Irrespective of the industry in which it operates, the Human Resources function (HR) is expected to partner the organization and create value for the business. HR can do this by delivering 5 people outcomes which are competencies, morale, motivation, attitudes, and performance. 

On average, in Ghanaian organizations today, HR is perceived as an administrative function which adds little or no value to the business. In the next 10 years, there will be the need to re-invent the HR function to expand its focus beyond its traditional administrative roles. HR must understand how to add value in the organization by aligning HR strategies, processes and practices with business needs.

HR TODAY

Human Resource Management in Ghana over the last three decades or so can best be described as human resource administration or traditional Human Resource Management, which focuses attention on administering benefits, policies and operational functions.

Human resource administration delivers stand alone activities such as recruitment, training, career development, performance appraisal and compensation. These stand alone activities are not aligned to corporate vision and strategy.

A basic problem with human resource administration is that, it is difficult to measure how HR administration impacts key business performance areas such as cost control, operational efficiency or productivity, and profitability.

The Business Environment Today

The business environment in Ghana today is characterized by influx of foreign products, rising costs of production, low employee morale and motivation, poor work attitudes, and low productivity.

To respond meaningfully to these business challenges and become competitive, Ghanaian organizations need to recognize the importance of Human Resource, and get the HR function to widen its focus from the administrative role it has traditionally played, to a broader, strategic role.

As the primary source of competitive advantage has shifted from physical to intellectual capital, HR managers are increasingly being challenged to serve as strategic partners in running the business. When Human Resource Management becomes a strategic partner, it would mean 3 things.

First it would mean that HR managers would have to understand the strategy of the organization. HR should be in the know of the organization’s plan for developing and maintaining competitive advantage in the market place.

Secondly, it would mean that HR managers understand the human resource implications of the strategy, and are able to align HR systems to the strategy.

Finally, it would mean that HR managers have developed measurement systems that will enable them to clearly show the direct positive impact HR systems have on the core business performance areas of cost control, operational efficiency or productivity, revenue, and profitability.

Value Creation

HR must add value to the organization by aligning HR strategies, processes and practices with business needs. Value creation must therefore be understood from the perspective of the customer. It is only the customer who can tell whether value has been added or not.

Value creation, from the point of view of the customer, means improving a product or service so that the product or service consistently meets needs in terms of one or a combination of three variables: (i) quality - physical properties of product or service; (ii) delivery – timely delivery of product or service; and (iii) reliability - uninterrupted supply and speed in responding to customer problems.

When HR practices in Ghana progress to the strategic partnership phase, HR managers will come to understand that the HR department has two customers, the external customer and the internal customer. HR value creation, therefore, involves understanding the needs of the external customer, and working with internal client departments to contribute value to the external customer.

Conclusion

The business environment of the future, as it is today, will be characterized by intense competition, rising costs, and higher customer sophistication and expectations. The solution to these business challenges shall be increased productivity and quality.

The need for increased productivity and quality shall, in turn, demand greater emphasis on the importance of Human Resource. With the recognition of human resource as the primary source of competitive advantage, HR managers will be challenged to serve as strategic partners in running the business. In the next 10 years, there will be the need to re-invent the HR function to play a more strategic role to add value to the organization by aligning HR strategies, processes and practices with business strategies.

Kwadwo Asare Bediako, Human Resource Practitioner