The HR business partner model
The term HR business partner has been the focal point for HR’s emergence within business for over a decade. First developed by Ulrich in the early 90’s, it has been applied and implemented to HR departments globally. For many HR directors, the HR business partner model is a must have for HR to deliver quantifiable return on investment.
Despite early successes, there are now ever increasing examples where applying the model has not worked. Many HR professionals feel that there’s a lack of understanding about what the business partner model really is and how it can be applied successfully. Among peers there’s often debate – as an HRBP are you truly operating under this banner, or do you simply have an over inflated job title?
We wanted to set the record straight. Heather Davies, HR director at Insight Investment, has experience of implementing the business partner model in several organisations. We asked her thoughts on the HR business partner model and whether it can really be implemented successfully.
Defining the HR business partner
What is a true HR business partner?
How has the business partner influenced HR?
Since its inception in the early 90’s, do you feel that the HR business partner model has been a key driver behind HR’s increased recognition within the business community?
The business partner model may well have resulted in more HR professionals getting a seat at the decision making table, but I don’t think this is new or that HR’s strategic input into a business is driven by this model.
The notion that HR departments have only ever been about admin is completely wrong. Historically in many industrial settings, which were highly unionised, it was an absolute essential that the HR director had a seat at the table. The employee relations agenda was one of the most fundamental in any unionised industry in the 70's and 80's, so the notion that personnel departments were simply pushing paper is nonsense.
I started working in my first personnel department in 1979. It was called personnel but it absolutely wasn’t. The personnel director sat on the board and unquestionably was the advisor to the CEO, but without the requirement for a strategic HR title. He was responsible for payroll and various other transactional duties, but that wasn’t his role on a day to day basis. So the assertion that strategic HR input is something new and has come about because of the business partner model is fundamentally wrong.
Appropriate for all businesses?
Is the HR business partner model applicable to all businesses and should it be a key goal?
When you start with a business problem, generally, you don’t start with a model. Your model is your solution not your diagnostic. Your diagnostic will start somewhere else. Start by questioning the type of business you are in; what are the commercial realities; what is the size and scope of the business; how many geographies do you cover etc.? After the commercial realities, question what you want to achieve professionally. As an HR function, what are you actually trying to do and how are you going to deliver it?
Then look at your organisational solution. Look at what you’re trying to achieve with the business and then work out how you are going to do it. This may turn out to look like the business partner model or a variant of it.
Advice for HR directors
What advice would you give to an HR director tasked with setting up or overhauling a new HR function?
How you organise is dependent on different commercial factors: size, scale, geography, cost - know the margins in your business and what you are driving towards in terms of cost, scale and efficiency.
The shared services model is driven by cost, but actually there are certain businesses that are not about scale and tight margins; asset management being one of them. To assume that a model driven by certain commercial realities in some large organisations is going to fit every business cannot be correct. A single solution is not always going to fit the circumstances.
Implementing the HRBP model
What pitfalls should an HR director be aware of once implementation is underway?
Alignment is absolutely fundamental. With the business partner model in practice, there’s a distinct lack of alignment between the various component pieces, particularly between centres of excellence and business partners.
The alignment between different parts of the function and their objectives, and the level of communication between them is key. You very often find that different parts of the function have quite different agendas, sometimes not complimentary but contradictory.
Getting alignment right
What is the potential risk if these alignment issues are not addressed when implementing the HR business partner model?
If alignment is not dealt with when implementing your solutions, you will have boundary issues. You will have three different elements of the department, with three different agendas represented by three different people - all of whom will be required in any decision making process. As a result you will trip over each other. So you’ll end up with line managers caught in the middle in what ultimately turns out to be a functional argument.
The communication and the boundary issue of ‘who is taking responsibility for what’ is the real challenge with any kind of model and it’s endemic in the HR business partner model. The model drives people into specialisms and, typically, does not provide enough cross fertilisation of talent across the function.
It drives people to make choices: do I want to be learning & development, employee relations or comp & bens and not do anything else? Breadth of capability/breadth of knowledge is not developing through a business partner model. We need to be building that breadth of knowledge across the function.
Other issues in HR
We’ve touched on some of the weaknesses in the HR business partner model - do you feel that there are other issues that need addressing in HR functions universally?
A lot of HR functions forget to value the basics. There’s so much focus on strategic thinking that HR professionals have lost the value of operational efficiency. It’s very hard to sit around an executive table if your function can’t be operationally efficient and can’t deliver the basics. If you can’t get contracts out on time, if you can’t pay people properly, can’t deal with queries efficiently, can’t get the pension contributions right; if you can’t deliver that efficiently, why would you expect to a seat at the top table?
The HR function has also tended to devalue a technical HR knowledge. There’s the notion that anyone can do HR and the really important skill is knowing the business. You need more than that - you need to know about HR. You need to really understand it and have some depth of technical knowledge. I don’t think that the HR business partner model is building it with a sufficient breadth to warrant a seat at the executive table. However much we know about the business, if we don't have that HR technical knowledge, we come back to CEOs asking ‘Why have I got you around the table when I have 10 other people who know about the business?’
The future of HR
How do you see HR as a discipline developing over the next decade? What do you think will be the next progression in the industry?
About Scott Fitzgerald
Scott has over 6 years recruitment experience both in consultancies and in-house, and works as a senior consultant on the permanent division at Piper Pritchard. Prior to joining Piper Pritchard Scott led overseas recruitment for the Canadian High Commission.