SHRM-CP Behavioral Competency 7: Business Acumen

What are the three subcompetencies that comprise the Business Acumen competency?

• Business and competitive awareness

• Business analysis

• Strategic alignment

What is SHRM’s definition of Business Acumen?

• “The knowledge, skills, abilities, and other characteristics (KSAOs) needed to understand the organization’s operations, functions, and external environment, and to apply business tools and analyses that inform HR initiatives and operations consistent with the overall strategic direction of the organization.”

What are the proficiency indicators for business accumen?

• Building Strategic Relationships

• Understanding the Business Operations

• Learning the Business and Operational Functions

• Understanding the Industry

• Making the Business Case for HR Management

• Marketing HR

• Applying Organizational Metrics

• Using ORganizational Metrics

• Leveraging Technology

What are strategic relationships?

• They provide each person or entity with something that they need

• Can exist with vendors, customers, regulators, and other oversight groups

• Symbolic!

What are business operations?

• The ongoing activities involved in the production of value for the organization’s stakeholders

How does HR contribute to an orgnaization’s business operations?

• Supports its people assets in ways that enhance the organization’s strategic goals and objectives

What is Operations Management?

• THe business function responsible for managing the process of creation of goods and serivces

• Involves planning, organizing, coordinating, and controlling all the resources needed to produce a company’s good s and services

• Involves managing people, equipment, technology, information, and all the other resources needed in the production of goods and services

What are industries?

• Collections of enterprises doing similar things or serving similar segments of the economy

What are the ten elements of an HR business case?

• Problem Statement

• Background

• Project Objectives

• Current Process

• Requirements

• Alternatives

• Compare Alternatives

• Additional Considerations

• Action Plan

• Executive Summary

What are organizational metrics?

• Measurements of individual functions or specific business processes within the organization

What are two basic measurements that impact HR?

• Revenue Per Employee → Revenue / Average Employee Head Count

• Expense Per Employee → Expense Element / Average Employee Head Count

What are tactical metrics versus strategic metrics?

• Tactical Metrics → includes reasons why people accept job offers, levels of satisfaction with their boss, number of new hires made within the target date on each requisition, etc.

• Strategic Metrics → include goals or targets met within a defined period, valeu received for HR programs compared to forecast value, achievement rates for revenue or expense targets and goals