The constantly
increasing pace at which change is occurring in the external environment has sparked
a passionate debate about the process business and HR strategies practically develop,
which has engaged business leaders as well as management practitioners. Some Authors
contend that strategy is a totally incremental, evolutionary process not
necessarily rational, which can be only retrospectively identified by analyzing
and reviewing the plan put into action by an employer; whereas others aver that
strategy, that is, “the long term direction and scope of an organization”
(Johnson et al, 2005) implies a plan, a plot, a pattern and a perspective and should
be thus properly formulated and ideally written.
Inasmuch as organizations
are nowadays increasingly subject to the pressure coming from the exogenous
environment and need hence to be ready to take advantage of the opportunities this
offers and capable to timely identify and implement the appropriate plan of
action necessary to counter the threats this poses; employers need to have crystal
clear ideas of the objectives they expect to achieve and of the approach they
intend to adopt to attain these in practice.
Technological,
legal, political, economic and environmental changes do not necessarily entail adjustments
in an organization’s strategy; these occurrences might in fact imply and
require a change only in the type of approach or means an employer should
better have recourse to in order to pursue its intended strategy. Considering
that strategy might be just retrospectively identified could be tantamount to
acknowledge that employers act not being aware of what they actually do and of
where they go. This would ultimately entail that whether an employer attain or
does not attain its objectives this does not depend upon the plan of action
this has craftily developed and implemented, but simply on the way events unfold
in the exogenous environment. Strategy should be thus regarded as something
which essentially escapes to the employer control and unintentionally pursued.
This mechanism, or rather, the
lack of a controlled mechanism which this idea essentially entails can be
considered debatable at best. Not only need strategies to be clear and explicit,
but it is of paramount importance that in order for these to produce the expected
results these must invariably remain under the employer full control. Whether strategies
would not be clearly defined and outlined these might be misread by managers and
differently implemented within the different areas or branches of the same organization
causing inconsistency, lack of integrity and confusion; ultimately exposing
employers to the risk that strategy execution may result in failure.
Implementation is,
by common consent, widely acknowledged as one of the most delicate activities,
arguably the most delicate activity, associated with strategy. Line managers
play a pivotal role in the execution of this process; different studies conducted
on this subject have indeed provided evidence that any given strategy can produce
different results according to the way it is executed. It is hence of paramount
importance ensuring that all of the individuals involved in the implementation
process are singing from the same hymn sheet.
In the event
strategy should not be clearly known and understood by managers and employees
and be subject to an uncontrolled, incessant process of change, it would be
completely impossible for line managers implementing it in a coherent and
consistent way and to evaluate the effects produced by their actions vis-à-vis the
intended scope.
Looking at strategy
exclusively in retrospect would provide employers information about where the organization
was at any one point in the past, but it would tell nothing about where the organization
actually wants to go and whether the identified and current positions are actually
consistent with and meeting the employer expectations. Yet, since the exogenous
environment is changing at an increasingly faster pace it would be pointless to
even try the exercise.
The lack of a precise and
clearly defined strategy for an organization may be compared to a soccer match
during which all players are continually running after the ball not adhering to
any precise attack or defence scheme, that is to say game strategy.
The findings of an
investigation conducted by PriceWaterhouseCoopers (2002) revealed that organizations
having a written strategy were able to generate 35 percent higher revenue per
employee compared to those do not having an explicit strategy.
A company ability
to promptly adapt to the external changing circumstances and to get the most of
all the opportunities offered by the exogenous environment, coupled with its
ability to timely counter the threats this poses, is clearly of pivotal
importance. Strategies unquestionably need to be constantly reviewed, adapted
and amended whenever it is considered appropriate, but with full consciousness
and awareness; clearly knowing where the organization wants to go, why and how,
and after having duly analyzed and considered the eventual threats and barriers
which could prevent the organization to go ahead with its intended plans.
Strictly associated with strategy
formulation is the theme of strategy implementation. Habitually, this process
causes indeed many problems, insofar as having been deemed: “weak at best”, “a
problematic area” and “patchy and sometimes contradictory.” An organization’s
capability to quickly transform strategy into action is crucial for its effectual,
practical pursuance. Nonetheless, in the event this is not clearly expressed,
it may prove to be rather tricky to properly, effectively and consistently
implement it.
Business strategy
clearly plays a pivotal role in every organization; the activities and
strategies of every company functions are in fact based on this and HR strategy
clearly makes no exception. Accepting that business strategy is exclusively dictated
by the circumstances would imply that HR strategy would become anytime soon
disconnected from and unaligned with it. Whether corporate strategy should
actually constantly change, insofar as the employer being able to gain
knowledge of this occurrence only looking backwards, HR managers would not be
in a position to adapt and amend HR strategy accordingly. Since the scope of HR
strategy and of the practices stemming from this is that to support and enable
employers to effectually pursue their intended strategy, the moment business
strategy should escape from the employer control HR strategy would in turn immediately
risk ceasing to produce its intended effects. This would clearly represent an
extremely potentially harmful occurrence for employers. HR practices might in
fact aim at pointing in a different direction vis-à-vis that suggested by the external
pressure on the basis of which, according to the emergent strategy theory taken
to extremes, business strategy stems from.
By reason of the remarkable
role played by human capital for the achievement of competitive edge, it is
hardly imaginable that HR practices might be unaligned with business strategy. Whether
it would be accepted that business strategy can be only retrospectively
identified it would be indirectly accepted that this is actually possible, but
whether this would really be the case, HR would never be able to accomplish its
mission, that is to say support and facilitate the achievement of corporate
strategy.
Business and HR strategies
are unquestionably influenced by and subject to the changes occurring in the
exogenous context, but this does not necessarily implies in turn adjustments
and amendments to the content and objectives of strategy. In most cases, these occurrences
may just prompt the employer to introduce changes concerned with the means or the
way the organization intends to achieve its strategy, not with a comprehensive redesign
of the content and core aim of organizational strategy.
A company ability and capability to promptly adapt to these changes clearly represent a remarkable asset to the employer for the achievement of competitive edge. Businesses should also strive to promptly take advantage of the opportunities offered by the external environment and be ready to cope with the treats this poses, but also in this case it is very unlikely that employers would not be in a position to intentionally and consciously change their direction and scope whether required.
It is absolutely true
that the exogenous environment changes and evolves very quickly, but not insofar
as not conceding organizations the time to redress their strategies and
objectives accordingly. One thing is an employer ability to promptly detect and
discern the changes occurring in the external environment and timely adopt and adapt
to these, a completely different story is unawareness, confusion and ultimately
chaos. A wise and savvy business captain needs to constantly plan and take
control of the vessel; regrettably, the risk of shipwreck is constantly around
the corner.
Longo, R., (2010), Explicit or emergent strategy: Should be corporate
and HR strategy planned or piecemeal?;
HR Professionals, [online].
