When we think about business strategy, we often focus on financial planning, marketing, or operational efficiencies. Yet, one of the most critical pillars of success is often overlooked – the HR strategy.

This brings us to a classic dilemma: Which comes first – HR strategy or the problems that demand HR intervention? Should businesses react only when issues arise, or should they invest in a strategy upfront to prevent those challenges from occurring in the first place?

The Reactive Approach: Waiting for the Problems to Hatch

Many companies operate without a structured HR strategy, only addressing HR issues as they arise. This might seem cost-effective in the short term, but in reality, it leads to:

  • Loss of great talent – Employees leave due to lack of engagement, career growth, or dissatisfaction.
  • Workplace conflict – A lack of clear policies and communication fuels misunderstandings and tensions.
  • Perceived lack of career opportunities – Without structured development plans, employees feel stagnant.
  • Compliance risks – Reacting to regulatory issues instead of proactively managing them can result in costly legal disputes.
  • High recruitment costs – Without a retention strategy, businesses constantly scramble to fill roles.

The Best Approach to HR Strategy: Investing in HR Before Problems Arise

On the other side of the debate, businesses that prioritise HR strategy reap long-term benefits:

  • A Stable, Engaged Workforce – Investing in employee experience and career development ensures retention and satisfaction.
  • Proactive Conflict Resolution – Clear policies and strong leadership prevent workplace tensions before they escalate.
  • People and talent planning – Businesses are prepared for growth and change, with a structured workforce plan.
  • Regulatory Compliance – Staying ahead of employment law changes reduces legal risks and financial penalties. There are plenty of these coming down stream over the next few months.
  • Enhanced Employer Brand – A strong HR strategy makes companies attractive to top-tier talent, making the fight for talent more winnable.

So, Which Comes First?

HR challenges are inevitable – but how a business chooses to deal with them makes all the difference. A reactive approach means constantly playing catch-up, while a proactive HR strategy prevents these issues from derailing success.

The choice is clear: Invest in HR strategy now or pay the price later. The businesses that thrive are those that understand HR isn’t just about fixing problems – it’s about creating an environment where those problems don’t arise in the first place.

So, what’s your approach? Are you waiting for the egg to crack, or are you building a nest that supports long-term success?

Our HR team are highly experienced at helping SMEs devise effective HR strategies to drive efficiency within their business.