By Patricia M. Trainor, J.D.
Legal Editor

If HR managers learn to speak to upper management in terms of its strategic style, they will be heard and respected in their organizations. So says Robert L. Brady, CEO and Founder of BLR, Inc. Brady spoke about HR's role in strategy at BLR's 2009 National Employment Law Update this week in Las Vegas.

Brady has been studying and writing about HR for over 40 years. He has come to the conclusion that for HR to get respect, it must understand the business strategy of its organization. Talking to management about best practices in HR can fall on deaf ears, but providing management with policies and practices that align with management's strategic style, will not only get the job done, it will earn management's respect.

HR's Role

HR does not set the business strategy. In fact, according to Brady, HR is usually an afterthought when management discusses its business strategy. He finds this ironic since the number one concern of management is getting the right people--an HR function. Nonetheless, it is critical for HR to understand the business strategy and support it with appropriate policies and practices.

Strategic Style

Citing Competitive Strategy by Michael Porter; The Discipline of Market Leaders: Choose Your Customers, Narrow Your Focus, Dominate Your Market by Michael Treacy and Fred Wierseman; and The Talent Solution by Edward Grubman, Brady explained that a company's strategic style generally falls into one of three generic business strategies with implications for many levels of the company:

• Customers --In these organizations, the focus is on relationship building. Leaders are collaborative and emphasize shared values. Employees are hired if they are a good fit with the company's values and have the ability to develop relationships. Compensation is often based on results. Examples of Customer organizations include Nordstroms and IBM.
• Operations --In these organizations, the focus is on consistent application, process control, teamwork, attention to detail, and a drive for results. Leaders of these organizations tend to be charismatic, and employees are results-oriented and team players. Compensation is usually based on formula driven incentives. Examples of Operations organizations include Wal-Mart and Dell.
• Products --The focus in these organizations is on ideas and constant innovation. People in these organizations tend to be curious, creative, life-long learners, artistic, and visionary. Leaders are usually low-key visionaries. Employees are selected based on their intelligence and their commitment to long-term employment at the organization. Compensation tends to have a long-term focus and less emphasis on individual differentiation than other strategic styles. Examples of Products companies include Nike, Apple, and Bloomingdale's.

To figure out an organization's business strategy or style, Brady suggested looking at the organizations history and culture. Consider what “big events” drove growth, what worked and didn't work, what management says about strategy, and what the company culture emphasizes, i.e. , customers, processes, or autonomy.

Why is It Important

Understanding an organization's business strategy is important because people need to fit the strategy; one size does not fit all. Brady explained that an organization needs the right people, not just the best people, and it needs the right policies, not just the best .

BLR's Strategic Style

Brady shared BLR's strategic style--Products. Brady said that the product has always been the “secret sauce” that makes BLR successful. As a leader, he encourages employees to take risks, be innovative, and to try new things. He is not concerned about failure, because failures can be educational. BLR's HR department understands that policies and practices need to be flexible in response to the changes new products and ideas may bring.