This is not a failure of effort but a failure of understanding what collaboration actually demands, and how it’s built. In this article, we explore how organizations can build a collaborative culture and how HR can use play to foster sustainable collaboration.

Contents
What is a collaborative culture?
Coordination vs. cooperation vs. collaboration
Why collaboration is important for organizational culture
The barriers to creating a collaborative culture
Using “play” as an approach to develop a collaborative culture
How HR can use play-based interventions to build collaboration

What is a collaborative culture?

A collaborative culture is one where people work across roles, teams, and functions to create outcomes they could not achieve alone. At its core, it’s about interdependence. Collaboration is not an individual capability that you can just train your employees in. The organization builds it through its norms, incentives, leadership behaviors, and everyday ways of working.

A collaborative culture is more visible in how work actually gets done than in what organizations say. You see it in decision-making practices, rarely in isolation and often through shared input and constructive challenge.

Information flows across boundaries without excessive friction, and teams do not wait for perfect clarity before engaging others. They share ownership where needed and measure success not just by individual contribution, but by the quality of the outcome created together.

Collaboration becomes most visible under pressure. When timelines tighten or ambiguity increases, people lean into each other rather than retreat into their own domains. They surface disagreement early and handle it productively, and roles remain clear but not rigid.

People also step in where needed without overstepping. In these environments, collaboration becomes second nature and the default way of working. The organization reinforces it through its design, performance evaluation, and how leaders show up every day.

Coordination vs. cooperation vs. collaboration

Organizations may mistake collaboration for coordination and cooperation, but they’re not the same, and they don’t aim to achieve the same outcome. Put simply:

• Coordination: Staying out of each other’s way to drive efficiency.
• Cooperation: Helping each other when interests align.
• Collaboration: Co-creating outcomes through shared ownership and dependence.

As organizations move from coordination to collaboration, the way of working changes. People are asked to give up autonomy, share control, and rely on others under conditions of ambiguity and pressure.

Let’s take a look at a practical example of launching a new performance management approach. Peter, an HR Business Partner (HRBP), needs to roll out a new performance management approach to the business. To succeed, he needs input from Talent, L&D, HR Operations, and business leaders.

• Coordination: Peter defines the plan and assigns responsibilities, so Talent designs the framework, L&D builds the training, HR Operations updates the system, and business leaders are briefed. Each function plays its part, and Peter brings everything together for the rollout.
  → Work is aligned but largely siloed, and success depends on timelines and handoffs.

• Cooperation: Peter involves stakeholders for input along the way. Talent shares drafts for feedback, L&D adapts training based on business input, and HR Operations adjusts processes where needed.
  → There is active support and information sharing, but ownership remains within functions. The solution improves, but integration remains partial.

• Collaboration: Peter brings all stakeholders together from the outset. Together, they define what “good performance” means, co-create the approach, and iterate in real time. This helps them balance business needs, system constraints, and development goals.
  → The solution is co-created. Success depends on interdependence, shared ownership, and continuous adjustment.

Here’s an overview of coordination vs cooperation vs collaboration side by side:

Why collaboration is important for organizational culture

There are numerous benefits to greater collaboration within organizations. Many studies show a meaningful impact on individual and team performance, and higher levels of trust and organizational resilience. Embedding collaboration into culture helps organizations:

• Make faster decisions: Teams can bring the right expertise into the conversation earlier, reducing delays and rework.
• Integrate expertise more effectively: Business functions do not solve problems in isolation. They combine knowledge to create better solutions.
• Respond to complexity with more agility: When priorities shift, collaborative teams can adapt together instead of waiting for perfect clarity.
• Improve execution speed: Shared ownership helps teams move from planning to action more quickly.
• Improve the quality of outcomes: Collaboration turns interdependence from a source of friction into a driver of performance.

The barriers to creating a collaborative culture

When collaboration initiatives don’t stick, the instinct is to double down, more workshops, clearer frameworks, stronger messaging. But the issue is rarely about effort; mostly, it relates to structural failures that inhibit collaboration. There are three common barriers to collaboration that organizations experience:

• Barrier 1: “Teaching” people how to collaborate in a cognitive way. Organizations often assume people will collaborate better if they understand the right frameworks, tools, and models. But collaboration is shaped through daily practice. People build it by sharing ownership, making decisions together, handling tension, and relying on each other in real work.
• Barrier 2: Assuming people know that collaboration is good for everyone. Collaboration requires people to give something up: control, speed, recognition. Without a strong sense of shared intent, participation remains performative. Research published in Harvard Business Review has shown that collaboration, when unmanaged, becomes a burden rather than a benefit, with high performers experiencing it as a drain on time and autonomy. If the cost of collaboration is not made explicit and worthwhile, people will default to protecting their own outcomes.
• Barrier 3: Believing that collaboration develops naturally. Collaboration is a capability that develops through experience, yet organizations expect it to emerge in high-stakes environments without ever being practiced in low-risk ones. Very few opportunities exist for individuals to learn how to collaborate in low-stakes or simulated environments.

These three barriers are not insurmountable. Yet many traditional HR interventions struggle to address them effectively. Adopting team-based play as an approach offers a different path, enabling more collaborative teams and cultures by focusing on how collaboration is actually experienced, not just how it is described.

Using “play” as an approach to develop a collaborative culture

In an organizational setting, play is defined as a structured, goal-oriented activity that places employees in simulated, high-stakes situations where they must act interdependently. Far from being recreational, this intentional approach mirrors the cognitive and social pressures of real work, while removing the associated material risks. In practice, HR can use this approach in areas such as:

• Leadership development: Simulate situations where leaders must share control, make decisions with incomplete information, and manage disagreement.
• Team effectiveness and reset interventions: Help teams surface decision-making habits, trust issues, and unspoken working norms.
• Cross-functional collaboration: Create scenarios where teams combine expertise, negotiate trade-offs, and solve a shared business problem.
• Culture transformation initiatives: Let employees practice behaviors such as openness, shared ownership, and constructive challenge.
• Onboarding and integration: Help new employees experience how collaboration works in practice.

When a team of people who work together play together, it never ceases to amaze me. People cannot help but show up as themselves. In playing together, you’re essentially creating a controlled experiment to simulate how people work together. You remove the need for subject matter expertise, the usual power dynamics, and the narrow actions people can take.

Alex Suchman, CEO, Barometer XP

How play helps people practice collaboration

When done well, team-based play puts people in scenarios where they must navigate ambiguity and pressure together, without the career-limiting consequences that can exist in the daily work environment.

This is a significant shift from conventional collaboration interventions. Traditional workshops and frameworks aim to foster collaboration by using principles and reflection to define what effective collaboration looks like. However, they often stay conceptual. Participants may discuss collaboration, but they are not always put in situations where they need to rely on one another to succeed.

The concept of play should not be confused with icebreakers or superficial gamification. While these might boost engagement, they fail to recreate the structural conditions that either enable or impede collaboration. Such activities simulate participation but do not create true interdependence.

Play does just that. It directly dismantles the barriers to collaborative success by:

• Translating collaboration from an abstract idea into observable, daily behavior
• Making the inherent costs and trade-offs of collaboration visible and tangible
• Providing a low-risk environment for individuals to practice under realistic, high-pressure conditions.

In this way, play reflects the evolution of leadership development. Behavior change comes through experience, not instruction alone. People only internalize new ways of working when they are placed in situations where they need those behaviors to achieve the outcome.

The value of play lies in whether it transfers back to real work. To make that happen, HR must connect the activity to everyday work, use reflection to analyze what happened, and define the shifts needed to embed those insights into the culture.

“I also make it very, very clear upfront that we’re not playing for fun. In a work setting, fun is never the purpose. The purpose is always to get better in some way. We have several different tools and assessments to look at how people on a team experience their culture, what they see as strengths, and what they see as challenges. Then, you essentially have, in their own words, the purpose for why we’re doing this. You can say, ‘Hey, I recognize that you feel a really strong sense of solidarity and team identity, but there are also misunderstandings, communication challenges, and a lack of clarity about who does what and when things are supposed to happen. So, we’re going to work on that.’

Alex Suchman, CEO, Barometer XP

How HR can use play-based interventions to build collaboration

For HR, the key question is how to use play with intent. A meaningful HR intervention requires clear design, defined outcomes, and a direct connection to daily work. Here’s a six-step approach illustrated on a company example to put play into action at your organization:

1. Start with the friction, not the format

Resist the temptation to begin with the activity. Start with the breakdown:

• Where does collaboration actually fail?
• Between which roles, teams, or decision points?
• What tension are people navigating in their day-to-day work?

The closer the intervention mirrors real organizational friction, the more relevant and transferable the insight.

2. Design for interdependence

If participants can succeed independently, the intervention is teaching coordination and not collaboration. Design the experience so that no individual has everything they need to succeed. Distribute information unevenly. Assign roles that depend on each other. Ensure that progress requires combining perspectives.

3. Introduce productive constraints

Constraints are what make behavior visible. Time pressure, incomplete data, and role limitations force participants out of their default, “polite” behaviors and into real decision-making patterns.

4. Make interaction non-negotiable

Collaboration only emerges when interaction is structurally required. The outcome of the team-based play must depend on the quality of the interaction, not on individual performance.

5. Capture behavior through structured reflection

Insight emerges from reflection, not just from experience. It is important to ensure participants engage in a sense-making process to understand the behaviors they have just learned and how they relate to the work environment.

6. Bridge explicitly to the workplace

After the sense-making phase, play participants need to understand how to transfer these learnings to the workplace. For some, it could imply redesigning certain ways of working; for others, it could mean more explicit connection points and a shared understanding of the behaviors required to drive this success.

Final words

Team-based play is not the intervention itself. It is the mechanism through which HR can surface reality, create shared understanding, and enable more deliberate change.

Most organizations will continue to promote collaboration. Few will build the conditions where it can be sustainably embedded in their culture. 

The post Building a Collaborative Culture: Why & How HR Can Use Team-Based Play appeared first on AIHR.

In some companies, the CPO is the top people leader and works in a role similar to a Chief Human Resources Officer (CHRO). The title often signals a stronger emphasis on culture, employee experience, and people-centered leadership. Depending on the organization, similar roles may include Chief People and Culture Officer, Head of People, or CHRO.

This guide explains what a Chief People Officer does, how the role compares with a CHRO, what a typical job description includes, how much CPOs earn, and what it takes to become one.

Contents
What is a Chief People Officer (CPO)?
Chief People Officer vs. CHRO
The strategic importance of CPOs for business success
Chief People Officer job description
Chief People Officer salary
How to become a Chief People Officer
The future of the Chief People Officer role

What is a Chief People Officer (CPO)?

A Chief People Officer (CPO) is an executive who leads an organization’s people strategy to support business goals, workforce performance, and company culture. As a C-suite leader, the CPO ensures that the organization’s approach to talent, employee experience, and organizational development aligns with its long-term direction and values.

The CPO typically oversees the people function at a strategic level, helping the business build a strong workforce, develop leaders, and create a work environment where employees can perform at their best. As more organizations recognize the impact of people strategy on business success, the CPO has become an increasingly important role within the executive team.

Did you know?

Recent research from McKinsey shows that when HR processes are aligned with the business’s talent-to-value efforts, where key roles and high-impact employees are prioritized, employee engagement increases by 50% and productivity by 40%, while training costs decrease by 50%. Another study reports that organizations where HR is driving positive EX are 1.3 times more likely to outperform organizations with less positive EX.

Chief People Officer vs. CHRO

A Chief People Officer and a Chief Human Resources Officer often have similar responsibilities, but the titles can signal a different emphasis. In general, CHRO is the more traditional executive HR title, while CPO often reflects a stronger focus on culture, employee experience, and people-centered business strategy.

In practice, the difference depends on the organization, since both titles can carry similar executive-level responsibility.

The strategic importance of CPOs for business success

As businesses become more people-centric, the Chief People Officer plays an increasingly vital role in achieving business success. Here are several ways the CPO can help an organization reach its goals. 

Leading organizational change and transformation 

The CPO helps guide the organization through changes by predicting and analyzing future trends and their impact on the company. For instance, the shift toward remote and hybrid work models requires changes in employee engagement and collaboration tools. Technological advancements like AI and automation call for reskilling and upskilling efforts to prepare employees for new roles.

They design and implement change management strategies, ensure the transformation aligns with the organization’s values and mission, and help the workforce adapt to new challenges and opportunities.

Developing and implementing DEIB strategies

As the people and culture leader of the organization, the CPO is committed to fostering a diverse and inclusive workplace where everyone feels they belong. This involves developing objective, equitable, and fair talent acquisition and management strategies, promoting an inclusive and welcoming organizational culture, and creating a positive employee experience.

Effective DEIB strategies enhance innovation, improve employee engagement and satisfaction, and strengthen the employer brand.

Building a future-ready workforce

An organization is only as future-ready as its workforce is capable of overcoming future challenges. The CPO helps the organization prepare for the future by developing strategies to upskill and reskill employees, leverage technology, and adapt to workforce trends. This helps the workforce become agile, digitally savvy, and future-ready to ensure the organization’s long-term success. 

Overseeing leadership development and succession planning

The CPO is responsible for cultivating leadership capabilities in the organization and building a robust pipeline of effective leaders. They develop strategies to identify potential leaders, provide them with training, and prepare them for future leadership roles, preventing vulnerabilities due to a lack of leadership readiness.

Enhancing employee experience

The CPO works to continuously improve the overall employee experience. Elements such as purposeful work, effective communication, proper recognition, and career growth opportunities can significantly boost employee satisfaction, loyalty, and productivity. This, in turn, will drive sustainable organizational success. 

Chief People Officer job description

The exact responsibilities of a CPO will vary depending on the context, talent needs, and workforce challenges of an organization. However, a typical Chief People Officer job description will often include the following responsibilities:

Roles and responsibilities of a Chief People Officer

• Advise the C-suite and key stakeholders: Provide strategic HR guidance, assess how business decisions may affect the workforce, help mitigate people-related risks, and align people strategy with business goals.
• Lead talent management strategy: Develop and execute strategies to attract, develop, and retain top talent, including performance management, leadership development, and succession planning.
• Shape the organization’s structure and workforce: Build an organizational design that supports agility, efficiency, and long-term effectiveness.
• Oversee HR operations: Ensure day-to-day HR activities comply with legal requirements, run effectively, and support company policies and business objectives.
• Strengthen culture and employee experience: Create a workplace where employees feel valued, supported, and motivated to contribute to the organization’s success.
• Drive DEIB strategy: Set diversity, equity, inclusion, and belonging goals, track progress, and embed DEIB principles into people practices and policies.
• Lead HR technology strategy: Guide the adoption of tools such as HRIS, ATS, and performance management systems to improve efficiency and support data-driven decision-making.
• Manage employee relations and workplace issues: Develop fair, legally sound approaches to handling disputes, conflict, and other people-related challenges.
• Oversee compensation and benefits strategy: Build a competitive rewards approach that supports attraction, retention, and employee motivation.

Overall, the CPO plays a central role in shaping the organization’s workforce, culture, and people strategy. The role helps ensure that HR priorities support the company’s long-term direction and business success.

Chief People Officer qualifications

A Chief People Officer job description will typically also include the qualifications required for the role. These often combine formal education, senior HR leadership experience, and strong business and leadership capabilities. Required qualifications generally include:

Educational requirements

• Bachelor’s degree in human resources, business administration, psychology, or a related field
• Master’s degree or MBA may be preferred, particularly for senior-level or larger organizational roles.

Recommended certifications

While not always required, certifications can help strengthen a candidate’s expertise and credibility. Common examples include:

• SHRM-SCP (Senior Certified Professional): Demonstrates advanced knowledge of strategic HR leadership, workforce planning, and organizational effectiveness.
• SPHR (Senior Professional in Human Resources): Validates expertise in HR policy, talent strategy, leadership, and people management.
• HR Business Partner 2.0 Certificate Program: A relevant AIHR option for professionals building strategic partnering, business acumen, and people strategy capabilities aligned with senior HR leadership roles.

Work experience

Different organizations may prioritize different types of experience, but most employers look for the following:

• Extensive experience in senior HR leadership roles
• Strong knowledge of talent management, organizational development, employee relations, compensation and benefits, and employment law
• Experience leading teams, shaping people strategy, and working closely with executive leadership
• Proven ability to align HR priorities with broader business goals.

Core leadership capabilities

Because the role is highly strategic, employers also look for candidates with strong leadership and interpersonal skills, such as:

• Leadership and decision-making skills
• Strong communication and stakeholder management
• Ability to influence senior leaders and guide organizational change
• Capacity to balance people needs with business priorities.

Chief People Officer skills

To succeed in their role today and in the future, a CPO needs a wide range of skills — mastery of five core competencies, leadership competencies, and a general understanding of the main HR functions. With this combination of skills, the CPO can drive business value across the full HR spectrum and guide the department and the organization through unknown challenges and opportunities in the future.

Let’s break down these competencies in more detail.

Business acumen 

Business acumen enables the CPO to speak the language of the leaders, build HR strategies that align with the overall business strategies, and become a trusted partner to the CEO and stakeholders. To master business acumen, a CPO needs to be able to: 

• Identify, interpret, and apply insights into business trends and organizational factors
• Clearly understand the organization’s financial requirements and performance, and the needs of the customers
• Co-create business strategies and align HR priorities. 

Data literacy 

Data literacy empowers the CPO to make informed, evidence-based decisions that enhance organizational effectiveness and drive strategic outcomes. This is especially important, considering that the CPO often has to make decisions that have far-reaching consequences for the entire organization. 

Good to know: Organizations leading with data enjoy a 3% to 5% increase in total enterprise value, equating to US$500 million.

A data-literate CPO is someone who can understand and use data to make informed decisions and translate people data into actionable insights.

Digital agility

Digital agility is becoming increasingly important for a CPO, as 90% of businesses are going through digital transformation. The CPO is expected to step up and guide the organization through the adoption of digital practices. 

Additionally, as technology evolves, the CPO needs to adapt to these changes and understand how to adopt new technologies to enhance HR’s effectiveness and efficiency. It’s also the responsibility of the CPO to equip the workforce with the necessary skills to handle future technological advancements and identify digital talent early on to train and place them in the right positions. 

As such, the CPO needs to be able to: 

• Integrate technology to build efficient, scalable, and impactful HR solutions
• Learn and experiment with working digitally, and be able to design digital upskilling strategies
• Build an organizational culture that is agile and ready for digital adoption. 

People advocacy 

The CPO is the bridge between the workforce and the organization’s strategic goals. This means they need to be capable of building a people-centric organizational culture that promotes productivity and wellbeing, navigates change, and holds the organization to ethical and sustainable standards.

Execution excellence

Execution excellence is about how the CPO shows up in the organization. This includes: 

• Action orientation: Implementing actionable and adaptive strategies to achieve business results. 
• Problem-solving: Finding practical solutions to navigate and overcome obstacles. 
• Interpersonal skills: Being self-aware, adaptable, and resilient. The CPO also needs to lead with empathy and build strong relationships with other business leaders, stakeholders, and employees.  

This competency is crucial for a CPO to translate HR strategies into tangible outcomes that positively impact the organization and its workforce. It ensures that HR initiatives are not only well-conceived but also effectively executed.  

Specialist competencies 

A CPO doesn’t necessarily need a deep understanding of every HR function, especially when they move into this role from other business units. However, they do need a broad understanding of HR specializations to plan and execute effective HR strategies. By the time they reach the CPO level, they’ve likely experienced multiple sides of HR throughout their careers, giving them valuable insight into various functions.

Depending on the business’s needs, a CPO might need deeper expertise in one or two HR functional areas. For example, if the organization is growing rapidly, it might need a CPO who specializes in talent acquisition and management, and organizational development. 

Leadership competencies

A CPO needs to have a wide range of leadership competencies to strategically and effectively manage the HR department. Mastery of these skills will also aid the CPO in developing training programs to nurture existing and potential leaders in the organization. 

The Society for Human Resources Management (SHRM) divides leadership skills into three categories based on their purposes: leading the self, leading others, and leading the organization. Here are some example skills that fall into each category.

Chief People Officer salary

A Chief People Officer based in the U.S. earns an average base salary of $163,000 per year, although pay varies based on location, company size, industry, and experience. For example, average salaries tend to be higher in major markets like New York than in cities such as Dallas.

Since a CPO is still a relatively new job title, it also makes sense to consider CHRO salaries when understanding how much CPOs earn. In Fortune 500 companies, CHROs earn between $4-8 million annually. Recent research shows that 13% of U.S. companies had CPOs in their top five highest-paid executives. 

When looking at the data for the CPO role specifically across different industries, here is what the salaries look like: 

• A CPO can earn an annual salary of around $190,000 in the education sector
• A CPO in the insurance sector gets paid an average salary of $200,000 per year.
• CPOs at companies with 500 to 1,000 employees get paid the highest annual salary, averaging over $250,000.

In addition to a base salary, CPOs will often receive performance-based bonuses. A CPO working in the tech industry can earn a bonus of $35,000 per year. Many companies also offer stock options, deferred compensation for tax benefits, retirement plans, and generous benefits packages, including paid time off, development opportunities, and professional membership fees (for SHRM or CIPD). 

CPOs also have great opportunities to grow in this role. This can either be vertical or horizontal growth. For example, they choose to continue as an HR executive in other companies or move into other business leadership positions. The trajectory of CPOs becoming CEOs is also getting more popular. And this isn’t as unlikely a career path as you might think. SHRM’s Chief Knowledge Officer predicts that by 2050, almost 20% of CEOs at Fortune 500 companies will have some HR experience.

How to become a Chief People Officer

The typical career path of a CPO starts with being an HR Manager, then moving into the HR Director role before eventually becoming VP of HR and joining the C-suite. During this process, HR practitioners gain experience in various HR functions, cross-functional collaboration, and a deep understanding of business operations. These ensure that they’re equipped with the crucial skills to excel in an executive role. 

There are also many other career paths that can lead to a CPO position, some of which are less linear and traditional. For example, Kathleen Hogan, Microsoft’s Chief People Officer, started as a software developer.

Here are six actions HR professionals can take to become a Chief People Officer. 

1. Gain broad HR experience across multiple functions 

88% of CPOs and CHROs in the Fortune 200 have HR experience prior to their appointment. Additionally, companies with a CPO/CHRO with previous HR expertise have been 35% more likely to grow their revenue. 

As we’ve previously mentioned, a CPO doesn’t need deep expertise across all HR domains. But, they do need a general understanding of the different functions to be able to develop effective HR strategies, improve HR processes, and align HR practices with business goals. 

An excellent way to get this experience is to rotate through various HR domains and gain exposure and an understanding of how each function contributes to overall business success. Additionally, joining cross-functional projects where an HR professional can work with different departments allows them to deepen their HR expertise and broaden their understanding of business operations.  

2. Pursue advanced education

While experience matters, most companies will also look at education level when searching for a CPO.

100% of CPOs/CHROs appointed in 2023 had Bachelor’s Degrees, and 77% of them held at least one advanced degree. A Master’s Degree in Human Resources Management is the most common option to consider. Pursuing a legal degree or an MBA also provides valuable skills in leadership, business strategy, and compliance, making these degrees strong choices for those aspiring to senior HR roles.

Beyond formal education, HR certifications are also a great option for future CPOs. HR is a dynamic and ever-changing field, and continuous learning is key to success. Gaining a certificate or getting certified in HR allows Human Resources professionals to stay up-to-date with the latest skills, knowledge, and best practices.

Notable certificate programs include those offered by AIHR, as well as the SHRM-SCP and SPHR certifications.

3. Seek mentorship 

Having mentors who are current or former CPOs or senior HR executives can be highly beneficial. They are a great well of knowledge and insights to help develop HR professionals navigate the path of becoming a CPO. Additionally, they can assist in expanding professional networks and opening up new opportunities.

Here are several tips for finding suitable mentors: 

• Identify and connect with potential mentors: Clarify the goals of the mentorship and look for individuals whose experience aligns with those goals. Use existing networks, attend industry events, or participate in formal mentorship programs. When reaching out, clearly communicate objectives and be mindful of their time.
• Establish clear expectations: Agree on mentorship goals, the frequency of meetings, and mutual expectations to create a productive relationship.
• Maintain the relationship: Express gratitude and keep the connection alive even after the formal mentoring period ends, building a lasting professional network.

4. Develop strong business acumen and understanding of organizational dynamics 

A CPO needs a deep understanding of the business to align HR strategies with broader organizational strategies and navigate the complexities of organizational behavior. This includes gaining cross-functional experience, which we’ve previously discussed, but also activities such as the following:

• Engaging in case studies: Regularly working on case studies that challenge complex business problems and enhance strategic thinking.
• Participating in simulations: Conducting scenario planning exercises that mimic organizational dynamics and require strategic decision-making.
• Joining business strategy meetings: Participating in strategic planning sessions to gain insight into the company’s direction and the thought processes of senior leadership.

5. Take on leadership roles

When the opportunity arises, HR professionals should begin transitioning into management and strategic roles such as HR Manager, HR Director, or VP of HR. These positions provide the chance to take responsibility for broader HR functions, lead teams, and implement strategic HR initiatives. Gaining such experience helps HR practitioners better understand how HR activities contribute to business objectives, preparing them for the comprehensive responsibilities of a CPO.

Aspiring CPOs who are not yet ready for formal leadership roles can volunteer for leadership positions within cross-functional teams for specific HR projects, such as implementing a new performance management system or revamping the employee onboarding process.

By leading such initiatives, HR professionals can gain hands-on experience in project management, task delegation, team leadership, and cross-departmental coordination, all while honing strategic thinking and communication skills. This approach offers the opportunity to gain leadership experience in a temporary, controlled setting without the long-term commitment of a formal role.

6. Build an HR network and stay up-to-date

Having a strong HR network and staying updated on industry trends are essential for CPOs. Here are some ways HR professionals can keep up with the latest developments:

• Join HR communities and professional networks:  HR practitioners can become members of organizations like SHRM or CIPD (Chartered Institute of Personnel and Development). Online HR communities, such as the AIHR community, also offer valuable opportunities to exchange ideas, seek advice, and connect with peers facing similar challenges.
• Attend conferences and workshops: Aspiring CPOs should consider attending major HR conferences such as the SHRM Annual Conference, HR Technology Conference, or regional HR summits. While it’s impossible to attend every event, it’s important to prioritize those that focus on emerging and strategic HR topics. These events provide both valuable insights and opportunities to network with industry leaders.
• Engage in continuous learning: Staying informed through HR newsletters, blogs, and podcasts helps HR professionals stay ahead of trends. For example, AIHR’s Chief HR Scientist, Dr. Dieter Veldsman, sends out a monthly newsletter filled with the latest analysis and actionable insights for HR leaders. Subscribing to these types of resources helps HR practitioners be part of the ongoing conversation in the field.

The future of the Chief People Officer role

Today’s business environment is characterized by Volatility, Uncertainty, Complexity, and Ambiguity (VUCA). This VUCA reality requires the CPO to be prepared to embrace new trends and developments in order to succeed. Their role continues to expand into the following areas:

• Balancing employee wellbeing with productivity: As the economic uncertainty continues and organizations are under pressure to perform, HR leaders must find ways to increase productivity while still protecting employee wellbeing. One solution is to implement holistic wellbeing programs to reduce burnout, increase satisfaction, and boost productivity. Flexible work policies are also a good option to help employees manage stress and maintain a better work-life balance.   
• Championing ESG and CSR goals for a positive impact on society: These two areas are increasingly becoming a part of the CPO’s agenda as businesses face rising pressure from employees, consumers, and investors to adopt sustainable, socially responsible practices that go beyond profit and contribute positively to society. CPOs can approach these either as independent pillars in the HR strategy or as two values that underpin the HR strategy. They need to develop transparent reporting mechanisms to track progress and demonstrate the company’s commitment.  
• Navigating legal and regulatory changes: Stricter labor laws, data privacy regulations, and industry-specific compliance requirements are becoming more prevalent and impact how organizations manage their workforce. CPOs need to continuously keep up with these changes. They’re responsible for overseeing regular reviews and updating company policies to ensure compliance with new laws. 
• Driving innovation in talent management: With the rise of advanced technologies like generative AI and machine learning, CPOs have new tools at their disposal to innovate in the talent management sphere. These technologies can help streamline recruitment, improve the accuracy of talent matching, and enhance performance management. It’s up to the CPO to leverage these innovations to build a future-proof workforce.
• Cultivating leadership within the organization: By 2030, 85 million jobs could go unfilled due to a lack of skilled talent. This situation can be even more dire for critical leadership roles. As such, the CPO needs to start identifying and nurturing leadership talent to build a robust pipeline of potential leaders and help ensure business continuity. 

To sum up

As part of the C-suite, the Chief People Officer is the people and culture leader of the organization. They work to improve the employee experience, enhance the organization’s competitiveness through its human capital, ensure HR strategies are aligned with and contribute to business goals, and build a great place to work. 

To become a Chief People Officer, HR professionals must develop a comprehensive skill set and knowledge through advanced education, gain board-level HR experience, and find opportunities to move into leadership roles. Becoming a Chief People Officer is not an easy path, but it’s a rewarding position that allows Human Resources practitioners to make a significant impact on both the organization and its workforce.

FAQ

The post Chief People Officer: All You Need To Know About the Role appeared first on AIHR.

Contents
What is HR cost optimization?
How HR budget planning helps optimize costs
How to reduce HR costs without cutting value
How to use AIHR’s budget planning PDF for HR cost optimization
FAQ

What is HR cost optimization?

HR cost optimization is the process of reviewing HR spending and making sure each cost supports business needs, employee experience, compliance, or workforce performance.

It is not the same as cutting costs across the board. Cost-cutting often focuses on spending less. Cost optimization focuses on spending better.

For HR leaders, this means analyzing how the HR budget is used, what outcomes each cost supports, and whether there are better ways to achieve the same or better results.

For example, reducing HR costs could mean canceling an underused tool, combining vendor contracts, improving workforce planning to avoid urgent hiring costs, or automating repetitive admin work. It could also mean moving budget from low-impact programs to areas that better support retention, manager capability, or employee productivity.

Simply put, effective HR cost optimization helps you focus spending on the tools, programs, and services that have the clearest value for employees, managers, and the business.

How HR budget planning helps optimize costs

HR budget planning gives you the structure to understand, review, and manage HR costs before they become a problem.

Without a clear plan, HR spending can become reactive. Teams may approve new tools, training programs, or hiring support without checking whether they overlap with existing resources. Over time, this can create unnecessary costs and make it harder to explain HR’s budget needs.

A strong HR budget planning process helps you:

• See the full picture of HR costs: Break down spending across areas like recruitment, learning and development, HR technology, benefits, payroll, compliance, and employee engagement.
• Connect spending to business goals: Review whether each cost supports a clear workforce need, such as filling critical roles, improving retention, developing managers, or meeting compliance requirements.
• Plan ahead instead of reacting: Forecast future HR needs, such as hiring volume, training demand, or technology changes, so you can avoid rushed and expensive decisions.
• Compare cost and value: Look beyond the price of a program or tool. Ask what problem it solves, how often it is used, and whether it improves efficiency or outcomes.
• Make trade-offs more clearly: If your budget is limited, planning helps HR decide what to keep, pause, reduce, or redesign.

This is where HR budget planning connects directly to HR cost optimization. Budget planning shows where the money goes. Cost optimization helps you decide whether that spending still makes sense.

How to reduce HR costs without cutting value

Reducing HR costs does not have to mean reducing the quality of HR support. The best opportunities often come from improving processes, removing duplication, and focusing the budget on what works.

Here are practical areas to review:

• Audit your HR technology stack: Check which tools are used, which features overlap, and which platforms no longer meet your needs. If two systems solve the same problem, you may be able to consolidate.
• Review vendor contracts: Look at external providers for recruitment, training, payroll, benefits, employee surveys, and compliance support. Check renewal dates, usage levels, and whether each vendor still delivers value.
• Improve workforce planning: Better planning can reduce urgent hiring, reliance on recruitment agencies, and overstaffing. It also helps HR align hiring plans with real business demand.
• Reduce turnover-related costs: Replacing employees can be expensive. Review exit interview data, retention risks, manager capability, and internal mobility options to reduce avoidable turnover.
• Prioritize high-impact learning: Training budgets are easier to defend when programs support clear skills gaps or business needs. Pause or redesign learning programs with low attendance, unclear goals, or weak follow-up.
• Automate repetitive HR tasks: Use automation carefully for routine work, such as reminders, document collection, basic reporting, and onboarding workflows. This can free up HR time for more valuable work.
• Standardize recurring processes: Inconsistent processes can create hidden costs. Standard templates, workflows, and approval steps can reduce errors, delays, and rework.

The key is to avoid short-term decisions that create bigger problems later. For example, cutting manager training may reduce costs now, but it could lead to weaker performance conversations, lower engagement, or higher turnover.

A better approach is to ask: What can we stop, simplify, combine, or improve without reducing how we support employees?

How to use AIHR’s budget planning PDF for HR cost optimization

Use this PDF document as a practical tool to connect HR budget planning with cost optimization.

Start by mapping your main HR cost areas. These may include recruitment, learning and development, HR technology, compensation and benefits, employee relations, compliance, and HR administration, and other areas, depending on the type and size of your organization.

Then, review each cost area against the budget planning steps in the document. Look at past spending, current needs, future priorities, and expected outcomes. This will help you move from a general budget review to a more focused cost optimization process.

You can use AIHR’s budget planning PDF to:

• Structure your budget planning process: Follow the steps to review past spending, define priorities, estimate future costs, and prepare your budget request.
• Check whether key HR cost areas are covered: Use it to make sure you’ve considered areas like recruitment, learning and development, HR technology, compensation, benefits, and compliance.
• Prepare for budget conversations: The HR budget overview helps you explain what HR needs funding for and how those costs support workforce priorities.
• Create a more consistent planning approach: Use the steps in the PDF as a repeatable guide when preparing annual budgets, revising quarterly plans, or reviewing HR spend with stakeholders.

HR cost optimization helps HR leaders make stronger budget decisions, show the value of HR investments, and align spending with workforce and business priorities. By reviewing costs, planning ahead, and connecting HR spend to outcomes, you can build a more efficient HR function that stays focused on the programs, tools, and services that create measurable value.

FAQ

The post HR Cost Optimization: Budget Planning Tips for HR Leaders appeared first on AIHR.

HR faces constant operational pressure due to critical responsibilities such as hiring, employee relations, and compliance. But the ability to step back, interpret ongoing changes, and act in advance also creates business value. This article explores what strategic thinking is, why it matters for HR, how it differs from tactical thinking, and how you can build it into your daily work.

Contents
What is strategic thinking?
Why strategic thinking in business matters for HR
6 strategic thinking competencies
Strategic thinking’s 6 disciplines: A framework for HR
7 ways to think more strategically
6 strategic thinking examples in HR

What is strategic thinking?

Strategic thinking is the ability to look beyond immediate tasks, understand what’s changing in your environment, and make decisions today that create advantages tomorrow. Thinking strategically means consistently asking these questions:

• What’s changing (labor market trends, technology shifts, business priorities, etc.)?
• What will this mean for the business and workforce?
• What should we do now to prepare?

A strategic mindset is a matter of perception. For instance, two different HR professionals could respond differently to rising attrition. One immediately initiates a retention campaign, while the other pauses to ask who’s leaving, why now, and what the risk to the business is. The second approach reflects strategic thinking in action.

Bear in mind that seniority or intelligence doesn’t determine your ability to think strategically. You don’t need to be in a leadership role to apply it. It’s a learnable skill that develops through better questioning, broader awareness, and consistent practice.

Strategic thinking vs. tactical thinking

Understanding how strategic thinking differs from tactical thinking helps clarify where HR often gets stuck. Essentially, tactical thinking improves existing processes, while strategic thinking questions whether those processes are solving the right problems. Here are some helpful examples:

Strategic thinking vs. strategic planning

Strategic thinking and strategic planning are complementary but not identical. Thinking generates insight, while planning turns that insight into coordinated action. Below are some relevant examples:

Why strategic thinking in business matters for HR

Strategic thinking in business matters for HR because it moves HR from a reactive function that waits for requests to a proactive one that anticipates challenges. Being proactive also means you see opportunities for improvement and help shape organizational outcomes.

Benefits for HR 

When you apply strategic thinking in leadership, you can:

• Align people strategy with business goals
• Anticipate workforce risks and emerging skills gaps
• Support leaders with better, data-informed decisions
• Prioritize high-impact work over low-value activity
• Build credibility and influence at the leadership table.

This matters across core HR areas like workforce planning, succession planning, and change management. Even if you’re not in a senior role, your ability to frame and articulate problems strategically can shape decisions at higher levels. It also allows you to identify opportunities for improvement.

For example, imagine your company is planning to expand into a new market, and business leaders ask you to start the hiring process immediately. A reactive HR response would focus only on filling vacancies as quickly as possible. A strategic HR response, however, would go further by asking what capabilities the business will need in 12 to 24 months, whether current leaders can support growth, and how hiring, onboarding, and learning plans should work together to support long-term success.

This approach helps HR move from task execution to business impact. Instead of only responding to immediate talent requests, HR can identify risks early (e.g., skills shortages, weak leadership pipelines, or poor role design) and suggest solutions that support both short-term delivery and future growth. In this way, strategic thinking allows you to add value not just by solving people issues, but helping the business make better decisions overall. 

6 strategic thinking competencies

To build strong strategic thinking skills, focus on the following six core competencies. They fall into three main dimensions, each concerned with how you see, think, and act. Here’s how they work:

Dimension 1: How strategic thinkers see

This dimension covers the following two strategic thinking competencies:

1. Big picture view

Strategic thinkers consider multiple variables at once, including business goals, talent needs, opportunities for improvement, and external trends. For instance, taking a big picture view when making hiring plans and decisions means factoring in market conditions and long-term capability needs, not just current vacancies.

2. Pattern recognition

Thinking strategically involves spotting patterns before they’re obvious to others. This allows you to investigate in advance, determine root causes, and prevent issues from snowballing into bigger problems. For example, you might notice rising absenteeism in one department, and correctly connect it to leadership changes or excessive workloads.

Dimension 2: How strategic thinkers think

In this dimension, you have competencies in curiosity and questioning, as well as in managing uncertainty.

3. Curiosity and questioning

Strategic thinkers challenge assumptions and ask better questions than others, seeking the real reasons behind issues and working toward effective solutions. In an HR context, this could entail determining if performance issues stem from unclear expectations or structural problems before you launch any training.

4. Comfort with uncertainty

To be a truly strategic thinker, you must be comfortable enough with uncertainty to be able to act without possessing perfect information. This is crucial when you need to make important decisions on short notice. For instance, you might have to make workforce decisions based on trends and signals, even when data is incomplete.

Dimension 3: How strategic thinkers act

The final dimension involves the ability to prioritize and make trade-offs, as well as a keen sense of business awareness.

5. Prioritization and trade-offs

Strategic thinkers recognize the importance of making the right decisions even with limited resources. This requires you to prioritize certain actions while shelving other plans, so you don’t overstretch any budget, individual, or team. In HR, this could involve focusing hiring efforts on revenue-critical roles, instead of distributing resources evenly.

6. Business awareness

Business awareness means understanding how the company creates value, and finding ways to support that. For example, when developing talent initiatives, you should consider how they can drive revenue, meet customer needs, and relieve competitive pressure on the organization. This will determine the effectiveness of your initiatives.

Strategic thinking’s 6 disciplines: A framework for HR

Michael Watkins’ book, The Six Disciplines of Strategic Thinking: Leading Your Organization Into the Future, provides a practical strategic thinking framework. It breaks down strategic capability into six areas:

1. Problem-framing: This means defining the real issue before jumping to solutions. For HR professionals, this helps ensure you address root causes, such as whether management, workload, culture, or pay is causing high turnover.
2. Systems thinking: This involves understanding how different parts of the organization influence one another. In HR, it helps you see how decisions in talent acquisition, learning, performance, and leadership can create ripple effects across the business.
3. Inductive reasoning: This is the ability to spot patterns and draw insights from observations and data. For HR, it means using employee feedback, workforce data, and business trends to identify emerging issues and opportunities before they become urgent.
4. Assertive inquiry: This combines confident thinking with asking thoughtful questions to test assumptions. You can use this discipline to challenge business leaders constructivelym and uncover what’s really driving different people or organizational issues.
5. Visioning: This is the ability to imagine a better future and define what success could look like. In HR, visioning helps you shape a people strategy that supports long-term business goals, rather than only reacting to day-to-day needs.
6. Strategic action: This is about turning ideas into focused decisions and measurable progress. For HR professionals, it means prioritizing the right initiatives, aligning stakeholders, and making sure strategy leads to real business and workforce outcomes.

Together, these form a structured strategic thinking process you can apply to your HR function. You can use this framework as a self-assessment tool by asking yourself, “Which of these disciplines do I use naturally?” and “Which do I avoid?” For example, if you tend to reach solutions quickly, you may need to focus on the areas of problem-framing and assertive inquiry. This reflection will help you develop more balanced strategic thinking competencies over time.

For HR professionals, developing these disciplines is not about becoming a corporate strategist overnight. It’s about building the ability to step back, connect people challenges to business priorities, and make more informed decisions with long-term impact in mind. The more consistently you practice these six disciplines, the better you’ll equip yourself to move beyond operational delivery, and contribute as a true strategic partner to the business.

7 ways to think more strategically

The key to thinking more strategically lies in changing everyday behaviors that prevent you from doing so. The following seven approaches will help you develop and improve your strategic thinking abilities:

1. Start with the business goal, not the HR task

Strategic thinking starts with understanding the broader business outcomes you want to achieve, instead of a single HR task. This shifts your focus from completing activities to creating measurable business value.

• What this looks like: You ask, “What business problem will we solve first?” before taking action. This helps ensure your response supports a business priority, not just an HR process.
• If you’re developing this skill: Ask simple questions like “What does success look like?” and “Why is this important now?” They help you build the habit of connecting your work to business needs.
• If you’re improving it: Go further by evaluating the trade-offs, risks, and long-term impact associated with the goal. This helps you make stronger recommendations that balance short-term pressure with long-term value.

2. Look beyond the immediate issue

Strategic thinkers go deeper than surface-level problems. They take time to understand what’s causing the issue, instead of responding only to what’s visible.

• What this looks like: You investigate root causes instead of reacting to symptoms. This means you don’t immediately assume the first problem you see is the real one.
• If you’re developing this skill: Use simple techniques, like asking “why” multiple times. This can help you uncover patterns you might otherwise miss.
• If you’re improving it: Combine data sources, such as exit interviews, engagement surveys, and performance data, to identify patterns. Looking across multiple sources gives you a more reliable picture of what’s really happening.

3. Build stronger business and data awareness

You can’t think strategically without context. A stronger understanding of the business helps you make better decisions and speak with more credibility.

• What this looks like: You understand how your company makes money and what drives performance. You also know which people issues have the biggest effect on results.
• If you’re developing this skill: Attend business reviews and ask leaders to explain key metrics. This helps you build commercial awareness and confidence in business discussions.
• If you’re improving it: Link HR metrics directly to business outcomes, such as revenue or productivity. This makes it easier to show that HR activity contributes to business performance.

4. Ask better questions before proposing solutions

The quality of your thinking depends on the quality of your questions. Better questions help you define the problem properly before you try to solve it.

• What this looks like: You pause before offering solutions, explore each problem more deeply, and collaborate with key players to better understand it. This helps you assess situations and develop solutions, and lets you base your response on reliable insights.
• If you’re developing this skill: Prepare three key questions before every stakeholder meeting to give yourself a simple structure for gathering useful information.
• If you’re improving it: Challenge assumptions and reframe problems to uncover new insights. This helps you move the conversation beyond obvious answers and find better options.

5. Make time for reflection and long-term thinking

Strategic thinking requires space. Without it, it’s easy to focus only on urgent tasks and miss bigger risks or opportunities.

• What this looks like: You deliberately create time to step back and think. You treat reflection as part of good decision-making, not as time away from real work.
• If you’re developing this skill: Block 30 minutes each week to review trends and priorities. A regular routine makes strategic thinking easier to practice consistently.
• If you’re improving it: Use this time to explore future risks, opportunities, and scenarios. This strengthens your ability to anticipate change instead of only reacting to it.

6. Practice scenario thinking

Strategic thinkers don’t rely on a single plan. They consider different outcomes, so they can respond more effectively when conditions change.

• What this looks like: You prepare for multiple possible futures and always have a plan B ready. This reduces the risk of being unprepared when the business environment shifts.
• If you’re developing this skill: Ask, “What if demand increases? What if it drops?” Even simple questions like these can improve your planning and decision-making.
• If you’re improving it: Design flexible HR strategies that work across different business scenarios. This helps you create plans that will remain useful even when assumptions change.

7. Prioritize impact over activity

Not all work creates equal value. Strategic thinkers focus their time on the work that will make the biggest difference.

• What this looks like: You focus on initiatives that drive business outcomes, and are willing to spend less time on tasks that are urgent but low-value.
• If you’re developing this skill: Identify one high-impact project each quarter to help you practice choosing work based on value rather than volume.
• If you’re improving it: Regularly reassess where your time and resources create the most value. This allows you to shift effort away from lower-impact work and toward stronger results.

6 strategic thinking examples in HR

Here are four practical strategic thinking examples that show how this skill can transform HR decisions from reactive to strategic:

Example 1: Learning and development

A business leader requests employee training due to declining team performance. At first glance, training may seem like the obvious fix, but the real issue may sit elsewhere.

• Reactive response: Roll out a leadership program. This treats the request as the solution, rather than determining if employees actually need training.
• Strategic approach: Analyze whether the issue is skills, role clarity, or team structure before designing any solution. This helps ensure the response matches the real cause of the performance problem.

Example 2: Retention

Turnover increases across several teams. To assess the situation strategically, you should look beyond the headline number to understand where the real risk sits.

• Reactive response: Introduce retention bonuses or engagement initiatives. This may create activity quickly, but it doesn’t address whether the same problem exists across all groups.
• Strategic approach: Segment turnover data to identify who’s leaving and why, and which exits create the greatest business risk. This allows you to focus your response where it will have the biggest impact.

Example 3: Succession planning

A senior leader leaves unexpectedly, exposing whether the organization has planned ahead for critical talent gaps.

• Reactive response: Start an external hiring process that may fill the vacancy, but can also delay continuity and overlook internal talent.
• Strategic approach: Identify critical roles in advance and build internal pipelines for future leadership needs. This strengthens business continuity and reduces dependence on last-minute hiring.

Example 4: Change management

Your organization is planning a business transformation. The success of the change depends less on the system itself and more on how well people prepare for it.

• Reactive response: Communicate the change at rollout. This shares information, but often comes too late to build real understanding or support.
• Strategic approach: Prepare managers early, as their support will determine employee adoption and overall success. This improves the chances employees will understand, accept, and adopt the change effectively.

Next steps

Strategic thinking is not something you master in theory, but something you build by asking better questions, connecting people decisions to business goals, and making time to step back from day-to-day HR demands. The more you practice these habits, the more value you can create for the business.

How to learn strategic thinking? Focus on building the soft skills that support it, such as critical thinking, business awareness, communication, and decision-making. AIHR’s Soft Skills Hub can help you strengthen these skills and apply them in your HR role with more confidence and impact.

The post Strategic Thinking: An HR Guide to Leading Differently appeared first on AIHR.

That gap between what HR teams can do and what the business needs them to do is not just a resource issue – it’s a visibility issue. Without a clear view of what skills your team actually has, it’s nearly impossible to make strategic decisions about hiring, learning, or internal mobility. That gap between skills and business needs keeps HR reactive instead of proactive.

Gartner found that organizations that focus on skills visibility and talent fluidity see up to a 60% boost in talent readiness. In other words, a thorough HR skills assessment gives HR leaders a tangible way to future-proof their teams and increase strategic impact.

Contents
Why conduct an HR skills assessment
7 methods to conduct an HR skills assessment
10 next steps for HR leaders after a skills assessment

Why conduct an HR skills assessment

HR leaders are under growing pressure to deliver strategic value, not just operational support. A targeted HR skills assessment offers a clear view of team strengths, gaps, and opportunities. By identifying what’s working and what’s missing, HR leaders can realign roles, prioritize training, and elevate their function’s impact across the business.

Whether you’re building a forward-looking team, responding to organizational change, or developing internal talent, regular assessments help you stay proactive and precise. Here’s how:

• Identify and bridge skills gaps: A structured skills assessment uncovers where capabilities fall short. Once identified, you can address these gaps through targeted upskilling, hiring, or outsourcing, reducing risk and improving HR’s ability to support the business.
• Hire the right talent: Understanding your team’s current strengths lets you hire with purpose. Instead of duplicating skills you already have, you can prioritize candidates who bring new capabilities, whether that’s deep systems knowledge, strategic thinking, or advanced people analytics.
• Future-proof the HR function: Future-ready capabilities like data literacy, change management, and digital agility are increasingly essential, but often lacking in organizations. Skills assessments give HR leaders the insight to invest in emerging competencies before they become urgent needs.
• Boost team performance: Assessments make performance conversations more concrete by linking strengths and gaps to job expectations. This increases clarity, sets realistic development targets, and helps team members understand where they can add the most value.
• Align HR with business strategy: HR doesn’t operate in a vacuum. A skills audit ensures your team is equipped to support business priorities, matching capability to strategy rather than function to role.
• Support targeted growth and development: Instead of generic training programs, a skills assessment enables tailored development plans for each team member, making learning more relevant, building confidence, and supporting succession planning.
• Encourage accountability and self-awareness: Skills assessments help team members reflect on their abilities and development needs, boosting ownership, improving goal setting, and encouraging proactive career planning.
• Reveal underutilized strengths: Sometimes the issue isn’t a lack of skills, but a lack of visibility. Assessments can surface hidden strengths or underleveraged expertise within the team, which team leaders can use to align the right people (and skills) with business-critical projects or mentoring roles.
• Support better workforce planning: Understanding your HR team’s capabilities helps you plan for restructuring, expansion, or leadership changes. You can anticipate talent gaps, build internal pipelines, and make more informed decisions about how to structure the function.
• Strengthen HR’s credibility: HR teams that actively evaluate and improve their capabilities demonstrate the same accountability they ask of the rest of the organization, building trust with stakeholders and reinforcing HR’s position as a strategic partner.

7 methods to conduct an HR skills assessment

Conducting an HR skills assessment is less about listing competencies and more about understanding how your team contributes to real business outcomes.

When approached strategically, these assessments offer a solid path to shaping a high-impact HR function – one that’s not just operationally sound, but aligned to what the business genuinely needs to thrive. Whether you’re upskilling, restructuring, or hiring, the following methods provide the right mix of insight and rigor to guide those decisions.

1. HR skills gap analysis

An HR skills gap analysis identifies the difference between the skills your team currently has and those required to deliver on the company’s short- and long-term priorities. It turns abstract capability conversations into a structured, actionable view of where to focus development, hiring, or even job redesign.

This approach works especially well when you’re trying to future-proof your team. If your business is heading into new markets, planning a major technology change, or facing an increase in compliance complexity, a skills gap analysis gives you a grounded baseline to work from so you’re not just reacting when a capability shortfall becomes a business risk.

Do this:

• Map business objectives and determine the core HR capabilities needed to support them
• List existing skills by team member, using job descriptions, self-assessments, or manager feedback
• Rate current proficiency levels and compare them with the required proficiency
• Identify gaps and prioritize based on strategic importance and urgency.

Use AIHR’s HR Skills Gap Analysis Template to get started.

Top tip

Aligns HR’s skill roadmap with actual organizational demand by bringing in leaders from other functions to validate what capabilities HR will need to support their departments.

2. T-shaped HR assessment

The T-Shaped HR Competency Model (developed by AIHR) is a powerful tool to understand how your team balances depth in one HR domain (e.g., L&D, recruitment, analytics) with broad knowledge across core HR competencies. It encourages specialists to develop strategic awareness and helps generalists identify where deeper expertise would increase their impact.

For HR leaders, it’s a strategic lens: Are you building a team of hyper-specialized experts who struggle to collaborate, or well-rounded professionals who can operate across silos and evolve with the business?

Do this:

• Share AIHR’s T-Shaped HR Assessment with your team
• Analyze individual results and aggregate data to see strengths and development needs at a team level
• Use this to guide development pathways and hiring decisions
• Revisit assessments annually to track growth and shape internal mobility.

Top tip

Use this tool to support career pathing by helping team members identify where they can broaden or deepen their skill sets to unlock new roles or responsibilities.

3. 360-degree feedback

360-degree feedback gives a multi-dimensional view of how HR professionals are perceived by peers, direct reports, and senior leaders. Beyond technical skills, it brings behavioral and interpersonal attributes into the spotlight, including how effectively someone collaborates, leads, communicates, and navigates complexity.

It’s particularly effective in identifying blind spots. High performers may be technically sound, but struggling with stakeholder influence. Others might be underestimated because their strengths are relational or strategic, not always visible in traditional metrics.

Do this:

• Select feedback providers from different levels and departments
• Use AIHR’s 360-Degree Feedback Template to create consistency and reduce bias
• Review feedback themes and discrepancies
• Use in performance reviews, development planning, and promotion discussions.

Top tip

Keep feedback focused on observable behaviors, not personality traits, to ensure the objectivity and actionability of the results.

4. Performance review analysis

Performance reviews, when analyzed with intent, reveal much more than past output. They show patterns in how individuals apply their skills over time and how that translates into business value. For HR teams, this can include metrics like time-to-hire, retention outcomes, employee satisfaction, and compliance rates.

Analyzing performance reviews as part of a broader skills assessment helps clarify who’s consistently delivering impact, who’s at risk of stagnation, and where support is needed to lift performance across the board.

Do this:

• Review several cycles of performance data to spot trends
• Cross-reference outcomes with business impact (e.g., project delivery, internal feedback, compliance results)
• Combine with skills self-assessments to surface misalignment between self-perception and performance
• Use insights to shape individual development plans and team-wide interventions.

Top tip

Focus on outcome-based indicators rather than activity-based measures. For example, “implemented a new onboarding process” is less straightforward than “reduced new hire turnover by 15%.”

5. Behavioral interviews for soft skills

Soft skills often differentiate good HR practitioners from great ones, but they’re harder to quantify. Behavioral interviews offer a structured way to assess qualities like judgment, empathy, influence, and agility, based on real past experiences. This is particularly valuable when hiring new HR professionals, but it can also be used internally to identify team members ready for more strategic or leadership roles.

Do this:

• Prepare questions that elicit real scenarios (e.g., “Tell me about a time you had to influence without authority.”)
• Use the STAR method (Situation, Task, Action, Result) to evaluate responses
• Look for clear decision-making, emotional intelligence, and accountability
• Compare outcomes across candidates or team members for consistency.

Top tip

Don’t just listen for “what” happened; pay attention to how they navigated context, competing interests, and follow-through.

6. Simulations and case study exercises

Real-world simulations test how HR professionals apply their knowledge in ambiguous, high-stakes scenarios, from navigating an ethics complaint or handling change resistance to resolving a data privacy breach.

These exercises often reveal capabilities that aren’t always evident in day-to-day work. They’re especially useful when evaluating readiness for leadership roles or special projects, where judgment and composure matter as much as knowledge.

Do this:

• Design or source role-relevant case studies tied to real business dynamics
• Ask individuals or teams to present their approach and rationale
• Evaluate critical thinking, problem-solving, and stakeholder awareness
• Use findings to inform promotions, training investments, or project assignments.

Top tip

Debrief after the exercise, covering what was missed, what was strong, and what could be improved to reinforce learning and promote shared standards.

7. Digital and data fluency assessments

HR is increasingly reliant on systems, analytics, and dashboards. Assessing your team’s ability to interpret data, work with HRIS tools, or run basic analytics has become core to the function. Whether it’s using Excel to model compensation changes or generating turnover insights, digital and data fluency directly affects how HR supports strategic decisions.

You can do this informally through task-based assessments or more formally through learning platforms and diagnostic tools.

Do this:

• Define what digital and analytical proficiency looks like for each role
• Assign scenario-based tasks (e.g., “Build a dashboard to track absenteeism by department”)
• Assess logic, accuracy, and interpretation beyond just technical skill
• Use results to inform upskilling, job design, or cross-functional training needs.

Top tip

Embed digital skills in real HR use cases to see how your team will actually apply them day to day.

10 next steps for HR leaders after a skills assessment

A skills assessment is only as valuable as what you do next. Once you’ve gathered data on your HR team’s capabilities, the next step is to translate insight into action. This process is about more than closing gaps – it’s about aligning your people strategy with the future of your business. Here’s how to move from assessment to impact.

Step 1: Take time to analyze and understand the results

Jumping straight into development plans without interpreting the bigger picture can lead to misaligned priorities. Start by reviewing the data holistically, looking at trends across the team rather than just individual results. Are there consistent weaknesses in areas like data literacy, stakeholder influence, or strategic thinking? Are certain skill sets heavily concentrated in one area, while other functions are under-resourced?

Then layer in the business context: Which skills will matter most over the next 12–18 months? If your organization is scaling quickly, gaps in workforce planning or onboarding processes may be more urgent than gaps in employee relations. If you’re focusing on digital transformation, prioritize skills tied to HR tech fluency and change communication.

This is also a good moment to bring the team into the conversation. Organize a working session to explore the results together. You can discuss what surprised people, what confirms existing hunches, and where the group sees risks or opportunities. When skills insights are interpreted collectively, you’re more likely to land on development priorities that are both relevant and actionable.

Step 2: Prioritize the skills that matter most

Not every skill gap needs immediate intervention. The most effective HR leaders focus on the capabilities that have the greatest impact on business outcomes, such as workforce planning, leadership development, and diversity and inclusion. You may also need to prioritize skills that future-proof your function, such as analytics, agile HR, or systems thinking.

Ask yourself (and your team):

• Which capabilities are business-critical right now?
• Which skills support our ability to scale, innovate, or manage risk?
• What will happen if we don’t act?

Remember, development efforts should be practical, measurable, and aligned with strategic goals, so identify where you have strong capabilities that you can scale, share, or build into mentorship opportunities.

Step 3: Create individual HR development plans

Once you’ve prioritized key skill areas, map out targeted development plans for each team member. These should consider current strengths, career aspirations, business needs, and any stretch opportunities available.

Plans should answer:

• What skills need to be developed or deepened?
• How will the team member acquire them (courses, projects, coaching)?
• What timeline makes sense given business priorities?

You can use this structured HR Professional Development Plan Template from AIHR to guide the process. It offers ready-made frameworks for defining goals, learning actions, and evaluation checkpoints.

Step 4: Set clear and measurable goals

Development without accountability often stalls, so once you’ve identified skills to develop, translate them into outcomes using the SMART goal framework (specific, measurable, achievable, relevant, and time-bound).

For example:

• “Complete foundational people analytics training by Q3 and apply insights in our next engagement survey redesign.”
• “Co-lead the implementation of a new HRIS and deliver stakeholder training across three business units by year-end.”

It’s also important to involve team members in setting their own goals, as ownership improves motivation and strengthens the link between personal growth and team performance. Help them develop goals that link individual development to organizational value.

Step 5: Launch targeted learning programs 

Short, intensive learning formats like boot camps can accelerate skill development in key areas such as digital HR, analytics, or business partnering. These programs offer immediate value by translating theory into real-world application and can be scheduled around operational demands. 

The AIHR HR Boot Camp is ideal for teams needing to quickly build capability in a targeted way. Other options include microlearning, internal knowledge sharing, and cross-functional secondments to apply new skills in real time.

Step 6: Build long-term capability through an HR academy

While boot camps address urgent development needs, long-term capability building requires continuous learning, so give your team access to structured, on-demand programs that evolve with the profession.

The AIHR HR Academy offers a wide range of certifications and courses across HR domains, from talent management and analytics to leadership and transformation.

Embedding this kind of resource into your development ecosystem encourages self-directed learning, reduces over-reliance on managers for skill-building, and reinforces a growth mindset.

Step 7: Assign stretch projects to embed learning

One of the most effective ways to develop new skills is through applied experience. After formal learning, assign team members to real projects that let them practise what they’ve learned, whether it’s leading an employee experience initiative, revamping onboarding, or co-designing new HR dashboards. This also provides opportunities for visibility, influence, and leadership development, particularly for high-potential talent.

To build capability and strengthen internal collaboration, you can also pair newer HR professionals with more experienced team members on strategic projects. 

Step 8: Communicate with stakeholders and secure support

Development plans and capability-building efforts are more effective when they’re supported by business leaders. Sharing key themes from your assessment with senior stakeholders builds credibility and may unlock budget, resources, or cross-functional support that accelerates progress.

These can include:

• What the team does well
• Where the gaps are
• How HR’s evolution supports broader business objectives. 

Step 9: Track progress and adjust as needed

Create checkpoints to assess whether your plans are delivering the intended outcomes. This might include manager feedback, peer evaluations, business impact metrics (like reduced time-to-hire), or updated skills self-assessments. You can use this information to adjust development plans, celebrate wins, and course-correct where necessary.

It’s also a good idea to make this part of your quarterly team rhythm by reviewing development plans alongside performance discussions to keep growth and execution aligned.

Step 10: Build skills assessments into your annual rhythm

Finally, don’t let skills assessments become a one-time initiative. Integrate them into your annual HR planning cycle and use them to guide workforce planning, succession planning, and investment decisions.

The goal is to make capability-building part of your team culture and an expected, supported, and rewarded part of professional life. You can even combine skills assessments with team retrospectives or strategy off-sites to keep learning connected to performance, not siloed as a separate HR exercise.

Wrapping up

An HR skills assessment provides a clear, actionable snapshot of your team’s capabilities, showing where your strengths lie, where critical gaps exist, and how your team aligns with the business’s current and future needs.

With this insight, you can make confident decisions about hiring, training, and team design, ensuring that HR is equipped to lead, not just support, organizational growth.

The next step is to translate insight into action. Prioritize the capabilities with the greatest business impact, create tailored development plans for your team, and embed learning into real work. Make sure you build momentum through stretch opportunities, structured learning programs, and ongoing feedback. When assessments become part of your regular rhythm, capability-building becomes a culture that drives performance and prepares HR for whatever comes next.

The post HR Skills Assessment: 7 Methods To Identify Gaps & Build a Stronger HR Team appeared first on AIHR.

These metrics were easy to collect, report, and scale. In a world where learning content was scarce and expensive to produce, they made sense, but today we know that those metrics are not enough to show value.

But that world has changed.

Artificial intelligence has dramatically reduced the time and effort required to create learning content. What once took weeks can now be done in minutes. Courses, simulations, guides, and microlearning modules can be produced faster than organizations can consume them. When content becomes abundant, activity ceases to be a meaningful signal of progress.

And yet, most learning programs still rely on training measurement that does not show whether learning leads to meaningful behavior change or business value. According to CIPD research, 30% of business leaders reviewing HR and L&D metrics cite that the figures don’t give them the full picture, and 22% say it’s not clear how the data connects to organizational priorities.

In this article, we explore the learning value measurement model adopted at AIHR. The model evaluates learning value from multiple stakeholder perspectives and builds on traditional frameworks, such as Bloom’s Taxonomy, Kirkpatrick, and the Phillips ROI model, to measure learning value in self-paced online learning environments.

Contents
Why traditional training measurement falls short 
A 5-layer training measurement model for measuring learning value
Why AIHR  focuses on learning value rather than learning impact

Why traditional training measurement falls short 

Most L&D teams are highly effective at training measurement when it comes to learning activity and consumption. Someone watches a video. Someone completes a module. Someone rates the course four stars. Over time, we have built sophisticated systems to capture all of this, and many dashboards are filled with these metrics.

But consumption is not proof of value.

Traditional learning metrics such as completions, clicks, and satisfaction scores can show participation, but they say little about actual capability building.

At AIHR, we define learning value as the extent to which learning builds capability, leads to meaningful behavior change, supports the original purpose of the learning intervention, and aligns with business outcomes. This is why training effectiveness should be evaluated through a broader lens than course completion or content engagement alone.

The real question is then not whether someone clicked through a module, but whether they do their job differently because of it.

A helpful way to think about modern training measurement is through three levels:

1. Activity reflects what people consume. 
2. Learning reflects what they understand. 
3. Value reflects what they actually do differently, and the impact those changes create in the business.

This distinction is not new. Bloom’s taxonomy already separated knowledge acquisition from higher-order outcomes such as application and synthesis. The Kirkpatrick model, with its four levels of reaction, learning, behavior, and results, has shaped L&D evaluation for more than 60 years, while the Phillips ROI model extended this logic by linking learning outcomes to financial impact.

These models laid the foundation for many of today’s learning and development KPIs, even if they do not fully reflect the realities of modern digital learning.

Many of the models, I think, are limiting because they overcomplicate what it is that we really need to do to show that what we’re investing in is really working. Simplicity can really make a difference for folks who are struggling with measurement. So what metrics should we be looking at? It’s not really about the metrics because I think that might put us in a box of trying to standardize. Not surprisingly, I am not a proponent of standardization across organizations. I do think you can create some standard procedures within an organization, and as long as everybody is bought in and understands why these systems and procedures matter, and they follow them, then it will work.

Dr Alaina Szlachta

I do believe it’s important to be able to benchmark or baseline, or to compare apples to apples. And so the way that we would do that is you could create something like an alignment score. How well is our program aligning with what matters to the business? And then you can have an alignment score for every single initiative that your team is accountable for, which allows you to compare apples to apples. In our alignment score, we would see that this particular program is clearly aligned with solving a business problem or achieving a business goal, whereas in this other initiative, the clarity is simply not there.

Dr Alaina Szlachta

A 5-layer training measurement model for measuring learning value

AIHR’s training measurement model builds on the foundations of the established training effectiveness models but updates them for the realities of modern digital learning and more effective training measurement. It introduces application readiness as a leading indicator, separates platform experience from learning outcomes, and grounds each layer in contemporary behavioral science, while explicitly recognizing the different stakeholders involved in creating and measuring learning value.

Equally important is starting with the business problem that the learning is intended to address. Learning should never exist as an isolated activity or as content looking for an audience. It should be designed to address a specific capability gap that prevents the organization from executing its strategy or improving performance.

This starting point shapes how learning value is defined and measured. When the underlying business challenge is clear, it becomes easier to determine which capabilities need to change, what behaviors should look different, and how success can be observed in the workplace. Measurement then moves beyond participation metrics to assess whether the learning intervention actually helped address the original problem it was designed to solve.

AIHR’s training measurement model comprises five connected layers that help L&D teams assess learning value more credibly:

• Layer 1. Platform Experience: “What is the experience of learning?”
• Layer 2. Knowledge and Skill Acquisition: “Did learning actually occur?”
• Layer 3. Application Readiness:  “Am I ready to use this?”
• Layer 4. Workplace Impact: “Did behavior visibly change at work?”
• Layer 5. Learning Reinforcement: “Does the work environment enable application?”

The first four layers track the pathway from learning experience to workplace behavior change. The fifth captures the organizational conditions that influence whether learning is applied and sustained over time.

Let’s look at each of the five layers in more detail.

Layer 1. Platform Experience: “What is the experience of learning?”

Learning value starts with the learner experience. Two factors matter most. The first is ease of use. The platform should be intuitive and frictionless so that learners can focus on the content rather than the technology. The second is expectation fit. The learning experience should deliver the level of interactivity, structure, and practical application opportunities that learners expect.

At this level, engagement-based learning metrics still play an important role. Completion rates, interaction data, and usability feedback help determine whether the learning experience is accessible and easy to understand. These are useful early indicators, but they are not enough on their own to assess training effectiveness. A strong platform experience does not create learning value on its own, but a poor one can quickly undermine it by preventing learners from engaging with the material effectively.

From a stakeholder perspective, these metrics are primarily used by our product and content teams. They help evaluate whether the platform and learning materials meet the expectations they were designed to fulfill.

Layer 2. Knowledge and Skill Acquisition: “Did learning actually occur?”

Once learners can access and understand the material, the next question is whether they can actually use it. At this stage, learning moves beyond simple recall. For many teams, this is where a common KPI for training stops, even though skill acquisition alone does not guarantee workplace application. 

Learners apply concepts to realistic situations and explore different ways of solving problems. Assessments, therefore, move beyond knowledge checks and focus on scenario-based challenges that test whether learners can recognize when and how to apply what they have learned.

This stage confirms that employees have gained new knowledge or skills. However, it does not guarantee that these capabilities will translate into workplace impact. Research by Pfeffer and Sutton on the “knowing-doing gap” shows that performing well in an assessment environment and applying knowledge in real work situations are fundamentally different cognitive tasks. Assessment designs that do not account for this distinction tend to overestimate learning transfer.

Our own data reinforces this insight. In other words, effective training measurement should assess not just whether someone knows something, but whether they are ready to use it. 

Effective application requires not only competence but also confidence. Measuring this level helps our subject-matter expert teams evaluate whether our content and learning experience are successfully building the skills we promise as part of our T-Shaped HR Competency Model.

Layer 3. Application Readiness:  “Am I ready to use this?”

This is one of the most overlooked layers in learning measurement and one of the most predictive. Between knowing and doing sits a critical question: Does the learner feel ready to apply what they learned in the real world? 

Application readiness captures the psychological bridge between learning and behavior change. It measures three things: 

• Whether learners see the relevance of what they’ve learned to their actual role, 
• Whether they feel confident enough to apply it, and 
• Whether they intend to apply. 

Before applying new skills at work, employees typically ask themselves a few practical questions: Is this relevant to my role? Do I feel confident trying this? When would I actually use it?

This stage is grounded in well-established behavioral science. Bandura’s self-efficacy theory shows that confidence in one’s ability to perform a behavior is one of the strongest predictors of whether that behavior will occur. Similarly, Ajzen’s Theory of Planned Behavior identifies intention as the most reliable predictor of future action.

For L&D leaders, readiness metrics provide something extremely valuable: predictability, making them one of the most useful indicators of training effectiveness. If learners complete a course without confidence or a clear intention to apply what they’ve learned, meaningful behavior change is unlikely, no matter how strong the content itself is. 

This metric is used internally by your teams and by our clients to evaluate whether they believe their teams will be able to apply the learning back at work. This is often measured at the end of the learning journey to allow corrective action before learners return to the workplace.

Layer 4. Workplace Impact: “Did behavior visibly change at work?”

Learning value becomes visible when behavior changes on the job through observable shifts in how people work. This layer is also where talent development metrics become more meaningful because they can be tied to behavior, performance, and business contribution. 

Unlike application readiness, which captures whether learners feel prepared to act, workplace impact captures whether that change is actually visible on the job.

Employees solve problems differently, design new approaches, and contribute more effectively to organizational goals. Managers notice changes. Teams adopt improved workflows. Decisions become better informed.

It is also the most difficult layer to measure because it requires moving beyond the LMS and into the work itself. Yet this is precisely where learning proves its value. Most L&D functions stop short of measuring behavioral change, which is why those that do achieve a fundamentally different level of organizational credibility. Research by Watershed shows that organizations recognized as strong learning organizations are twice as likely to use performance improvement as their primary measure of learning success.

At this level, incorporating data from 360-degree feedback, performance reviews, and other performance-related indicators becomes critical to evaluating training effectiveness in practice. These sources help identify whether the intended behavioral changes are actually occurring in practice.

…answering the simple question, did our investment do what it said it was going to do? Did we accomplish what we invested in this program in the first place? So did we accomplish what we set out to accomplish?

Dr Alaina Sclachta

At AIHR, this layer often sits outside the direct scope of our programs. However, we support our clients in measuring these outcomes and in connecting observed performance changes back to the learning interventions that enabled them.

Layer 5. Learning Reinforcement: “Does the work environment enable application?”

The final layer looks beyond the learning intervention itself. Learning does not happen in isolation, and behavior change rarely depends on training alone. Whether new skills are applied and sustained depends heavily on the work environment around the learner.

Learning takes place in organizations shaped by competing priorities, inconsistent management, misaligned incentives, and cognitive overload. Baldwin and Ford’s influential 1988 transfer-of-training model identified three factors that determine whether learning transfers: training design, trainee characteristics, and, critically, the work environment. Decades of research have consistently confirmed that workplace conditions, particularly manager support and opportunities to apply new skills, are among the strongest predictors of whether learning translates into behavior change.

In practice, we focus on three factors that most consistently determine whether learning translates into value or quietly fades after the course ends.

• Incentive alignment: If the organization rewards the old behavior, the new one will not stick. Learning cannot overcome a compensation structure or performance management system that points in the opposite direction.
• Manager reinforcement: Managers are arguably the most powerful variable in learning transfer. A meta-analysis by Blume et al. found that supervisor support is one of the most consistent predictors of training transfer across studies—often stronger than the quality of the training itself. Gartner research reinforces this point: when managers actively embed new behaviors into day-to-day interactions with their teams, employee performance increases by up to 35%.
• Opportunity to apply: Sometimes employees genuinely want to apply what they have learned, but simply cannot. The tools are missing, processes prevent it, or the team culture discourages experimentation. These are not learning failures and often need to be resolved through organizational design, process reengineering, and the availability of tools.

Seeing the model in practice

Consider a company redefining the role of its HR Business Partners. Historically, HRBPs focused on operational support—handling employee issues, coordinating processes, and responding to requests. Leadership now expects them to act as strategic advisors, contributing to workforce planning, talent decisions, and organizational design. The challenge is not simply to train HRBPs, but to change how HR operates within the business.

Using AIHR’s training measurement model reshapes both the program and how its outcomes are evaluated.

• Layer 1: Platform experience. HRBPs engage with an intuitive learning platform designed around interactive, scenario-based exercises rather than passive content. Engagement data and usability feedback confirm that the learning experience is accessible and aligned with participants’ expectations.
• Layer 2: Knowledge and skill acquisition. Participants work through realistic business cases; interpreting workforce analytics, identifying talent risks, and recommending strategic actions. Scenario-based assessments confirm whether they can apply the concepts to real organizational challenges.
• Layer 3: Application readiness. After completing the program, HRBPs assess whether the new capabilities are relevant to their role, whether they feel confident applying them, and whether they intend to use them in upcoming conversations with business leaders. Where readiness is low, targeted coaching reinforces learning before the opportunity for impact is lost.
• Layer 4: Workplace impact. Several months later, the focus shifts to the workplace itself. Are HRBPs bringing workforce insights into planning discussions? Are they influencing talent decisions rather than simply responding to requests?
• Layer 5: Learning Reinforcement. The team also investigates whether HRBPs are included in strategic forums and whether their mandate has shifted to align with the new role expectations.

Why AIHR  focuses on learning value rather than learning impact

A natural question about this model is why we refer to learning value rather than learning impact. The distinction matters because good training measurement should show contribution without overstating causality. 

The reason is simple. True organizational impact is rarely the result of learning alone.

When outcomes such as productivity, revenue growth, or organizational performance improve, many factors are at play. Strategy shifts, leadership decisions, market conditions, technology, team dynamics, and organizational structures all play a role. In complex systems like organizations, isolating learning as the sole driver of impact is rarely realistic.

For this reason, AIHR’s model focuses on learning value instead, giving L&D leaders a more credible and practical framework for training measurement. Value captures the contribution learning makes along the pathway from capability development to behavioral change at work. It reflects whether learning builds skills, increases readiness to apply those skills, and leads to observable changes in how people perform their roles.

Impact may still occur, and organizations should absolutely track broader business outcomes. However, learning value allows L&D to measure what it can most credibly influence and demonstrate how learning contributes to improved performance without overclaiming causality in complex organizational systems.

How can we use learning analytics to tell the story of the value, and prove the value of learning through our learning analytics? And the answer is, you can’t. Our learning analytics, if you think of it as a story, learning analytics are just part of the story of what unfolds when people engage in learning initiatives. There are a lot of other data points we look at to understand the impact, or to prove, did your initiative do what it was intended to do? 

Dr Alaina Szlachta

Final words

AI has already changed how learning is created. The next step is for HR and L&D leaders to rethink training measurement so it reflects learning value rather than learning activity.

The real question is whether HR and L&D leaders will use this disruption to measure what matters finally.

Activity metrics once helped L&D scale and report participation, but they do not predict value. In a world where content is abundant and knowledge is everywhere, access to learning is no longer scarce. Capability is.

The post Training Measurement for Impact: Moving From Activity to Learning Value appeared first on AIHR.

You’ll see pockets of quick wins, even in your HR teams (drafting job ads, summarizing policies, or crafting employee communication), but also familiar blockers. Employees may be uncertain about which data can be used, inconsistent access to tools, concerns from IT and Legal, and a growing gap between experimentation and workflows that are safe, repeatable, and measurable. 

An AI hackathon helps solve some of this. It creates a short, focused window where teams can come together and build something tangible around real business workflows, demo it to stakeholders, and create momentum to continue building and experimenting. Done well, it’s also one of the fastest ways to go from experimentation to scalable AI solutions that people can actually use.

This article shows you how your HR team can run an AI hackathon that drives adoption, including a practical case study of how we structured our own AI Hackathon at AIHR.

Contents
What is an AI hackathon?
Should your AI hackathon be company-wide or function-led?
The AI hackathon format that worked well for AIHR
Free AI hackathon playbook
How your HR team can run a successful AI hackathon
AIHR case study: How we ran our AI hackathon

What is an AI hackathon?

An AI hackathon is a time-boxed event where teams prototype solutions using AI. The goal is not to build perfect, production-ready systems in one or two days.

The goal is to build demos and prototypes that prove value quickly and give your organization concrete examples of what’s possible.

That can include:

• AI-enabled workflows (automations, copilots, intake flows)
• Prototype tools (internal apps, dashboards, assistants)
• Reusable assets (prompt packs, custom GPTs, AI agents). 

The best hackathons end with outcomes people can copy next week, not ideas that sound good in a slide deck.

Should your AI hackathon be company-wide or function-led?

There’s no single best format. It depends on your organization’s size and how you want adoption to spread.

If you’re a smaller organization: Go company-wide

A company-wide AI hackathon can work well in smaller orgs because you can build cross-functional teams (HR, Ops, Product, Commercial, Marketing). 

Your HR team will still need IT buy-in for tool access and integrations, and security and legal sign-off before your build day.

If you’re a larger organization: Run a function-led hackathon

A function-led AI hackathon is often easier to run and easier to govern in larger organizations.

For example, your HR team can run a focused hackathon to improve HR workflows and the employee experience, while still inviting cross-functional partners (IT, Security, Data, Legal, Comms) as mentors, judges, or team members.

Function-led doesn’t mean each team or department builds alone. It means the team owns the problem definition and adoption, while your partners make sure the solutions are feasible and compliant.

What we did at AIHR

As a mid-sized company, AIHR started with a company-wide hackathon to build a common vocabulary, shared momentum, and internal examples. From there, departments were encouraged to run their own versions later with a tighter scope.

The AI hackathon format that worked well for AIHR

We chose a simple format that worked well for our first AI hackathon.

In the week before the hackathon, HR scheduled a kickoff event to explain the hackathon format. Employees could then pitch ideas, and HR compiled them on a single sheet. Employees could then explore all of the ideas and join a team to participate in a specific build that would interest them 

The following week, HR hosted the hackathon build day. The team presented the workflow they would be developing and split off across the company to explore together. AI Champions (employees with more advanced AI skills) circulated amongst the groups to lend support, answer security questions and risk concerns, or enable access to tools and APIs. 

The team builds were followed by a demo-half day, where each team could present their workflows. Teams were encouraged to present even if the build was not successful, to showcase challenges and share learnings. The best builds were judged with a celebration afterward. 

Free AI hackathon playbook

We’ve developed a quick reference AI hackathon playbook you can download to help guide your first AI hackathon:

How your HR team can run a successful AI hackathon

Step 1: Define the purpose

Be explicit about what you want out of the hackathon. Common goals could include:

• Increase practical AI usage in day-to-day work
• Generate prototypes worth scaling
• Create reusable assets (prompt packs, custom GPR, workflows)
• Identify champions who keep building after the event
• Build confidence, excitement, and momentum across teams.

The core purpose for AIHR’s hackathon was adoption: Get people using AI themselves, generating ideas, and seeing what’s possible.

Step 2: Choose your scope and challenge tracks

You can leave the problem space open, but teams do better when they have a few tracks to choose from.

Examples that work well across functions:

• Productivity: Reduce repetitive work and admin.
• Customer impact: improve customer experience and outcomes.
• Operations: Improve internal systems, handoffs, and clarity
• Learning and enablement: improve how people learn and apply skills.
• Insights: Turn messy information into decisions faster. 

We intentionally allowed a broad problem space (workflow hacking, customer solutions, product features), with one simple rule: solutions must leverage AI in some way.

If you want HR-specific inspiration, AIHR’s overview of generative AI in HR use cases can help teams start with proven workflow categories

Step 3: Set guardrails early 

This is where your AI hackathons could go wrong if due consideration hasn’t been given beforehand.

If teams don’t know what they can use, what data is allowed, and what tools are approved, they either:

• Take risks, you’ll have to shut down later, or
• Hold back and produce safe but shallow outputs.

Create a one-page “rules of the game” covering:

Data rules:

• What data is allowed (synthetic, anonymized, public)
• What data is not allowed (employee personal data, confidential customer data, proprietary docs unless approved)
• What redaction/anonymization is required.

Tool rules: 

• Approved models and tools
• Whether external integrations are allowed
• How credentials and access will be handled.

AIHR’s hackathon prep included resharing our AI policy and setting up an AI support squad to help teams get unstuck.

Step 4: Make team formation a real process

Don’t leave team formation and ideation for the day of the hackathon. Give employees the opportunities to think about workflows they believe are worth experimenting with, and those that may not have a clear idea, the opportunity to join in on an idea that interests them. 

A simple system can work well here: 

• Share a spreadsheet or board for idea pitches
• Include clear roles: team captain, domain expert, contributor
• Set a deadline for teams to form (ideally 2–3 days before build day).

We ran a pre-hackathon week where people pitched ideas asynchronously using a shared spreadsheet, and cross-functional teams formed around these.

Practical tip:

• Keep teams cross-functional by default in smaller organizations
• In larger organizations, encourage cross-functional support even if the hackathon is function-led.

Step 5: Define the “minimum viable prototype”

If you don’t define what a prototype is, you’ll get two extremes: teams that overbuild and run out of time, or teams that deliver a concept slide.

Specify what the minimum viable output expectations are. For example: 

• A short demo (3–6 minutes)
• A walkthrough of the workflow or user journey.

AIHR’s HR team communicated that the event would be followed by live demos presented to judges at the end of the build day.

Step 6: Build enablement into the event

Even if your hackathon is designed for advanced experimentation, teams still need fast support.

Provide:

• A starter pack with patterns (prompt pack examples, workflow examples, “how to prototype quickly”)
• A help desk (MS Teams/Slack channel) for blockers
• Office hours with a few AI-savvy mentors.

We created an “ask-ai-helpdesk” style channel and a designated support team to unblock participants quickly.

Step 7: Use judging criteria that reward usefulness

Judging criteria shape behavior. If you focus too much on novelty, teams build flashy demos instead of something that creates real value for the business.

Define a practical set of criteria, like:

• Impact: What business value does this create? How much time does it save, what risk does it reduce, what experience does it improve?
• Innovation: Is the approach meaningfully new or clever in how it applies AI?
• Proof of Concept: Does it work in practice? Can someone realistically build on it after the hackathon?

Also consider award categories that increase engagement, for example, judges’ choice, people’s choice, best workflow, most scalable, or best use despite constraints. 

Step 8: Make demo day a moment

Treat the demo day like a mini launch.

• Invite leaders and stakeholders who can sponsor follow-through
• Keep demos short and structured
• Celebrate participation, not just winners.

We intentionally included celebration as part of the event, not as an afterthought, to help encourage AI adoption.

Step 9: Plan follow-through before the hackathon starts

One of the biggest challenges for HR and managers is continuing to drive adoption. While the hackathon is a great initiative to drive adoption on the day, continued use will taper post the hackathon if you don’t plan beforehand on how you will continue to encourage adoption across the organization. 

Before the event begins, decide:

• Who will shortlist the projects to scale
• What the next 30 days look like
• Who can allocate time, budget, or engineering support if needed
• How you will communicate outcomes.

A simple follow-through model for HR and managers could include selecting one to three projects to be executed, assigning an owner per project, and. publishing a “what shipped” update at day 30. 

This is also the point where organizations may realize they need team-wide capability building. Scaling will stall ff the same two or three people keep owning every AI workflow.

AIHR case study: How we ran our AI hackathon

Here’s the structure we used at AIHR, based on our internal proposal and materials.

1. We paired a kickoff event with the hackathon

The hackathon wasn’t announced in isolation. We created the moment first.

Week 1: Kickoff event

• Recap key learnings from our AI transformation work to date
• Internal presentations showing how teams already use AI
• A panel component (internal or including external voices)
• Announcement of the hackathon and the start of team formation.

We aligned the kickoff with the release of updated AI resources and enablement materials.

2. We used a pre-hackathon team formation window

People pitched ideas asynchronously and teams formed around them using a shared system (Slack + spreadsheet) in the week between kickoff and build day.

We didn’t restrict the problem space, but we required that solutions leverage AI either in the build process or in the solution itself.

3. We put support structures in place

Our prep list included:

• team formation process and comms
• a help desk channel to unblock teams
• cancel all internal meetings
• resharing the AI policy
• an AI starter pack
• tool access and lightweight procurement support.

4. We used clear judging criteria

Teams presented to a panel of judges and were evaluated on:

• Impact
• Innovation
• Proof of Concept.

5. We generated breadth of ideas, then focused on demos

We generated over three dozen project ideas for people to join, and successfully ran around a dozen projects through to the demo stage.

That shape is common and healthy: lots of ideation up front, then a smaller set of executed demos at the end.

To sum up

An AI hackathon is a practical adoption accelerator. It moves AI from “interesting” to “useful” by forcing teams to build, test, and demo real workflows in a short time window.

If you want the hackathon to create a lasting impact, treat it as part of a bigger system. Set guardrails early so teams can move fast without risking privacy, data security, or compliance. Build a path to scale with owners, success metrics, and a 30-day plan before demo day happens. Invest in team-wide capability – including within your own HR team, and not just champions, so adoption doesn’t bottleneck.

The post AIHR Ran a Successful AI Hackathon: How Your HR Team Can, Too appeared first on AIHR.

Just ask Marc Benioff, co-founder and CEO of tech giant Salesforce. “Acquiring the right talent is the most important key to growth. Hiring was – and still is – the most important thing we do,” he says. And he should know. Having launched the business in 1999 from a one-bedroom apartment, Salesforce is now a juggernaut boasting best-in-class software for 11 straight years, as well as a team of over 80,000 employees.   

What’s the key to acquiring the right talent? It’s about so much more than simply filling vacancies. It’s strategically acquiring talent to fuel growth, innovation, and competitive advantage – and it all begins with a strategic hiring plan.

Contents
What is a hiring plan?
Why your organization needs a hiring plan
7 considerations for an effective hiring plan
How to forecast hiring needs for the next year in 7 steps
How to create a hiring plan: Best practices
Free hiring plan template
Startup hiring plan vs. established company hiring plan
Hiring plan example: AccounTech

What is a hiring plan?

A hiring plan, also referred to as a recruitment plan, is a structured roadmap that outlines which roles your organization needs to fill, when, and why over a defined period (typically a quarter or a year). It’s a practical way to turn business targets and a broader talent acquisition strategy into clear hiring priorities. Instead of reacting to open roles as they appear, you plan ahead, aligning headcount, timing, skills, and budget with what the business actually needs to deliver results.

An effective hiring plan should include the following:

• Roles to be filled and the required headcount for each, factoring in new positions and replacements for employees leaving the company
• Key capabilities or experience profiles required per role, especially for business-critical or hard-to-fill positions
• The timeline for when those positions should be filled, to ensure your company has the right people in place to meet its business goals
• The budget allocated for the recruitment process. This includes the hard costs of advertising job openings, recruitment agency fees, and the soft costs associated with administration, interviewing candidates, and onboarding new hires.

HR and talent acquisition leaders typically own the hiring plan. They work with business leaders to define workforce needs, clarify role scope, and align hiring budgets and timelines. Throughout the year, they also track and report on key hiring metrics to ensure delivery stays on target.

Why your organization needs a hiring plan

When you don’t have a hiring plan, recruiting becomes reactive. Business leaders submit urgent requests to hire for critical vacancies, priorities clash, and your TA team rushes to fill roles without clear direction. A hiring plan puts you in control and ensures hiring supports real business outcomes.

Your organization needs a hiring plan to:

• Align hiring with business strategy: Revenue targets, expansion plans, and product roadmaps translate into concrete hiring needs.
• Set clear role priorities: Instead of filling roles based on urgency alone, the business agrees on which positions deliver the most impact.
• Control hiring costs: Forecasting recruiting expenses and internal capacity helps prevent budget overruns and last-minute trade-offs.
• Give TA a clear execution roadmap: Defined hiring waves, seniority levels, and timelines allow recruiters to plan sourcing and pipeline building in advance.
• Create accountability across stakeholders: Clear ownership of headcount approval, delivery, and progress tracking reduces friction between TA, HR, and Finance.
• Reduce hiring risk: Early visibility into hiring needs, timelines, and hard-to-fill roles prevents delays that slow growth.

7 considerations for an effective hiring plan

If you want your hiring plan to drive results, it needs structure and clear decision-making. The seven considerations below will help you build a plan that is realistic, aligned, and executable.

Company objectives 

Does your hiring plan align with your company’s long-term goals? Are you planning a major product launch, market expansion, or scaling operations in the coming year?

These business initiatives should guide your recruitment needs and the types of talent you seek. For example, a product launch may require you to hire engineering and marketing talent early, while a market expansion might increase demand for sales, customer support, or local compliance expertise.

Avoid over-recruiting, which strains budgets and onboarding capacity, or under-recruiting, which delays execution and puts pressure on existing teams. Regular workforce planning helps you adjust hiring plans as business conditions shift.

1. Budget constraints 

Is your recruitment plan budget realistic? 

Consider job posting costs, agency fees, referral bonuses, and ATS expenses. A clear budget helps prioritize efforts and allocate resources effectively. Invest in quality recruitment tools and technologies to improve efficiency and reduce long-term costs.

2. Labor market conditions 

Understanding the labor market is crucial. Are you facing a talent shortage or high-demand skills? 

Analyze labor market trends to adjust your recruitment strategy and attract top talent. For instance, if the market for the skills you need is tight in your area of operation, you might consider partnering with educational institutions to build a talent pipeline or expand your search to remote candidates to fill skills gaps.

3. Technology 

Are you using technology to streamline recruitment? 

Applicant tracking systems (ATS) help manage job postings and candidate progress in the selection process. AI tools can automate tasks like résumé screening, pre-employment assessments, and scheduling, reducing time to hire and improving efficiency. However, they must involve human judgment to ensure fairness and avoid biases.

4. Diversity and inclusion 

Are your hiring plans aligned with your organization’s diversity and inclusion goals?

Review your hiring processes for potential bias and ensure your recruitment strategy supports equitable access to opportunities. A structured, inclusive approach helps you widen your talent pool, strengthen decision-making, and build teams that reflect the markets and communities you serve.

5. Legal compliance

Is your company up-to-date with employment laws? 

Review and update recruitment policies regularly to avoid legal issues. Consult legal counsel to ensure compliance with relevant laws, especially when hiring in multiple areas.

6. TA capability

Does your TA team have the capability to deliver on the hiring plan?

Assess whether your team has the right skills across workforce planning, sourcing, stakeholder management, and recruitment analytics to execute your recruitment plan. If gaps exist, you need to address them early through upskilling, process improvements, or additional hiring.

You can use AIHR’s TA Capability Gap Assessment to identify strengths and prioritize development areas.

How to forecast your hiring needs in 7 steps

A hiring plan is only as strong as the forecast behind it. For HR and TA leaders, forecasting hiring needs means turning business strategy, growth targets, and operational plans into a clear view of future talent demand. A structured forecast helps you secure critical skills in time, plan budgets effectively, and give your TA team realistic timelines to deliver.

Here’s how to forecast hiring needs for the period ahead:

Step 1: Consult with department heads

It’s virtually impossible to forecast your organization’s hiring needs without consulting widely with department heads. Only once you have a firm grasp on their strategic goals, expansion plans, and potential challenges can you pinpoint areas where additional staffing may be required. 

Maintaining ongoing communication and collaboration with division heads will also help ensure your hiring plans remain on track and aligned with business objectives.

Step 2: Leverage data analytics

Company data is another essential source of information for forecasting hiring needs. 

Analyzing your historical hiring trends, turnover rates, and workforce demographics will better equip you to identify patterns and predict future requirements. For instance, if a particular department has experienced high turnover in the past, you can use this data to anticipate the need for additional hiring in that area.

Step 3: Align with business growth projections

Understanding your organization’s growth projections is a key factor in forecasting hiring needs. 

If your company is experiencing rapid growth, you will likely need to increase hiring to support this expansion. Conversely, if your business or industry is facing economic uncertainty or a slowdown, you’ll need to adjust your hiring plans accordingly.

Step 4: Plan for employee turnover

Employee turnover is a natural part of any business cycle. By analyzing historical turnover rates, identifying factors that contribute to turnover, and conducting stay interviews, your team can proactively anticipate future departures and plan for replacements.

Step 5: Consider the impact of tech advancements

Technological advancements, such as automation, artificial intelligence (AI), and other emerging technologies, can significantly alter workforce needs and require hiring for new skills and expertise. 

Keep on top general and industry-specific technological trends and their potential impact on your workforce.

Step 6: Assess skill gaps

Conducting skills gap analyses can help you identify areas where employees lack the relevant skills and knowledge they need to perform their roles effectively. 

The analysis will also help to inform your future hiring decisions and training initiatives for existing staff.

Step 7: Incorporate succession planning

Factor succession planning into your hiring forecast by identifying which critical roles may become vacant in the next 12 to 24 months due to promotions, retirements, or expected turnover.

At the same time, assess whether ready or near-ready successors exist for those roles. Where internal successors are strong, you can prioritize development. Where gaps remain, you can plan external hiring early and avoid rushed searches.

HR tip

Does your hiring plan account for the unexpected?

Consider various scenarios to ensure your hiring plan is adaptable. For example, an economic downturn could mean that a hiring freeze is necessary. Similarly, if the business’s strategic goal is to grow rapidly, you might need to accelerate recruitment. By anticipating potential shifts, you can proactively build different strategies based on various scenarios. For example, you could pre-screen candidates for future needs or build a flexible budget to accommodate unexpected opportunities.

How to create a hiring plan: Best practices

A hiring plan turns business demand into clear hiring commitments for the TA team: actions, ownership, and timelines. The following best practices help you create a hiring plan that’s realistic, aligned, and executable.

Assess your organizational needs

The first step in building a hiring plan is assessing your current workforce and identifying the positions that need to be filled in the short-, medium-, and long-term.

To do this effectively:

• Analyze your current workforce data: Review headcount, turnover rates, and time to fill. Identify skills gaps and roles with high attrition or performance risk.
• Consult with business leaders: Speak with department heads about upcoming projects, expansion plans, and capability gaps. Clarify which roles are critical and when they’ll be needed.
• Review growth projections: Align with Finance or Business Development to understand revenue targets, regional expansion, or new product plans that may drive hiring demand.

By combining workforce data with business input, you create a fact-based view of future talent needs instead of relying on ad hoc hiring requests.

Strategic questions to ask

1. What roles are critical for achieving the company’s strategic goals?
2. Which departments are experiencing the most growth or strain due to understaffing?
3. Are there internal candidates whom you can promote or retrain to fill upcoming roles?
4. What is the projected headcount needed for the next 12 months?
5. Should we consider a mix of full-time, part-time, and contract employment types to match evolving growth needs?

Define roles and responsibilities within the TA team

Clear ownership keeps your hiring plan on track. Before hiring ramps up, define who within the TA team drives delivery, stakeholder alignment, and reporting.

Clarify responsibilities across:

• TA leadership: Sets hiring targets, manages capacity, aligns with business stakeholders, and tracks performance.
• Recruiters or talent acquisition specialists: Run intake meetings, build sourcing strategies, manage pipelines, and deliver against timelines.
• Sourcing specialists (if applicable): Develop proactive pipelines for critical or hard-to-fill roles.
• Recruitment operations: Manage systems, reporting, interview processes, and data quality.

Defined responsibilities reduce confusion, speed up decisions, and make it easier to course-correct when priorities shift.

Beyond role clarity, you need to ensure your team members have the capabilities required for the complexity of the roles you’re hiring for. Complex hiring plans often fail due to capability gaps, not just workload constraints.

Strategic questions to ask

1. Have we allocated our team members effectively to execute the hiring plan?
2. Do we have a sufficient team capacity to execute the plan within the stipulated timeframes?
3. Do our TA team members have the right capabilities to support this plan?
4. Where do capability gaps create execution risk?

Define role profiles and critical capabilities

A hiring plan should clarify what “good” looks like for each priority role before recruiters enter the market. Without clear capability profiles, hiring slows down, and stakeholders disagree on candidate quality.

When defining role requirements, focus on:

• Core responsibilities: What outcomes must this role deliver in the first 12 months?
• Critical capabilities: Which skills or experience are essential for business impact, especially for revenue-generating or business-critical roles?
• Level and scope: What seniority, decision-making authority, and ownership does the role require?
• Must-have vs. nice-to-have criteria: Separate non-negotiables from preferences to avoid over-screening and extended time to fill.

For hard-to-fill roles, invest more time upfront to align stakeholders on capability expectations. This reduces rework, shortlists misalignment, and late-stage offer rejections.

Strategic questions to ask

1. Which capabilities are truly non-negotiable for impact?
2. Have we clearly defined capability levels (e.g., junior, mid, senior) across functions?
3. How often do we review and update our role profiles?

Determine your recruitment strategies

Your hiring plan should define how you’ll source talent for different role categories. Not all roles require the same approach. High-volume hiring, niche technical roles, and leadership searches demand different sourcing models and timelines.

When defining your recruitment strategy, consider:

• Channel mix by role type: Decide which sourcing channels work best for critical, high-volume, or hard-to-fill roles (e.g., direct sourcing, referrals, agencies, campus programs).
• Build vs. buy decisions: Determine when to develop internal talent and when to hire externally.
• Capacity planning within TA: Align recruiter workload with projected hiring volume to avoid bottlenecks.
• Pipeline strategy: Identify roles that require proactive pipeline building rather than reactive posting.
• Timeline alignment: Set realistic hiring timelines based on market conditions and role complexity.

Define milestones for sourcing, screening, interviewing, and onboarding, and review progress regularly. Adjust your strategy when market response, candidate quality, or time-to-fill data signals a gap.

Strategic questions to ask

1. What are the most effective recruitment channels for the target roles?
2. How will we attract passive candidates for hard-to-fill or niche roles?
3. How can we measure the effectiveness of our recruitment channels and strategies?

Establish a hiring timeline

A hiring plan should map out the end-to-end hiring process and define realistic timeframes for each phase. Clear milestones help TA teams manage expectations, coordinate stakeholders, and prevent delays.

Outline the process across key stages:

• Role approval and intake: Confirm role scope, success profile, budget, and timeline with the hiring manager before launching the search.
• Sourcing and pipeline building: Activate agreed sourcing channels and build a qualified candidate pool.
• Screening and shortlisting: Assess candidates against the defined capability profile and align with the hiring manager on a shortlist.
• Interview and evaluation: Conduct structured interviews and ensure timely feedback from stakeholders.
• Offer and acceptance: Align on compensation, extend the offer, and manage negotiation timelines.
• Pre-boarding and onboarding: Prepare documentation, systems access, and onboarding plans to ensure a smooth start.

For each stage, define target timelines and decision ownership. Regularly review progress against these milestones and address bottlenecks early, especially for business-critical roles.

Strategic questions to ask

1. What are the critical milestones in the hiring process?
2. How can we expedite the hiring process without compromising the quality of hires?

Allocate budget

You’ll need to allocate a sufficient budget to execute your hiring plan effectively. Consider the following costs:

• Sourcing investments: Job boards, direct sourcing tools, employer branding campaigns, and referral programs.
• Agency and search fees: Especially important for leadership or hard-to-fill roles.
• Assessment and background checks: Tools used to evaluate and verify candidates.
• Recruitment operations costs: Technology, ATS, and interview infrastructure.
• Onboarding expenses: Equipment, training, and initial enablement support.

Prioritize budget allocation toward business-critical and revenue-generating roles. High-impact positions may justify higher sourcing spend or external search support. At the same time, track spend against hiring outcomes throughout the year. If cost per hire increases or timelines extend, reassess your channel mix, role requirements, or capacity assumptions.

Strategic questions to ask

1. Where should we invest more to secure scarce or high-impact talent?
2. What are the most cost-effective recruitment strategies we can use without compromising top-talent hires?
3. How can we maximize the return on investment for our recruitment efforts?
4. Which roles can we fill more efficiently through internal mobility or referrals?

Implement an onboarding process

A robust onboarding process can help new hires feel welcome and productive from day one. Key components of an effective onboarding process include:

• Preboarding: Make a good impression by sending a welcome email and providing essential information about the company and the role.
• Orientation: Conduct a comprehensive orientation program to introduce new hires to the company culture, values, and policies.
• Role-specific training: Provide training on the specific skills and knowledge required for the job.
• Mentorship: Assign a “buddy” to guide new hires and answer their questions.
• Regular check-ins: Schedule regular check-ins with new hires to assess their progress and address any concerns.

Strategic questions to ask

1. How can we ensure a smooth and efficient onboarding process?
2. What kind of training and development opportunities must we provide to new hires?
3. Do we have mentors we can assign to new recruits?
4. How can we measure the effectiveness of our onboarding program?

HR tip

Embrace inclusive hiring practices

To build a truly inclusive workplace, begin by reimagining your hiring process.

• Expand your talent pool: Partner with organizations supporting underrepresented groups, use diverse job boards and explore non-traditional recruitment channels.
• Enhance your interview process: Train your interviewers to ask unbiased questions, actively listen, create a welcoming environment, and implement structured interviews with standardized scoring to minimize bias.
• Assemble diverse interview panels: Consider factors like gender, race, ethnicity, age, ability, and sexual orientation when forming your panels. This helps to support varied perspectives, reduce bias, and signals your organization’s commitment to inclusion.

Hiring plan template

A clear hiring plan brings structure to your recruitment efforts and keeps business expectations grounded in reality. This Excel template helps you organize roles, priorities, headcount, timelines, and budget in one place so you can plan hiring proactively instead of reactively. Use it as an overview to ensure your TA team has the clarity and capacity to deliver.

Startup hiring plan vs. established company hiring plan

The structure of your hiring plan should reflect your organization’s maturity and growth stage. Startups optimize for speed and adaptability, while established companies focus on scalability, governance, and long-term workforce planning. The comparison below outlines the key differences.

Hiring plan example: AccounTech

Now that we’ve reviewed the steps and considerations involved in building a hiring plan, let’s look at what one might look like in practice. In this example, AccountTech, an accounting software company preparing to expand its customer base, needs to scale its sales team to support growth and drive adoption of its upgraded software platform.

To sum up

Legendary business author Jim Collins’ adage, “great vision without great people is irrelevant”, underscores the critical role of talent in achieving organizational goals and the immense importance of building strategic hiring plans.

Without a well-executed, aligned hiring plan, attracting the right talent to drive innovation and fuel long-term business growth is virtually impossible.

The post How To Create a Strategic Hiring Plan in 2026 [FREE Template] appeared first on AIHR.

Yet beneath these discussions lies a more fundamental shift. AI is not only changing how HR works, but it is also changing how organizations make people decisions. And that’s where HR’s leadership and guidance are most needed. The real opportunity is not simply to deploy AI, but to elevate the quality, fairness, and integrity of our decision-making.

In this article, we explore how AI is reshaping people decisions, the four risks leaders must actively govern, and a practical lens to integrate AI in ways that can strengthen organizational trust.

Contents
How AI is changing the architecture of HR decision-making
4 risks to address before scaling AI in HR decisions
A practical framework for AI in HR decision-making

How AI is changing the architecture of HR decision-making

AI is influencing HR decision-making at multiple levels, from daily operational choices to strategic workforce planning.

For years, HR has been on a journey toward more evidence-based decision-making, from building analytics capabilities to strengthening reporting and investing in dashboards. Adoption of people analytics has increased by 60% over the past five years within HR functions, signalling the higher importance of data-driven decision-making. In addition, 74% of organizations report measurable improvements in workforce experiences through the use of people analytics.

Yet in many organizations, data still plays a supporting role. Insights often follow discussions rather than shape them, and metrics validate decisions more than they inform them.

AI changes that dynamic. Instead of reporting on what already happened, AI systems identify patterns across fragmented data sets and generate predictive insight. Leaders can move from retrospective reporting to forward-looking risk signals. From reviewing last year’s attrition to predicting which roles are most likely to turn over next quarter. Put simply, AI is changing how HR leaders evaluate evidence and make workforce decisions.

We discussed AI governance and the role of HR with John Rood, Founder of Proceptual, an AI compliance solution provider. Watch the full interview here:

Balancing human judgment and AI in HR decisions

While human judgment has always shaped HR decisions, it has never been flawless. Decades of behavioral research show that managerial decisions are shaped by cognitive bias, incomplete information, and matters such as overconfidence. AI does not remove these dynamics, but it changes how organizations manage them. When well-designed and governed, AI can surface hidden patterns, highlight inconsistencies, and help reduce bias in decision-making.

Consider a promotion decision, one of the most consequential moments in an employee’s experience. Traditionally, a manager builds a case based on performance history, observed potential, and personal assessment. HR provides benchmarks or historical data, but the reasoning is explicit and human.

Now imagine that same decision supported by AI. The system surfaces patterns from prior promotions, highlights capability gaps associated with success, flags potential bias in historical ratings, and generates ranked recommendations. The manager’s judgment is no longer the sole driver. It is augmented, not ignored, but seen as one of the data points, not the overarching factor.

This also represents a subtle redistribution of authority. The parameters embedded in a model, the variables selected, the thresholds defined, and the outcomes optimized reflect design choices. And those choices shape decisions long before a manager enters the conversation.

The opportunity is significant: greater consistency, earlier insight, and a more structured basis for high-stakes decisions, while retaining human oversight and responsibility.

At the most fundamental level, AI ethics is about alignment. How do we align the AI systems we develop, buy, or use with what we want them to do, and think carefully about how our use of AI affects other people? That alignment question is the foundation. The next level up is a simplified model we call the three cornerstones: transparency, bias prevention or mitigation, and explainability.

John Rood

Adapting the HR operating model for AI-enabled decisions

Adopting AI in HR decision-making also changes the expectations of roles such as the HR Business Partner. Historically, HRBPs created impact through advice, judgment, and influence in the room. In an AI-enabled environment, their value increasingly lies in:

• Scalable decision-making capability
• Knowing when to rely on data
• When to challenge system recommendations
• How to design decision processes that remain fair and accountable.

In other words, HR’s competitive advantage shifts from individual judgment to scalable decision architecture. Fairness, accountability, and discretion are no longer shaped only by human reasoning; systems shape them. And that is where leadership must pay attention.

4 risks to address before scaling AI in HR decisions

As AI becomes embedded in people’s decisions, the risks extend beyond compliance or technical accuracy. They are leadership risks as they affect trust, culture, and credibility. And because AI rapidly scales decisions, it also scales their impact, or potential harm.

There are four risks to actively mitigate as part of scaling AI in people’s decision-making:

1. Opacity and explainability

AI systems often rely on logic that is not easily visible, explainable, or transparent. When employees cannot understand how a decision was shaped, trust weakens.

Example: An employee is declined for an internal role because their “fit score” falls below the threshold, yet neither the manager nor HR can clearly explain how the AI model calculated that score.

Mitigation: Ensure that all AI model outputs are explainable and that leaders using them can justify and explain how the model reached its conclusions.

2. Maintaining fairness at scale

AI can reduce bias, but it can also institutionalize historical patterns. Unlike human bias, which is inconsistent, system-level bias can be replicated with precision and speed.

Example: A screening model consistently filters out candidates from non-traditional career paths because past hiring data favored linear trajectories.

Mitigation: Audit training data and maintain a human-in-the-loop approach for high-risk and critical decision-making.

3. Dehumanization

As decisions become more data-driven, employees may experience processes as transactional rather than relational. Being assessed by a system feels different from being seen by a leader.

Example: Performance discussions focus on productivity dashboards, leaving little room for context, nuance, or individual circumstances.

Mitigation: Ensure that AI does not replace human interaction or accountability, but rather enhances the manager or employee’s ability to improve the quality of the interaction.

4. Diffused accountability

When AI informs decisions, responsibility can blur. Was it the manager’s call, or the system’s recommendation? Ambiguity undermines credibility. There is also a quieter risk: automation bias. When a system appears data-driven and precise, leaders may defer to it too quickly — mistaking algorithmic output for objective truth.

Example: A leader justifies a compensation decision by saying, “That’s what the system recommended,” without owning the outcome.

Mitigation: Establish clear human accountability for AI-generated outputs and decisions. The human being remains accountable for the decision made.

There’s a significant regulatory push in this direction. We do a lot of work with the EU AI Act regulation; we have a number of laws here in the United States as well. Global organizations really have to start thinking, with all of these measures going into effect over the next two years, what is the strategy for getting out ahead of that compliance hurdle?

John Rood

None of these risks is an argument against AI. They are reminders that technology reshapes power, perception, and responsibility. They are also increasingly visible to regulators and courts, as AI-informed employment decisions come under greater scrutiny. 

However, how do we translate these principles into a framework that leaders can practically adopt in their organizations daily?

A practical framework for AI in HR decision-making

Before adopting or scaling AI in any people process, leaders should apply a disciplined set of questions that helps guide them on how AI could or should be applied. These questions act as decision gates, and AI must pass each hurdle before we decide to proceed.

AI in HR decision-making framework in action: A Singaporean business using AI in the performance management process

When the executive team proposed replacing annual performance reviews with an AI-driven continuous scoring system, the ambition was to reduce bias, increase objectivity, and make talent decisions more objective.

But when HR pressure-tested the idea through a few simple decision gates, some concerns were evident.

Decision gate 1: Enhancing judgment

Would this strengthen managerial judgment, or replace it? Having AI assign and process incentives based on the scoring risked the technology becoming the decision-maker, rather than the decision support.

Decision gate 2: Clear accountability

Who, precisely, owned the final call? The algorithm? The manager? The executive team? The lack of a clearly accountable human decision-maker exposed a governance gap.

Decision gate 3: Fair consequences

Early analysis showed potential unintended harm, particularly for lower-visibility roles and employees returning from leave. 

Decision gate 4: Explainability

Could leaders explain, in plain language, how scores were generated and how they influenced outcomes? If the answer required technical defensiveness, the system wasn’t ready.

Decision gate 5: Maintaining trust

Would employees experience this as fair and dignified? Trust depends as much on perception as precision.

Based on these decision gates, the team redesigned the process to augment annual reviews rather than replace them with AI. AI helped employees prepare, enabled managers to check decisions for bias, and allowed executives to analyze trends to improve calibration over time.

Final words

AI will continue to evolve. Models will improve. Adoption will accelerate. But the defining question for HR will remain unchanged: Who safeguards the integrity of people decisions?

HR’s responsibility is not to master every algorithm, but to set the standards that guide decisions, embedding fairness, accountability, and employee experience into the systems that shape workforce outcomes.

The post AI in HR Decision-Making: How To Create Better, Fairer People Outcomes appeared first on AIHR.

It clarifies how to build critical capabilities, create clear growth pathways, and shape a supportive culture, so leaders and HR can make better decisions about where to invest and outcomes to prioritize. This can improve employer reputation and business performance. This article explores the key pillars of an effective people strategy, along with real-world examples and practical steps to help you start building one.

Contents
What is a people strategy?
Why is a people strategy important?
Key pillars of a people strategy
6 people strategy examples
How to develop an effective people strategy: 5 steps
FAQ

What is a people strategy?

A people strategy is a framework that explains what an organization aims to offer prospective candidates and employees. It clarifies the employee experience that the company promises and aligns that promise with the employer brand. It also links the organization’s talent needs to business goals by defining the capabilities required to achieve desired outcomes and how the company will attract, support, and develop the people who can deliver them.

A people strategy should connect business strategy and HR strategy and reinforce your employer brand. It should also reflect the organization’s values around how it treats employees so leaders can build an environment where people feel engaged, supported, and motivated to achieve shared goals.

People strategy vs. HR strategy

People strategy and HR strategy can sound similar, but they serve different purposes.

A people strategy is outward-facing. It sets out what the organization promises to candidates and employees and the kind of employer it commits to being. It also sets the direction for how leaders can help employees do their best work by building needed capabilities and shaping a culture that supports performance.

An HR strategy focuses on execution. It sets the HR function’s long-term priorities and defines what HR will deliver over a given period to support organizational success, from core people processes to the programs and initiatives that bring the people strategy to life.

Why is a people strategy important?

A people strategy provides a clear definition of who the organization wants to be as an employer and what it will prioritize to get there. Without one, organizations miss opportunities to build workforce capabilities that support business goals and to develop a cohesive culture.

Executing a people strategy enriches organizations in multiple ways, including:

• Employee empowerment: People play a central role in achieving the organization’s vision, and a people strategy helps employees see how they create value. When leaders set employees up for success with the right support and a positive environment, employees thrive and contribute more.
• Commitment to employees: When organizations document and implement a people strategy, they make a clear commitment about what employees can expect in return for their work and dedication. Organizations can also weave it into the employee value proposition and employer branding to support recruitment and retention.
• Better response to uncertainty and changes: When leaders champion employees and give them ownership of their work, employees adapt, problem-solve, and innovate more easily during new or unexpected circumstances.
• Support for long-term business success: A people strategy creates a plan to develop the workforce over time. As employees build skills and work more effectively, the organization strengthens performance and resilience, even when challenges arise.

Key pillars of a people strategy

Boston Consulting Group (BCG) highlights five fundamentals of a people strategy: leadership, culture, talent, skills, and HR. You can group them into three practical focus areas. Together, these pillars help you define the experience you want to create, build the capabilities you need, and put the right HR support in place to sustain it.

• Leadership and culture: A strong leadership presence and a supportive culture inspire employees and spur commitment to organizational success.
• Talent and skills: Organizations need to attract, develop, and deploy the right skills to meet strategic needs.
• HR: HR needs to enable the other fundamentals by providing the systems, programs, and support that make them work in practice.

Did you know?

Work culture ranks third behind job security and fair pay as a reason employees stay with an organization, according to Mercer’s Global Talent Trends report (see p. 28).

6 people strategy examples

Now that we’ve covered what a people strategy is in theory, let’s look at how different organizations communicate theirs.

Here are six real-world people strategy examples you can use for inspiration:

Example 1: Adidas

Europe’s largest sportswear manufacturer, Adidas, sees its people strategy as a commitment to winning employees’ hearts and minds so the company can deliver its business strategy.

Example 2: Cisco

Multinational digital communications technology conglomerate Cisco communicates its people approach through its Purpose content, saying its people “power” its purpose and fuel the business and culture through learning, connection, and collaboration.

Example 3: City of London

The City of London Corporation’s People Strategy links its people priorities to public service goals and highlights the need to support employees as one organization while still allowing leaders to tailor outputs to their teams’ needs.

Example 4: Spotify

Example 5: Albatross Group

The Albatross Group, a travel and tourism company, describes its people strategy as “all about our people owning their own future.” The company also emphasizes consistency, stating that employees should follow the same process and access the same opportunities across the group, regardless of team or manager.

How to develop an effective people strategy: 5 steps

Developing a people strategy takes focused planning and clear choices. To give you an idea of what this process involves, we’ve broken it down into five broad but actionable steps:

Step 1: Look at the “big picture”

Start with a clear understanding of the organization’s overall business strategy,  then map out what it means for employees. 

Consider questions such as:

• What are the organization’s driving forces (e.g., innovation, growth, technology, efficiency)?
• How do these forces shape the work employees do?
• What is the fundamental contribution employees make to bottom-line business outcomes?
• How does organizational culture play into employee engagement and performance?

Step 2: Audit current practices and define people outcomes

Evaluate your current people and HR practices to spot gaps, then use what you learn to define priorities and outcomes for your HR people strategy.

This step should include:

• Defining the areas to review, such as skills gaps, talent management, recruitment, compliance, and culture
• Reviewing HR data, workforce metrics, and employee feedback to check whether day-to-day practices match documented policies
• Assessing whether current and past practices have delivered the results you want
• Identifying how workforce strengths and weaknesses affect business performance
• Writing clear cause-and-effect statements, such as “Upskilling improves efficiency by boosting productivity.”
• Turning goals into measurable outcomes, such as linking turnover reduction to retention initiatives
• Assigning each priority to the relevant HR owner or team
• Setting targets and timeframes for key objectives.

Step 3: Put the focus where it matters

Identify what is critical to your organization’s success. Then decide which people issues have the most impact on this and what will happen if you don’t address them. This should reveal the highest-impact areas to focus your people strategy efforts and resources. 

AIHR’s research shows that top-performing companies often treat ESG, DEIB, and employee engagement as critical to success. These priorities show up in their HR strategy focus areas, and they actively monitor and report on related metrics. You can apply the same approach to your people strategy by translating these priorities into a clear promise to employees and candidates, and by tracking progress over time.

Step 4: Create content that speaks to all stakeholders

Compelling content will get the people strategy out to employees and candidates for better implementation and buy-in. This means creating visuals, narratives, and documents, and ensuring they’re accessible. 

Here are some tips:

• Create a one-page executive summary that highlights key pillars and shows how the strategy supports business goals. Use visuals to make it easy to scan.
• Explain any HR policy, practice, or activity changes being made to support the strategy.
• Describe any new initiatives, resources, or opportunities available to employees.
• Share the content through internal channels (intranet, apps, comms channels) and externally where relevant, such as the careers page.

HR tip

Think through how employees may react to changes in people processes. Anticipate what questions and concerns they may have and be prepared with answers and information.

Step 5: Measure, review, and adjust

Your people and culture strategy must be evaluated and refined on an ongoing basis to keep it relevant and aligned with business needs. This is especially important during times of major internal or external shifts. 

Track key metrics, such as retention, turnover, productivity rates, training ROI, and employee engagement scores, to see if they’re delivering the anticipated results. Gather employee feedback data as well.

When results stall or gaps show up, adjust priorities or refine the activities behind the strategy. When results improve, capture what works and embed those practices into ongoing processes across the organization.

Next steps

Done right, a people strategy shapes an employer-employee relationship that enables employees to perform at their best and helps the organization get the most from its strengths.

Organizations increasingly rely on a clear people strategy to attract, engage, and retain talent. Start by using the key pillars and aligning your focus areas with business goals. Then you can invest in what matters most: a capable workforce that consistently delivers results.

FAQ

The post People Strategy: Key Pillars, Company Examples, and Steps To Develop One appeared first on AIHR.