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HR IN TRANSITION – THE SHAPE OF THINGS TO COME – theHRDIRECTOR ISSUE 229 – NOVEMBER 2023 | ARTICLE OF THE WEEK

Imagine this scenario: Planning for the Board’s 2023, two-day Strategy Retreat commences in earnest. A salubrious countryside setting, conducive for both serious, constructive discussion and social recreation. A top five management consultancy is booked to give a ‘state of the industry’ presentation, then there will be prepared inputs from all the Directorates, outlining the challenges and opportunities ahead. All department heads are preparing, but after an enforced hiatus from the annual away day, trepidation has crept back into the mind of the HR Director.

Imagine this scenario: Planning for the Board’s 2023, two-day Strategy Retreat commences in earnest. A salubrious countryside setting, conducive for both serious, constructive discussion and social recreation. A top five management consultancy is booked to give a ‘state of the industry’ presentation, then there will be prepared inputs from all the Directorates, outlining the challenges and opportunities ahead. All department heads are preparing, but after an enforced hiatus from the annual away day, trepidation has crept back into the mind of the HR Director.

As usual, the HRD had been asked to prepare the department’s report on recruitment and retention, along with attracting and developing talent and the key training needs across the workforce. The presentation was an opportunity to raise concerns about strengthening internal management capabilities and working on culture, but the HRD is realistic enough to know that this is unlikely to garner more than polite acknowledgment. It is the Marketing and Operations presentations that are likely to generate most attention – market analyses always provokes a lot of discussion – and there will be the usual heated debate about productivity and customer service. The HR team’s work will really start with the organisational structure changes that might follow finalisation of the strategic plan. Going back to March 2021, the mood within the Executive team reflected division and uncertainty. The sudden disruption to everything a year earlier had put everyone in emergency survival mode. In fact, looking back now, the way the business had responded was remarkable, equipping employees rapidly to work from home, setting up new communication processes across the company and handling furloughs with sensitivity. The HR Department had been at the heart of this, proactively supporting managers as they worked out how to engage remotely with their teams and acting as a conduit with the Executive team, to feedback how this was working. But the continual conversations on Teams had taken their toll on people’s energy and the worry about the financial situation and future was showing in the often-fraught Board discussions. Not knowing what was going to happen was concerning enough, but it was not knowing how to deal with this that was causing the frustration and disagreements.

Spring 2020 had posed some fundamental questions about the future, but for several Board members, these were proving too hard to contemplate and they were resorting to focus only on when everything could ‘return to normal’. Until then there was no point in thinking about strategy, there were just too many unknowns’. However, it was very clear to the HR Director that there could be no ‘going back’. A significant shift in people’s motivations, connections, values and their relationship to work could not be ignored or undone with ‘back to the office’ edicts. They needed to make sense of where the business was heading and to understand how they could contribute to this. The organisation needed to be clear about how it was going to deal with the future, with all its potential challenges and opportunities. The HR Director was beginning to realise that there was another challenge though, with colleagues were struggling to deal with uncertainty and didn’t know how to think about the future and the business had no idea how to consider its strategy in such a context. Their ‘traditional’ way of reviewing strategy and setting out the company’s ambitions for the next three years, linked to their annual budgeting cycle, was clearly no longer adequate. An apparent solution that was likely to appeal to some Board colleagues would be to launch a full strategic review, enlisting the help of to develop and evaluate some strategy options. But the HR Director felt that this would be a sort-term fix – not to mention very expensive – and that the business would be no better prepared to deal with the next major shock that came along. Instead, the company needed to develop the capabilities and the confidence to “think, talk and act strategy”. In the conversations that followed over the next few months, it required a more dynamic approach to strategy, with the ability to respond and adapt quickly.

There were several ‘building block’ elements required to achieve this. The organisation needed to create the ‘space’ to talk about strategy, prioritising time and encouraging ‘rich conversations’ that explored topics in depth. These needed to be seen as safe spaces for open discussion and exploration of issues and they had to be part of a structured process to steer and channel the conversations. People’s ability to think strategically varied across the workforce, steps could be taken to develop this, but just taking part in strategy discussions with the right approach and support would be a valuable practical learning opportunity. As Professor Henry Mintzberg1 puts it, strategy comes from synthesis and synthesis is a learning process. The art of strategic management is to facilitate the crafting of strategy and the skill of strategic leadership is to know what and when to change. How to think about the future was another building block element. HR’s role was to develop the skills and the willingness to consider different possible futures and to work through the implications of these for the business now. It was then a case of what ‘signals’ and changes to monitor, what actions they should take to prepare for different scenarios – and encourage an ‘alertness’ and ability to respond, linking this into the structured strategic management conversations and processes. This is not about being able to predict the future or choosing one particular scenario on which to base a strategy, rather it’s about developing futures and foresight learning skills to be better able to anticipate what could happen in the future and so be better prepared to deal with it.

A willingness to try out ideas, to test innovations – and most importantly learn from these – was another aspect of becoming more agile. This required being prepared to invest resources in initiatives that might fail and to make early decisions about whether to develop the ideas further or to ‘pull the plug’. Assessing and understanding the strategic risks and learning how to accept the uncertainty, was another dimension in how the organisation developed its corporate governance. As they started to work on these ‘building blocks’ it became clear that it was embarking on a journey of learning how to strengthen its strategy capabilities; this wouldn’t be a ‘quick fix’ that happened overnight but an evolving process that would develop a more dynamic and confident approach to strategy. The cultural aspects were important too, engaging people across the business and supporting them as they developed their strategic thinking and confidence to contribute. This was about individual and organisational learning, embracing a dynamic approach to strategy as an ongoing and integral part of how the company worked and as some have argued, learning might be the only truly sustainable competitive and collaborative advantage that an organisation can have2 .

October 2023: The strategy journey continues, but there is a buzz of engagement and an aura of quiet – but not complacent confidence – that it has developed a more dynamic and agile approach to strategy and an openness to considering possible ways in which the future might evolve. The shocks of the pandemic might have been the trigger, but the ways in which the firm has strengthened its strategy capabilities have been transformational, putting the building block elements in place took sustained commitment and belief, orchestrated by a perceptive HR Director persuading colleagues to embark on the journey. At its heart, strategy is about people and helping them make sense of where they are heading, a journey of discovery learning and equipping.

REFERENCES
1. Mintzberg, H (1987). ‘Crafting strategy’. Harvard Business Review, July/August pp.66-75
2. Garad A. and Gold J. (2021). ‘The Learning-Driven Business’. Bloomsbury

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