Should HR Play Offense or Defense?
In competitive environments, most people recognize that offense or defense is a false choice: a winning strategy is a combination of both offense and defense. However, when it comes to Human Resources strategies in business, too many organizations limit themselves to defensive practices and miss out on the powerful gains to be had by a more balanced approach. Let me explain.
Defensive HR practices are the many things we do to prevent bad things from happening— things like inefficiency, disorganization, and litigation. Defensive HR practices include:
- Accurate and timely payroll,
- Solid policies and procedures,
- Efficient benefits administration, and
- Compliance with federal, state, and local laws.
These defensive HR practices are not controversial but that doesn’t make them widespread. If you have ever been exasperated with a bureaucratic HR function, felt uncertain about your company’s risk levels, or invested too much management time in sorting out HR operational matters, then you know the value of having a solid foundation in the HR fundamentals.
Defense Lays a Foundation
A solid foundation in defensive HR practices offers many obvious benefits. Efficient and legally compliant HR administration saves time and money by addressing situations correctly the first time. It also reduces the risk of catastrophic events such as major legal claims, regulatory fines, or a unionization effort.
Defensive HR practices also provide many indirect benefits. For business leaders, solid HR administration prevents many HR headaches and enables leaders to focus on their primary jobs. For employees, a reliable HR foundation instills a sense of confidence in the employer, whereas shoddy HR practices can quickly lead to dangerous generalizations like “this place doesn’t have its act together,’ or “this place doesn’t treat people fairly.” Beliefs like that can be precursors of turnover, under performance, or litigation.
These defensive HR practices are essential table-stakes for employers, especially in California, where state and local employment regulations are abundant. With these foundational practices in place, businesses mitigate risk and set a baseline for efficient and professional operations. Defensive HR practices are essential, but they are only half the equation.
Offense-oriented HR, also known as strategic HR, is a set of strategies and practices that maximize the contribution of the workforce. When HR goes on offense, it builds value for the business.
HR on Offense
When HR goes on offense, it takes strategic actions to create a high performing workforce that is aligned with the company’s strategy and priorities. Offensive/strategic HR recognizes the fact that people are not a commodity but rather a golden opportunity for differentiation. Unlike the best practices of defensive HR, which are highly similar from one company to another within an industry, HR practices on the offense are tailored to fit the strategies and culture of each organization. This customization helps create differentiation in the marketplace and strategic advantage for business. Your competitors may copy your equipment, your procedures, and your locations, but they cannot easily copy the HR strategies that make your company unique. Just ask the many airlines that failed when they tried to copy Southwest Airlines’ model. Or ask the companies that tried to copy the Silicon Valley startup atmosphere by putting a ping pong table in the break room.
What kind of HR strategies will put you on offense and create competitive advantage? A great starting point is to assess your culture. Organizational culture is like an invisible current that pulls everyone in the same direction: it’s just how we do things here. Every company has a culture, i.e., its own pattern of behaviors, values and norms. Assessing your culture means gaining clarity about your company’s culture, how strong it is, and how well it serves your business.
Culture may seem like an unlikely place to begin but in the words Peter Drucker, ‘culture eats strategy for breakfast.’ The best laid plans for recruiting. developing, and leading a high performing team can be undermined by a misaligned culture. Rather than taking a passive approach to culture, offensive/strategic HR harnesses culture. Shaping and changing culture requires consistent, thoughtful use of formal processes (like hiring, training, and compensation) and informal practices (like management practices, communications, and day-to-day interactions). A strategic approach to HR integrates these processes and practices so they reinforce the desired culture. When these formal and informal practices are aligned, they begin to reinforce one another. The resulting synergy creates organizational momentum and competitive advantage.
The offensive/strategic approach to HR builds formal processes (i.e., recruiting, performance appraisals, etc.) not only to be efficient, not only to deliver great results, but also to reinforce the desired culture. Aligning and improving these HR processes becomes a driver of value for the business.
Similarly, the informal practices and day-to-day interactions require attention to ensure they strengthen the desired culture, rather than dilute it. Although these informal practices can be hard to quantify, they nonetheless can have a dramatic effect on business performance. For example, Google recently completed an extensive study of their high and low performing teams. They were surprised to discover the critical success factor was not the team members’ technical skills, but how the team members interacted with each other. It is about the micro-climate of informal practices within the team. This is good news because these informal practices are learnable. These skills, behaviors, and priorities can be developed into a source of strength for any organization.
Should your organization’s HR play defense or offense? Both. If your organization does not have good defensive HR practices in place, start there. Those foundational HR practices not only remove risk and inefficiency; they also eliminate potential sources of a harmful workplace culture. Start there but don’t stop there. The rewards are much greater for those organizations that see their workforce as their greatest opportunity for improvement and competitive advantage.
If your team needs coaching or players to for better offense or defense, count on our CHROs2Go team for solutions that make your company a winner on the field.
Drew Starr has more than 25 years of experience leading human resources in large and small organizations in a wide range of industries. He helps clients build efficient operations and effective strategies that accelerate business performance. Drew combines HR best practices and practical insights from behavioral science to build customized solutions to clients—always with a focus on business priorities and results.