Who Are the Typical Stakeholders in HR Projects?

A human resource project may be based within a company’s walls, but that doesn’t mean its stakeholders are limited to the employees and managers most directly affected. A business owner must be aware of all the stakeholders in HR projects to assess the potential ramifications. External forces sometimes have a critical role in determining the success or failure of a change in policies.

HR projects obviously have a large effect on employees, so they are key stakeholders. Whether it's a beneficial policy to increase training opportunities or a more difficult one such as reducing salaries and benefits during tough times, HR actions affect compensation and career growth as well as how employees feel about their work. Beyond the policy itself, how the HR staff communicates these policies and answers employee questions can determine a project's success or failure.

Most HR projects have an effect on business expenses. Some may help the bottom line by decreasing inefficiencies, while others add to the costs by raising salaries or sponsoring additional training or other expenses. Investors want to see the anticipated return on investment for efforts. A training program for a consulting firm that leads to higher-skilled workers who can charge clients more per hour is a short-term cost with a long-term benefit that could get investors onboard. Without that return on investment metric, investors may be stakeholders that work against HR projects as being a drag on business value.

The community might not seem like an obvious stakeholder for an HR project, but what a business does in this regard can have a sizable effect outside the office. An HR staff that doles out promotions and raises affects local businesses because employees have greater spending power. Charity drives help local organizations, and training programs might use community learning institutions as favored providers. When an HR policy subsidizes gym memberships, the local clubs benefit. On the other hand, an HR project that includes employee layoffs has a ripple effect on the community as well.

HR projects may result in more or less work for outside companies. Health insurance companies obviously have a big stake in a firm’s decision on benefits, while investment firms may covet the chance to have their funds included in a retirement plan offering. An HR policy that increases day care subsidies can cause local businesses to scramble to be the company's provider of such services. Any function that HR decides to outsource inserts firms seeking that business into the equation.

Rival companies are stakeholders in HR projects because they can change the competitive marketplace. A generous benefits package that attracts better workers is both a threat to other companies and an opportunity for them to beat you on price if that decision forces you to raise prices. If you cut benefits, other firms may be grateful that they can now do the same without losing a comparative advantage in fighting for talented workers.