Tag: What is People Strategy

How Professional Services Use A People-First Strategy to Drive Business Success

Professional services today serve a very important role in the business ecosystem. They deliver core expertise such as legal services, CPA services, and project consultation that can safeguard and transform a business’s success trajectory. 

In this context, talent is considered to be a core asset for business success at professional services firms. The exit of even one employee can be detrimental to the business, triggering distrust among clients. Yet, businesses struggle to build a robust value proposition for employees to stay on and grow with the business. 

Today, adopting a people strategy in business is emerging as a key strategy to enhance employee experience and retention, and reduce the Cost-to-Company (CTC) per employee. 

In this blog, we deconstruct what is a people strategy and how professional services can leverage it to drive business growth and success. 

Why is a People-First Strategy Important for Professional Services?

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First, let’s understand how a professional services business is distinct from, say, a product business and, hence, requires a unique strategy for business success.

A product business offers a tangible offering in the form of a product. On the other hand, a professional service is an intangible product, and thus, the scope of services can be wide. No doubt, business success for both categories is dependent on employee expertise.

However, human capital is the top asset of professional services businesses because the unique competencies of each talent are a key contributor to success. This is why a people-first strategy is emerging as an important ingredient in the success of professional services firms. Now, let’s understand what this entails. 

A people strategy in business is a holistic plan that clearly outlines how a business will manage and cultivate talent. The ultimate aim is to enhance business performance and drive revenues and profitability. Talent is treated as a core asset to the business and thus prioritized in the pecking order. 

For example, the caliber, skills, expertise, and reputation of lawyers play an important role in driving growth at a successful law firm. Similarly, the skill set, knowledge base, and experience of a project management consultant play a key role in driving success at a project consulting firm. 

The key benefits of adopting a people strategy in professional services are as follows: 

1. Higher Quality Service Delivery

Quality of service is the most important deliverable of a service business. An engaged and satisfied workforce has the potential to increase productivity by 18% and 41% enhancement in quality.  

2. Improved Client Satisfaction

High-quality services lead to increased client lifetime value, client recommendations, and increased business and, in turn, revenues. The cost of client acquisition goes down, which increases profitability. 

3. Increased Innovation and Problem-Solving

Professional services firms are sorted out for their differentiated problem-solving capabilities. A people strategy in professional services empowers an organization to nurture actionable frameworks where innovative thinking and problem-solving skills are valued, recognized, and rewarded. 

Also Read: The Ultimate Guide To 30-60-90 Day Performance Review and Templates

Building a People-First Culture in Professional Services

A survey conducted with 500 companies indicated that a toxic corporate culture is 10.4 times more effective than compensation in predicting the future attrition rate of a business.

Another survey indicated that 91% of the respondents shared that they were seeking learning and development opportunities. These are just some of the challenges faced by businesses.   

Now that we’ve deconstructed what is a people strategy, and its benefits, professional services need to design and deliver a people-first culture that drives business success. 

Here’s a snapshot of what strategies are used for successful businesses and why. 

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1. Attracting and Retaining Top Talent

There are three pillars to building a sustainable workforce as follows: 

  • Offer competitive compensation and benefits in line with industry standards. Consider aspects such as stock options, for instance, which drive more ownership. Also, health benefits and other areas that are important to employees, such as child care, for instance.   
  • Create opportunities that help accelerate professional development and growth for employees at all levels of the hierarchy. For instance, design unique and personalized growth paths for individual employees, as opposed to generic career progression. 
  • Today, a growing number of employees seek work-life alignment. Offer flexibility and initiatives that promote positive work-life balance. 

2. Empowering Employees

Employee empowerment is a great tool to increase engagement and productivity. Here are some key opportunities: 

  • Understanding employee needs is important. Foster a company culture of open communication and feedback through initiatives such as regular employee surveys and structured communication programs. Nuspire, a leading managed security services provider, was struggling with low employee morale. By implementing the Engagedly E10 Engagement Survey, they were able to analyze workforce engagement metrics and boost employee engagement by 15%.
  • Provide decision-making authority on projects where employees can demonstrate leadership, accountability, and ownership of their work. This approach helps them shift from executors to owners of their projects. 
  • Encourage initiative, creativity, and innovation through recognition and rewards for individual milestones. In turn, professional services can nurture innovative problem-solving. 

3. Investing in Employee Well-Being

According to a recent mental health survey, 92% of professionals shared that they prioritized working for an organization that values emotional and psychological well-being. 

Further research indicates that the incidences of burnout grew from 43% in 2022 to 62% in 2023. 

When employees experience burnout, their productivity instantly drops, and this can be followed by long phases of low productivity unless they actively receive the support they need. A lack of work-life balance, stress, poor work culture, and lack of access to mental health support can quickly escalate into diminished mental health. 

Professional services firms, in particular, need to invest in promoting initiatives that nudge employees to embrace work-life balance. Another important pillar is to offer wellness programs and mental health support that make practices such as counseling accessible. Active investments in such initiatives remove stigma and encourage employees to seek help early on. 

Also Read: How to Set and Reach Department Goals?

4. Recognition and Appreciation

Businesses need to institute a structured, consistent approach to employee recognition and appreciation. However, businesses often tend to only recognize the big wins. They may also lack a structured approach to recognition. Instead, they must prioritize the recognition and appreciation of employees at all levels for wins that may vary in size. 

Recognition, however, is not all about compensation. While monetary recognition is important, employees also seek other types of recognition.

For instance, businesses can implement a combination of recognition programs that include public praise, bonuses, and awards for their contributions. The programs must be well-structured and executed consistently to be effective.  

5. Building Strong Teams

A people-first approach, while strongly focused on the individual employee, also has an important team-building component. This is because effective problem-solving for clients demands team effort and seamless collaboration. 

Professional service firms must create a collaborative framework that enables teams to work seamlessly together via collaborative technology and other initiatives. 

Such initiatives can include team-building activities such as workshops and group getaways. Firms can also benefit from celebrating team achievements as much as they do individual milestones. By doing so, the identity of the team becomes as important as individual employees. 

6. Leadership Development

How do you succeed in professional services? A key pillar of success is to invest in building leaders from within the team. Unlocking the leadership potential in employees is a win-win for the workforce and the business. Hence, businesses need to make early investments in training and development programs for managers and leaders. 

Superior, sustainable initiatives equip them with the skills to build trust, delegate effectively, and provide constructive feedback. Firms that successfully nurture talent can build a pipeline of future leaders from within the business rather than hiring from the outside.  

Also Read: What Is the True Cost of Recruiting and Onboarding Employees?

The Conclusion

Talent plays an exceedingly important role in professional services firms because the expertise, knowledge, reputation, and experience of individual employees form the backbone of business success. 

Adopting a people-first strategy that prioritizes the well-being and aspirations of the workforce can help firms secure their talent and lay the foundation for sustainable, long-term business success.   

Engagedly’s comprehensive people-first solutions enable professional services to turbocharge their talent management strategy and bring data-centricity, inclusion, and business goal orientation to the process.

Through the adoption of people-first best practices, our partner businesses can enhance employee engagement and productivity and boost business performance and profitability. 

Learning and Development

Frequently Asked Questions

1. How can professional services prioritize employee well-being and aspirations?

Professional services firms need to adopt a comprehensive strategy for building an inclusive, transparent, supportive culture that nurtures talent at the individual and team levels.  

2. How does a people-first strategy help businesses reduce costs?

By adopting a people-first businesses can bring down costs by reducing expenditure on hiring, onboarding, and other aspects of the recruitment process. They can also promote leaders from within the business, as opposed to hiring expensive external resources. 

3. What is the impact of people strategy on business performance? 

By implementing a people strategy, businesses can become more agile, harness innovation, and respond to client needs and market shifts much faster, thus building a competitive edge. 

 

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People Strategy: What Is It and How to Make One?

In the current strategic landscape of organizational management, “people strategy” has become a vital approach for companies to survive in a fast-moving and changing market. At its core, a people strategy pertains to the deliberate design and implementation of initiatives to effectively manage an organization’s most valuable asset: its people. The strategic plan embeds human resource management practices within a holistic framework, building a bridge between human resources and organizational goals.

Formulating an effective people strategy entails a multifold process that starts with a detailed grasp of your organization’s mission, goals, and employee working dynamics. By aligning people practices with the company strategy, businesses can foster employee commitment, productivity, and engagement.

Organizations with a great people strategy observe enhanced employee engagement (64%) and job security (65%) among employees. In this blog, we will explore all the people strategy elements characterized by talent acquisition, development, and retention.

Also read: The Future of HR: Identifying 7 Evolving Roles and Strategies to Secure Them

What Is a People Strategy?

A people strategy is a comprehensive plan that outlines how an organization intends to manage and develop its workforce to achieve its business objectives. It encompasses various aspects such as recruitment, retention, training, and performance management. The strategy aims to align the organization’s goals with the needs and capabilities of its employees, ensuring that talent is effectively utilized and developed. It is, however, different from a human resources strategy.

A human resources strategy is a unified method for managing and developing a company’s human assets in line with its long-term goals. A people strategy underlines a more developed philosophy that sees employees as core strategic assets, unlike traditional HR strategies that mostly concentrate on technical operations like recruiting, salary, and compliance.

A people strategy includes operational aspects related to staff management, such as engagement, training, and performance management. It also evaluates the organizational culture, values, and leadership styles, with the main objective of creating a platform where employees are appreciated, engaged, and motivated to attain organizational objectives.

A people strategy has the following three elements:

  • Leadership & Culture: This includes creating a sound organizational culture and a leadership direction that is consistent with the company’s values and vision. It implies building leadership skills at all levels of the enterprise.
  • Talent & Skills: This element pivots on attracting, retaining, and developing the right skills along with the necessary knowledge and competencies that can drive organizational performance. It encompasses talent acquisition, career development, succession planning, and skills training to ensure the organization maintains a skilled workforce.
  • Human Resources (HR): HR functions are part of the overall people strategy. This aspect concerns transforming HR practices to be more strategic and proactive in dealing with issues that affect the achievement of organizational goals. It involves tactics such as HR analytics, employee design experience, and performance management, which enable HR to implement business strategies.
Also read: HR Development (HRD) vs HR Management (HRM) – Key differences

Why Do You Need a People Strategy? (Benefits)

A people strategy is essential for organizations seeking to thrive in today’s competitive business landscape. Here are some key benefits of having a people strategy:

  • Attract and Retain Top Talent: A well-defined people strategy helps attract high-caliber employees by showcasing the organization as an employer of choice. Companies can retain top talent by offering competitive compensation, opportunities for career advancement, and a supportive work culture. This strategy reduces turnover costs and maintains a skilled workforce.
  • Boost Employee Engagement: Engaged employees are more productive, innovative, and committed to achieving organizational goals than non-engaged ones. A people strategy that focuses on fostering a positive work environment, providing meaningful work, and recognizing employee contributions can significantly boost engagement levels. It leads to higher performance and retention rates.
  • Achieve Business Goals: Aligning people strategy practices with business objectives is crucial for driving organizational success. A people strategy ensures that the workforce is equipped with the necessary skills, capabilities, and motivation to execute strategic initiatives. It leads to improved performance, profitability, and sustainable growth.

Examples of organizations that boast of their people strategies include: 

  • Google: Renowned for its innovative and employee-centric culture, Google invests heavily in its People Strategy. It offers perks such as flexible work arrangements, professional development opportunities, and attractive benefits packages. This approach has helped Google consistently rank among the top employers globally and maintain high levels of employee satisfaction and retention.
  • Zappos: Zappos, an online shoe and clothing retailer, places a strong emphasis on its people cultural strategy and employee happiness. Through initiatives such as the “Zappos Family Core Values” and a unique hiring process that focuses on cultural fit, Zappos has created a highly engaged workforce that delivers exceptional customer service, contributing to its success as a customer-centric organization.
Talent Management Software
Also read: Careers Spotlight: What Is an HR Generalist?

How to Build a Winning People Strategy

Here are actionable steps to guide you through how to develop an effective people strategy:

Step 1: Align with Business Goals

Recognize that any organization’s success depends on its people. Aligning the people strategy with business goals ensures that human capital initiatives directly contribute to achieving organizational objectives, whether increasing revenue, expanding market share, or enhancing customer satisfaction.

Anticipate future skill requirements and talent gaps by forecasting the organization’s needs. Consider factors such as technological advancements, industry trends, and demographic shifts to ensure the workforce remains agile and adaptable.

Step 2: Assess Your Current Workforce

Conduct a comprehensive assessment of the existing workforce to identify skills gaps and areas for improvement. Utilize tools such as skills assessments, performance evaluations, and employee feedback surveys to gather insights into the current talent landscape.

Also read: Essential Skills Every HR Professional Should Master

Step 3: Develop Your Strategy Framework

Define key focus areas within your people strategy, such as recruitment, training, performance management, and employee engagement. Develop targeted initiatives and action plans for each focus area to address identified talent gaps and support organizational goals.

Step 4: Implement and Monitor

Implement initiatives systematically, considering factors such as resource allocation, timeline, and stakeholder engagement. Communicate the rationale behind each initiative and provide adequate support and resources to ensure successful implementation.

Establish key performance indicators (KPIs) and metrics to track the effectiveness of your people strategy initiatives. Monitor progress against these metrics regularly and gather feedback from employees and stakeholders. Use data-driven insights to adapt and refine your strategy as needed to ensure continued alignment with business objectives and evolving talent needs.

Also read: Top 7 Productivity Hacks Used by Successful HR Leaders

People Strategy Best Practices (Pro Tips)

Here are some pro tips to enhance your people strategy:

  • Data-Driven Decision Making

Utilize data analytics to inform your people strategy initiatives. Collect and analyze relevant workforce data to identify trends, uncover insights, and make informed decisions about talent management, recruitment, training, and performance management.

  • Foster a Culture of Learning

Encourage continuous learning and skill development among employees by providing access to training programs, workshops, and educational resources. Create a culture that values curiosity, innovation, and personal growth, fostering an environment where employees feel motivated to enhance their skills and knowledge.

  • Prioritize Diversity, Equity, and Inclusion (DE&I)

Recognize the importance of diversity, equity, and inclusion in driving organizational success. Foster a diverse and inclusive workplace where all employees feel valued, respected, and empowered to contribute their unique perspectives and talents. Implement DE&I initiatives that promote fairness, equality, and opportunities for underrepresented groups.

Also read: Which HR Roles are Most Likely to Be Replaced by AI?

Summing Up

Crafting a robust people strategy is paramount for any organization aiming to thrive in today’s dynamic business landscape. By aligning organizational goals with the development and well-being of its employees, companies can foster a culture of engagement, innovation, and sustained success. Through careful consideration of recruitment, talent development, retention, and diversity initiatives, a well-rounded people strategy can drive productivity, boost morale, and ultimately propel the organization toward its objectives.

Performance Management Tool

Frequently Asked Questions

  • What role does technology play in supporting a people strategy?

Technology can play a significant role in supporting various aspects of a people strategy, such as recruitment, performance management, training and development, and employee communication. Leveraging HR software and analytics can help streamline processes, improve decision-making, and enhance the overall employee experience.

  • How can small businesses or startups develop a people strategy on a limited budget?

Small businesses or startups can develop a people strategy on a limited budget by focusing on essential elements such as clear communication, offering opportunities for growth and development, providing meaningful feedback, creating a positive work culture, and leveraging low-cost or free resources like online training platforms, networking events, and mentorship programs.

  • What are some common challenges organizations may face when implementing a people strategy?

Common challenges may include resistance to change, a lack of alignment between the people strategy and overall business goals, and difficulty measuring the impact of HR initiatives. Effective communication, leadership buy-in, and ongoing evaluation can help address these challenges.

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