key results (OKRs): List the plan’s objectives and the metrics for measuring progress. HR OKRs will help quantify the success of the HR strategic plan.
- Summary of key HR initiatives: Detail the main initiatives for each area of HR that will facilitate achieving the HR strategy’s goals. These are often focused on recruitment, compensation and benefits, organizational culture, employee experience, and employee performance management and development.
- HR operating model and skills needed: Outline how the HR department is organized and delivers its services, such as business partner, functional, or agile HR operating model. State which skills and technical expertise HR professionals need to uphold this type of operating model.
- Resources: Identify the budgetary, technology, and human capital resources needed to implement the HR initiatives. Summarize how they will be allocated to avoid cost overages and employees being overextended.
- Risks and risk management: Name the potential barriers to executing the HR strategic plan and how your organization can mitigate the risks. For example, a tight labor market may require introducing innovative talent attraction and recruiting methods.
- Priorities: State the activities in the priority areas that HR will focus on while executing its agenda. Explain why the activities will improve HR service and support business objectives. For instance, how new succession planning techniques will ensure leadership roles are well-staffed.
Developing an HR strategic plan: 7 steps
Before your HR strategic plan becomes a single document, you need to have a clear idea of your HR strategy. The plan should reflect the organization’s broader objectives and address specific workforce needs and challenges.
Here are seven steps you can follow to develop an HR strategic plan:
1. Understand the organization’s business strategy and goals
An HR strategic plan must mesh with what the organization is doing and where it aims to go. This means that you should be in the loop on high-level planning and decisions to gain a solid grasp of what the business needs are. Then, you can work with leaders to identify the ways HR functions can fulfill these needs.
It’s essential to maintain open communication with key stakeholders and regularly participate in strategic discussions, ensuring HR initiatives are directly contributing to the company’s overall mission and objectives.
2. Assess current HR capabilities
Once you know the business expectations of HR, you need to assess the current state of the HR department and see if it’s equipped to live up to them.
Start by evaluating the strengths, weaknesses, and opportunities you have throughout HR. Also, identify any external factors you should be prepared for. You can conduct a SWOT analysis to walk you through this process.
You can also assess the readiness of your HR department by performing an HR audit. This thorough review of all the HR policies and processes will shed light on how well they’re functioning and reveal which components need to be updated or modified to be more effective for upcoming business goals.
3. Conduct a workforce analysis
The next step is to probe beyond HR and assess the entire staff. Collect data on the existing workforce and identify any gaps in the skills required to take the company through its next phases.
Consider how you will address these disparities, such as through training, recruiting, or adopting new technologies.
Another way to analyze your staff’s current state is to look at other types of workforce data. Find out what story the numbers are telling about employees by reviewing statistics from areas such as:
- Productivity
- Turnover
- DEIB
- Employee engagement
- Employee satisfaction.
These steps will help you establish what exactly your HR strategic plan should cover and focus on.
4. Explain the priorities and objectives of your HR strategy
Summarize the priorities of your HR strategy and list the key objectives you’ve established.
Decide which specific initiatives or programs you will implement to fulfill each HR objective. Then, write a brief description of these that you can display in the finalized HR strategic plan.
For example:
Objective: Address skills gaps and build sufficient staffing levels to support projected business growth.
- Partner with local technical schools to recruit graduates with the required technical skills
- Create online training opportunities to upskill employees for new roles
- Evaluate and adapt compensation and benefits programs to be more competitive.
5. Create the document layout and design
There’s no point in preparing an HR strategic plan if it’s not accessible and engaging. The key to getting people to read and absorb the plan is to present the information clearly and concisely.
This starts with an appealing layout that catches the reader’s eye. Even though it will cover plenty of information, it doesn’t have to be overwhelming. There are many customizable templates available, or you can create your own.
Use simple, concise language that speaks to your audience. Avoid academic-sounding text and HR jargon that might alienate those outside of HR.
It’s fine to use company-specific words, phrases, or acronyms if they are common enough that everyone will be familiar with them. If necessary, you can also provide a brief, parenthetical explanation for a particular term.
Be sure to display the projections, metrics, and statistics in a digestible format. Including visual elements, such as charts, graphs, and infographics, is eye-catching and the most effective way to translate numbers.
6. Develop a communication plan
You’ll want to keep all levels of the organization informed and engaged with the HR strategy so it gains traction. Start at the top with an HR strategic plan presentation to the leadership team and walk them through how the plan ties to the organization’s overall business strategy.
Find various ways to share the core message of your HR strategic plan with employees so they understand its purpose and the benefits of the progress being made.
A regular cadence of tapping into communication channels such as meetings, emails, newsletters, and posts on internal social media will help you provide the information and resources employees need to be in touch and grasp how the HR strategy and plan will impact them.
HR teams should have widespread exposure to how the plan is being activated and a clear picture of how their day-to-day activities are crucial to implementing the HR strategy.
Effective communication is especially important when the plan prompts shifts in policies or practices that affect employees. Announce the changes well in advance and explain what will improve and how they will benefit the company and teams. Be sure to include what type of support you will offer during transitions.
7. Create specific action plans based on your strategic plan
With the HR strategic plan document as a base, you can map out the specific action plans. Break down each objective into high-level, achievable tasks for accomplishing them. Then, assign the tasks to the appropriate teams and set a schedule of timelines, milestones, and deadlines for the activities.
Having this structure in place for HR leaders and teams to follow will keep them motivated and focused on the strategic HR plan. The action plans are also a point of reference for accountability, avoiding delays, and measuring progress.
HR strategic plan examples
Let’s look at some highlights from two real-life HR strategic plan examples:
Example 1: Pennsylvania State University
The HR department of Pennsylvania State University (Penn State) structured its HR strategic plan around five overall goals relating to HR organizational effectiveness, recruitment, DIB, and engaging, developing, rewarding, and retaining employees.
The plan describes the steps for achieving the goals and fulfilling the HR mission of “creating innovative solutions to attract, develop, engage, and retain a diverse workforce.”
Penn State’s document also contains a “Planning Process” section that explains who was involved in creating the plan and the six phases of how it was carried out.
Example 2: The County of San Mateo
The County of San Mateo, California’s comprehensive document explains its five-year HR strategic plan by outlining three areas it will focus on to “maximize individual potential, increase organizational capacity, and position the County as an employer of choice.”
The priorities of each focus area (talent management, employee experience, and HR excellence) are also described.
The document format contains both narrative text and tables to convey the plan’s elements. It is also enhanced by graphics and photos for visual appeal and personalization.
Key takeaway
Creating an HR strategic plan helps you bring your HR strategy to life and is a necessary component for demonstrating HR’s relevance and contribution in today’s business environment.
Once the planning process is finished, the strategy must be accessible to the entire organization. By developing a strategic HR plan document, you can communicate what HR is doing, why and how it’s being done, and make it clear that everything ties into helping the organization progress toward its goals.
FAQ
Developing an HR strategic plan is essential because it clearly summarizes and communicates your HR strategy, making it more accessible to the organization and ensuring accountability.
Writing an HR strategic plan involves understanding your organization’s business needs, assessing what HR competencies you have on the team, analyzing the state of your workforce, formulating the goals of your HR strategy, creating an effective layout for the document, and presenting your plan to your stakeholders.
An HR plan is a proposal for accomplishing HR activities. An HR strategic plan explains what HR will do to address an organization’s business needs and advance its goals.
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