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An integrated human capital strategy is vital to helping companies drive business advantage and achieve high performance.
The experience and skills needed to translate new and cutting-edge business strategies into their human capital implications—and then to drive measurable improvements in business performance—elude many organizations today. Yet, conceiving and implementing a human capital strategy—a plan that integrates multiple dimensions of talent, leadership, culture and organization—can be a competitive advantage across every industry.
This paper shares Accenture’s practical insights—built on experience, research and conversations with scores of senior-level executives in multiple industries and geographies—into developing a human capital strategy that can guide a business in the years ahead and help it achieve a new era of growth and high performance. The paper also shares Accenture’s own story of developing a comprehensive human capital strategy to address the competitive nature of our business and the implications of globalization, changing customer value propositions and the retention of top talent.
Today’s business challenges—acquiring and retaining new customers; applying innovation to stay ahead of the competition; managing change; improving productivity, driving growth—point to a business environment that is more competitive and global than ever before. What‘s the common denominator beneath these challenges? They focus an intense light on the need for differentiated human capital assets to execute or implement an enterprise’s strategies and respond to new competitive challenges.
Yet many executives across the globe express concerns about whether they have the skills, knowledge and experience internally to translate evolving business strategies into an effective human capital strategy. But making that translation—articulating business strategy in human capital terms across multiple dimensions of talent, leadership, culture and organization—is critical if companies are to succeed as 21st-century businesses.
Companies have always had some means—whether called HR, talent management or workforce planning—to put in place the people and skills needed to run the business. For several reasons, however, economic challenges and the speed of marketplace change have outstripped the ability of traditional HR planning to meet business needs. As a result, while many companies have in place an HR or workforce plan, it is frequently nowhere near robust or comprehensive enough to cover all of the critical dimensions of human capital.
A human capital strategy goes beyond the limited, though important, activities focused on the employee lifecycle—recruiting, training and rewards—and looks comprehensively at four interrelated sets of questions:
A program to create and implement a human capital strategy involves multiple phases of work—from diagnostics of an enterprise’s starting position relative to the four integrated human capital components of talent, leadership, culture and organization; to planning, delivering and maintaining the strategy; to supporting the entire initiative through competent program management and governance.
Accenture’s own experience developing and implementing a human capital strategy highlights several keys to success:
Establish strong governance and executive sponsorship. Involvement of senior leadership—both at the visioning stage and throughout the development process—is essential.
Ensure the lead HR officer is a key sponsor for the program. The ongoing leadership of the head of HR is critically important to the success of a human capital strategy. Because these leaders are in high demand, special attention needs to be paid to reallocating time for HR leads to take advantage of their guidance.
Monitor the ongoing impacts of the human capital program on business strategy. A human capital strategy often creates ripple effects back toward the business strategy, and in fact can help “connect the dots” across different business entities. Those effects must be understood so that the entire business continues to benefit from the insights delivered in the human capital strategy work.
A human capital strategy is much more than a new way to engage in traditional talent management and workforce planning activities. It’s actually a new lens on business strategy— helping companies put in place the right leaders to source, develop and direct the right workforce talent, supported by the right culture, organization and operating model—to drive growth, agility and ongoing market competitiveness.
David Smith is managing director of the Accenture Talent & Organization Performance practice. Mr. Smith specializes in designing and developing talent and organization performance strategies and solutions. He has been a guest lecturer at Wharton Business School and Babson College and is a frequent speaker at industry conferences and events. In addition, he has authored and coauthored several articles and papers, and has contributed his viewpoints on talent management to various business media and industry publications. He is based in Hartford, Connecticut.
Yaarit Silverstone is the managing director responsible for human capital and organization effectiveness offerings within the Accenture Talent & Organization Performance practice. A consulting professional for more than 25 years, Ms. Silverstone has extensive experience diagnosing complex organizational performance issues and designing, implementing and sustaining human capital strategy and talent management solutions, as well as leadership development programs. Originally from South Africa, she is based in Atlanta, Georgia.
Adrian Lajtha is the London-based chief leadership officer for Accenture, responsible for the company’s strategies and programs around leadership development, succession planning, inclusion and diversity, corporate citizenship and human capital strategy. He is also a member of the company’s executive leadership team.
Accenture senior director Elizabeth Hopkins, and Accenture senior managers Lisa Finkelstein, Andrew James, Claudy Jules, Laurence Morvan and Punya Upadhyaya contributed to this paper.
November 19, 2010
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