Any article on this topic typically begins by stating that HR goals primarily depend on the business and its current state. However, our aim here is to provide a clear and concise answer to what constitutes the goals for an HR department or an HR generalist.
A crucial disclaimer here is: do not confuse HR goals with HR processes.
Two primary HR goals in 2024:
1. Staffing Levels:
Comment: Staffing levels directly impact the ultimate outcome of the business.
2. High Labor Productivity:
Comment: Productivity refers to the high added value of employees' work results.
Ultimately, despite the undeniable importance of other goals, CEOs and shareholders will evaluate the HR department’s performance primarily based on these two objectives.
However, it would be incorrect to focus solely on these top-level goals.
Seven Important HR Goals:
1. High Hiring Speed:
Comment: The time-to-job offer metric is crucial, not only for the recruitment manager but also for the rapid expansion of the business.
2. High Quality of Hire:
Comment: This goal is reflected in the percentage of new hires who successfully pass their probation and the profit the company gains from the hired employees.
3. High Employee Satisfaction:
Comment: This HR goal is driven not by humanitarian concerns but by its impact on retention, which enhances business stability.
4. High Employee Engagement:
Comment: Together with high satisfaction, engagement helps achieve the top-level goal of labor productivity.
5. Reduced Turnover:
Comment: While turnover rates vary across industries, reducing it is a relevant goal for HR in almost any business. The rationale is simple: companies aim to part ways only with low-performing employees, as replacing staff is always costly.
6. Create an Effective Compensation and Motivation System:
Comment: This is a frequent HR goal, though difficult to define. An effective motivation system is one where, upon meeting turnover metrics, the labor productivity goal is achieved. In simpler terms, the company must balance how much to pay employees (to retain them and ensure quality work) with business profitability norms.
7. HR Strategy Aligned with the Business Strategy:
Comment: At first glance, this HR goal might seem out of place next to turnover or employee engagement. However, it is indeed crucial. A strategy not only sets the direction but also makes HR’s work meaningful. Hence, having a strategy aligned with the business strategy is very important.
Additional Goals for the People Team Optimize Recruitment and Hiring:
1. Accelerate Candidate Progress through the Recruitment Funnel:
Comment: Effective time management during each stage of recruitment allows for quicker hiring of suitable candidates. For instance, automating resume screening and preliminary interviews can reduce processing time from weeks to days, which is critical in a competitive job market. Speeding up recruitment helps in not missing out on talented candidates who might receive offers from other companies.
2. Track and Improve Candidate Experience:
Comment: Enhancing candidate experience involves all aspects of their interaction with the company, from initial contact to receiving an offer. This may include improving communication at each stage, creating user-friendly application platforms, and providing transparent feedback. For example, implementing post-interview surveys and analyzing feedback can help identify problem areas and improve processes, making the hiring process more positive and professional.
3. Implement Interview and Hiring Standards:
Comment: Standardizing the interview and hiring process ensures objectivity and consistency in evaluating candidates. This may involve creating a set of questions for interviews applied to all candidates for the same position and developing interviewer guides. For example, using structured interviews and evaluation forms helps reduce subjectivity and improve candidate fit with job requirements.
Develop and Assess Staff:
1. Implement Performance Appraisal Systems:
Comment: Performance appraisals help measure and improve employee productivity and identify areas for development. This could involve regular performance evaluations, setting goals, and providing constructive feedback. For example, introducing a 360-degree feedback system gathers insights from colleagues, subordinates, and managers, offering a comprehensive view of an employee’s performance and impact on the team.
2. Implement Competency Assessment Systems:
Comment: Competency assessment systems help determine employees’ skill levels and identify training needs. For example, competency matrices showing required skills for various roles and levels can be used, and regular training sessions can address gaps. This facilitates targeted employee development and improves effectiveness.
3. Implement Individual Development Plans and Career Planning:
Comment: Individual development plans support career growth and increase employee motivation. This could involve creating personalized training and development plans, discussing career goals, and regularly updating plans. For instance, organizing mentorship programs and providing career counseling helps employees build their careers within the company and see growth prospects.
Compensation and Rewards:
1. Implement a Reward System:
Comment: A reward system motivates employees to perform at high levels and achieve corporate goals. This could include monetary bonuses, company stock, additional vacation days, or other forms of recognition. For example, developing a bonus program based on key performance indicators helps motivate employees to meet ambitious goals and improves overall company results.
2. Create a Financial Model for Compensation and Forecast Personnel Costs:
Comment: A financial model helps forecast personnel costs and optimize the reward system. This could involve budgeting for different types of rewards, analyzing salary and bonus expenses, and creating scenarios for various payout levels. For instance, modeling salary and bonus scenarios helps manage costs and plan budgets in uncertain conditions.
Organizational Structure and Processes:
1. Design Organizational Structure:
Comment: An effective organizational structure enhances coordination and communication within the company. This may involve reviewing the current structure, creating new departments, or changing reporting lines. For example, analyzing current processes and identifying bottlenecks can optimize the structure, improve inter-departmental interaction, and enhance overall work efficiency.
2. Develop Policies for Identifying and Managing Talent Pools (HiPo – HiPro Model):
Comment: Talent pool policies help identify and develop high-potential employees ready for leadership positions. This may involve creating development programs for high-potential employees and planning their career progression. For example, developing a leadership program for high-potential employees helps prepare them for future managerial roles and ensures continuity in the company.
3. Restructure Processes for Remote Work:
Comment: Adapting processes for remote employees involves optimizing workflows and implementing technologies to support remote work. This may include setting up video conferencing tools, project management, and collaboration platforms. For example, introducing project management platforms and communication tools helps integrate remote employees into the team and improve their interaction.
Safety and Inclusivity:
1. Develop and Implement a Safe Work Environment Policy:
Comment: A safety policy protects employees from potential risks and supports their health and well-being. This may include creating safety standards, conducting training, and regularly checking working conditions. For example, developing and implementing evacuation procedures and providing necessary safety equipment helps prevent accidents and create a safe work environment.
2. Implement an Inclusivity and Diversity Policy:
Comment: An inclusivity and diversity policy fosters a fairer and more innovative work environment. This may include developing awareness programs, conducting training, and implementing practices that support diversity in the company. For example, creating programs to attract and support diverse employee groups helps build a more inclusive culture and enhances the company’s corporate image.
Managing Remote and International Staff:
1. Transition to a Distributed Work Format:
Comment: Shifting to a distributed work model allows for flexible resource management and expands access to international talent. This may involve implementing flexible work schedules, organizing workspaces, and adapting business processes. For example, creating hybrid work policies and providing employees with necessary remote work tools helps increase flexibility and team productivity.
2. Hire Employees Abroad:
Comment: Hiring international employees expands access to diverse talent and promotes team diversification. This may involve developing hiring strategies, complying with local legislation, and adapting hiring processes. For example, creating international recruiting campaigns and managing legal aspects of employment in different countries helps attract and integrate international talent.
3. Set Up Global Payroll Processes:
Comment: Organizing global payroll processes allows for efficient management of payments and tax obligations for international employees. This may include implementing payroll calculation systems, complying with tax requirements, and managing currency risks. For example, using global payroll platforms and managing tax declarations helps ensure accurate calculations and compliance with laws in different countries.
4. Set Up Onboarding Processes for Remote Employees:
Comment: Effective onboarding for remote employees helps them adapt quickly to their new roles and become productive team members. This may include organizing introductory training, creating onboarding programs, and providing support resources. For example, developing online courses and providing communication and interaction tools help new remote employees integrate quickly into work processes.
5. Organize Health Insurance for Remote Employees:
Comment: Health insurance for remote employees ensures their health and safety, which contributes to their satisfaction and loyalty to the company. This may include selecting insurance plans, managing medical expenses, and providing healthcare support. For example, developing health insurance policies that cover treatment in various countries helps provide reliable health protection for remote employees.
Ethical and Cultural Aspects:
1. Create an Ethics Committee:
Comment: An ethics committee helps maintain high standards of conduct and address ethical issues within the company. This committee may work on developing and implementing codes of ethics, addressing ethical dilemmas, and ensuring compliance with corporate norms. For example, establishing an ethics committee allows for prompt responses to violations, conducting investigations, and developing recommendations for improving corporate culture. This fosters trust among employees and clients and supports the company’s positive image.
Key Considerations
HR goals should not be merely a set of directive tasks but the result of thorough strategic planning and team involvement. A crucial aspect of successful goal-setting in HR is that goals should stem from the HR strategy rather than being imposed top-down. Team participation in goal development significantly enhances their relevance and effectiveness, as goals become more meaningful and aligned with the team's perspective.
The Relationship Between HR Goals and HR Strategy
HR goals must be closely linked to the company’s HR strategy. The HR strategy sets broad directions and key priorities for human resource management, which are then translated into specific goals and tasks. This alignment ensures consistency between strategic vision and operational actions. For instance, if the company's HR strategy focuses on leadership development and fostering an innovative culture, corresponding HR goals might include implementing leadership development programs and encouraging innovation within the team.
Team Involvement in Goal-Setting
Goal-setting is most effective when HR goals are developed collaboratively with the team rather than being directive. When the team is involved in the goal-setting process, it increases employee commitment and motivation. Employees feel a sense of ownership over the collective goals, which promotes more active participation in achieving them. For example, when setting goals to improve the recruitment process, incorporating feedback from recruiters and line managers can lead to more realistic and achievable targets, such as reducing time-to-fill or enhancing the candidate experience.
Addressing Current and Future Business Needs
HR goals and strategy should address not only the current business needs but also anticipate future challenges. This is especially important in a rapidly evolving business environment and technological landscape. A classic example is the technology industry, where distributed work is becoming increasingly common. For HR teams, this means proactively organizing processes related to remote work.
Examples of HR Goals Impacting the Future:
1. Organizing Recruitment Processes for Distributed Teams:
The future of work already involves hybrid and remote formats, so HR goals should include developing and implementing effective recruitment strategies for remote employees. This involves optimizing candidate sourcing and selection processes and utilizing technology for virtual interviews and assessments.
2. Managing Global Payroll:
In a globalized world, companies often face the challenge of managing international payroll. HR goals should include creating and configuring systems that handle payroll for employees in different countries, considering tax and legal requirements.
3. Onboarding Remote Employees:
An effective onboarding process is crucial for new remote employees to adapt quickly and integrate into the team. This requires developing online courses, virtual communication tools, and support mechanisms for their integration.
4. Setting and Tracking Goals in a Distributed Team:
Setting and monitoring goals in a remote work environment requires creating transparent and effective systems for performance assessment and goal achievement. This may include implementing new technologies and tools for project management and coordination.
How Not to Set HR Goals (with examples)
Setting HR goals is a critical aspect of achieving company success. However, improperly set goals can lead to various problems and negative consequences. Let’s consider some anti-examples to understand how not to set HR goals.
1. Unmeasurable Goals:
Unmeasurable goals hinder tracking progress and assessing success. An example might be a goal stated as "Improve corporate culture." Without specific criteria and metrics, such as "Increase employee satisfaction by 20% based on survey results," it is challenging to determine if the desired outcome has been achieved.
Real Case: In a large company, a goal was set to "Improve internal communication." Without specific metrics and measurements, managers could not determine how or to what extent results were achieved. According to Harvard Business Review, such vague goals lead to insufficient employee motivation and loss of focus on genuinely significant tasks (HBR, 2021).
2. Unachievable Goals:
Unachievable goals can demotivate employees and lead to decreased performance. An example might be a goal to "Increase sales by 300% in the next quarter." Such a target may be unrealistic and not consider current market conditions and company resources.
Real Case: In 2017, Wells Fargo set goals for employees to open a large number of new accounts. Because the goals were too ambitious, it led to the creation of fake accounts and serious ethical violations, as reported by The Guardian (The Guardian, 2017).
3. Sabotage of Directive Goals Imposed from Above:
When goals are set top-down without team involvement, it can lead to sabotage and decreased productivity. For instance, if company leadership sets a goal to reduce application processing time by half without considering employee input, staff who are not involved in goal-setting may not support it, leading to reduced efficiency and internal conflict.
Real Case: Amazon experienced high employee turnover after implementing top-down performance goals without employee input. Research published in The New York Times shows that such goals lead to deteriorated morale and increased stress among employees (NYT, 2015).
4. Work Simulation Due to Incorrectly Set Goals:
When goals are set incorrectly, employees might simulate work to meet requirements, even if it does not produce real results. For example, if the goal is to conduct 100 client meetings per month, employees might falsify meeting reports to meet the goal formally, without real business benefit.
Real Case: In Volkswagen, a goal to reduce vehicle emissions led to fraudulent testing methods. According to The Guardian, company staff and management used software to manipulate test results, leading to a major scandal and legal consequences (The Guardian, 2015).
Conclusion
Setting HR goals requires a careful approach to avoid these issues. Unmeasurable goals, unachievable targets, directive goals without team involvement, and incorrectly set goals can lead to negative consequences such as employee demotivation, sabotage, work simulation, and even legal risks. Team involvement in goal development, along with goal realism and measurability, will help ensure their achievability and positive impact on the company.
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