Step up HR
“It’s time to say goodbye to the department of human resources,” declared Ram Charan in a recent Harvard Business Review article. Voicing common frustrations that we hear often, both from business executives and even HR leaders themselves, Charan discusses the ‘disappointment’ with HR in its failure to be forward-looking partners on matters of strategy, organisation, and talent, and the tendency to become caught up in administration. His solution? Split HR into two divisions: one that deals with the transactional, while the other focuses on the strategic.
Indeed, it feels like there has been a never-ending conversation about HR’s need to ‘step up’, to ‘be strategic’ and to ‘get a seat’. Yet for the CIPD’s CEO Peter Cheese, HR has much to offer business and can be better prepared to do so without dividing the function. The key thing, he believes, is building confidence.
“This is HR’s time,” he told delegates at Changeboard’s Future Talent Conference. “We have to be honest with ourselves about what we have to improve on, then we have to build the capabilities and confidence to get there.”
HR and business coming together
As an HR professional, if you are constantly complaining about the need for ‘a seat at the table,’ you are at the wrong end of the telescope, says Cheese. “You’re talking as a victim rather than thinking ‘this is an opportunity for us to demonstrate value and we are going to get on with it; and we will have whatever seat is deemed appropriate’.”
Part of the problem, Cheese suggests, is that HR tends to think that it cannot be confident with strategic elements unless it has mastered the transactional parts.
“Of course we need to make sure we do the operational stuff well, but that should not be seen as a constraint to say that ‘we can’t act strategically’ until that is all perfect – as it won’t be,” he adds.
An 'inflection point' for HR
He acknowledges that, historically, it has been difficult for HR to engage business leaders in the people agenda. Thankfully, he believes we are at a different point of thinking now – “an inflection point,” as he terms it – and there’s a recognition that people are the most important asset of business.
“I’ve never seen this level of debate about the importance of corporate culture,” he enthuses. “Business and government are realising the need to change corporate culture and figure out a way to change behaviour.”
It’s good news that the business and political language is now much more about people, skills, engagement, workforce and corporate culture – but while these are central agenda items of the HR profession, they fit into the more ‘strategic’ end of HR which, for Cheese, is “not the area we have always comfortably occupied”.
“There is so much to play for in helping to build sustainable, socially responsible businesses – this language is used so much now, so now’s our time to demonstrate what we can contribute to that agenda,” he says.
For Cheese, the corollary of this for HR is to establish the skills and capabilities the function needs to develop, and work out how to enhance the image and credibility of the profession to engage with these issues strategically within their own businesses and the wider political domain.
Building credibility establishing consistency
However, to be confident in a senior business environment, Cheese argues that you have to speak the language of business. “You have to have the knowledge that you are speaking from a position of strength and credibility,” he says.
In HR, this means having insight into your own functional domain, backed up by data, analytics and being able to relate those ideas to a business context and your organisation’s challenges.
“We [HR] have to operate in a less siloed way,” he declares. “We need to recognise that other functions have profound skills we could be applying to our own function – marketing, for example, has deep analytics skills around customers and we should be applying some of that stuff to employees. Stepping up is not just about HR on its own – we have to get better at working with other functions and drawing ideas together so we’re all speaking the same language.”
And while HR’s perceived ‘lack of confidence’ has been a recurring discussion topic, Cheese is keen to point out that a lot of other functions have a similar view of themselves.“This problem is not unique to us.There’s a consistent resident theme that other functions have been siloed too,” he states.
Establishing consistent ways of measuring key people data – and in turn increasing the appetite to report more consistently – is a central agenda for Cheese. “Not everything that is counted counts and not everything that counts is
counted,” he asserts.
He uses recruitment as an example. “This is a classic efficiency debate for HR – often it’s all about reducing the cost of recruitment, but what is more important – reducing cost or recruiting the right people? If recruiting the right people means I will be spending more time understanding behaviour and culture alignment, then surely that’s what we should be measuring rather than the cost of recruitment.”
So what, in Cheese’s view, is the role of the CIPD in helping the profession step up? “It’s to help understand the direction of travel. We’ve been squeezed on efficiency agendas and organisations downsizing have resulted in smaller HR teams. We need to build more assets to improve the capability of the profession, how we promote it, and encourage continued growth and skills within it,” he says.
Enhancing HR's appeal
Cheese agrees that HR is not a popular career path that young people aspire to pursue. “People might say they ‘ended up’ here because they were no good at numbers or understanding business but liked people,” he explains. “We want to work with universities and business schools to illustrate how HR is increasingly being put on to the business agenda.”
In light of this, the CIPD is also working to pull together tools such as competency frameworks to help young people as they enter the profession, as well as developing mentoring programmes using its membership.
To be a good manager or leader, Cheese argues that you should be exposed to the real heart of the people management agenda, and this has been lacking in many leaders’ development journeys – often with devastating consequences, he thinks. “It’s not just about creating a diverse community from the bottom end; I want to explore ways that people can gain exposure to HR at different points during their career.”
He also highlights the importance of accredited skills in moving HR forward.
“It’s the accepted norm that if you work in finance or accounting, you are professionally qualified. This is where we should be going – we need to treat ourselves as professionals,” he says.
Operating in a changing context
While in recent years HR has generally been criticised for its effectiveness, Cheese believes the mindset is shifting and he puts this down in part to the continual economic changes which have forced business leaders to “get comfortable” with adaptability, agility and resilience.
As a result, he says that most HR directors are all too aware of the opportunity that the function has and are trying to step up – encouraged by business leaders who are increasingly “getting it”.
So what does HR need to do to move forward? “Stand up and be counted,” he urges.
“It’s not just about knocking on the door and hoping someone is listening – the door is opening so we have to go through it and make sure we stay through it to help businesses be what they should be.”