Why strategic human resource management can help an organization gain a competitive advantage?

Relying on your human resource department to recruit the best employees, design appropriate and effective training programs and institute successful retention programs can give your company a competitive advantage. While competitors struggle with maintaining an experienced and motivated workforce, your company can focus more on productivity and increased sales when your HR department plays an integral role in your workforce development.

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Human resources can ultimately help locate, hire, train and maintain a finely tuned and productive workforce, thus providing a competitive advantage for your business.

Hire Professionals with Experience

Human resource professionals vary in the kinds of skills and experience they bring to a job. Many are administrators proficient at processing payroll and executing benefits programs, but have little more leadership status than your clerical workers. You can upgrade your HR department to include recruitment specialists who also understand your company’s strategic roles and can play an integral part in shaping your business success.

Executive-level human resource professionals can help design job descriptions and training programs, advise you on where to find the best candidates, and participate in defining salary levels that will result in the best new hires.

Give HR Leadership Positions

The human resource department often is given job descriptions and told to fill the positions. Salaries are predetermined and the HR staff has little or no input into the hiring process. To tap into the HR professional’s insights, you should bring your human resource manager into the hiring process more completely. Allow HR to play a role in determining appropriate recruitment pay and tactics, let you know how much it takes to recruit top talent, and how company policies can be amended to recruit the best, both now and in the long term.

Let HR Determine Training Programs

With an HR department that participates in defining and implementing company goals, you can rely on your human resources team to consider the company’s profitability with each decision they make. In addition to defining employee jobs and required qualifications, an actively participatory HR department can monitor employee activity levels, morale and customer service success to design and implement appropriate training programs with line supervisors and executive management teams.

Provide HR Tools to Monitor Employee Performance

The human resource department can build programs to track those employees who stand out. When your human resource professionals are involved in designing and providing employee reviews, they can help you spot talent and advise you on how you can best groom employees for promotions. They can provide designated employees with specific training and help you devise opportunities for growth, serving as your eyes and ears for seeking out the best candidates that will push your company into a competitive advantage.

The primary goal of human resources is to create and sustain a workforce that meets the business needs, an essential goal for any HR department, regardless of the organization's size. A company's employee base is its most valuable resource, according to conventional HR wisdom and theory; therefore, HR planning and development are essential to gaining a competitive advantage ahead of industry counterparts through improving an organization's most valuable assets.

Recruitment

1. HR planning involves staying abreast of labor market changes and projections for the occupational landscape, including small businesses affected by availability of workers. For example, the U.S. Bureau of Labor Statistics indicates jobs for registered nurses will increase by 26 percent between 2010 and 2020. The American Association of Colleges of Nursing predicts a nursing shortage, based on a growing number of job openings and the number of nurses who will be retiring. Strategic planning, such as developing recruitment initiatives at nursing schools before graduation, gives employers a competitive edge against industry counterparts in attracting qualified candidates.

   Businesses with limited capital and resources for top-flight recruiting methods should look to creative ways of reaching qualified candidates, such as open houses and small-scale social events that give potential applicants a closer look at the organization. Another alternative for small business recruiting is to develop employee referral programs that tend to attract candidates with professional traits and values similar to those of current employees.

Work-Life Balance

1. "Fortune" magazine and CNN Money rank employers in their "best of" lists according to a number of factors, such as best benefits or best places to work for women. "Work-life balance" is a phrase that's become common in the HR vernacular. It means that the employer may be open to flexible work arrangements such as alternative scheduling, telecommuting and compressed workweeks. A competitive advantage is gained through providing employees with opportunities to achieve work-life balance so they remain productive and engaged contributors to the organization. HR planning is necessary to launch these programs; however, small businesses must carefully weigh how successful workplace flexibility can be. Modifying work hours or reducing the time spent in the office could cripple some business units, especially when employees work cross-functionally to support more than one area of the business.

Performance Measurment

1. HR departments generally are responsible for creating performance management systems. These systems enable periodic rating of employee job performance through annual evaluations, disciplinary warnings and improvement plans. Small businesses generally have cohesive work environments that lend themselves to more opportunities to engage workers on an individual, personal level. This can encourage employees to strive for high performance levels when they realize an employer genuinely is interested in their success. High-performing employees give organizations a competitive advantage because they are productive, enthusiastic and fully engaged in their responsibilities. HR planning is necessary for monitoring the employer's performance management systems, training supervisors to produce unbiased feedback and adapting the system to meet the needs of employees and employer.

Compensation

1. Salaries and wages aren't the only reason employees stay with their employers, but workers who believe their compensation and benefits are fair and competitive are likely to think twice before leaving an organization that provides them with tangible rewards for their talents. Smaller businesses may have an advantage in this area because they often can be flexible in setting wages and salaries more so than large corporations with rigid wage scales. HR planning that includes compensation and benefits analyses reveals areas for improvement concerning the employer's compensation structure. HR's assistance in ensuring a sound compensation structure can increase the organization's appeal to employees, giving it a competitive advantage from an employee retention perspective.

Compliance

1. In many organizations, HR is responsible for compliance with employment laws. This critical component of HR saves companies the expense of hiring lawyers to defend employment actions or settlement costs for claims arising out of unfair employment practices. It's especially important for small businesses that could be hit hard by a legal claim, whether by tangible consequences such as litigation expense or intangible consequences such as the loss of reputation. Businesses with as few as 15 employees are subject to federal labor and employment laws. HR implements workplace policies consistent with federal, state and local laws. Policies range from affirming the employer's commitment to equal opportunity employment to seemingly insignificant matters such as coffee breaks, all of which support organizational structure and mitigate the company's risk of liability for claims from employees and applicants. Money saved enables the organization to build its wealth and, consequently, improve its business reputation and competitive advantage.

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