How To Build a Comprehensive People Strategy for Organizational Success

What are people strategies?

The most critical asset of an organization is its people. In a dynamic, fast-paced, information-based economy, hardworking, creative, and passionate people drive the world’s best companies. It should come as no surprise, then, that one thing all highly successful companies have in common is that they have a people strategy.

Here, we look at the concept of a people strategy, discuss some pros and cons of those strategies, review the process, provide some examples, and go over how Visier can help organizations develop and execute their people strategies.

What is people strategy

Modern companies need exceptional talent to outperform the competition. A people strategy is a company’s plan for leveraging the benefits of exceptional talent. This includes all strategies to attract, develop, retain, and engage people in the organization. 

While it’s not uncommon to think of the hiring process as a people strategy, it is just one element of a people strategy, albeit an important one. In reality, people strategy considers the entire lifecycle of employees at a company—from hiring to exit.

Elements of a people strategy

A comprehensive people strategy involves a plan to attract, engage, train, and retain talent. Let’s consider each individually.

Attracting talent

When people think of people strategy, most people think of attracting talent first. That’s somewhat fitting, as attracting people is the first phase of a broader people strategy. Of course, you have to have employees on board before you can engage, train, and retain them.

Attracting talent requires thinking about an organization’s needs and whether and how bringing on new staff can address those needs. This might include hiring for specific talent, competencies, or experience required now or anticipated as a future need, or strategically approaching talent acquisition to increase organizational diversity.

Engaging employees effectively

Companies want their employees to be passionate about their jobs. While some employees may be naturally passionate about their work, employee engagement doesn’t just happen. A strong people strategy includes intentional efforts to keep employees motivated, connected, and aligned with the organization’s mission.

When employees are engaged, they bring higher levels of energy, commitment, and creativity to their roles—leading to increased productivity, improved employee performance, and better business outcomes. Investing in engagement isn’t just about job satisfaction; it’s a key driver of organizational success.

Training and developing staff

Ideally, companies would be able to hire exceptional staff who come in the door with all of the skills and experience needed to help the company thrive. However, in reality—especially in a tight labor market and with rapid technological change—this is rarely the case. Employers must actively bridge skill gaps by providing training that equips employees with the capabilities they need now and in the future.

In addition, research continues to show that learning and development are in high demand among employees who often leave a job to seek employment elsewhere to further their development. This is particularly true among younger employees. Clearly, training is an essential element of any people strategy.

Retaining top talent

Turnover is an unpleasant reality in all businesses. In fact, the trend in recent decades is toward shorter and shorter tenures at companies before employees start exploring other options. Employee retention is a significant challenge for all organizations. An effective people strategy is key to that effort. This can come in the form of efforts to boost employee engagement and satisfaction and is closely tied to things like performance management, compensation, and general employee well-being.

The impact of a strong people strategy

There are many benefits to creating and implementing a people strategy and few drawbacks. In fact, most drawbacks result from poor planning and/or execution.

Benefits of people strategy

A people strategy involves thinking deliberately about attracting, engaging, training, and retaining staff. One of the obvious benefits of a people strategy is that it gets the key stakeholders thinking about these challenges and how to address them. Well-designed and well-implemented people strategies help organizations do better at all four key employee management elements.

Additionally, a people strategy that is effectively communicated to employees sends a clear signal that the organization cares about them and their professional development. It’s a great way to communicate a sense of inclusion and belonging. 

As a result, employees often feel more confident in giving their own feedback to their employees, thereby improving dialogue and communication. This helps to address any simmering issues before they come to a head.

Overall, a people strategy, if designed and implemented effectively, creates a better, more dedicated, more effective, and more efficient workplace. That kind of improvement won’t just happen on its own. 

Having a people strategy in place is necessary to get the best out of a company’s workforce, but—as we’ll discuss in the “cons” section—simply having a people strategy isn’t always sufficient to achieve those results.

What steps should be followed to develop people strategies?

Creating and implementing a people strategy is similar to any other major corporate process initiative. Here are the key steps to developing a people strategy that every organization should follow.

Seeking feedback

Feedback is a critical component of developing any type of strategy. People strategy is no different. Organizations need to seek input from employees, in addition to evaluating their own people data to identify strengths, gaps, and opportunities for improvement. Employee engagement is one key metric that organizations should consider as they’re formulating their strategies. 

Feedback should also include consideration of internal and external factors that impact talent needs. For instance, changing customer expectations, increasing turnover, a changing competitive landscape, technological advances, and emerging competition will all impact the scope and direction of a people strategy.

Defining objectives

A thorough internal and external analysis will drive the development of desired goals and objectives. Effective people strategies need to have associated measurable goals and objectives to help organizations determine whether their actions have the desired positive impact. 

Defining desired objectives requires a lot of careful and insightful consideration. It requires thinking about the present and expected future opportunities and challenges and what an organization needs to do to mitigate those challenges and capitalize on those opportunities. It also requires the people strategy team to isolate key metrics that they will track and define what success looks like from the outset.

A team that starts its people process with objectives that aren’t meaningful, realistic, or aligned with the broader corporate strategy will run into friction and challenges down the road. A team that does not benchmark its current state, track relevant metrics reliably, and measure progress against targets will be unable to demonstrate impact from its people strategy.

Evaluating current state

Once a company has its desired objectives in mind, it needs to take an objective and honest look at where the organization and how its key pieces sit today with respect to those objectives. 

If the objectives are the finish line, the current state is the starting point. The next step in the people strategy process is figuring out how to get from the starting point to the finish line.

For example, a company with a people strategy of employing the most knowledgeable customer service representatives may need to invest heavily in training if its existing customer service staff is not as knowledgeable as the desired end state. 

Similarly, a company that desires consistent customer experiences will need to work to ensure that organization-wide service standards and quality controls are developed and adhered to.

Again, having a defined set of metrics to benchmark and track progress against will ensure that organizations can effectively measure and report on the impact of their people strategies.

Considering internal mobility

People strategy will be both externally and internally focused. Considering internal mobility can help organizations develop and maximize the value of existing talent while identifying opportunities to bring in new talent from outside the organization.

What are some examples of effective people strategies?

People strategy is a big concept. There are many examples of focused initiatives that fall under this broad umbrella.

One example might be creating growth and development plans for staff that demonstrate high potential. These plans might involve customized training courses, mentorship programs, and inclusion in leadership meetings to gain familiarity with executive team members and the executive team's culture. 

Another example might be an organization that implements a diversity and inclusion program to improve its level of diversity and employee engagement.

Or a company might solicit feedback on quarterly employee satisfaction surveys and review the results to consider changes to company policies around flexibility, salary and benefits, professional development, workplace safety, and other issues.

Effective people strategies require data and analysis to ensure that the appropriate actions are being taken. 

First West Credit Union is one example. The credit union had tried different interventions to reduce turnover—from pay increases, to better onboarding, to management training. They used data and analysis to help them determine which was most effective and found that upskilling employees through additional training increased revenue significantly—returning $2.5 million on their investment.

Create and manage more effective people strategies with the right tools

People strategy is an essential component of every organization’s broader strategic workforce plan. Unfortunately, many organizations don’t have the headcount or resources on their HR teams to craft a holistic people strategy that aligns well with other corporate initiatives and contains realistic and meaningful objectives. In short, HR teams need help. For many, that means onboarding the right tools to help them extend their capacities.

Retention tracking tools let HR teams benchmark turnover at the organization and understand the underlying causes, helping to focus on initiatives that improve employee loyalty. Better managers’ tools help to identify top performers, map desirable career paths for them, and strategically place them in positions of greater influence. And tracking employee satisfaction helps to identify key employee engagement benchmarks, and uncover underlying problems or opportunities.

Connecting business data with people data can effectively inform a data-driven people strategy, ensuring that corporate assets—both people and budget—are properly aligned and allocated. Visier offers the tools, technology, and sophisticated AI capabilities to ensure companies can develop, implement, evaluate, and continually update their people strategy. Take a two-minute tour to learn more.