Strategic Human Resources Management (SHRM) is a key business approach, focusing on aligning HR strategies with company goals. It's about placing the right employees in the right roles, ensuring they're skilled and satisfied.
SHRM enhances company performance by fostering employee growth, and aligning individual and organizational objectives. It's a critical tool for business success, ensuring employee well-being and company growth. Google, Cisco, American Express, and Hilton use SHRM, now let's help you use it too.
What Is Strategic Human Resource Management?
Strategic human resource management (SHRM) is an approach to HR that supports long-term business goals and outcomes by aligning HR policy and practice to the strategic organizational objectives.
It ensures that the right people are in the right roles at the right time, and that they are motivated and skilled to perform effectively.
Through it, HR leaders will:
- Look at business goals and objectives through a talent lens
- Advise business leaders on the feasibility of their human capital plans
- Implement company-wide policies and initiatives that help the organization gain a competitive advantage through talent.
As such, SHRM covers everything from workforce planning to engagement and retention.
4 Strategic Human Resource Examples From Top Companies
Today, too few companies are truly dedicated to improving their HR practices for better business performance. As we've touched upon, it requires getting HR professionals out of a silo and closely integrating their work with business strategy.
Here are four top companies that demonstrate exemplary strategic human resource management.
Use Data to Drive Learning and Development Like Google
Google being Google, it's no surprise that their approach to HR broke away from tradition.
We all know about the tons of employee perks and amazing "Googlified" facilities that set a new trend in office design. But Google's strategic approach to human resources goes beyond that.
Like most tech companies they're obsessed with data and the HR function is no exception.
In 2006, co-founders Sergey Brin and Larry Page decided to take an empirical approach to HR founded on feedback and employee data.
A manifestation of this is Project Oxygen, an ongoing study into management practices that identifies and measures key management behaviors and helps nurture them.
It all gets quite technical, but essentially Google hired some smart people to perform an in-depth statistical analysis of what their employees consider to be good managers.
They discovered ten common traits exhibited by the top-performing managers and then trained the rest in them. Those traits include:
- A desire to coach
- Firm decision maker
- Possess a technical skill set
- Supportive of career development
- Good communicators
- Understand vision and strategy
- Focus on productive behavior and results
- Embody inclusivity
- Empower teams by avoiding micromanagement
As a result, Google saw an overall improvement in people management and team metrics such as turnover, satisfaction, and performance over time.
By examining your current workforce composition, identifying skills gaps and digging into historical data, HR can effectively start to forecast the organization's future needs.
Put Development Pathways in Manager's Hands like Cisco
True to their industry, CISCO developed their own HRM technology to guide strategy and better serve the needs of the business.
The CISCO Talent Cloud is essentially an internal CRM that gives managers transparency into the competencies and experiences of the company’s 70,000+ employees.
It also gives employees themselves the tools and insights they need to take the initiative and advance their careers (like an internal LinkedIn!).
This approach allows managers to:
- Put together the best team to complete a particular project
- Give employees the opportunity to learn by working on a project that helps them meet a particular goal
- Access real-time intelligence on team performance, such as how they produce results, execute priorities and levels of engagement.
Cisco calls this a ‘one-size-fits-one’ employee experience and it seems to be working. The company is ranked number one in Fortune’s Best 100 Companies To Work For and is able to attract top talent to help meet company goals.
By developing tools that help managers see a more holistic view of the talent at their disposal, organizations empower team leaders to make better personnel decisions when big projects and key initiatives come around.
Create Clarity with Performance Scorecards like Hilton
Hilton is regularly recognized as one of the best global companies to work for (just behind Cisco in the rankings)—quite a feat for a service industry company.
The secret to Hilton's success, on both fronts, is in no small part down to a highly strategic approach to managing their organizational culture.
Hilton's approach was to introduce a method of quantitative analysis into its talent management practices. One is 'the balanced scorecard' and the other is 'the team member survey'.
The balanced scorecard seeks to:
- Intertwine corporate vision, strategy and goals with team member performance
- Track KPIs such as revenue maximization, customer loyalty, employee satisfaction, skills training and diversity.
Employees and teams are able to see how their roles and performance impacts the company. Discoveries and best practices are regularly shared across the company (this is a highly simplified version, you can read more here).
The team member survey compliments the balanced scorecard. It's conducted globally once a year and measures factors such as morale, leadership effectiveness, employee engagement and development.
The purpose of any scorecard should be to create a level of transparency in performance management.
Align the goal of the scorecard with organizational values, and design it to foster a positive and constructive feedback environment.
This approach helps in setting clear expectations and benchmarks for performance while promoting a company culture of continuous improvement and open communication.
Create the Right Level of Flexibility for Your People like American Express
Number three on top places to work list, and the only financial institution in the top ten, is Amex.
So how have they done it?
The company's approach to flexible working called the ‘Amex Flex work model’ has been in place since before the pandemic.
The company had started investing in collaboration tools, hardware and security protocols to streamline remote working, so that ~20% of staff were already virtual.
This investment was accelerated by the pandemic but, after listening to employees through surveys, Amex discovered that, while most liked the flexibility to work from home, many missed the in-person collaboration.
Taking onboard the feedback, Amex launched a hybrid model encouraging employees to ‘come into the office with a purpose’, i.e. make use of office time to collaborate and network.
Under the new model, Amex colleagues can “work form anywhere” for 30 days of the year, 80% can work remotely day-to-day, and 99% are eligible for hybrid work.
Recent feedback found that:
- 90% of respondents were either very satisfied or satisfied with Amex Flex
- 87% felt supported in their career development.
The success of the new model is in no doubt predicated on the company continuously listening to its employees and using the feedback to shape strategy.
In order for any flexible working arrangement to succeed, one key ingredient must be in place; trust.
Cultivate a culture of trust where management believes in the employees' ability to complete their work effectively, regardless of how many hours they are at their desk or their location.
This will have a positive impact on employee retention and create a work culture that is attractive to new hires.
Improve Your HR Strategy
- Outline your goals and objectives for the Human Resources department
- Set KPIs to support data-driven decision-making and investment in HR
- Cultivate the skills you need to drive the organization forward
Delving into the innovative SHRM practices of Google, Cisco, Hilton, and American Express, it's evident that Strategic Human Resource Management is not just a buzzword; it's a pivotal element in the success of modern organizations.
Some key takeaways
- Data-Driven Decisions: Google's approach, epitomized by Project Oxygen, shows the power of data in transforming HR practices. The lesson here is clear: leverage data to understand and enhance management practices, leading to improved performance across the board.
- Technological Integration: Cisco's Talent Cloud demonstrates how technology can revolutionize HR, offering transparency and development opportunities for employees. This highlights the importance of using technology to align HR practices with organizational needs and employee aspirations.
- Balanced Metrics: Hilton's balanced scorecard approach exemplifies how aligning employee performance with corporate goals can drive success. It underscores the need for organizations to create clear, measurable objectives that resonate with both the company's vision and employee roles.
- Flexibility and Adaptability: American Express's hybrid work model, especially in response to the pandemic, illustrates the significance of flexibility in the workplace. Listening to employee needs and adapting strategies accordingly is crucial for maintaining a motivated and productive workforce.
- Trust and Empowerment: Across all these examples, one common thread is the trust in and empowerment of employees. Whether it's through personalized development plans, flexible work arrangements, or data-driven management, these companies show that valuing and trusting employees leads to a positive work culture and business success.
- Continuous Improvement: The ongoing efforts of these companies to refine their HR strategies highlight the necessity of continuous improvement. It's not about finding a one-size-fits-all solution but evolving and adapting practices to meet changing needs and challenges.
In conclusion, the examples from these top companies provide a roadmap for us as we seek to integrate human resources management with strategic business objectives effectively.
The key is in recognizing the value of human capital, leveraging technology and data, and maintaining a culture of trust, flexibility and continuous improvement.
By doing so, our organizations can not only attract and retain top talent but also enhance overall performance and our competitive edge.
Join the conversation
With competition for talent so high, Strategic HRM with HR working closely with senior leaders is crucial to creating a great employee experience.
There are always new and better ways of doing talent management—new tools, methodologies, operating models and ways of thinking.
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