Firms are failing to align their managers' personal goals and reward packages with the strategic people management objectives of their organisations, according to research published today.
The IRS research, based on a survey of 49 public and private sector organisations, found that while senior managers' goals and reward packages are closely linked to the delivery of organisational strategies and annual budgets, links to HR strategies are notably weaker.
- The majority, (69.3%) of respondents, were evenly split between suggesting that strategic priorities are quite well reflected in the HR budget or only partially so. However, one in ten reported that they were not at all reflected.
- Although the development of HR strategies is a relatively informal matter, six in 10 respondents try to ensure that their strategies are based to some extent on the broader organisational plan. Senior managers outside the HR department are often involved in progress chasing.
- Seven in ten do not measure human capital although they do have clear views about the human capital elements that are important to the overall strategic direction:
* 83.6% ranked leadership as very important
* 67.3% ranked strategic skills (talent and strategy know-how) as very important
* 57.1% ranked culture and awareness as very important
* 44.8% ranked strategic alignment is a top priority and
* 44.8% ranked the ability to share knowledge and staff assets as very important."If business and HR strategies are not properly aligned, competitive advantage may be lost. Unfortunately, there is no uniform framework for reporting HR strategies, and there are no conventions for describing the knowledge, skills and commitment of the workforce that make up the intangible "human capital" of a company," said IRS Employment Review Managing Editor, Mark Crail.