Human Resource Management (HRM) is influenced by several considerations. The most essential of them are: (i) type and strategy of the business, (ii) business growth cycles and planning, (iii) environmental uncertainties, (iv) time horizons, (v) type and quality of forecasting information, (vi) labor market. Over time the significance of the value of HRM to its firm has increased. The HRM moved from being operational to strategic, which are the two different types of HR, and from reactive to proactive. The HR field may shape its philosophy about the past, present, and future around the structure that results from the amalgamation of both proactive and reactive HR. Operational HR activities largely refer to the routing, day-to-day delivery of HR basics.
HR activity involves the following main five criteria:
- Long term: whether the activity would add value in the distant future as opposed to the immediate future.
- Inclusive: whether the activity encompasses the entire business or individual departments.
- Structured: whether the activity is well planned before it is done or if it is done on impulse.
- Combined: whether it would bring other disconnected activities together.
- High value added: whether it emphasizes on business, financial and market success.
Proactive and reactive human resources are both critical to the success of businesses in managing and motivating people. Both are especially important for strategic HR processes. However, the strong growth of proactive HR applications can assist managers evade dependence on reactive HR. Reactive human resource management sits tight for complications to take place before something is done about it. Proactive human resource management anticipates requirements and complications and tries to avert them in advance. Both proactive and strategically reactive HRM are used to add value to an organization.
Reactive HR concentrates on applying the business strategy for e.g., growth, new product, innovation, cycle reduction, new market entry. In various ways HR can help support its successful application. Such undertakings consist of classifying and evolving the technical knowledge, strategic skills, and business culture that are constant with the demands of the business policy. Proactive HR stresses on building prospective strategic substitutes. Such undertakings include generating a culture of modernization and resourcefulness and crafting in-house competencies that constantly pursue and line up with the marketplace.
Similarities: The main similarity between proactive and reactive HR is that both are essential in HRM, which has become an obvious function in the early 21st century. Businesses need to proactively develop processes but have a competent structure to agree well when problems arise out of the blue. Both approaches include procedures of dealing with employees and their distresses. In both cases, HR professionals and managers want to keep workforces content and industrious so that production is high.
Differences: Proactive HR strategies are usually applied before problems crop up. Proactive techniques include calculatedly employing definite staff and paying what it takes to stimulate them. Reactive techniques more frequently include waiting until staff object or challenge to raise salary or other incentive complications. The difference between reactive and proactive HR basically boils down to two things – foresight and timing. Proactive HR practices include the scheduling and application of strategies established on analysis of data and developments that aid to support the business plan. Regular compliances with policies and procedures, systematic payroll runs, and controlling daily attendance are all basic actions. However, these are reactive HR duties that form part of the operational running costs without adding any intentional value or effect.
Important guidelines for creating a proactive HR function:
- Depend on pieces of evidence: Form your application based on the suggestion of what actually works, not on what is presently prevalent.
- Concentrate on practices that are important: HR needs to concentrate their restricted resources on what gives the biggest “value for money.” This takes consideration of what is most essential in your business and the self-restraint to move resources to where they have the most leverage.
- Coach senior leaders to promote issues globally: Occasionally, global policies or talent practices might obstruct your company’s ability to reach its growth objectives. It is therefore essential for HR to train leaders about which talent issues are serious and inspire them to raise these concerns with the corporate office to discover a way out.
- Make certain HR is up to date: Having a proactive HR department requires talented and experienced HR professionals. In certain countries, the staff might be too small to develop suitable talent procedures. In such circumstance, request for more backing from regional or global HR.
Be proactively watching out for solutions. Do not just agree that how matters are held is tolerable. In the age of globalization with more than half of companies looking to grow globally, HR has more resources and technologies, accessible to them than ever before. Plan forward and find a way out that agrees for flexibility. Look out for suppliers that offer consulting services like establishing accounts, tax, accounting, legal, etc. Try to get as many services from a single source to save money and time. True leaders are the proactive planners that inspire their teams to handle strategic jobs, by giving them the best resources.
My recommendation for 2019 is for HR professionals to be proactive in reviewing their HR policies and practices in order to streamline processes to drive efficiencies and improve the way of working. A good example of this is the recent shift we have seen in how some companies are now managing the annual performance management processes. Some organizations have replaced the traditional annual performance management process with more regular informal reviews that focus on an employee’s strength and potential rather than the development areas being the main focus of the discussion. The traditional annual review process was seen as time-consuming with little or no value addition so this is now being replaced by a different approach. The new approach is still being tried and tested but what is important to note, is that the companies that made the change, replaced the traditional method because it wasn’t working for them.
Looking at efficiencies internally within the HR function is a good place to start. In 2019, it will be important to collate data and use HR analytics to drive prudent business decisions. We should start by measuring the costs of key HR activities such as recruitment, attrition, absenteeism, and ROI of training and development as an example. HR has a role to play in influencing key business decisions not just in implementing the decisions once they are made.