What is the relation between strategic management and human resource planning?

Difference between Human Resource Planning and Strategic Planning

Difference between Human Resource Planning and Strategic Planning

Planning begins with the organization’s strategic plan. At any given time, there may be long-term goals, for e.g., opening of a new facility or reduced spending. There may be situations where the organization may be required to face sudden changes which may include increased demand for services or receipt of grant funding.

Given these varying situations, organization’s leadership envisions various steps which must take place in order for the goals to become reality. Human resource planning offers a means to systematically line up organizational priorities with the budgetary and human resources requirements to accomplish them.

In the beginning of the planning process with identified strategic objectives, managers can develop human resource plans that will help them accomplish those objectives. These plans provide a sound basis for justifying budget and staffing requests, as there is a clear correlation between objectives, the budget, and the human resources needed to accomplish them.

HR planning must relate to other planning efforts of the organization. Human resource planning done in a vacuum cannot be successful. For the proper implementation of HRP, one must be aware of organizational direction. Also, achieving organizational goals requires a competent workforce.

Human resource planning combines employees and employee skill sets needed to achieve the organization’s goals. Effective human resource planning provides for a flexible and proficient human resource to be able to adapt to the changing needs of the organization.

Because human resource planning addresses staffing implications of strategic and operational plans, it affects the full range of HR functions like recruitment, hiring, training, compensation, and retention.

Human resource planning should also consider other human resource functions like succession planning, employee development, career ladders, and organization development. Each aspect should be considered to be important in identifying critical skills, forecasting potential vacancies, and preparing employees and the organization to meet future needs.

Human resource planning includes elements of strategic planning, workload projections, legislative forecasts, and budget projections. Human resource planning forecasts the numbers of people and type of skills needed at the future period of time to meet the future needs by comparing the available human resource (gaps).

An organization’s human resource policies must be aligned to support the mission, vision, goals, and strategies by which the organization has defined its direction and expectations of people with it. An organization’s human resource practices should be implemented by the standard of how well they help the organization pursue this intent.

Government should build a solid foundation in strategic planning, succession planning, recruiting and training the best possible talent, and establishing a performance culture—including appropriate performance measures and rewards—that steers employees toward the accomplishment of their organizational mission.

Human resource planning is critical because if the right people with the right competencies are not in place, it is difficult to effectively achieve the organization’s strategic goals and objectives. Thus human resource plan highlights the “people factor” in achieving results.

Human resource planning naturally supports and is a follow-up to strategic planning. Just as strategic planning helps an organization outline its plans, a human resource plan lays out the specific tasks and measures needed to ensure that the organization has the necessary man power to accomplish its mission.

A strategic plan charts broad mission-related targets and milestones. An understanding of organization’s vision, mission, and measurable goals and objectives drive the identification of type of work needs to be accomplished.

When organizations effectively line up human resource activities with organizational strategy, activities fit strategically and reinforce one another.

This “strategic fit” approach produces several advantages:

(i) First, it creates consistency.

(ii) Second, human resource activities will strengthen and support the organization’s business strategy.

(iii) Third, a good “fit” facilitates information exchange across activities.

(iv) Lastly, strategic fit approach eliminates redundancy and minimizes efforts being wasted.

Each of these activities reflects a fundamental decision made by the organization on preparing for tomorrow by investing in its people.

Difference between Human Resource Planning and Strategic Planning

There is a close link between HR planning and strategic planning of an organization.

Those working in HR departments should always remember that HR planning (and HR functions) do not exist as ends in themselves, but exist to serve the rest of the organization in achieving the business goals of the organization. Often HR functions and human resource planning get accidentally de-linked from business goals.

Since human resource functions and strategies are a means to achieve corporate ends, they need to be aligned to, and driven by the corporate role, mission, vision and strategic goals, or else they simply end up as processes that add overhead, but decrease return. The solution is obvious. Human resource planning needs to refer the details of the overall strategic plan of the organization. In effect, it serves the strategic plan.

Technically, it’s possible to do short term human resource planning that is a bit different from strategic human resource planning, in the same sense one can plan strategically. However, in basic terms, planning within human resources should be done strategically, since long-term thinking is required to effectively manage human resources over time.

Considering the complexity of any human resource planning process, it seems obvious that the process needs to be strategic in nature. Unfortunately, many companies do not allocate enough time or resources to develop long term strategic HR plans.

All HR planning should be strategic. In practice, many companies plan their human resources in a shorter term, or bandaid type fashion that involves reacting to short term forces, rather than being proactive and long term.

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