HR best practices are a set of proven strategies and guidelines in the field of Human Resources Management (HRM) that aim to optimize departmental performance, enhance employee satisfaction, and promote business growth.
These practices include creating a supportive workplace environment, ensuring job security, maintaining transparency, and aligning company needs with employee expectations. They are deemed “evergreen,” adapting to various contexts and changes over time.
The ultimate aim of HR best practices is to strike a balance between the organization’s needs and its employees, fostering a healthy, productive work culture that makes the organization a desirable place to work.
So, it’s no surprise that keeping on top of the latest professional developments is one of HR’s key responsibilities.
Unfortunately, this is a topic where Google results are sometimes unhelpful. There’s a lot of recycled material out there! So, we’re going back to basics in this article.
We’ll start by thinking about the term “best practice.” We’ll define it, explain how it’s different from HR activities, and introduce one of the most famous lists of “best practices” in HR from Jeffrey Pfeffer.
Then, we’ll introduce three working models for HR best practice in 2023 from Deloitte, CIPD, and Gartner.
By the end of this article, you will have a comprehensive understanding of HR best practices, and be able to identify which approach is most suitable for your organization.
What are HR best practices?
“Best practice” is an odd phrase and we need to be careful when we use it.
To explain it loosely, it means “the best way of doing HR.”
HR Best practice refers to the principles, guidelines, or approaches proven to deliver superior results and are widely accepted by experts in the field. However, best practices aren’t set in stone; we must strive to learn and improve, embracing a path of continuous growth.
In day-to-day language, best practice is useful when trying to solve particular problems.
- Best practices around data security
- Best practices for talent pipelines
- Best practices for workplace conflict
- Best practices in change management
- Best practices in performance management
- Best practices in health and safety
In all these areas, every HR professional wants to make their workplace more efficient, effective, productive, and profitable.
The problems come when we try to invent a complete set of best HR practices that work for every company. Think about it for a moment. Are all companies the same? Are all jobs the same? Can one set of management principles really apply to all of these people?
And when we look at a company’s HR function, the questions are even more contested. Culture, industry, and hierarchy all make a drastic difference.
The concept of best practice fits well with the idea of so-called “scientific management.” That’s the method invented by FW Taylor in the early twentieth century. At that time, it seemed sensible to discover the single best way of doing things, which could then be applied to other situations.
Today, the world of work is a very different place. And that’s why this article won’t give you a list of “best practices” that you can quickly implement for sure-fire success.
We take seriously what Susan Chen writes in her 2023 book, The Death of Best Practices: “When HR leaders realize that there are, in fact, many solutions to use … a world of possibility opens before them.”
What’s the difference between HR best practices and HR activities?
As you might have guessed, in this article, we’re treating HR activities and overall best practices as two different things.
HR activities refer to the specific tasks, functions, or processes that HR professionals undertake to manage human resources within an organization.
These activities include actions relating to:
- Performance management
- Employee engagement
- Training and development
- Diversity and inclusion
- Health and wellness
These things are all important. But, without a deeper set of principles, it may be difficult to align HR activities with your business goals. A thorough concept of best practices will help your HR department achieve excellence in all its activities.
These days, “best practice” is just one way of talking about excellence in these areas. You may also hear folks talk about “smart practice,” “evidence-based practice,” or “effective practice.”
Pfeffer’s seven tips for HR best practices
One of the classic models of best practice in HR is from the book The Human Equation: Building Profits by Putting People First by Jeffrey Pfeffer. Although this book was written in 1998, many people still find his ideas persuasive.
His seven principles are as follows:
- Employment Security
- Selective Hiring of New Personnel
- Self-managed teams and decentralized decision-making
- Comparatively high compensation
- Extensive employee training
- Reduced status differentiators (dress, language, office arrangements, wage differences)
- Transparency around company information – especially regarding finances and performance
In Pfeffer’s book, he argued that implementing these strategies as a bundle could lead to swift positive results for any company. And these seven strategies sound great right?
Who will argue against better wages, staff independence, and clarity about the business structure?
Unfortunately, the reality is that organizations are much more intricate than that. Mick Marchington and Irena Grugulis explored this complexity in a classic article that questioned whether best practices are a “Perfect Opportunity or Dangerous Illusion?“.
They showed persuasively that:
- It’s not supported by rigorous evidence. It’s very hard to attribute causality and these aren’t tested.
- Some of these tactics will contradict one another
- These suggestions work in favor of the company – and not for its staff)
- Pfeffer doesn’t see that a moral case rarely wins in business.
Of course, Marchington and Grugulis believe that HR can be better in any organization. But, they argue against universals and in favor of HR processes that emerge from specific organizational situations.
How to make sense of HR best practices in 2023
To summarise what we’ve said so far. For a great HR department, you can’t just rely on the “one size fits all” wisdom from a previous generation.
So what are you meant to do instead?
We need to look for models of best practices with a good track record. And we need to make sure that those models respond to the challenges that modern businesses face.
The great news is that the information is certainly out there. You could try to get a sense of the field by looking at:
- Academic research like HR journals and books
- Theoretical models from major companies
- Professional federations like the CIPD
- Professional handbooks and textbooks
- Popular management books
Any one of these genres could give you the inspiration you need to lead a highly successful HR department. But don’t worry in the next section, we’ll give you a good head start on the latest models.
Three models for HR best practices
If you want to find the best practices for your HR department, you don’t have to start from scratch.
Although there is no “one size fits all” solution, there are lots of lessons you can learn from other organizations. In this section, we’ll take a look at three approaches to HR best practices. All of them are making a difference to business organizations around the world.
- Deloitte’s model for a “high impact” HR department
- Global research from the CIPD on principled decision-making
- Gartner’s HR transformation toolkit
These examples show us what great HR looks like for 2023 and beyond.
How Deloitte creates a high-impact HR department
First, let’s talk about Deloitte’s model for a high-impact HR department.
Deloitte’s model shows us how a HR department can have a big effect on the business. They argue that HR must try to have an impact on business outcomes. With agility and flexibility, HR should respond to the latest challenges in the wider world.
Some of the specific insights include these processes:
- Develop a deep understanding of business imperatives.
- Evolve HR competencies, focusing on adaptability, agility, and analytical acumen.
- Implement HR technology that provides easy-to-use data and information tools to line managers and employees, improving business decision-making and allowing HR teams to better advise, consult, and innovate with their client stakeholders.
- Leverage technology to support roles, responsibilities, and interactions and ensure HR teams understand self-service and HR analytics technology.
- Adopt a new mindset that empowers the HR team to function as consultants, advisors, and change agents, embedding HR within the business and involving them in day-to-day operations and strategy-making.
These targets require a process of change management. As such, Deloitte’s model is not a “quick fix“. But if you’re looking for best practices for responsible HR and business-oriented HR this is the place to go.
CIPD and the principles of good HR
In 2015, the UK’s CIPD produced an extensive research report, “From Best Practice to Good Practice HR”. The title itself teaches us a useful lesson. This is not a document about the actions that could apply to any business.
Rather, the project shows how HR professionals can approach the complex topic of people management in their organizations. As they put it, it’s no longer to decide on “best practice” with “the growing complexity and uncertainty in the world of work“.
The research tried to discover what HR professionals thought about different “lenses.” That is different ways of seeing the same HR problems and the different decisions they lead to.
The different principles include:
- Well-being Lens
- Rights Lens
- Merit Lens
- Fairness as Justice Lens
- Markets Lens
- Democracy Lens
- Character Lens
- Handing-Down Lens
If the HR department makes decisions with a “handing down lens,” they focus on the long-term success of the company. That means that they will have different choices than a “merit” lens, for example, which focuses on making the most out of talent.
Choosing the lens helps HR to make consistent, strategic, and principled decisions about people.
Ultimately, the CIPD report recognizes that principles may be sacrificed in the name of a business case. And, whatever lens you look at things through “Ignoring the voice of people carries a danger of creating working relationships that appear sustainable to the people management professionals, but aren’t acceptable to the workforce.”
If we go to the CIPD research to understand best practices, we discover a slightly more difficult process. But with their help, we can understand the contradictions and conflicts we might encounter.
Gartner’s HR Transformation Toolkit
In 2023, HR departments worldwide are still adapting to complex new challenges. They must find ways to meet changes in employee expectations, technology advancements, recruitment challenges, and global supply chain issues.
In this context, Gartner’s HR Transformation Toolkit helps HR teams to change. The toolkit gives a comprehensive approach to improving HR delivery over time. It leads to the goal of a reliable system of strategic human resource management.
The toolkit includes four key components: HR Leadership, HR operating model, HR capabilities, and HR technology enablement.
The toolkit comprises several interconnected resources that cover the entire function of HR. Together, they help to establish core principles, devise an implementation plan, and equip everyone involved in the process to see it through to completion.
What’s great about this toolkit is that it moves HR departments away from constantly putting out fires and instead encourages them to focus on creating a vision for the future.
With its wide-ranging guidance and plethora of individual approaches and methods, the HR Transformation Toolkit is a valuable tool for any HR team looking to make real, lasting changes.
Gartner’s transformation toolkit reminds us that true HR success isn’t achieved by one “quick fix.” It takes a big bundle of interconnected best practices.
Some Quick Wins for HR Professionals in 2023
The models we’ve described here are all about root-and-branch changes that reach for HR best practices. But what if your HR department’s doing okay, and you just want to keep up to date?
A 2021 analysis from BCG proposed five key areas for the future transformation of HR:
- Employee centricity
- Cost efficiency and value delivery
- Skills, capabilities, and end-to-end process responsibility
- Agility and scalability
- Data and digital readiness
BCG suggested several activities to deal with these. However, the stand-out feature is the need for using new digital tools.
This could be a good time to invest in that HCM software you’ve always dreamed about. Or to implement automation wherever possible. Or even just to maximize your company’s existing IT capabilities.
The current state of digital adoption means you are very well supported and there are plenty of tools that help get the most out of your software investments.
Revitalizing your HR department
Looking ahead, HR departments will likely undergo significant transformations.
As technology advances, automated systems and AI will play a greater role in optimizing processes and improving efficiency. At the same time, a renewed focus on employee well-being and engagement will be crucial to attract and retain top talent in an increasingly competitive job market.
Therefore, HR professionals must stay adaptable and open to new methodologies while maintaining a people-centric approach to drive organizational success.
To revitalize your HR department, explore the possibilities available. Look into the latest trends in human resources management and determine which ones would best suit your organization. These could include flexible work arrangements, continuous learning initiatives, or diversity and inclusion programs.
While Pfeffer’s seven pillars may hold potential, a more contemporary approach is recommended for a comprehensive HR transformation.
Deloitte, CIPD, and Gartner provide insightful perspectives on revitalizing people management, propelling it to new heights.
There are countless resources available to help you build an HR team that truly makes a difference.Check our article on the 6 key challenges for HR departments in 2023 to stay ahead of the game and drive meaningful change.
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