The HR function can and increasingly is making significant contributions to building an organization that is staffed by the right human capital to effectively carry out the work of the firm and to enable the accomplishment of business strategy. It does this by developing competency models and by focusing on recruiting, staffing, and developing individuals.
Although information technology is an important tool in the administrative and transactional aspects of staffing and competency development, these functions and their supporting systems are best crafted and carried out by professionals who are knowledgeable about the organization as a business and as a strategic entity. Additionally, the many judgment, dynamic, and tacit aspects of this work mean that HR will continue to play a critical value-adding role in this area.
But it may not be the most important work that the HR function can do in the future.
HR’s greatest opportunity to add value may well be to play a role in the development and implementation of corporate strategy. HR can make a logical case for being an important part of strategy development, because of the importance of human capital in the ability of the firm to carry out its strategy. Increasingly, talent limitations and limited organizational flexibility in the application of scarce talent to various opportunities constrain the strategic options of the firm
(Mohrman, Galbraith, & Lawler, 1998). At least in theory, this should mean that HR can play an important role in the formulation of strategy by making explicit the human capital resources that are required to support various strategies and strategic initiatives, by playing a leadership role in helping the organization develop the necessary capabilities to enact the strategy, and by playing a strong role in implementation and change management. Most