HR Strategic Planning Flashcards
Organizational strategy
focuses on the future of the organization as a single unit—a general vision of the future it seeks and its long-term goals.
Business unit strategy
Business unit strategies address questions of how and where the organization will focus to create value.
Operational strategy
reflects the way in which organizational and business unit strategies are translated into action at the functional level through functional strategies
Strategic planning
Setting goals and designing a path toward a competitive position.
The strategic plan helps create alignment of efforts and provides a layer of control.
Strategic management
Actions that leaders take to move their organizations toward the goals set in strategic planning and to create value for all stakeholders.
Strategic alignment
Each business unit examining their strategic plan to align with organization’s.
Necessary to maintain focus on defined goals
Strategic drift
Failure to recognize and respond to environmental changes that necessitate strategic change
Often caused by an organizational culture that is too deeply rooted in “the ways things have always been done”
Core competencies
unique advantages an organization possesses, abilities that are integral to creating customer value and are difficult for competitors to imitate
4 steps of strategic management and planning process
What happens during each step
Formulation: leaders analyze internal and external information to determine the organization’s capabilities, opportunities, and constraints.
Development: of strategic plan
Implementation: of tactics—the process of strategic management. This requires clear communication of objectives to teams, coordination and support of their efforts, and control of resources.
Evaluation: continually and at designated intervals to determine the effectiveness of the strategy itself and the need for change or improvement.
Systems thinking
One tweak in one area of company can affect entire strategy
Challenge is to coordinate interacting and interdependent parts to achieve strategic goals (beer situation with MIT)
Input Process Output model
Quality input is best way to get quality output
Inputs: all the factors that can affect the outcome.
Process: all the methods the organization can apply to maximize its opportunities
Output: desired strategic effect—for example, expansion or redefinition of markets, increased sales or profitability, increased diversity, or enhanced environmental sustainability.
Environmental scanning
Process of systematically surveying and gathering data, from both internal and external sources, that can be analyzed to identify opportunities and threats and to strengthen strategic plans and goals.
PESTLE analysis
Political Economic Social Technological Legal Environmental
Growth share matrix
Used for larger organizations to find greatest value
vertical axis: rate of growth in this area, (larger rate of growth predicts greater value)
horizontal axis: size of market share, (larger market share predicts stronger competitive position)
Star: high growth rate/high market share. A business line that is growing and has a dominant share
Cash cow: low growth rate/high market share. A static but dominant business line that creates value reliably but shows little opportunity for growth
Dog: low growth rate/low market share. Consuming resources without offering strong value or future growth.
Question mark: high growth rate/low market share. could be winners or losers; their future is unclear.
Balanced Scorecard
What are the quadrants
Where looking to achieve balance
Purpose is to have KPIs in each of the four quadrants - shouldn’t be putting performance assessment all in one bucket:
Finance
Customers
Internal business processes
Learning and growth
The purpose of a balanced scorecard is to achieve balance in three key areas:
Between financial and non-financial indicators of success
Between internal and external constituents in the organization
Between lagging and leading indicators of performance
What does benchmarking do? What does process involve?
Allows for an understanding of best practices
compares performance levels and/or processes of one entity with those of another to identify performance gaps and set goals aimed at improving performance.
The benchmarking process includes the following steps:
Defining KPIs - find biggest gaps and focus on those first
Measuring current performance
Identifying appropriate benchmarks and securing their performance data
Identifying performance gaps between oneself and the benchmark organization
Setting objectives and implementing any necessary support activities
Strategic fit
Compatibility of an organization’s strategy with its external and internal environments
Happens when activities are:
Consistent with strategy
Interact with/reinforce each other
Are optimized to reach strategic goal
Blue ocean v. red ocean strategy
blue ocean strategy create a completely new arena, often within an existing industry, untainted by competition.
Red ocean competes within existing marketplace.
Strategic alliance
agree to share certain aspects of company but not equity
Joint venture
Two or more companies invest together in forming a new company that is jointly owned. Requires each company to contribute equity
Equity partnership
One firm acquires partial ownership through purchase of shares.
Merger/acquisition
A firm purchases the assets of a local firm outright, resulting in expanding the acquiring company’s employee base and facilities.
Significant cultural, systems, and management challenges.
Data privacy can be a big issue.
Franchising
A trademark, product, or service is licensed for an initial fee and ongoing royalties.
Often used in the fast-food industry.
Similar to licensing, but control over franchisee behavior is greater.
Licensing
A local firm is granted the rights to produce or sell a product.
Low risk because it avoids tariffs and quotas imposed on exports.
Little control of the licensee’s activities and results.
Contract manufacturing
A firm arranges for a local manufacturer to produce components or products as a means of lowering labor costs.
Management contract
Another company is brought in to manage and run the daily operations of the local business. Decisions about financing and ownership reside with the host-country owners.
Turnkey operation
Needs no work.
An existing facility and its operations are acquired and run by the purchaser without major changes.
Greenfield operation
What is HR’s role?
A company builds a new location from the ground up. This represents a major task and a commitment to completely staff and equip the new location.
HR: risk analysis, staffing, authorities, policies and procedures, audit workplace practices
Brownfield operation
A company repurposes, through expansion or redevelopment, an abandoned, closed, or underutilized industrial or commercial property.
Divestiture
selective “pruning” of parts of the organization that are underperforming or that are no longer in line with the organization’s strategy.
Challenges: making sure that the organization retains key talent during and after the process
Steps for divestiture
Identify the candidate for divestiture: ID risks, participate in SWOT analysis
Identify a target buyer: Provide accurate info about value of workforce.
Restructure: ID and prepare strong leaders, design incentive offers.
Execute the deal: assemble a balanced transition team, facilitate exit of departing employees
Differentiation strategy
Setting a product or service apart from its competition by giving it unique characteristics that consumers value.
Comes from a variety of factors, including product/service features, marketing approach, and delivery system.
ex.: Apple
Critical success factors in strategic planning
Alignment of effort (organization, business unit, operation)
Control of drift
Focus on core competencies
Mission Statement
Destination for our strategy (point B)
What organization intends to pursue and charted management course. Provides focus and purpose of strategy
Vision Statement
Aspirational - desired future state (ex. “a world without HIV”) Helps guide the mission.
Values Statement
What beliefs the organization/function supports through behaviors and actions
Provides guidepost for decision making
Lagging/Leading performance indicators
Lagging: indicator that is measured after the fact/effects that already occurred and cannot be changed
ex. turnover
Leading indicators: describe predictive actions that can help change future success
ex. employee satisfaction can indicate future retention rates/cost of hiring
Smart-ER objectives
S-pecific M-easurable A-ttainable R-elevant T-imebound E-valuated R-evised
Porter’s competitive strategies
You can either employ cost leadership or differentiation to create competitiveness. Apply either strategy in segment or niche.
Cost leadership: lowest price, economy of scale, efficient production (ex. Walmart)
Differentiation: higher price for unique offering (ex. Apple)
Focus: apply either strategy in segment or niche
Critical path analysis
uses information about start or mandatory end dates, the logical relationship of tasks (e.g., whether task C must be completed before task F can begin), and the length of each task to find the earliest completion date (or latest start date)
Gantt charts
represent the scheduling of tasks visually, showing the length and timing of specific activities. They can help identify problematic conflicts in activities or gaps that can be exploited to condense the schedule. They are also a primary way to communicate expectations to the team and coordinate activities.
Lean project management
Eliminating waste
focuses on eliminating waste by:
Maintaining a tight focus on the intended value of the project.
Empowering the team to make decisions.
Analyzing and solving problems rather than working around them.
Emphasizing continuous learning.
Six sigma project management
Reducing errors
Level of quality is so high that very few errors occur.
Focus on projects with a quantifiable return of value, commitment to quality and involvement in problem solving, measuring results in a manner that allows empirical analysis, and fact-based decision making.
Agile project management
used when the assumptions on which a project is based are unclear or may evolve as project work proceeds.
focuses on iterations of the deliverables—completing one iteration and then using customer input to plan the next iteration.
Critical chain project management
Used when resources cannot be increased to meet deadlines. Buffers are built into the schedule both to account for dependencies (i.e., having to wait for another task to be completed) and to allow some room for variance for the estimated task requirement.
For example, an HR department may be able to allocate no more than 10 hours per week of staff time to do project work. Project activities are scheduled accordingly.
Operational budget
Ongoing activities to provide HR to internal customers - talent acquisition costs, comp, benefits
Strategic budget
Funds aligned with strategic goals - ex. development of mentoring program, cultural alignment initiatives
Project Stage: Planning
Work with stakeholders, define deliverables, Scheduling, assembling team
Project Stage: Executing
Communication, removing obstacles, managing stakeholders, monitoring and controlling
Project Stage: Closing
assessment and evaluation, team debriefing, continuous improvement and learning
What to do when communicating strategic results
Create a narrative, visualize with charts/graphs, acknowledge disappointments and successes, invite reactions/feedback, describe next steps
PESTLE process
list (focus groups, experts),
identify impacts,
research impacts (causes, dimensions, connections),
assess (importance, strength of data)
