Survey highlights strategic disconnect between business leaders and HR

Business leaders and senior HR practitioners are “united” on the short-term priority of cost management but opinions differ when it comes to longer-term people issues, according to research published today by the Chartered Institute of Personnel and Development (CIPD).

The CIPD’s report, HR Outlook: a variety of leader perspectives, found that, while 64% of business leaders and 71% of HR professionals agree that cost management is their top priority when asked what “keeps them awake at night”, HR professionals were more like to cite longer-term issues relating to their people. Four HR respondents in 10 (41%) said that this was the case, compared with18% of business leaders.

There was also a difference in the proportion of respondents who said talent development for future skills needs was a priority, with 27% of HR respondents and 18% of business leaders respectively citing this.

The CIPD has said that organisations should work to balance the tension between short-term needs and long-term strategy if sustainable performance is to be achieved.

Peter Cheese, CIPD chief executive, said: “This is a time of real opportunity for HR. In what is often called the ‘current economic climate’, but would more accurately be called ‘the new normal’, businesses face many conflicting priorities, such as reducing costs at the same time as trying to increase employee engagement. This puts HR issues at the heart of the business agenda now more than ever.

“Business leaders are looking to HR for creative solutions to the challenges the business faces, but there still needs to be a solid and robust business case for action. Using metrics effectively to inform business decision-making is essential.”

However, a worrying finding of the research was that many business leaders remain unconvinced about HR’s contribution to business performance, and suggested HR is not demonstrating its strategic value as strongly as it could be. The research found that HR is perceived by business leaders to be more involved in implementing strategy, than in devising it.

Almost one-fifth of business leaders who responded to the research said they don’t know what HR’s contribution to strategy is.

Cheese added: “It is clear that HR still has work to do in terms of increasing its visibility and impact and ultimately in demonstrating the organisational value they deliver.

“HR needs to make better use of metrics to look forward, support and inform the business agenda, but HR leaders must also have the courage, and the business savvy, to effectively challenge and influence business leaders and strategies.”

Personnel Today has more information on HR strategy.

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