7 Successful HR Strategy Examples that Work in 2023
It’s no secret that the role of human resources (HR) is evolving. What worked last year may not work this year, and what works this year may not work next year.
As the workforce changes and technology advances, HR strategies must adapt to remain effective. So, what does the future of HR look like?
Here are seven HR strategy examples that will help your company stay competitive in the ever-changing business landscape.
Table of Contents
What is an HR strategy?
An HR strategy is a plan that organizations use to manage their human resources department. The best HR strategies are about defining the roles of HR within the organization, setting goals for HR, and creating policies and procedures to guide HR activities.
An effective HR initiative can help an organization to attract and retain top talent, improve onboarding and recruitment, reduce turnover, improve employee engagement, and boost productivity.
According to Dyer and Reeves, they are described as ‘internally consistent bundles of human resource practices’. Richardson and Thompson suggest that:
The goal of any good strategic HR plan is to articulate what a company plans to do about its HRM policies and procedures both now and in the future.
They aim to meet both business and human needs within the organization. Without a full, solid HR strategy in place, your human resources department can negatively affect the growth rate of your business.
Before you align on what HR strategy you want to implement that is best for the wellbeing of your organization, there are a few elements to consider.
For a functional HR plan, you’ll need to take into account the following:
- Hiring and dismissal procedures
- Building effective co-worker relationships
- Compensations and salary schedules
- Training and development of current employees
- Installing safety procedure
- Maintaining workplace peace
With these in mind, let’s dive into some of the two primary types of HR strategies.
Two main types of HR strategies
While there are many ways to set up an HR department, there are two main types of strategies. The first one revolves around the business as a whole.
That means this action plan will focus on the HR needs of the entire company, ideal for large businesses with a clear hierarchical setup.
It describes the company’s overarching principles for how employees should be developed and managed, along with the actions that must be taken to make sure that the corporation can attract and retain the talent who will assist in attaining its goals.
The next HR strategy type is focused more on individual employees and the different facets of HRM (human resource management), such as rewards, l&d (learning and development), and training.
This approach to HR aims to outline what the company is trying to accomplish when it comes to knowledge management, which involves sharing, acquiring, producing, using, and capturing knowledge to improve performance and reduce skill gaps in its employees.
Every business is different, so your business goals need to go hand in hand with your organization’s strategic HRM plan in order to get the most return on investment.
7 HR strategy examples working today
Now that we have the two foundational principles in place, it’s time to decide which HR strategy can help your business the most when it comes to hiring top talent, employee development, and reaching your business objectives.
However, creating an effective HR business strategy is easier said than done. So, to help you get started, here are some of the world’s most successful HR strategy examples:
Examples of business-based strategies
Kaizen is the Japanese word for improvement. This HR strategy example relies on periodic changes rather than a set of stable rules.
With a large business, it can be tricky to keep track of every action daily. Each manager has several employees who have smaller departments and so on.
In 1986, Masaaki Imai introduced the idea of Kaizen, hoping to boost productivity. His primary strategic goal was to eliminate waste and redundancies.
To do that, it had to be a group effort. Every employee would perform their duties and look for ways to improve production.
This includes minor assembly line workers all the way up to the CEO. While only managers can affect change, input from subordinates is crucial.
It lets the business know where it’s falling short. This strategy is helpful to both the workers and the company.
The employees feel as if they’re a part of the team. This creates a harmonious work environment. Besides that, the company gets to improve its processes, which in turn, boosts profits.
Many successful businesses, like Nissan, utilize this HR strategy with impressive results.
2. Community Outreach
Sometimes, to improve a business, you have to look outside the confines of the workplace. That may seem counter-intuitive, but it can have positive effects.
Generally, businesses will only judge employees based on their duties in the workplace. They look at the number of assignments fulfilled and other factors of this nature.
While this is fair, it only accounts for a small portion of the worker’s day. So instead, companies like Alliance Boots place a lot of care into community outreach.
For example, Boots awards its employees benefits for various out-of-work contributions. This includes holding seminars to raise health awareness or organizing a campaign.
While this doesn’t directly correlate to increasing profits, there’s an indirect link. Employees are incentivized to deal with the public under the company’s name.
So, with any billboards or flyers, the business is getting advertisements. Aside from that, as the community notices the efforts to help out, they’ll be more likely to support your company.
On top of that, it gives employees a little more freedom. Since community outreach isn’t mandatory, workers feel like they have an option as to what to do.
That can lead to more satisfied workers and higher productivity.
Many people try to set up an internal structure when thinking about HR strategies. However, sometimes this can be costly and ineffective.
Another option is outsourcing the HR duties to a separate entity or business. These establishments will take over all significant roles of the department.
That includes finding new hires, carrying out performance reviews, and dismissing workers. There are a couple of competitive advantages and disadvantages of this method.
Right off the bat, outsourcing gives you the freedom to focus on more urgent matters. On top of that, the HR company is an impartial party, meaning its decisions are usually unbiased.
This will help nurture a fair environment in the workplace.
However, tailoring the HR plan to your company culture may take time and effort. Depending on which HR outsourcing business you choose, the service will change.
Some offer personalized strategic plans, while others only have a few standard options. Besides that, the service can be pretty pricey. So it’s always good to weigh the risks against the benefits.
Examples of employee-based strategies
1. Quality over quantity
Most of us have an idea of what Google offices look like. Google puts a lot of effort into the employees’ mental health to boost productivity and creativity.
However, such a boost in performance won’t appear unless you’re investing in the right employee. Boosting the creativity of someone usually includes giving them some free time so they can shine.
If your employee isn’t already creative, he or she will look at the free time as a break. This is why Google’s HR hiring process often favors quality over quantity.
That means that employees don’t need much work experience to apply for a job. However, they need a complete understanding of how to perform work duties.
So, Google only hires the most innovative people and gives them many benefits. This helps build up loyalty for the company and increases personal productivity.
On top of that, the business growth plan uses incentive programs. When an employee fulfills a task extraordinarily, there’s always a reward.
Google also places a lot of emphasis on diversity. To reflect the worldwide audience of the business’s site, people from all over the globe get a chance to apply.
2. Training and development
As we mentioned earlier, Google prefers to hire employees with advanced skills. Yet other successful companies find it more productive to take a different approach.
Instead of locating a skilled worker, the business opens its doors to all applicants. Once the employees secure a position in the workforce, the training and development process starts.
The company will help the employees progress and improve their abilities. As they upgrade their skills, the business also provides promotion opportunities.
That means employees will have a chance to advance in a career path.
This aspect is incredibly enticing to many people. The ability to grow in the same workplace allows them to plan for the future with a little more certainty.
You may think that the time-consuming training will decrease workflow, but that’s not the case.
Employees still contribute to the production during the training. Plus, with this HR strategy, a business is free to hire as many workers as it likes, regardless of experience.
Hiring more people means that no individual can stop the workflow, as someone else will step in.
3. Dynamic communications
One of the most challenging aspects of HR is communication. Making sure the employees have all the information they need can be tricky.
In that case, dynamic communication is key to a successful workflow. This HR strategy allows for information to travel between all parts of the business.
For example, let’s take a look at the Mayo Clinic. As a hospital, there are hundreds of doctors and nurses working at any given moment. With patients’ lives at stake, attendings need to access their records instantly. That’s why the hospital has a much more strict communication rule.
Any medical personnel that helps a patient has to record the exact nature of the transaction. This includes any recommendations or prescriptions.
Dynamic communications take hierarchy out of the equation. Instead, everyone involved in patient care has the same obligation to assist in any way they can.
This creates a sense of community in the workplace. In addition, it encourages employee engagement and makes them work together towards a common organizational goal.
Usually, a company will hire an employee and compensate them weekly or monthly.
This process works well for workers with set working hours and tasks. However, not all businesses operate under that assumption. For instance, some companies contract freelancers to finish specific projects. In that case, the employees won’t have much contact with each other or the HR team.
With a structure similar to this, the other strategies wouldn’t be fair to the business or the employees. For that reason, the merit-based system can act as a compromise. Workers get payment and bonuses based on their work throughout the month.
On top of that, they get the freedom to select their schedules and what projects they take on.
The merit-based strategy example is incredibly effective and can motivate employees to work harder. Yet, it doesn’t help them build loyalty. People are more likely to seek other work opportunities without a sense of belonging.
How to develop an HR strategy
HR strategies can be a little different for every business. Yet, the developing stages generally all start the same.
To figure out which strategy example is best, you can use a SWOT analysis. That stands for strengths, weaknesses, opportunities, and threats.
Creating an empty list with all this information will help you set goals. It’ll show where you need to improve and what resources you have to do that.
It’s also essential to maintain HR reporting and track events in your company.
HR strategies are the responsibility of HR professionals. These HR managers typically have a Bachelor’s or Master’s degree in order to correctly fulfill their roles.
HR strategies help streamline the day-to-day interactions between all employees. Not only will this help foster good relationships, but the workflow will also be smoother. This is because the setup allows immediate response to any issues that may come up.
The short answer to this question is yes; technically, a business doesn’t need an HR strategy. However, in practice, it’s almost impossible to grow your company without one.
With hundreds of employees, you can’t keep track of all of them without a pre-set plan.
A human resource strategy example focuses on how the employees of a company interact with each other. It also outlines working guidelines and labor compensation.
There are hundreds of HR strategy examples that you can adopt to improve business performance. These include training and development, dynamic communications, and community outreach. You may also try out training, the merit-based approach, and outsourcing.
To make choosing more straightforward, you can use SWOT analysis to highlight where you need help. With all this information, you’re ready to head out and create your own HR strategy.