HR and Business Strategy

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On the SuccessFactors Blog Mick Collins asks if HR and the Business are on the same page? I believe that HR has to have two continuing conversations - with the leaders of the business and with the employees. The first conversation has to be to understand how business, its strategy and tactics are evolving in response to external reality. The second conversation is to understand how people would respond to any strategic or tactical changes in structure, systems and processes. If for example the business' core competency is operational excellence then all the HR processes - from recruiting to performance management to succession planning to talent development has to be designed keeping that as a the fulcrum.
Here's the excerpt from the blog post:

One particular question asked “What do you consider to be the three biggest HR challenges being faced by your organization today?” At the top of that list was ensuring that employees remain engaged and productive, followed by retaining key talent, and developing leaders.
In my mind, the first “business of HR” response came in fourth: aligning people strategies to business objectives.
It reminded me of a conversation I had when running a marketing function. My manager would (rhetorically) ask me, “What should be marketing’s #1 metric?” The answer: revenue. Every other marketing metric and activity, from building brand awareness to identifying leads, is a contributor to the function’s overall goal: to generate revenue for the business.
In much the same way, HR’s biggest challenge should be helping the business design, deliver, and execute on its strategy, in order to achieve its goals. Every other challenge (hiring, retaining, engaging employees, etc) should flow from that.