Ch. 9

HR Strategy

BASK Definition

The activities needed to develop, implement, manage and evaluate the strategic direction required to achieve organizational success and create value for stakeholders.

BASK Key Concepts

Approaches to project management: traditional; Lean Six Sigma; agile; critical chain; design thinking; Kaizen
Project management processes: initiating; planning and designing; launching; monitoring and controlling; closing
Planning, monitoring and reporting tools: critical path analysis; Gantt charts; variance analysis; outcome monitoring
Project leadership and governance: team roles; team management; work breakdown structures
Systems thinking: related parts; systems theory; interdependence; the need for feedback; differentiation of units
Strategic planning frameworks: PESTLE; SWOT; industry analysis; location-specific analysis; scenario planning; growth-share matrix; real time; blue ocean
Strategic planning process: formulation; goal setting; implementation; evaluation

What Strategic HR Means

Strategic HR management means aligning people practices with the organization's goals so that HR creates a competitive advantage. HR shifts from administrative work (processing transactions) to strategic partnership (shaping how the business wins through talent). At the CP level, you are expected to understand the strategy, implement HR's part of it and give leaders accurate information. Designing the strategy is an SCP-level expectation.

The Strategic Planning Process

Step	What happens	HR's role
1. Formulation (environmental scan and analysis)	Review the mission, vision and values. Analyze the internal and external environment (SWOT, PESTLE, Five Forces). Identify strategic options.	Supply workforce data: skills inventory, labor market trends, turnover, succession readiness
2. Goal setting	Set long-term goals and measurable objectives	Translate business goals into HR goals (SMART)
3. Implementation	Allocate resources, assign responsibilities, execute	Align structure, talent, rewards and culture with the strategy
4. Evaluation	Measure results against goals and adjust	Report HR metrics and use the balanced scorecard

SMART goals: Specific, Measurable, Achievable, Relevant, Time-bound. Your course's SMARTER adds Evaluated and Revised (or Reviewed).

Strategy Terms

Strategy: A plan of action for achieving long-range goals.
Strategic plans: Usually cover 3–5 years.
Tactical plans: Cover 1–2 years and support the strategic plan.
Operational plans: Cover day-to-day work.
Real-time planning: Continuous strategy adjustment using up-to-date data, instead of a fixed multi-year plan.
Location-specific analysis: Assessing local labor markets, laws, costs and culture for a particular site.

Systems Thinking

Systems thinking is understanding how seemingly separate parts of an organization interact and influence one another. In systems theory, an organization is an open system: inputs (people, money, materials) → throughputs/processes → outputs (products, services), with feedback loops and interaction with the environment.

HR application: A change in one HR area ripples through others. Cutting training costs, for example, may raise turnover and recruiting costs. Peter Senge's The Fifth Discipline makes systems thinking the "fifth discipline" of a learning organization (Ch. 12).

Project Management

Project management processes, following the Project Management Institute's process groups:

Initiating: Define the project, its business case, sponsor and high-level scope. Output: a project charter.
Planning: Define the detailed scope, schedule, budget, resources, risks and communications. Output: the project plan.
Executing (launching): Carry out the plan.
Monitoring and controlling: Track progress against the plan, manage changes and fix variances.
Closing: Deliver, get formal acceptance, release resources and capture lessons learned.

The triple constraint: Scope, time (schedule) and cost (budget), with quality in the middle. Changing one affects the others. Scope creep is the uncontrolled expansion of a project's scope.

Project Management Approaches

Approach	Description
Traditional (waterfall)	Sequential phases, each completed before the next begins. Best when requirements are clear and stable.
Agile	Iterative, incremental delivery in short cycles ("sprints"), with frequent feedback and adaptation. Best when requirements are uncertain. Scrum is a popular agile framework.
Lean	Eliminate waste (anything that doesn't add value for the customer)
Six Sigma	Reduce defects and variation using data. It uses the DMAIC cycle (Define, Measure, Analyze, Improve, Control). "Six Sigma" quality means 3.4 defects per million opportunities.
Lean Six Sigma	Combines waste elimination (speed) with defect reduction (quality)
Critical chain	Schedules around resource constraints and uses time buffers, instead of padding individual tasks
Design thinking	Human-centered problem solving: empathize → define → ideate → prototype → test. Used to design the employee experience.
Kaizen	Japanese for "continuous improvement." Small, ongoing, incremental improvements by everyone.

Planning and Monitoring Tools

Tool	Description
Work breakdown structure (WBS)	Breaks the project down into smaller deliverables and tasks
Gantt chart	A bar chart showing tasks against a timeline, including their durations, overlaps and progress
Critical path method (CPM)	Identifies the longest sequence of dependent tasks, which sets the minimum project duration. A delay to any task on the critical path delays the whole project.
PERT	Program Evaluation and Review Technique. Estimates task times using optimistic, most likely and pessimistic estimates.
Variance analysis	Compares planned and actual schedule and cost
Outcome monitoring	Tracks whether the project achieves its intended results, not just its deliverables
RACI chart	Clarifies roles for each task: Responsible (does the work), Accountable (owns the outcome and signs off; there should be only one per task), Consulted (gives input; two-way), Informed (kept updated; one-way)

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