The significance of business knowledge for human resources to compete globally

 

In the contemporary business environment, the critical significance of HR's active involvement in developing an organization's business strategy has become apparent. In addition to serving as a business partner at the operational level, one of the key duties of an HR professional is to engage in production flow as a strategic partner.

An HR professional must thus have a thorough awareness of the business plan, as well as a working knowledge of the organization's functional operations and the business environment. This knowledge is crucial for developing HR strategies that are in accordance with the business strategy..(Becker, B. and Huselid, M. 2001)

What would happen if human resources professionals lacked business knowledge?

·        A human resources specialist won't be able to assist other departments.

·        will not be able to perform to their standards

·        The use of HR ideas and practices will not provide positive results.

The strategic importance of HR professionals.

A method to develop and implement HR strategies that are integrated with business plans and help the organization accomplish its goals is known as strategic human resource management (Armstrong, 2008).

strategic human resource management is known as the management of human resources that offers a strategic framework to assist the achievement of an organization's long-term business goals and outcomes

In order to appropriately align HR with an organization's strategy, HR may play a vital part in the strategic planning of the business if it is equipped and structured.

Why HR need to properly manage the human capital?

•         In order to successfully align with the plan
•     Take use of the leverage

HR Strategy and Business Strategy Coordination

Recognizing the role of the HR department and its responsibilities is one of the first stages in aligning HR with strategy. And rather than serving the conventional administrative purpose, it serves as a strategic asset.

A strategy-focused professional is the first step in aligning HR with an organization's strategy. The second need is that the HR system be developed in accordance with the organization's strategy. Employee strategic focus must be ensured by HR (Becker & Huselid, 2001).

The objectives are more readily attained if employees are aware of the company's strategy and goals and are recognized for their superior performance.

HR's role in company strategy

Why Human Resources Professionals Need to Understand the Business   ?

For HR professionals to be successful in their primary tasks, such as selecting the best candidates, creating training programs, handling performance reviews, etc., they must have a solid understanding of the business. HR must make judgments even for day-to-day operations; HR involvement is necessary.

What Should HR Professionals Know About Each Function?

It is common knowledge that no organization follows a single management structure. Even if different companies adhere to various management structures, it is still possible to generalize these structures (perhaps with distinguished functions or department titles). However, HR should have a deeper understanding of the key roles that are present in all types of enterprises.

The sales and marketing department has a bigger role to play in a company climate that is highly competitive, changing quickly, and driven by demand. Finding the target market and the products or services will be HR's first step in understanding this function.(Ulrich, D. 1998)

Different methods are used to manage marketing workforces. Their requirements for training, performance evaluation, and incentive programs may be highly particular. However, HR professionals 

should be able to support this Sales & marketing function's demands in the present as well as the future. HR won't be able to meet the shifting demands without understanding these crucial parts of the role.

     Understanding the Business Will Help You Meet Future Challenges

Business managers are in charge of informing workers about the organization's objectives, goals, and production targets so that they feel like participants in the business.   

The HR department and management team must work together to create a successful program for employee training and development, performance evaluation, and employee awards after having gained an understanding of the business's future trends.

Additionally, HR departments must assist and educate younger employees. Acknowledge their duty to support the business plan and objectives of the Operational costs and budget needs. As new technologies advance, responsibility and training and transparency become more crucial managerial traits.

Common Concerns & Issues in the Sector

• Company HR material is too wordy & convoluted to actually follow.
• Critical concerns necessitate more HR involvement.
• Performance reviews do not include professional-level actions that go beyond job descriptions.
• The organization's HR demands for various employee groups are not effectively distinguished.

learning outcomes

Strategic areas including people management, succession planning, engagement, recruiting, and retention benefit greatly from HR's remarkable contributions. When an HR professional participates in the process of developing a strategy, it is crucial that they have a solid understanding of the business or 

the overall picture of the organization. Consequently, the HR professional's position is essential for corporate success.

Strategic plans can only produce the desired outcomes if they are regularly and swiftly carried out in the operational areas.

An HR professional with in-depth knowledge of the company's business processes will be able to provide solutions in addition to being acknowledged.

References

 

Becker, B., Huselid, M. (2001). The Strategic Impact of HR. Harvard Business School Publishing, Balanced Scorecard, May – June.

Ulrich, D. (1998). A New Mandate for Human Resources, Harvard Business Review, January – February.

Jay B Barney & Patrick M Wright, (1997) “On Becoming a strategic partner: The Role of Human Resources in gaining competitive advantage”

Aslam, H. D., Aslam, M, Ali, N., Habib, M, B. (2014), Importance of Human Resource Management in 21st Century: A Theoretical Perspective [Online] Available at, https://www.researchgate.net/publication/313269603_Importance_of_Human_Resource_Management_in_21st_Century_A_Theoretical_Perspective Access on 27th November 2022