Will the HR function have a seat at the corporate table in 2008?

Mark Stelzner, author of organizational-development blog Inflexion Point (and did that gravelly voice-over for Southwest Airlines) sees 2008 as a make or break year for the role of Human Resources:

"Like Toby on NBC’s The Office, HR continues to have a bad name in the eyes of business units, managers and employees.  Often viewed as either enforcers, legal risk mitigators or transactors, the human resources department is not the first place business leaders turn to for advice and guidance in meeting strategic goals and objectives.  They are generally perceived to lack basic business acumen (root cause analysis, business case skills, comparative analytics, etc.) despite years of trying to shift internal and external perception.  I believe this is a make-or-break year for HR.  If consistent, demonstrable examples of strategic value add do not break the glass ceiling in 2008, we will see the continued absorption of HR responsibilities into legal, finance, IT and outsourced service providers, effectively resurrecting the “personnel department” of old."

The HR function has been under increasing scrutiny in recent years, typified by the now-infamous 2005 Fast Company article "Why We Hate HR", by Keith Hammonds.  Stelzner does hit upon a very important point that HR strategy is becoming a core competency that is needed by managers in all corporate departments.  Any successful business manager today should have a solid grounding in HR skills when managing talent, in addition to a degree of understanding of finance to allocate and determine budget for his/her area, and some understanding on the IT needs of his/her function.  Hence, "HR strategy" is not something that is silo-ed into a single HR department, but is pervasive across an organization's management.  The HR department should be the driver and facilitator of sound HR practice across the management team, and ensure these HR practices are aligned with their organizations' strategic goals.  By demonstrating this alignment between solid HR and business performance (i.e. linking customer metrics with employee performance), HR will regain it's "seat at the table" when corporate decisions are made.  Moreover, with many businesses undergoing complex change with outsourcing, globalization and this predicted economic downturn, the role of HR has never been so important as it is today (I outlined the role HR needs to play in a company's outsourcing environment in this article for the IAOP earlier this year).

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'    ......not yet free to have a seat at the table

   

Comments

[Alex Rotenberg]

Although the HR function is more and more strategic , because talent is scarce and difficult to measure and service perceived by customer links to particular employees (the stars of the company) rather than to products, the content of the HR function is moving to a facilitator role rather than a custodian of corporate strategic objectives.

My bet is that in 2008 particular employees (the stars of the company) which could be in HR or elsewhere and are filling this important role of embodying the human dimension of the corporate strategy are going to take a seat at the Corporate table instead.

[Phil Fersht]

Some interesting discussion related to this article:

http://360vendormanagement.com/2007/12/29/human-resources-outsourcing-wheres-the-value/

[Ray Miller]

If HR is to have a seat at the table they need to generate their added value instead of just being a functional bureaucracy processing applicants and open enrollments for benefits.

[Mark Stelzner]

Happy New Year all.

Just to add a point of clarify, neither Phil nor I are advocating for HR's demise or that HR does not warrant a seat at the table. Instead, my point is simply that HR has been attempting to attain the role of strategic business partner for many years with (unfortunately) very few truly successful outcomes. I believe this must change now, or the degradation of the HR function will continue to accelerate.

Best,
Mark

[Adam Organ, PMP]

This is a complicated question with no easy answer. The sanitized response to your question is: Yes, HR should have a seat at the table. Linking customer satisfaction to deliverables in your organization will indirectly connect the people who do the job to your customer; there HR is the chief facilitator of not only job satisfaction but also customer satisfaction. That being said....

Larger companies continue outsource their first tier HR functions. Instead of having a partner that management can leverage as a sounding board and employee relations tool they are forced to use a call center which dehumanizes the human resources experience for both the employee and middle management. Unless this trend starts to reverse itself the effectiveness of HR to have a positive impact on business will continue to decline.

[Octavio Ballesta]

Hi Philip,

Absolutely, Human Resource function should have a Seat at the corporate table as soon as possible. Let see us why:

- Human talent should not be considered as a commodity that may be just hired, fired and replaced by convenience. In engineering and Oil & Energy industries, it is easy to appreciate how the shortage of specialized talent due to high prices of crude oil and collateral increment of Exploration and Production activities is generating the beginning of a cannibalistic attitude from corporate recruiters to hire the scarce talent available.

- The growing emphasis that corporations are posing over medullar processes are inducing to outsource most of the administrative tasks, and is generating subtle pressures over corporate culture and climate. The role of a strategic HR function should provide the guidelines to ensure the observance of policies; safeguard corporate climate and ensure employee commitment in a uncertain and highly competitive business contexts.

- Today’s organizations will be successful in the measure that they are enabled to anticipate business change, and develop transformational projects, in which Human Resources function should support appropriately all the initiatives of change management to ensure the success of these projects and generate effective cultural change.

- with human talent being a strategic asset for the years to come, HR should work in a coordinated manner with Senior Management to asses, identify and provide opportunely the human talent with the skills, training, competences and experiences that today’s organisations will require to fulfil the goals envisioned in the strategic planning.

- From the perspective of a strategic Human Resource function I believe that this organisation should be instrumental in the generation of a corporate culture driven by innovation. If innovation will be a clear differentiator in business and a competitive advantage for the next future, HR should promote mechanisms and structure to encourage the free generation of ideas with business’ potential in a culture that propitiates personal creativity and workgroup’s innovation.

- If we assume that Knowledge based organisations will be more common in the future organisation, Human Resources function should promote the means to foster a culture based in collaboration where the tasks of generating, sharing, disseminating and improving corporate knowledge as a competitiveness tool can be properly recognized, stimulated and rewarded.

Being Human Talent the most strategic asset in today’s organizations a Human Resource function that is strategically conceived should then deserve a seat at the corporate table in 2008.

Octavio

[Sanjeev Himachali]

Until HR makes an attempt to understand their company's industry, business model, revenue generation and profitability, it is difficult to say. But there are few people who are making an attempt and are already in board-rooms but that number is very negligible.

[Madhurima Goswami]

HR should have a seat at the table going forward - to bring in the difference and not just implement senior mgmt decisions.

High perfoming companies focus on building human capital and there is a strong link between maturity of an organizations human capital processes and its overall financial performance. Effective human capital mgmt practices makes all the difference. It does not end at the mere say 'HR partnering with business'. Unless this is in the agenda of an HR Head to push through, his team will continue to experience low attention and low visibility focussing only on hiring, training and driving appraisals even in a fast growing organization.

[Hamish Taylor]

They should have a seat at the table in 2008 as in every year - but they must also bring value to the table in terms of improving the efficiency of other business areas and not seeing themselves (as some though thankfully not all) as a headcount administration agent of management.

The worst type of HR head is one who sits at the table like a management poodle begging for scraps from his or her puppet-master; invariably they lack the true people management skills to add value to the business and some of them even lack a basic understanding of HR law and commit some pretty fundamental sins that cost their businesses a lot of money.