Strategic Human Resources Management: Aligning with the Mission

U.S. Office of Personnel Management
Office of Merit Systems Oversight and Effectiveness
Strategic Human Resources Management:
Aligning with the Mission
September 1999

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STRATEGIC HUMAN RESOURCES MANAGEMENT:
ALIGNING WITH THE MISSION
Contents
Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . i
I. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
What is Alignment? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Why Align? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
The Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
II. Strategic Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Agencywide Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
HRM Integration in Agency Strategic Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Agency HRM Strategic Measures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
HR Involvement in Agency Strategic Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Agency Annual Performance Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
HR Strategic Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
III. Strategic Implementation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Strategic HRM Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
HRM Measurement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
IV. Strategic Relationships . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Corporate HR and Top Agency Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
The HR Office and Line Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Accountability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
V. Where Do We Go From Here? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Appendix A - Non-Federal Findings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1
Private Sector . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1
Non-Federal Public Sector . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-2
Appendix B - HRM Alignment Bibliography . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1
Internet Sites . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-5

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EXECUTIVE SUMMARY
Human resources alignment means integrating decisions about people with decisions about the
results an organization is trying to obtain. By integrating human resources management (HRM)
into the agency planning process, emphasizing human resources (HR) activities that support broad
agency mission goals, and building a strong relationship between HR and management, agencies
are able to ensure that the management of human resources contributes to mission
accomplishment and that managers are held accountable for their HRM decisions. This is
especially important in light of the Government Performance and Results Act’s (GPRA) push to
align all agency activities, including HRM, toward achieving defined agency strategic goals and
measuring progress toward those goals.
In fiscal year 1999, the U.S. Office of Personnel Management (OPM) embarked on a special study
to determine how much progress Federal agencies have made toward aligning HRM with agency
strategic goals in support of HRM accountability and agency mission accomplishment. Our key
findings and conclusions are summarized as follows.
C Many more agencies than expected include HR representatives in the agency planning process
and integrate human resources management goals, objectives, and strategies into agency
strategic plans. However, most agencies are still struggling in this area. Therefore, agency
executives and HR leaders need to work together to fully integrate HRM into the planning
process so that it will become a fundamental, contributing factor to agency planning and
success.
C Although some agency HR offices have begun focusing on organizational activities that assist
agency decision-making, most are still emphasizing internal HR office efficiency efforts. While
internal issues are important to the success of any HR program, HR offices also need to
examine the “big picture” and find ways to impact the success of the agency as a whole.
C Most agencies are in some way measuring the efficiency and/or effectiveness of the HR
function. These measures, however, are generally output-oriented, focus on internal HR
processes and activities, and are used to make improvements to HR-specific policies and
procedures. As HR refocuses its activities to broader organizational issues, HRM measures
also need to be expanded to gauge the impact HRM has on agency goals and mission. Then,
the measurement data can be used to inform agency-level decisions.
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Executive Summary
C The relationship between HR and management is becoming more collaborative. HR executives
are beginning to earn a seat at the management table. HR offices are becoming more
consultative and involved in day-to-day line management activities. Nevertheless, there is still
a long way to go if HR is to become a strategic partner at all levels. To do so, HR needs to
build its own internal competencies to deal with organizational issues, educate itself on agency
and program missions, and find ways to offer creative and innovative solutions to
organizationwide issues.
Although many National Performance Review (now known as the National Partnership for
Reinventing Government) initiatives, such as downsizing, reorganizing, streamlining, and
delegating HR authorities, were meant to improve HR’s ability to focus on organizational issues,
they have not taken hold as quickly or thoroughly as hoped. Therefore, HR is still doing most of
the process work, and its ability to focus on alignment has been limited. However, as HR’s role in
agency planning, activities, and decision-making advances -- and it is advancing -- so too will the
alignment of human resources management with agency mission accomplishment.
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I. INTRODUCTION
A company is known by the people it keeps.
- Unknown
What is Alignment?
Strategic human resources management...strategic alignment...alignment with mission accom-
plishment. These are just a few of the terms being used to describe the new, evolving role of
Federal human resources management (HRM). What do these terms really mean? If you were to
ask agency personnelists, managers, or employees, you would probably get a wide range of
answers. So, it’s important to establish from the beginning what we are really talking about.
Human resources management alignment means to integrate decisions about people with
decisions about the results an organization is trying to obtain. Our research indicates that
agencies that successfully align human resources management with agency mission
accomplishment do so by integrating HRM into the agency planning process, emphasizing HR
activities that support mission goals, and building strong HR/management relationships.
1
In addition to being a vital contributor to
Hierarchy of Accountability
agency mission accomplishment, HRM
alignment is the ultimate level of HRM
Alignment
accountability, as demonstrated in the
with Strategic
Hierarchy of Accountability. While HRM
Goals of the
Organization
accountability must begin with basic legal
compliance, it ultimately encompasses all four
Effective HRM Programs
levels of the pyramid, including demonstrating
how HRM supports achievement of the
Efficient HR Processes
agency strategic goals.
Legal Compliance
Why Align?
Why the sudden emphasis on aligning HRM activities with agency mission accomplishment?
Basically, it comes down to demonstrating the value of human resources management to the
For consistency’s sake, this report uses the term “agency” when referring to the broadest form of the Federal
1
organization. For instance, the Department of Agriculture, along with all its components, is an “agency.” When
addressing specific components within an agency, the report will refer to them as “sub-components.”
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agency. In the past, one of HR’s primary roles has been to ensure compliance with laws, rules,
and regulations. Although this is still, and will always be, a necessary function, many recent
developments have led to a strong emphasis on results.
The National Performance Review (NPR) took on the task of reinventing government to make it
2
work better, cost less, and get results. NPR mandated many initiatives that changed the focus of
HR from just compliance toward results, including downsizing the HR function, delegating HR
authorities to line managers, calling for HR to demonstrate its business value, and enhancing
customer service. Through these initiatives, management of human resources would become
more responsive to mission-related needs because it would take place at the line level, and the HR
staff would be able to expend more of its energy on broader organizational issues.
The Government Performance and Results Act (GPRA) of 1993 has also played a large part in
focusing agencies on results. The purpose of GPRA is to improve Federal program effective-
ness, accountability, service delivery, decision-making, and internal management, thereby
improving confidence in the Federal Government. This is achieved by demonstrating organiza-
tional results through strategic planning and performance measures. Although the primary focus
of GPRA is on programmatic functions, agencies are also required to describe how administra-
tive resources, such as HR, are being used to achieve strategic goals. Further, the General
Accounting Office (GAO) and the Office of Management and Budget (OMB) have evaluated
many of these efforts, and are calling for agencies to improve their discussions of HRM alignment
in strategic and annual plans. Therefore, the human resources function is increasingly being
aligned to the agency strategic plan, which requires HR to show how it is supporting mission
accomplishment.
Alignment has already occurred in other key administrative functions. When Congress devel-oped
a statutory framework to introduce performance-based management into the Federal Government,
it initiated financial, information technology, and procurement reforms through such mandates as
the Chief Financial Officer Act and Information Technology Management Reform Act. Human
resources management is the administrative missing link to this comprehensive package.3
The private sector has recognized that it is not just financial and technological capital that provide
companies with the competitive edge, but people, or human capital. Without attracting and
retaining the right people, in the right jobs, with the right skills and training, an organization
cannot succeed. Therefore, people have been recognized as companies’ most important asset. As
the Federal Government moves toward a performance-based management approach, we, too,
need to realize the importance of our human resources. A huge percentage of agencies’ budgets
Now known as the National Partnership for Reinventing Government.
2
3U.S. General Accounting Office. Major Management Challenges and Program Risks: A Governmentwide
Perspective.
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Introduction
is spent on human resources -- salaries, benefits, training, work life programs, etc. Nowhere else
do you make that substantial an investment and not measure the return.
Not only do human resources provide the competitive edge, but several recent studies have
confirmed that the quality and innovation of HR practices impact business results. These studies
were able to draw a correlation between increased quality of HR practices and increased business
success. Among other benefits, HR alignment with mission accomplishment increases HR’s
ability to anticipate its customers’ needs, increases the agency’s ability to implement strategic
business goals, and provides decision-makers with critical resource allocation information.
Finally, HR alignment is a vital process to advance agency accountability. By defining, main-
taining, and assessing HRM goals and measures, communicating them throughout the agency, and
using the information to make management decisions, agencies are able to ensure that the
management of human resources contributes to mission accomplishment and that managers are
held accountable for their HRM decisions in support of mission accomplishment.
The Study
Once we defined what alignment means and why it is important, we wanted to find out where
agencies currently stand in terms of aligning their human resources management with agency
mission accomplishment. Therefore, the Office of Personnel Management (OPM) embarked on a
special study designed to explore the following objectives:
< Assess how well human resources management is linked to agency mission
accomplishment;
< Explore the role played by the HR staff in agency strategic planning;
< Determine how the HR service providers work with line managers to carry out agency
strategic goals; and
< Identify best practices aligning HRM with the agency strategic plan and goals.
In order to obtain information pertaining to these objectives, we did the following:
< Reviewed 31 agency strategic and 28 annual performance plans;
< Conducted an extensive literature and Internet search;
< Gathered information from agency HR professionals, supervisors, and employees at 17
agencies of various size through the fiscal year 1998 and 1999 OPM Oversight reviews;
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and
< Interviewed nine additional leading agency HR Directors.
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