#5. Workforce Strategy with a Mind of Its Own

Increasingly, we are seeing a troubling trend of people strategy becoming detached from an organization’s core strategy and ultimate mission. This drift often reveals itself over time with catastrophic cost to the organization. What’s more concerning is that the typical reaction to bad people strategy is to dismiss it altogether. However, this approach only worsens the problem, resulting in costly, major, and sometimes fatal effects on the impacted organization.

For those who like to skim, this article will address What’s going on, What this looks like, and 3 ways leaders can address follow any of the links here to skip ahead.

Human Resources isn’t a thing we do. It’s the thing that runs our business.

Steve Wynn, CEO of Wynn Resorts Limited

What’s going on

As workforce management drifts from core mission, idealized notions of leadership begin creeping across all aspects of people management—from hiring to performance management, promotion, and governance structures. Slowly, organizations drift off course until leaders suddenly realize they are drastically misaligned, fearing they may not be able to make it back.

This problem is further exacerbated by the chronic lack of investment in HR. While many may accurately or inaccurately blame HR departments for such deviation, here’s the not-so-secret secret: organizations need HR (or their equivalent) more than ever. This is not a new trend, but one worth repeating. Rising labor laws starting in the 1970s, globalization in the 1980s, an increasingly diverse multi-generational workforce, and rapid technological innovation have made managing the workforce ever more complex, requiring skillsets and focus that extend beyond day-to-day management by people leaders.

Understanding how to navigate a complex web of labor laws (especially in the US), developing a holistic approach to development and retention of internal talent, and creating robust strategies for competing in the job market to acquire the right talent are only a few areas where organizations desperately need workforce-specific expertise. Unfortunately, for various reasons, they feel they are falling short.

HR departments are often just as frustrated as the leaders who are frustrated with them. However, in a seemingly vicious cycle, the lack of proper resources—whether IT, skilled people experts, or executive attention—serves as a core accelerant to the issue. Without strong leadership from mission-minded people strategists, bad initiatives proliferate, leaving leaders with very little recourse.

Just a few of the consequences Nikkiforos has seen with our own clients include:

• Excessive bloat due to lack of strategic workforce planning, causing layoffs and undermining public trust
• High cost of talent acquisition due to inability to source talent in a timely manner from lack of strategy to develop strong talent pools and understaffed recruiting teams
• Out-of-control overtime costs because managers did not have the tools to properly control it, resulting in loss of market competitiveness
• Worker threats of unionization from out-of-date system errors regarding accumulated vacation time and idealized approaches to time-off policy

What this looks like 

While those who have been following our trends series know I love a good story, outlining three macro examples is the clearest way to show the impact of this trend. Though large in scale, each issue developed gradually—building over time until a drastic correction became unavoidable.

Twitter/X

One need look no further than Twitter when it shocked the world in late 2022 by laying off nearly 50% of its workforce¹. While layoffs are always jarring given their impact on those being laid off, what was more surprising was that Twitter’s workforce had grown so disconnected from the company’s mission that even after laying off half its workforce, it could keep its doors open. Many rushed to assign blame to Elon Musk’s takeover; however, Jack Dorsey (Twitter’s co-founder and former CEO) made it clear that the mass exodus was a symptom of poor workforce strategy when he apologized for growing the company too fast in the wake of the layoffs².

US universities

As the US populace groans under nearly 750% inflation-adjusted increases in higher-education tuition since 1963³, confidence in education effectiveness continues to plummet, with 68% of Gallup survey respondents believing education is headed in the wrong direction⁴. Examining workforce strategy in many universities reveals drastic deviation from universities’ core mission of educating students.

Case in point: between 1976 and 2018, university administrative staff and other professionals increased by 164% and 452% respectively, versus faculty peers—those involved in actual education execution—who increased only 92%, despite student enrollment growing just 78%. Studies found three administrators and professionals for every faculty member⁵. The impact of such radical deviation from core mission is self-evident in current American public discourse and skyrocketing education costs.

Charities, churches, and mission creep

Nonprofits relying on volunteers and donations face even stronger temptation to chip away at mission until it’s eroded entirely. Temptations include:

• Poor governance structures to appease specific stakeholders
• Changing fundamental policies out of fear of losing volunteers
• Accepting workers who are under-qualified or do not align with organizational values to address staffing shortages
• Failing to remove known problematic stakeholders efficiently
• Success of side “objectives” overshadowing core mission, distracting resources until core mission is lost

This manifests as churches becoming better food banks than churches, charities unable to make real impact, public backlash over donations funding bloated overhead, and worst-case scenarios of toxic work culture, fraud, and scandal leading to organizational collapse.

How leaders can address…and Nikkiforos can help

While every organization exists to solve some world problems, no organization can solve them all. HR and marketing departments increasingly put forth initiatives addressing issues outside core mission. Do I want to hear Starbucks discuss fair trade coffee? Yes. Do I want to hear their opinion on the Palestinian conflict? No. Not only do I not want to hear about war while starting my day with chai, Starbucks is not equipped to address the issue.

Similarly with internal workforce initiatives, organizations must stop copying latest university trends and focus on implementing programs addressing real-world organizational needs. For example, rather than trying to fix inner-city problems in distant cities where they have no power, they should focus on creating jobs or volunteer opportunities in the local communities they operate in. Focus talent development on skills your organization needs and cut programs that do not align with core mission or divide your workforce. This is especially important for smaller and nonprofit organizations where funding and time are scarce. Anything not directly advancing your mission competes with it for resources, time, and attention. Keep the main thing the main thing.

Often people issues are relegated to HR (or the organization’s equivalent) while broader leadership focuses on operational metrics and accounting numbers. However, people strategy is corporate strategy, as staffing undergirds every aspect of broader strategy—from branding to production to delivery. HR should serve as consultant to organizational leadership, providing expertise and administration to support leadership efforts throughout the organization.

However, HR’s role doesn’t abdicate other leadership from shaping workforce strategy. HR can advise on consistent performance management frameworks, but only direct managers can determine what metrics matter most for their teams, how those align with broader organizational metrics, and provide accurate employee assessments. Success of any workforce tool will be directly correlated with leadership’s prioritization and engagement in partnering with people experts to design and deliver it.

The organization’s relationship with HR must reflect this reality. When issues arise from bad people strategy, news never blames HR; when companies succeed, HR receives no credit. Responsibility for organizational people sits squarely on all leadership shoulders, especially the executive team.

As mentioned in Trend #4 – Ignore Your Infrastructure to Your Peril, many organizations have HR departments running on crumbling infrastructure of outdated technology and processes and  lacking budget to hire or develop proper HR talent with right skillsets at proper staffing levels. This results in HR running from fire to fire—hiring backlogs months old, burdensome onboarding processes, workers failing to utilize IT systems due to poor fit, and high exception rates from multiple processes bogging down managers, workers, and HR.

Justification for HR investment differs from other functions—HR investment may not directly equate to dollars and cents. But fail to properly invest in HR and watch costs skyrocket. Return on investment in proper HR infrastructure becomes evident when organizations avoid costly consequences of poor people strategy—excessive turnover and recruitment costs, legal issues, and reputational damage.

Organizations that get this right understand their people strategy must be as carefully crafted and executed as business strategy. They invest in right tools, hire skilled HR professionals, and ensure every people decision aligns with and advances core mission. They recognize that managing people effectively in today’s complex environment requires specialized expertise, not just good intentions.

The disconnect between people strategy and organizational mission represents one of modern organizations’ most critical challenges. When workforce initiatives operate independently of core strategy, organizations waste precious resources and risk losing their way entirely.

The solution requires deliberate leadership commitment to align people strategy with mission, proper investment in HR infrastructure and expertise, and discipline to resist trendy initiatives that distract from core objectives. Organizations mastering this alignment will find themselves better positioned to achieve their mission, while those that don’t may discover—like Twitter and universities—that course correction becomes increasingly difficult and expensive over time.

¹Victor Ordonez and Melissa Gaffney. “Twitter Sends Email to Employees Announcing Layoffs Friday.” November 4, 2022. https://abcnews.go.com/Business/twitter-sends-email-employees-announcing-layoffs-friday/story?id=92635005.

²CBS News. “Jack Dorsey Apologizes to Twitter Employees After Thousands Laid Off in Elon Musk Takeover.” November 5, 2022. https://www.cbsnews.com/news/jack-dorsey-apologizes-to-twitter-employees-after-thousands-laid-off-elon-musk-takeover/.

³Nicole Goodkind. “Curious Consumer: College Cost.” July 16, 2023. https://www.cnn.com/2023/07/16/investing/curious-consumer-college-cost.

⁴Michael T. Nietzel. “Americans’ Confidence in Higher Education Drops Again, Finds Gallup.” July 9, 2024. https://www.forbes.com/sites/michaeltnietzel/2024/07/09/americans-confidence-in-higher-education-drops-again-finds-gallup/.

⁵Paul Weinstein Jr.. “Administrative Bloat at US Colleges Is Skyrocketing.” August 28, 2023. https://www.forbes.com/sites/paulweinstein/2023/08/28/administrative-bloat-at-us-colleges-is-skyrocketing/.