While it may be interesting to debate the strategic value of HR, and how best it should add value to the business, recent articles do not provide conclusive evidence that will be of practical value to HR professionals.

HR in the spotlight yet again - but how to get it right?

The very recent July /August edition of the highly influential Harvard Business Review has a cover title that reads “It’s time to Blow up HR and Build Something New - Here’s how.” The magazine then contains three detailed articles all based around the current role and challenges facing HR. While it may be interesting to debate the strategic value of HR and how best it should add value to the business the articles do not provide conclusive evidence that will be of practical value to HR professionals.

Sadly almost all of the articles retread the same old criticisms and observations of HR –
• We are not connected enough to the business.
• We need to be more business and metric centred.
• We need to stop applying old HR processes that don’t deliver value or work.
• CEO’s really do need to take us more seriously!!!

The big new idea - replace the annual appraisal
The articles also reference the latest big idea in HR which is to stop doing the annual appraisal and move to on-going conversations.

It’s all every well saying let’s have on-going performance feedback discussions but most experienced HR directors will know that the majority of managers continue to struggle to give performance feedback in a positive and direct manner to their staff. Many managers like the comfort blanket of a performance rating or grading scale as it helps them overcome their own shortcomings in critically assessing their talent.

In my experience they may readily criticize rating metrics but when you say “let’s just get rid of them” they often start to step back in the knowledge that they would have to become much more accomplished at engaging their staff and giving negative as well as positive feedback to their people. The fact is that until organisations have people who are comfortable conducting adult and direct conversations around performance issues any evaluation system or process is going to suffer no matter how well designed.

But it is obvious to this writer that the next big HR idea is going to be let’s stop the annual performance rating. No doubt if we follow our traditional approach we’ll all be doing this over the next few years persuaded by the corporate examples cited in HBR.

HR being criticized is not new
The fact is that these types of article continue a long line of challenging attacks on the HR function and professionals. Only last year the leadership and organization “guru” Ram Charan (who co-authors one of the HBR articles) caused a big debate when he argued in another HBR article that HR should be spilt into two separate functions – the HR Director for Administration (HR-A) and the HR Director for Leadership and Organisation (HR-LO).

Charan’s assertion was soon challenged by the ubiquitous HR guru, Dave Ulrich who argued in a blog that Ram had got it wrong and that his observations were “unfair and simplistic”. Ulrich might of course have a vested interest in this argument given that his HR model has had massive global influence over the last decade or so and yet seems not to have fixed the criticisms.

Indeed in recent years there have been some revisionist thinking that argues Ulrich’s model did much to harm HR. Firstly, by de-skilling large parts of HR and consigning many of us to the transactional world of shared services and functionally limited call centres. Secondly, Ulrich provoked many internal turf battles within HR over who owns the customer – the HR Business Partner or the functional specialist? The combined impact for many line managers was to make HR more complex and difficult to do business with. The reality is, that despite the all pervasive impact of Dave Ulrich’s model in the HR world, the criticisms have not gone away as evidenced by the current HBR articles.

Having been around the HR space for many years I can recall back in May 1995 when the then CEO of DHL Europe, Rob Kuijpers wrote an article in the UK’s leading HR professionals magazine entitled, “Why time is running out for HR, unless…” Kuijpers wrote a scathing attack on how HR had failed to deliver for DHL. He again argued that HR needed to become strategic and business focused and move away from being a “collection of functions, payroll, basic recruitment, benefits administration, union recognition, and basic training.” If you then research as far back as 1955 you will learn that the father of management theory, Peter Drucker wrote an article asking whether or not “Personnel Management was Bankrupt?”

How do we get it right?
So what are we to make of this latest high profile attack on HR’s effectiveness? Certainly HR seems to receive far more criticism than the combined efforts of the Finance, Marketing and IT functions. Is it fair? Probably not! We all know that marketing has just as many questions to answer about their effectiveness and outcomes as HR. But then we provide an easy target as the majority of managers believe that when it comes to running and operating core HR processes they are just as expert as HR.

Clearly this level of managerial confidence soon starts to evaporate when it comes to information technology and financial matters. What we need to recognize in HR is that we are engaged in an area of activity where everyone in the organization believes they know better. It is part of the job that we just need to accept it and move on.

The fact is that the cost of running HR in most organisations is very small yet,

we have the potential to have a huge impact and HR’s unrealized value for the most part is HR’s ability to motivate and leverage people, talent and capabilities.

It is good that we are aware of all these HR articles and ideas. However we do need to get on with the job.

When we work with clients and their HR teams we argue that HR needs to adopt some very simple and focused operating principles.

  1. Drive everything from the customer and business agenda- keep asking how you can create value for the customer and business?
  2. Focus on performance, performance and performance – be an advocate of driving better performance – take on difficult people performance decisions and avoid diluting or compromising!
  3. Get out of your office and away from the tyranny of email - entrench yourself in the business – work with managers on real problems
  4. Be easy to do business with – make HR processes simple and user friendly – drop the rules and regulations wherever possible – empower smart people to do the right thing. Develop a client centric culture amongst the HR team
  5. Start using digital solutions to classic HR processes – start developing apps for HR – sponsor a Hackathon for HR
  6. Think 80-20 – 80% of our success is based on 20% of what we do! The rest is noise and interference- Ask yourself what is the 20% for HR – are you prioritizing that 20% or are you getting distracted
  7. Eradicate the non-value-added stuff. Ask yourself “if we stopped doing this how long before anyone would really notice?”

Is it time to review how HR is adding value in your organization? We can provide expert facilitation to support your discussion, bringing in relevant experiences and examples as needed, and helping you get to value adding conclusions that you can act on.

Do you need to raise the knowledge and competence level of your HR professionals so they are fully equipped and acting confidently in truly partnering and adding value to their line manager colleagues? We can provide developmental experiences which will build their skill, knowledge and confidence led by business professionals who understand both HR and the business impact it can bring.  

For further information feel free to contact Gerry Buckley on gbuckley@theppinetwork.com or +32 479 281601 for an exploratory discussion.

About the Author

Mark Thomas: Leading International Expert on Business Partnering

Mark Thomas

Mark Thomas is an international business consultant, author and speaker specialising in business planning, managing change, human resource management and executive development. Prior to working with PPI he worked for several years with Price Waterhouse in London where he advised on the business and organisational change issues arising out of strategic reviews in both private and public sector organisations.