SumTotal Blog

It’s Time for HR to Play a Bigger Role in Your Org — and Here’s Why

February 16, 2022 | by SumTotal Blog | 4 min read

Is your human resources (HR) department instrumental in helping employees achieve business goals? Or is HR relegated to hiring and compliance? If you haven’t evaluated the role of your HR team lately, it’s time to take a hard look at their role in your people strategy. The last thing anybody wants to do in 2022 is ignore their organization’s most valuable resource: its people.

As organizations of all shapes and sizes face the Great Resignation, future-looking companies are retaining their top talent by elevating the role of HR. This renewed focus serves as one of the most important indicators of an organization’s maturity.

What Is Organizational Maturity?

With a basis in years of research, our Organizational Maturity Index has nine key indicators that identify where your business is in its maturity transformation:

  1. People-centric culture
  2. HR’s role and people strategy
  3. Organizational alignment and curation strategy
  4. Employee experience
  5. Technology infrastructure
  6. Elective participation
  7. Governance
  8. Funding
  9. Reporting and measuring

In this article, we focus on just one indicator: HR’s role and your people strategy.

The SumTotal Organizational Maturity Index shows that the most mature organizations are focused on upskilling their workforce in a way that strategically manages employees’ long-term career development and improves their daily work experience.

If you’re looking to mature your operations, it’s time to consider digital transformation as you build a future-ready workforce. Instead of siloed learning, talent, and workforce functions, a mature organization has a collaborative and transparent culture that focuses on the employee experience.

Want to know where your organization stands? Assess your maturity by downloading our eBook, The 5 Stages of Organizational Maturity, and completing the SumTotal organizational maturity index diagnostic tool.

Why Is HR’s Role in Your Organization Important?

In the past, HR focused on the administrative aspects of hiring, learning management, and compliance. Today, HR professionals need to be strategic enablers who work closely with C-suite executives, driving programs that ensure the workforce has the skills the organization needs in the long term — not just right now.

McKinsey calls these HR strategists “Talent Value Leaders” who use data to understand their organization’s current talent pool and apply those learnings to reach business objectives. To do this, HR must focus on three priorities:

  1. Making talent a top priority for the business by finding the right people to get the job done
  2. Promoting from within over hiring externally
  3. Identifying and nurturing the skills your organization needs

If you think these are just nice-to-have priorities, think again, because voluntary employee turnover is expensive for organizations. In 2018 alone, the total cost of voluntary turnover for U.S. businesses was more than $600 billion — and volunteer turnover is forecast to reach 35% by 2023. It’s time to address this rising problem head on.

Be Honest About Your Current Organizational Maturity

It’s important to understand where your company sits on the maturity scale.

Has your HR team’s role in the business evolved to include a holistic people strategy focused on training and retention?

Are You a Less Mature Organization?

In a less mature organization, HR teams are disconnected from both the leadership team and employees. Simply put, they don’t understand the people they are trying to support. As a result, one of their biggest hurdles is getting buy-in from leadership to create the comprehensive learning and development programs that their employees expect.

The result? Steady employee attrition. Currently, 1 in 5 employees who quit point to a lack of career development opportunities.

…Or Are You a More Mature Organization?

Within a more mature organization, HR takes the lead on engaging with employees throughout their time at the company. Instead of limiting HR’s impact on greater business objectives, a mature company has a Chief People Officer or Chief Human Resources Officer sitting at the decision-making table.

Progressive HR leaders don’t just tackle each team’s learning needs one by one — they understand how to align individual departments and employees with the larger organizational objectives.

How to Align HR With Business Goals

To succeed in this alignment, your organization needs to focus on retaining its current workforce and maximizing each employee’s potential through upskilling and reskilling, with the aim of creating a flexible and adaptable workforce.

After all, workers are clear on what they want: 94% of employees state that they would stay at a company longer if the organization invested in their growth, career development, and overall success.

With this in mind, start by connecting the dots between your company’s goals, each department’s needs, and employee engagement. Next, begin to build a learning program tailored to prioritize employee experience at your organization.

When HR Is Aligned With Business Objectives, Everyone Wins

By empowering your HR team to identify and nurture the skills needed for long-term success, your organization will see a stronger alignment between people strategy and business success.

Looking to dive deeper? Read our eBook on the 5 Stages of Organizational Maturity to learn how HR’s role and people strategy connects to our other indicators and what you can do to become a future-ready company.

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