Many HR leaders and professionals have struggled for years to establish HR’s relevancy in the view of senior leaders. But really, the question isn’t about relevance of the function or gaining a “seat at the table;” rather, the question should be:
WHAT IMPACT HAS HR MADE ON THE BUSINESS?
IMPACT IN GENERATING REVENUE AND CUSTOMER SATISFACTION?
“Every people manager has a responsibility for hiring, developing, recognizing and retaining their talent,” says J.C. Herrera, CHRO at McAfee. “They are the day-to-day person who each employee has interactions with, so they have to have the skill set to run through the HR stuff seamlessly.”
Leaders of other high-performance organizations agree. In its recent study of Talent Management in the Trenches, i4cp discovered high correlations to market performance when talent management tools, processes and services are designed and developed in partnership between HR and line managers. When talent management activities are executed with a balance of responsibilities between HR and line managers, a high correlation with performance again emerged.
As Campbell Soup Company CHRO Bob Morrissey explains, “… we shifted our focus to manager quality, defining the role of the manager, giving them the confidence and competence to do it. That encourages them to take more responsibility, at the same time, taking some of the burden off HR.”
To ensure healthy and profitable growth, placing the right leaders in new markets is crucial.
“Local is best” when it comes to determining who will lead in new markets, says Dan Henry, CHRO of Bright Horizons. Ultimately, though, using a mix of local leaders and expatriates is realistic, and the circumstances dictate the best approach. “We usually send expatriates only when there is not appropriate local talent,” says Ben Dhaou, SVP of HR at SGS.
HR must also lead the way when it comes to company culture. HR leaders understand more than most the delicate balance that organizations must strike when expanding into new locations and cultures.
“One should never seek to impose a company culture at the expense of local considerations,” suggests Hyatt CHRO Robb Webb. “It’s important to understand the culture of your company and carefully find a way for it to coexist with that of the community.”
The i4cp report, The Future of HR: The Transition to Performance Advisor, explores key themes highlighted below.
One theme continuously came up in these discussions: the role of HR business partners.
In i4cp’s upcoming report Future of HR: The Transition to Performance Advisor, research shows that HR business partners have a presence in 43% of high-performing organizations – based on profitability, market share, revenue growth and customer satisfaction as compared to five years previously.
According to the human capital executives interviewed, the HR business partner is at the forefront of the function’s evolution, redefining the role and scope of the traditional HR professional. This includes a new mindset about the profession’s core strengths, along with a new and complex set of competencies that will be needed to achieve business impact in the future.
The picture drawn for a successful HR business partner portrays a trusted advisor and strategic resource for business leaders who can help drive organizational performance. For HR, the compelling challenge now is finding and developing talent to fill that strong business partner role. Today’s top CHROs say that probably means looking beyond HR.
Business and strategy capabilities account for more than half of the top competencies respondents say will be the most vital hallmarks of the future HR professional. HR business partners will “… need to understand how the business works and how the company makes money,” says Sterling Bank’s EVP of HR Karla Gehlen.
Beyond business-specific skills, the need for certain qualitative competencies, such as self-awareness and self-confidence were also highlighted by i4cp’s research. Dean Carter, CHRO at Sears Holdings, calls emotional intelligence an indispensible attribute for HR professionals. Pete Pesce, AT Kearney’s CHRO, says that confidence is a must-have. And Tim Massa, VP of HR at Kroger, declares courage the number one competency for tomorrow’s HR professionals.
From changes in the very structure of the function, to the elevation of analytics and the evolving role of the business partner, HR has much to look forward to as it transitions to greater strategic value creation in the coming five years.
Moving from Generalists to Strategists
The business partner is an established, if somewhat flexibly defined, HR role. Many organizations use the term generalist to describe a position that often operates at a lower or mid-level in the business that touches multiple aspects of HR. However, in top companies the generalist function is giving way to a more strategic role, which combines in-depth business savvy and trusted consultative skills in order to coach leaders of business functions on how to be more competitive and productive.
One HR leader explained that the traditional, lower-level generalist “doesn’t do strategic work. Generalists execute the strategy. In contrast, the HR business partner is someone who can have robust conversations about people issues in the business. He or she knows how to identify potential problems and brainstorm creative solutions.”
Donna Morris, SVP of HR and CHRO at Adobe, concurs, characterizing “the role of the business partner as someone who can work at the strategic level, diagnosing and determining what the people needs are for the respective businesses. Defining best reward mechanisms, best people, right processes. That’s the partner.”