The WorldatWork Handbook of Compensation, Benefits & Total Rewards: A Comprehensive Guide for HR Professionals

Chapter 20. Planning Benefits Strategically

While many people are familiar with the concept of “strategy,” fewer might associate this concept with human resources. Webster’s Dictionary provides a first definition of strategy as “the science of planning and directing large-scale military operations, specifically (as distinguished from tactics) of maneuvering forces into the most advantageous position prior to actual engagement with the enemy.” If strategy is crucial to warfare, it is also crucial to business.

Numerous internal and external forces are having an impact on today’s organizations, and these forces demand corporate strategies that help organize, plan, and direct the organization’s efforts to:

• Produce high-quality products and services.

• Position itself favorably with competitive prices and sensible costs, including human resources programs that provide a good return on investment.

• Engage domestic and global competitors successfully.

Benefits strategy is the one definable link in a strategic chain that starts with an organization’s overall business objectives. Once the overriding business objectives are set by senior management, they cascade down throughout the organization, supported by strategic plans at the division, business unit, department, work group, team, and, possibly, even the individual level. The human resources function is not exempt from this process; in fact, HR strategies in general and benefits strategies in particular must support overall business objectives. ...