Seven Best Practices for HR

HR best practices are specific actions and processes and actions that have proved to be instrumental in adding value regardless of the organization or industry. When aligned with the business strategy and vision, it leads to exceptional business performance, optimum efficiency, and increased company profits.

When combining these seven best practices, you can expect a profoundly positive impact on the organization and for the employees. Ultimately, it will all contribute to achieving strategic goals and gaining a competitive edge.

Best Practices

The following Human Resource best practices were proposed by Jeffrey Pfeffer who is an academic in the fields of organization theory and human resource management and author of The Competitive Advantage through People (1994), and The Human Equation: Building Profits by Putting People First (1998). 

Providing Employee Security

Security and stability are highly important to people as they can consistently provide for their family and it’s the primary reason why people go to work. Security underpins everything that the Human Resource department does. When employees feel their security is threatened, it affects performance, attendance, and has an immediate ripple effect throughout the organization. It is therefore essential that HR works on retaining employees and being able to quickly identify issues that can potentially jeopardize an employee’s sense of security.

Recruiting the Right People

Hiring the right candidates means finding people who are a good fit and who will add value. This is key to the company achieving its goals, making a profit, and avoiding unnecessary and expensive lay-offs. Using HR analytics and effective recruitment tools is crucial in making the right choices. Tools such as IQ tests, structured and unstructured interviews, personality assessments, and reference checks help uncover key characteristics to ascertain a candidate’s ability, trainability, commitment, and work ethic.

Effective, Self-managed Teams

Teamwork is a necessary component and high-performing teams are what HR should strive towards nurturing for productive outcomes. Teams that are psychologically safe and cognitively diverse deliver the best output and HR can use a number of approaches to facilitate teamwork. These include feedback channels, goal setting, brainstorming sessions, and team-building activities.

Performance-based Compensation

When a company has the right people in place, it is important to compensate them fairly and, in some cases, at above-average rates. The people who add the most value are the ones that should be protected and retained. Compensation can come in formal pay, bonuses, and other benefits that the employee feels are worth the reward. Incentives like profit sharing and stock options promote an employee’s sense of ownership and commitment to the organization.

Relevant Training

Identifying relevant training for the right people ensures the workforce skills remain current and enable them to be experts in their field. Through continuous learning, companies are able to innovate faster and improve and develop products for increased profits. Formal training through courses and workshops, as well as on-the-job learning, are central to valuable employees having opportunities for further development. A lack of relevant training often leads to a high rate of employee turnover.

Promote an Egalitarian Approach

Although it may be a challenge to completely replace the traditional hierarchical organizational structure with an egalitarian one, especially in a large company, a combined approach can be just as effective. It doesn’t require eliminating all boundaries and reporting channels, but a blended style based on an egalitarian philosophy increases flexibility, autonomy, and collaboration between employees and teams.

Information Transparency and Accessibility

Openly communicating with employees about financials, strategies, and operational issues fosters a culture of trust. When employees feel trusted, informed, and valued, it discourages negative rumours and malicious gossip. It also allows the workforce to share their ideas as they have a good understanding of what is happening in the business. Providing the opportunities to contribute and influence decisions engenders loyalty and productivity.

Creating Value with HR

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