The Two Sides of HR
You may have heard the terms “operational” and “strategic” when referring to an organization’s approach to Human Resources. Both terms have risen in popularity in recent years as a growing number of organizations recognize that HR should be an important part of their strategic plan, rather than a separate entity.
In short, operational (or traditional) HR focuses on the immediate and necessary needs of a workforce, while strategic HR looks ahead to future growth.
When it comes to well-defined HR tasks the differences between the two are subtle. But for more indistinct tasks, linking both functions together can have a positive impact on the success of your business. Larger companies with an HR team may have staff dedicated to each role. Small- to medium-sized businesses can benefit from outsourcing their HR functions to address both disciplines.
Operational vs. Strategic
Operational HR encompasses the highly visible, daily tactical operations essential to maintaining a workforce. The primary function is to maintain compliance and this is accomplished by keeping up on labor laws and making certain they are consistently followed.
Strategic HR, as defined by SHRM, “covers the concepts and practices that guide and align Human Resource Management philosophy, tactical planning and practice with the strategic and long term goals of an organization…it deals with concerns regarding structure, quality, culture, values, commitment, and matching resources to future needs and other longer term people issues.”
Practice What You Preach?
While management and HR professionals recognize the importance of taking a strategic approach to HR, many organizations are not yet practicing it. According to a survey conducted by Bamboo of both HR and non-HR business leaders, 60% said that HR spends more time performing administrative and maintenance tasks than strategic ones.
Why is this? Lack of resources (both financial and software) and administrative demands were cited as reasons. Another barrier hindering strategic HR is lack of support by upper management—according to the same survey, only 67% of non-HR management professionals think that strategic HR is important to success, vs. 85% of their HR counterparts.
Who Handles What?
To gain a better understanding of the roles, below is a chart that breaks down some common HR functions:
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