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Why HR Policies Are Prerequisites to Organizational Excellence HR policies must complement the distinct culture of an organization and ensure fair treatment of its employees, only then success will come

By Sanjay Lakhotia

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Human resource (HR) department is undeniably one of the most pivotal cogs of an organization. It is the sole bridge that connects a company and its employees which strengthens inter-personal relationships while eliminating any discrepancies. It also strategizes on painting the bigger picture and focusing on the short-term goals.

In the current scenario, HR's role has become more strategic thus taking on more responsibilities than mere recruitment and policing employees. According to a research conducted by Glassdoor, 90 percent of job seekers say that it's important to work for a company that embraces transparency. HR departments have, thus, begun to articulate policies that give structure, control, consistency, and fairness to organizational procedures and activities.

HR policies essentially serve the following functions: communicate values and expectations for activities within the organization; empower the company to comply with laws and provide protection against employment claims; and document and implement best practices appropriate to the organization.

Organizational Criteria

The HR department tackles certain pertinent questions extensively while formulating policies:

  • Will it promote the desired work culture?
  • What outcome will the policy achieve?
  • Does the policy reflect company values? How can it enhance them?
  • Who will monitor and enforce them?
  • Will the policies restrict managers from working efficiently? If yes, how can this be avoided?
  • Will they help attract and acquire top talent?
  • Will they be welcomed by employees and easy to implement?

HR policies must, therefore, complement the distinct culture of each organization. For instance, startups may advocate structures that include flexibility and relative informality. Hence, rigid policies would be considered unacceptable for employees. On the other hand, a large conglomerate will demand orthodox levels of discipline and control. It is thus, an organization is representative of certain values and the practices must in turn be reflective of these. Formulating policies accordingly will increase employee trust and loyalty while attracting fresh talent for recruitment. A conclusive study by SHRM is a testament in proving that building an employer brand and company culture helps hire the right people (55 percent), increase qualified candidates (49 percent), increase employee referrals (41 percent), and increase diverse candidates (32 percent).

The policies must address the context of each industry and stage of business for the company. What also needs to be considered is the employee demographic and the needs of the employee population, which once matched will lead to higher retention.

Companies like Google have raised the bar and have created policies, which support major life events in the life of an employee, including friendly policies supporting new parents, care for senior parents, higher education needs for employee, freedom to innovate and flexible work arrangements.

Clarity in Directives

Policies must be crystal clear and articulated with precision leaving no room for doubt. Spelling out the course of action clearly and concisely will ensure fair treatment for all employees. A consistent policy document is crucial in saving time and avoiding administrative overload, providing easy access to all employees is of utmost importance.

While developing policies is essential, regularly monitoring and inducing amendments is equally imperative. Legislative changes can make certain policies obsolete and changing needs of the employee population can make existing policies ineffective at the workplace in the long term. HR policies pave the way for a standard that will be applicable throughout an organization. It is therefore a must that they cater to the entire workplace rather than a minority.

Startups and other smaller organizations possess the advantage of creating a conducive work environment for employees. At this scale, it is easier to resolve issues as it is possible to have one-on-one interactions with people working in the organization. In such an environment, it would be beneficial to have greater degree of flexibility, openness and more individualized arrangements to attract people to the organization and also help retain them.

In Conclusion

Regardless of the approach an organization follows, the key to success is to devote the time and resources needed in order to develop the appropriate policies, before the need arises. It is an investment on a comprehensive people strategy that will pay dividends by creating the right culture, instilling the right values and building a foundation for success for the organization.

Sanjay Lakhotia

Co-Founder, Noble House Consulting Pte.

Noble House Consulting Pte is a Singapore registered company, an HR talent marketplace that helps independent consultants find short- and long-term assignments as per their skill set. Sanjay Lakhotia is the co-founder of Noble House Consulting Pte and has more than 20 years of experience in working across all areas of HR including HR Transformation, Leadership development, HR technology deployment, Performance culture, Rewards etc.  

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