HR Strategy - Meaning, Importance & Example

Published by MBA Skool Team, Last Updated: August 02, 2021

What is HR Strategy?

HR Strategy is the strategy adopted by an organization which aims at integrating core human resource aspects like organization’s culture, its employees, partners, training, incentives and overall system by coordinating a set of actions to get the required business goals. Therefore it must be aligned to organization’s overall mission, vision and goals. The characteristics of the industry in which the organizations is to be analyzed and its competitive advantage need to be determined for developing an HR strategy.

HR Strategy Dimensions

The four key dimensions must be addressed in order to develop HR strategy:


It is the beliefs, rules and style of management of the organization


It is the structure, job types, job descriptions and reporting lines of the organization.


The most important part of the organization is its people. The skills level, employee potential and the capability of the management constitutes the people.

4.Human Resources Systems

It is the people focused mechanism which deliver the correct strategy for the organization - recruitment, communications, training and development, compensation and benefits etc.


Importance of HR Strategy

The senior managers frequently, while managing people, element focus on only one or two dimensions and neglect the other people. Typically companies prefer to relieve their managers of bureaucracy and push for more creative and entrepreneurial spirit but then the management fail to develop a suitable compensation and training system.

When the mentioned creative or entrepreneurial flair does not appear from the employee’s work, the managers blame the employees and not the system. If an organization wants to retain the quality of work then its duties are not only to retain talented staff but also the organization needs to be reviewed and the training and compensation benefits need to be improved in order to facilitate employees in a better way.

This is where HR strategy comes into picture. Strategy makes sure that all the core aspects of human resource management are in sync and aligned with the overall strategy. If employees are trained to become creative then the results and incentives and the overall company culture has to align accordingly to show results which are as per the company's overall strategy and mission.

5 Ways and Examples to successful HR strategy

1.Align your initiatives

Strategic relevance/ Profit resource/demand risks

2.Align budgets and performance

Performance Incentives and bonus should be directly connected to strategy

3.Strategy After Structure

The structure should allow organizations to create strategies

4.Staff Engagement

Communication, Participations, team building  etc.

5.Monitor and adapt

Strategies must be adaptable and flexible and regularly monitored for results

Hence, this concludes the definition of HR Strategy along with its overview.

This article has been researched & authored by the Business Concepts Team. It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.

Browse the definition and meaning of more similar terms. The Management Dictionary covers over 2000 business concepts from 5 categories.

Continue Reading:

Share this Page on:
Facebook ShareTweetShare on Linkedin