Dear All, Please suggest some new best HR Practices as i wat to implement something new in my Company. I work in Corporate HR office in Organization Development dept. Shruti.
From India, Mumbai
1From India, Mumbai
Giving you the the theory but the practalities will depend on your organizations - cause what right for one organization may not work for another...perhaps you can start by doing gap analysis and then build on it...
WHAT IS NEXT FOR HR? By David Ulrich, Ph.D.
The HR profession is in a state of constant flux. This is not a surprise since most of the world we live in is in flux. Change is happening all around us and HR can not be immune. This paper lays what might be "next" for our HR profession. The ideas are drawn from people whom I admire deeply. In the last three years while on sabbatical I have been a bit away from the daily routines of HR. But, I have stayed in contact with the book The Future of HR edited by Mike Losey, Sue Meisinger, and me. We asked 61 other thought leaders to answer the simple question, "what is next for HR?" and we received very insightful and creative essays. Their collective work has informed my thinking and I draw from it. In addition, Wayne Brockbank and I have worked together for over 20 years to think about and prod the profession we care about. In the process, I can seldom separate my ideas from his, but need to acknowledge that my thinking has been profoundly influenced by this exceptional colleague and dear friend. Our book The HR Value Proposition contains most of the ideas in this paper. But this paper extracts them and offers an executive summary of HR and where it is going.
Defining the future for a profession has two parts: theory and action. Theory offers insights on where the profession should be headed, questions it should be dealing with, and the rational for why things should be as they should be. Action turns theory into ideas and makes sure that ideas have impact. Theory without action is abstract and inane. Action without theory is random and unfocused. We need both.
I like to connect theory and action with the image of a diamond. At the top, we start with simple questions, then as the diamond gets larger, these questions turn into more elegant responses which become complex at times. At the wide angle of the diamond, the theory becomes rather intricate as the subtleties of the theory become apparent. Here is where theory is both the best and worst. At its best theory explains why things happen in enough detail to predict the future with some degree of certainty. At its worst, theory becomes academic and so complex and removed from reality that it can not lead to change. So, the bottom half of the diamond is critical to turn the elegant and complex theory into simple and doable actions. This requires working on the questions "so what does this mean?" and coming up with specific responses. So, this paper will be organized by the numbers:
1 fundamental message
5 key elements or factors to this message
14 criteria for the new HR
3 conversations you should hold
1 enduring thought and reminder
1 Fundamental message
We exist as an HR profession because we add value. Value means many things. It comes from the Latin word valuta which means to be worth something. In our modern day, value as a noun may refer to the values and beliefs we hold or to the monetary value of an item As a verb it refers to the process of assigning monetary worth of an item or to consider something highly (I value your opinion). Regardless of its use as noun or verb, the fundamental message of value is that value is defined more by the receiver than the giver. Let me give two personal examples of this how value is defined by the receiver more than the receiver. We are in the process of selling a house in Michigan. We have invested a great deal in this house. We think it is a marvelous house with the right bedrooms, living space, and offices for our family for the past 15 years. We designed the house and it has met our needs. So, we figured out what we felt it might be worth by comparing to other (obviously less good houses in the neighborhood) and listed it with a realtor. A few months later after no offers and traffic, we lowered the price about 12%. Immediately neighbors who recently bought homes called us to chastise us for "hurting the neighborhood" by having lower our price. Our simple response was that the market picks the price, not us and our desires. Value is defined by the receiver more than the giver. And, we have had to lower the price again to make the sell.
Second, and I have shared this before. I know that in my relationship with my wife of 30 years, the value of a gift I select for her is defined by her more than me. My preferred gifts ( e.g., tickets to the NCAA finals) may not mean as much to her than me. So, I learn to give her gifts that mean something to her, the receiver, more than me, the giver. This means varying the gifts and offering what might mean more to her than me. Recently, this mean offering her a gift of weight loss, which she readily accepted and I have attempted to do.
So what does value have to do with HR? Simply stated, we exist as a profession because what we do creates value for someone else. If we do not carefully consider the value we create, we will focus on what we want, not what our stakeholders need and desire. We may build elegant programs and practices, but until and unless someone finds them of value, they are not.
1 fundamental message: Value is defined by the receiver more than the giver.
5 factors or elements to determine value
So, how do we go about turning this message of value into something more elegant. We propose a five factor "solution" to the HR value proposition. Each factor represents a key element of HR's creation of value. These five factors are the elements that will enable HR professionals to determine and create value.
Factor 1: External Business Realities
To define an HR value proposition, we do not begin with who we are or what we know and do, but with the context of where we do our work. We have to understand and appreciate the world that our stakeholders live in so that they can trust us to understand them. HR actions inside a firm must reflect and influence business realities outside that firm. HR professionals should be able to cogently discuss these external realities—the technology, regulatory and economic factors, and demographics of the global business environment—and connect them to their day-to-day work. Knowing business realities makes it possible to put HR practices in context, tie them to competitive challenges, and relate them to concerns facing line managers. These contextual factors offer the rationale for why an HR transformation should occur. Everyone in your HR function should be conversant with both the realities of the external world and how HR actions will help your firm compete in this changing context.
Factor 2: Stakeholders
Value is defined by the receivers of HR work—the investors, customers, line managers, and employees—more than by the givers – HR professionals. HR is successful if and when its stakeholders perceive value from it. Delivering what matters most to stakeholders focuses on the deliverables (outcomes of HR) rather than on the doables (activities of HR). The deliverables of HR involve those outside the firm and come in the form of investor intangibles and customer share. The deliverables also come from activities inside the firm like organization capabilities and/or individual abilities.
The context and stakeholders are those things that happen outside our HR world. We start there because by going outside/in we learn what we need to do to create value.
Factor 3: HR Practices
HR practices institutionalize beliefs and values and make them real to all stakeholders. For example, the way you hire, train, or pay people or the way you organize work sends messages to employees about what matters most. There are almost an unlimited list of HR practices that focus on all sorts of things ranging from internet hiring to performance appraisals to coaching teams to communicating with employees. We have taken the liberty of organization HR work into four flows, each representing a cluster of HR activities. These flows are HR practices around people, performance, information, and work flows,. Within each of these flows, HR professionals may create and/or identify HR practices to manage this flow. We like the metaphor of a menu. On a menu in a restaurant you have categories of food (appetizers, salads, main course, drinks, desserts, etc.). Within each food category, are a list of choices that the patron might select from. Likewise the HR menu may be clustered into people, performance, information, and work pages with menus of choices in each category. These HR practices deliver value to internal and external stakeholders when they are appropriately aligned with your organization goals. They also ensure that the organization outlives any individual leader. They become cultural pillars for your organization.
Factor 4: HR Department or Function
The HR function within your company needs to be thought about as a business. As a business embedded within the company, your HR function needs a strategy and structure that will deliver value. The strategy will help you focus attention on key factors and respond appropriately to business realities; the structure will organize HR resources in ways that govern how HR work is done. The strategy and structure of your HR department will ensure that HR resources are deployed where they add the most value.
Factor 5: HR Professionalism
Each HR professional in your organization must learn to play a role and master competencies to deliver value. Roles represent what people do; competencies define how they do it. HR functions are only as good as the people who inhabit them, so having clear roles and distinct competencies ensures that they will deliver they value they intend. And HR Professionals must invest in themselves and continually improve.
That's it.
1 principle: HR must add value
5 factors to creating value: external realities, key stakeholders, HR practices, HR departments, and HR professionals.
This is a simple logic. It makes sense. It reflects what most of us feel and many of us know about HR and its role in today's organization. It offers a destination for where we are headed as a profession (value) and how to get there (five factors).
But, I have learned in recent years that having a roadmap and getting to the destination are two very different things. To turn these simple ideas into reality is not easy. It will require a new set of criteria by which we will ask others to judge us and by which we will judge ourselves. These criteria follow the simple flow we have started, but they push us to become more than what we have been.
The HR Value Proposition
14 Criteria for HR Value
With value as the guiding principle and the five factors as the key elements, we can now define the requirements or criteria for the new HR, for what lies ahead. Each of these criteria can be used as a self assessment (see tool on www.rbl.net) or an assessment of your HR department. They are the milestones of the HR Journey we need to take. If we meet these criteria, we will deliver value and be seen as credible. If we miss some, we should not despair, but focus and invest in ourselves to get prepped for what lies ahead. Unfortunately, at this point what seems simple become a bit more complex because the world we live in is complex and requires that we stretch ourselves.
To what extent do the HR professionals in my department understand how external realities of technology, economics, and demographics in the global context affect our industry and business?
We should go beyond sensing that the external world is changing and be able to talk to our business colleagues about specific changes and how they affect our business. These new business realities include but are not limited to:
Changing technologies: What is the pace of technological change in our industry? What new technologies will change the products we produce, services we provide, and ways we work together?
Changing economics: do we know the changing nature of competition within our industry? The changing customer expectations? The changing competitors we might face?
Changing demographics: how will our workforce change, both within our country and globally? What will be the expectations and requirements of the workforce of the future? Where will we find them? How will we develop them? How will we retain them?
Saying the world is changing and being able to engage in a conversation about the changing world are two different things. Then, turning conversation to action requires a new set of skills.
As an HR professional, how would you respond if you were asked to discuss the technological, economic, and demographic global changes in your firm and industry. Would you be able to do it? Would you be able to credibly present to a group of line managers within your firm, potential employees to the firm, customers and/or suppliers to your firm, and/or investors? Some firms used to define "market share" as North American when the real market was global; other HR folks are so busy doing HR that they lose sight of why.
To what extent does our HR work link to the intangibles that investors value?
Investors in for profit firms show up as stockholders; in not for profit firms they show up as donors, alumni, political allies, and financiers. We must pay attention to these investors. And increasingly they are not just looking at tangible cash flow, but at intangible corporate reputation. The intangibles represent about 50% of the market value of a firm. As HR professionals we should be able to play in the intangible game.
The importance of intangibles has become clear both in practice and research. Researchers who study market behavior have found that intangible issues are central to investor decisions. At times, these investors are fuzzy about what constitutes an intangible (thus its name, perhaps?), but they know that they matter. In practice, when HR folks can help investors have confidence in the quality of organization and management, they have a stronger belief in the future of the company and intangible value goes up (as reflected in stock price). As HR professionals, we can and should be involved with investors. Take the investor test:
Who are the major investors to my firm?
What are the buying (or not)?
What is our intangible vs. tangible value compared to our leading competitor?
What can we do to increase our intangible value?
How can we include investors in designing and delivering our HR practices?
To what extent do we use HR practices to build long-term connections with target customers?
Creating customer value comes from products and services, but also from relationships. Long term customers often find parity in price and product mix, then differentiate based on relationships. 20% of the customers who represent 80% of the firms revenues deserve special attention. Customer share replaces market share. How do we work with them? As HR professionals we can play a major role in connecting with these target customers.
The importance of bonding customers through HR can be demonstrated with a simple examples: restaurants. Imagine that you own a small restaurant. Your goal is to increase revenue. This would likely start by identifying target customers, or those who live with 15-20 minutes of your restaurant and who eat in restaurants 15 or more times a month. These are the target audience and those you want to go after. They already spend the money on eating out, so your job is to get them to spend this money on you. Take a specific customer who might now eat in your restaurant 3 times a month, or have 20% customer share (3/15). Your goal might be to increase this customer's share to 40% (6 times a month in your restaurant). You would do this by include this customer in all sorts of decisions like product mix (what you serve), but also decisions around culture (ambiance, setting) and people (who you hire, how you train and pay them, and how you communicate with them). By including customers in traditionally internal practices, they become more bonded to you and may increase their share.
More complex examples abound. Customers may be involved in staffing by helping define the criteria for future employees, by recommending future employees, or by interviewing potential employees. They may be involved in training by designing the curriculum, by attending the courses, or by helping teach the courses. They may be involved in rewards by defining the standards for performance, by participating in the performance reviews of those standards, or by directly or indirectly allocating rewards. They may help with communication by sharing information about what is desired.
By talking about investors and customers we are pushing ourselves out of our traditional HR comfort zone. When we go outside to create intangible value for investors and customer share for targeted customers, we deliver enormous value to our organizations.
To what extent do we create value for line executives by auditing and creating organization capabilities that will turn strategy into action?
Once we turn our attention inside the organization, we also deliver enormous value. We do more than design HR practices or do activities related to HR; we create capabilities. In recent years, organization changes have focused on downsizing, restructuring, and reengineering. All of these efforts are viable and worthy of attention, but all are based on an assumption that an organization is a cost that must be cut. We would rather think of organizations as capabilities that can be leveraged.
When you think of an organization, you don't often think about how many levels of management it has, how it is organized, or how it manages its processes; you think about its identity, its reputation, and what it is good at doing. These factors are the capabilities of a firm. The capabilities of a firm are the deliverables of HR. We should measure ourselves by these deliverables more than the doables. Think of a matrix with rows and columns. Often we think about the rows (or activities of HR): staffing, training, paying, communicating, etc. But, unless these rows are lined up with the columns (the deliverabvles of HR), we are not really adding value. Activity without outcome is random and senseless. We used to talk about the importance of everyone receiving 40 hours of training a year, but when you think about this for a minute, it hits you that the activity (40 hours of training) is less important than the outcome of the activity (our organization is faster to market than someone else). The outcomes or deliverables of HR are the capabilities of an organization. These capabilities might include things like speed, collaboration, learning, accountability, leadership brand, talent, shared mindset, or other things that give your organization its reputation. The capabilities of a firm represent the deliverables of HR and the intangibles that investors value and the shape the connection that customers value.
To what extent do we have a clear employee value proposition that lays out what is expected of employees and what they get in return?
We are finally going to talk about people. Yes, we are "human" resources and people or employees are a key stakeholder, but no longer our only stakeholder. We build an employee value proposition when employees who give to the firm get something back from the firm. Employees give by providing competence and commitment to the organization; and in return those who are competent and committed get back good things like meaning, vision, opportunities to learn and grow, money, community, etc. We should help guarantee that each employee has both the competence and commitment to perform at high standards. Competence ensures that employees have ability; commitment that they have desire and dedication. And, when employees demonstrate competence and commitment, they get back from the organization things that matter to them. Our challenge and opportunity is to ensure that we create an employee value proposition . Employees who give and contribute to the firm should get back from the firm.
Many companies have employee value propositions where employees give a lot and get a lot back in return. The get back may be financial (stock options at a growing firm) or relational (the opportunity to work on teams). HR professionals who build an employee value proposition deliver value.
So far, we have focused on what is outside the direct purview of HR: business realities and 4 stakeholders, 2 outside the firm and 2 inside. If we master these contextual factors, we can then shape HR.
But, HR may mean a lot of things. Let us suggest three: [1] HR practices, or the policies, procedures, and work we do. [2] HR departments, or the organization we create. And, [3} HR professionals, or the people like us who chose to create these practices and work in these departments. Criteria 6, 7, 8, and 9 refer to HR practices; 10 and 11 to HR departments, and 12, 13, and 14 to the HR professionals.
HR Practices:
The work of HR includes many practices and activities. The array is long as evidenced in many great books or training programs that talk about a lot of HR work. At the risk of grossly oversimplifying the complex work of HR, we have created a typology of four flows of HR work. Each flow represents a critical resource to the firm: people, performance, information, and work. Each flow has the requirement to deliver value to stakeholders. For each flow, we can create a menu of choices that can be used to figure out which HR practices work best. A menu is a simple, but useful metaphor. In a good restaurant, the menu tells me the things I could chose to eat, depending on my desires and needs. Likewise HR menus allow HR professionals to select the HR practice (in people, performance, information, or work) that best meets the needs of the business, given its strategy. The menu approach does not say that one size fits all, but it suggests that good HR Professionals help managers pick what will work best given the business strategy.
To what extent do our HR practices that focus on people (staffing, training, development) add value?
Clearly HR should take the lead in managing the flow of talent in, through, up, and out of an organization. We do so by buying, building, borrowing, bouncing, bounding, and binding talent. When the flow of people in an organization is right, investors have confidence in management, customers build relationships of trust with key employees, and line mangers are assured that their strategies will be accomplished. Our profession has rapidly grown to offer insights on this people flow, from 360's, to learning agility, to behavioral based interviews, to internet hiring, to leadership development, to referral networks to outplacement to outsourcing to action learning in training, to learning from experiences to contracting for employees to retaining the best talent to removing the worst talent to promoting those who have the most skills, and to other people practices that continue to affect how we treat people in organizations.
To what extent do our HR practices that focus on performance (setting standards, allocating rewards, providing feedback) add value?
We in HR also manage the performance flow in an organization. Through managing performance, individuals face positive and negative consequences for their performance and become accountable for it. Compensation systems should be open to investors so that they have confidence in what management is encouraging and rewarding; they should also be transparent to customers. If a customer could design a performance appraisal form that highlighted the prototype employee the customer would want, would it look like the appraisal you are using? Do the investor and customer voices get heard when evaluating employees? Are 360's being turned into 720's where those outside the firm are also participating in evaluating performance?
A lot of performance comes from follow up. When we consistently report on how we are doing and hold people accountable for doing, they do more.
People and performance have traditionally been the "strike zone" for HR work. We have been and should continue to be known for innovative and impactful HR practices in people and performance. But, we can go beyond this.
To what extent do our HR practices that focus on information (outside-in and inside-out) add value?
Within any organization the flow of information sends signals about what matters most. When HR professionals participate in turning external information into internal actions, they deliver value. When they help line managers tailor and shape messages so that they penetrate all organization layers, they deliver value. And, when they help share information across organization divided by function, product, or geography, they deliver value. Good information is timely, focused, consistent, tailored, and simple. When we know why we do what we do, we accept the what.
To what extent do our HR practices that focus on work flow (who does the work, how is the work done, and where is the work done) add value?
Organizing work so that it is done both efficiently and effectively can come from insightful HR professionals who are gifted at managing teams, organization designs, work processes, and work settings. Knowing what type of discipline to put on how work is done will HR investors believe that resources are correctly allocated, enable customers to smoothly interact with the firm ( e.g., with a customer account manager, for example), and help line managers ensure that the structure follows the strategy. One of the emerging areas for HR practices is work space. Work space sends a cultural message about the company's values; it also enhances productivity and increases employee retention. HR professionals can and will engage with architects and facility managers to create great places to work.
As HR professionals, we should feel an obligation to build emerging HR practices in people, performance, work, and information. When these practice domains are aligned to employees, line managers, customers, and investors, we deliver enormous value.
HR Governance
We need to think of HR like a business. As a business, we have to to organize and govern our own resources. HR departments often are the last to be reorganized and transformed, when we should be the model that other staff functions should follow. There are two basic elements of putting our own hose in order.
To what extent does our HR strategy process turn business goals into HR priorities?
We need to think of HR as a business and a business starts with a strategy. Where are we going? What are we trying to do? What are the key investments we need to make to succeed? What is our vision for HR? What are our goals? A business needs a Vision, Goals, Actions, and Follow up. An HR strategy offers this methodology to our function. Our HR business plan turns external business realties into on going HR investments. The strategy should not be an afterthought to a business strategy nor an isolated thought relevant to a business strategy. It should be an integrated component of what the business is doing and help every line manager know that aspirations will lead to actions. The HR strategy is simple: strategy from the business, capabilities from the organization, and action from HR leads to results.
To what extent is our HR organization (e-HR, service centers, centers of expertise, embedded HR, and outsourcing contracts) aligned with the business strategy?
And, with an HR strategy in place, HR can now be organized appropriately. HR organizations are currently being split in two. Part of HR work deals with the administrative and necessary processes for organizations to operate. People have to be hired, trained, relocated, paid, and given benefits. Many of these tasks are standard, routine transactions that can be done more efficiently. And, they are being increasingly done through service centers, e-HR, and outsourcing. The criteria for these administrative tasks is efficiency, doing more with less and thus reduces costs that adds value to investors and customers.
But HR is also about transformation not just transaction. As HR professionals help line managers deliver strategy through capabilities; employees gain abilities, customers develop relationships, and investors increase confidence, they transformation the way work is done. We have found that the transformation of HR does not end by putting in an new HRIS system or by form ing centers of expertise. It requires a complete overhaul of the HR organization to assure that HR will be governed in a way to deliver on strategy.
HR Professionals
Now, we get to me. What does this new HR value proposition mean to me? I work in compensation doing market analysis, what value do I add? I work as a trainer or facilitator, how does all this talk of investors and customers relate to me? I work as a plant HR manager, what can I really do?
We suggest that each of us in HR should become more professional by recognizing and playing the right role, by gaining competencies required for success, and by investing in ourselves.
To what extent do our HR professionals play employee advocate, human capital developer, functional expert, strategic partner, and leadership roles?
In the 1990's we talked about 4 roles for HR: strategic partner, change agent, employee advocate, and administrative expert. Each of these roles defined the deliverables of HR: strategic partners helped make strategy happen; change agents managed change; employee advocates nurtured employees, and administrative experts did HR work efficiently, In the value driven world, these roles have shifted somewhat. We still need employee advocates who care about, defend, and manage employees. But, as intellectual capital becomes ever more scarce and the war for the right talent continues, we also need HR professionals who are developing future human capital, who envision what individual abilities will be required of the organization in the future and finds way to get them. We also need HR professionals who are not just administratively efficient, but functionally expert. There is a body of knowledge in compensation, training, work redesign that an HR Professional should master. Being competent in what we are expected to do requires continual education. HR professionals must continue to make strategy happen by being able to turn strategies into actions. They should be able to do organization audits that identify gaps and then they should be able to fill those gaps. And, finally, all HR professionals should become leaders who take responsibility for their own development and the success of the company.
To what extent do our HR professionals demonstrate competence in strategic contribution, HR delivery, business knowledge, personal credibility, and HR technology?
To fulfill these roles, HR professionals must be competent. We have collected data for about 18 years from nearly 30,000 people on what makes a competent HR Professional. We have collected this data in waves and across nearly all continents. We now can say with some assurance what HR professionals must know and do to be not only be seen as competent by those who rate them, but also to contribute financial value to their firm. And the competencies are:
Strategic capability: HR professionals must help a company deliver strategy
Personal credibility: HR professionals must gain the trust of those they serve
HR mastery: HR professionals must become experts in their chosen domain.
Business literate: HR professionals must be able to communicate in business terms
HR systems: HR professionals need to learn to use technology
We now know what it takes. We know the roles we should play and the competencies required to play them well.
The final criteria is that we should invest in ourselves.
To what extent do we invest in improving the quality of HR professionals through training and development?
As the profession changes, so must we. The half life of knowledge in our profession is changing. Much of what we knew when we entered HR as a career has moved. We need to continually invest in learning through reading, listening, observing, and practicing. Our colleagues have shown that those who are learning agile are far more successful. The same applies to each of us.
So, for the trainer or compensation specialist, let me pose some questions. What roles do you play today and what should you be playing tomorrow? Once you have mastered being a functional expert, can you begin to apply your knowledge to the other roles? How do you rate against the 5 competencies we have identified for successful HR professionals? Where do you need to improve? What investments are you making to read, listen, observe, and practice new skills. Are you building on what you have known to create your future.
Can we really change?
The theory and journey laid out in this logic is intense and extensive. Again, it is all based on a simple principle:
HR must create value
And, this principle breaks into five factors:
HR value is created through
Knowing the business realities
Serving key external and internal stakeholders
Adapting HR practices
Aligning HR departments
Investing in HR professionals
To do these five factors, we have identified 14 criteria to judge the new HR. These criteria become the requirement for reframing and transforming HR. These criteria become the basis for our journey ahead.
Now for the application. The bottom half of the diamond.
3 conversations:
As a result of this theory and logic, we would suggest that HR professionals engage in three conversations.
Conversation 1:
With your business leader
Sit down with your business leader. We listen carefully to the realities that our business is facing. It might be a competitive threat, a customer bailing ship, a technology discontinuity, or a leadership shortage. Help the business leader see that we can add value to their problems. We can help investors make intangibles tangible and increase confidence in our organization. We can bond with targeted customers and gain their customer share. We can help line managers make their strategies happen by building stronger organizations. And, we can ensure that employees have both the competence and commitment to do their work.
This conversation may be private between you and your business leader or it may be in a staff meeting where you begin to describe how you will help key stakeholders get what they need. This conversation may be part of an on-going dialogue you have already begun or it may be a new discussion where you test the HR value waters for the first time.
Conversation 2:
With your HR team
When talk about HR Value proposition to line managers, they generally start very skeptical. OK, here comes another slogan or platitude about people as our most valuable asset. But, when they start to realize that through value based HR, their stock options will be worth more; their key customers will give them more money; their strategies that they have been forming for months or years will happen; and that their employees will actually engage in the work, they begin to see the light. Their eyes sort of light up and they say, "give me what you propose ... where do I find it." When I suggest the look into their HR department, sometimes the guffaw and laugh.
We have to change this image. Now. We have to have hard, candid conversations within our HR community. We can add value. The path to doing so is clear. Now, we have to do it. If HR professionals in your organization want to languish in the past of security based and risk-free HR doing routine and standard work, engage them in what can be. We are players today who can not idly stand by and watch as our opportunity for impact passes by.
If you are the team leader of an HR team, challenge your HR professionals to play the roles they must and to master the required competencies to be a valued player. If you are a team member, propose a new view of HR. Paint the picture of HR that engages others in a new dialogue.
Conversation 3:
With yourself
Talking to yourself can be dangerous at times. But, it can also be healthy. Look at the 14 criteria. Am I really ready to play a value based game with investors, customers, line managers, and employees. Can I manage the HR flows with people, performance, work, and information? Can I help craft an HR strategy and design an HR organization that will deliver value? Am I ready to play? In all likelihood the answer is 'maybe" ... in some areas, I am close and in other areas I am not. So talk to yourself. Commit to yourself and others that you will make a difference and play a contributing role. Improve yourself.
1 principle
5 factors
14 criteria
3 conversations
1 enduring thought and reminder
Now, at the end of our HR value journey, let me touch on and highlight some things I have learned in the past three years. This is not the forum to discuss a lot of the details, but I have had the privilege of sitting knee to knee, eye to eye, and soul to soul with hundreds of people who want to find a direction in their lives.
A major reason I am choosing to stay in the HR profession is that we are the soul of our organizations. We continue to help the helpless and offer insight to those in need. We are about business and competitiveness and winning. But, HR value is more than numbers, it is building the value of responding to a set of universal needs.
I have learned in the past few years, that there are universal needs: needs for:
The peace from meaning: a sense of purpose, an identity, a sense of pride in oneself
The resilience of hope: a sense of the future and what can be, an ability to change and become something new, to make the next two years of your life the best ever
Growth through learning: a sense of personal learning one step at a time through successes and failures, an ability to try and move forward
Joy of relationships. We are not on an isolated island. We live with and through others. We find the greatest joy and sorrow within those relationships.
The universal needs for meaning, hope, learning, and relationships go beyond work, but work is the place where these relationships are played out in what Kenny Moore calls a universal language. Meaning comes as we articulate values and set visions; hope comes through our goals and strategies; growth comes via education, training, and job experience; and relationships come through mentoring, teams, and work design.
I am proud to be in HR because we offer meaning, hope, growth, and relationships to those we serve. Ultimately, we create organizations we are proud of, not just for the business value, but for their personal values.
Let us not lose sight of this remarkably important and enduring source of energy that unifies all of us in this noble HR profession. We create value. For each individual who crosses our path or who is touched by our efforts. And as a result of our work, their lives are a bit richer and more abundant.
From India, Mumbai
WHAT IS NEXT FOR HR? By David Ulrich, Ph.D.
The HR profession is in a state of constant flux. This is not a surprise since most of the world we live in is in flux. Change is happening all around us and HR can not be immune. This paper lays what might be "next" for our HR profession. The ideas are drawn from people whom I admire deeply. In the last three years while on sabbatical I have been a bit away from the daily routines of HR. But, I have stayed in contact with the book The Future of HR edited by Mike Losey, Sue Meisinger, and me. We asked 61 other thought leaders to answer the simple question, "what is next for HR?" and we received very insightful and creative essays. Their collective work has informed my thinking and I draw from it. In addition, Wayne Brockbank and I have worked together for over 20 years to think about and prod the profession we care about. In the process, I can seldom separate my ideas from his, but need to acknowledge that my thinking has been profoundly influenced by this exceptional colleague and dear friend. Our book The HR Value Proposition contains most of the ideas in this paper. But this paper extracts them and offers an executive summary of HR and where it is going.
Defining the future for a profession has two parts: theory and action. Theory offers insights on where the profession should be headed, questions it should be dealing with, and the rational for why things should be as they should be. Action turns theory into ideas and makes sure that ideas have impact. Theory without action is abstract and inane. Action without theory is random and unfocused. We need both.
I like to connect theory and action with the image of a diamond. At the top, we start with simple questions, then as the diamond gets larger, these questions turn into more elegant responses which become complex at times. At the wide angle of the diamond, the theory becomes rather intricate as the subtleties of the theory become apparent. Here is where theory is both the best and worst. At its best theory explains why things happen in enough detail to predict the future with some degree of certainty. At its worst, theory becomes academic and so complex and removed from reality that it can not lead to change. So, the bottom half of the diamond is critical to turn the elegant and complex theory into simple and doable actions. This requires working on the questions "so what does this mean?" and coming up with specific responses. So, this paper will be organized by the numbers:
1 fundamental message
5 key elements or factors to this message
14 criteria for the new HR
3 conversations you should hold
1 enduring thought and reminder
1 Fundamental message
We exist as an HR profession because we add value. Value means many things. It comes from the Latin word valuta which means to be worth something. In our modern day, value as a noun may refer to the values and beliefs we hold or to the monetary value of an item As a verb it refers to the process of assigning monetary worth of an item or to consider something highly (I value your opinion). Regardless of its use as noun or verb, the fundamental message of value is that value is defined more by the receiver than the giver. Let me give two personal examples of this how value is defined by the receiver more than the receiver. We are in the process of selling a house in Michigan. We have invested a great deal in this house. We think it is a marvelous house with the right bedrooms, living space, and offices for our family for the past 15 years. We designed the house and it has met our needs. So, we figured out what we felt it might be worth by comparing to other (obviously less good houses in the neighborhood) and listed it with a realtor. A few months later after no offers and traffic, we lowered the price about 12%. Immediately neighbors who recently bought homes called us to chastise us for "hurting the neighborhood" by having lower our price. Our simple response was that the market picks the price, not us and our desires. Value is defined by the receiver more than the giver. And, we have had to lower the price again to make the sell.
Second, and I have shared this before. I know that in my relationship with my wife of 30 years, the value of a gift I select for her is defined by her more than me. My preferred gifts ( e.g., tickets to the NCAA finals) may not mean as much to her than me. So, I learn to give her gifts that mean something to her, the receiver, more than me, the giver. This means varying the gifts and offering what might mean more to her than me. Recently, this mean offering her a gift of weight loss, which she readily accepted and I have attempted to do.
So what does value have to do with HR? Simply stated, we exist as a profession because what we do creates value for someone else. If we do not carefully consider the value we create, we will focus on what we want, not what our stakeholders need and desire. We may build elegant programs and practices, but until and unless someone finds them of value, they are not.
1 fundamental message: Value is defined by the receiver more than the giver.
5 factors or elements to determine value
So, how do we go about turning this message of value into something more elegant. We propose a five factor "solution" to the HR value proposition. Each factor represents a key element of HR's creation of value. These five factors are the elements that will enable HR professionals to determine and create value.
Factor 1: External Business Realities
To define an HR value proposition, we do not begin with who we are or what we know and do, but with the context of where we do our work. We have to understand and appreciate the world that our stakeholders live in so that they can trust us to understand them. HR actions inside a firm must reflect and influence business realities outside that firm. HR professionals should be able to cogently discuss these external realities—the technology, regulatory and economic factors, and demographics of the global business environment—and connect them to their day-to-day work. Knowing business realities makes it possible to put HR practices in context, tie them to competitive challenges, and relate them to concerns facing line managers. These contextual factors offer the rationale for why an HR transformation should occur. Everyone in your HR function should be conversant with both the realities of the external world and how HR actions will help your firm compete in this changing context.
Factor 2: Stakeholders
Value is defined by the receivers of HR work—the investors, customers, line managers, and employees—more than by the givers – HR professionals. HR is successful if and when its stakeholders perceive value from it. Delivering what matters most to stakeholders focuses on the deliverables (outcomes of HR) rather than on the doables (activities of HR). The deliverables of HR involve those outside the firm and come in the form of investor intangibles and customer share. The deliverables also come from activities inside the firm like organization capabilities and/or individual abilities.
The context and stakeholders are those things that happen outside our HR world. We start there because by going outside/in we learn what we need to do to create value.
Factor 3: HR Practices
HR practices institutionalize beliefs and values and make them real to all stakeholders. For example, the way you hire, train, or pay people or the way you organize work sends messages to employees about what matters most. There are almost an unlimited list of HR practices that focus on all sorts of things ranging from internet hiring to performance appraisals to coaching teams to communicating with employees. We have taken the liberty of organization HR work into four flows, each representing a cluster of HR activities. These flows are HR practices around people, performance, information, and work flows,. Within each of these flows, HR professionals may create and/or identify HR practices to manage this flow. We like the metaphor of a menu. On a menu in a restaurant you have categories of food (appetizers, salads, main course, drinks, desserts, etc.). Within each food category, are a list of choices that the patron might select from. Likewise the HR menu may be clustered into people, performance, information, and work pages with menus of choices in each category. These HR practices deliver value to internal and external stakeholders when they are appropriately aligned with your organization goals. They also ensure that the organization outlives any individual leader. They become cultural pillars for your organization.
Factor 4: HR Department or Function
The HR function within your company needs to be thought about as a business. As a business embedded within the company, your HR function needs a strategy and structure that will deliver value. The strategy will help you focus attention on key factors and respond appropriately to business realities; the structure will organize HR resources in ways that govern how HR work is done. The strategy and structure of your HR department will ensure that HR resources are deployed where they add the most value.
Factor 5: HR Professionalism
Each HR professional in your organization must learn to play a role and master competencies to deliver value. Roles represent what people do; competencies define how they do it. HR functions are only as good as the people who inhabit them, so having clear roles and distinct competencies ensures that they will deliver they value they intend. And HR Professionals must invest in themselves and continually improve.
That's it.
1 principle: HR must add value
5 factors to creating value: external realities, key stakeholders, HR practices, HR departments, and HR professionals.
This is a simple logic. It makes sense. It reflects what most of us feel and many of us know about HR and its role in today's organization. It offers a destination for where we are headed as a profession (value) and how to get there (five factors).
But, I have learned in recent years that having a roadmap and getting to the destination are two very different things. To turn these simple ideas into reality is not easy. It will require a new set of criteria by which we will ask others to judge us and by which we will judge ourselves. These criteria follow the simple flow we have started, but they push us to become more than what we have been.
The HR Value Proposition
14 Criteria for HR Value
With value as the guiding principle and the five factors as the key elements, we can now define the requirements or criteria for the new HR, for what lies ahead. Each of these criteria can be used as a self assessment (see tool on www.rbl.net) or an assessment of your HR department. They are the milestones of the HR Journey we need to take. If we meet these criteria, we will deliver value and be seen as credible. If we miss some, we should not despair, but focus and invest in ourselves to get prepped for what lies ahead. Unfortunately, at this point what seems simple become a bit more complex because the world we live in is complex and requires that we stretch ourselves.
To what extent do the HR professionals in my department understand how external realities of technology, economics, and demographics in the global context affect our industry and business?
We should go beyond sensing that the external world is changing and be able to talk to our business colleagues about specific changes and how they affect our business. These new business realities include but are not limited to:
Changing technologies: What is the pace of technological change in our industry? What new technologies will change the products we produce, services we provide, and ways we work together?
Changing economics: do we know the changing nature of competition within our industry? The changing customer expectations? The changing competitors we might face?
Changing demographics: how will our workforce change, both within our country and globally? What will be the expectations and requirements of the workforce of the future? Where will we find them? How will we develop them? How will we retain them?
Saying the world is changing and being able to engage in a conversation about the changing world are two different things. Then, turning conversation to action requires a new set of skills.
As an HR professional, how would you respond if you were asked to discuss the technological, economic, and demographic global changes in your firm and industry. Would you be able to do it? Would you be able to credibly present to a group of line managers within your firm, potential employees to the firm, customers and/or suppliers to your firm, and/or investors? Some firms used to define "market share" as North American when the real market was global; other HR folks are so busy doing HR that they lose sight of why.
To what extent does our HR work link to the intangibles that investors value?
Investors in for profit firms show up as stockholders; in not for profit firms they show up as donors, alumni, political allies, and financiers. We must pay attention to these investors. And increasingly they are not just looking at tangible cash flow, but at intangible corporate reputation. The intangibles represent about 50% of the market value of a firm. As HR professionals we should be able to play in the intangible game.
The importance of intangibles has become clear both in practice and research. Researchers who study market behavior have found that intangible issues are central to investor decisions. At times, these investors are fuzzy about what constitutes an intangible (thus its name, perhaps?), but they know that they matter. In practice, when HR folks can help investors have confidence in the quality of organization and management, they have a stronger belief in the future of the company and intangible value goes up (as reflected in stock price). As HR professionals, we can and should be involved with investors. Take the investor test:
Who are the major investors to my firm?
What are the buying (or not)?
What is our intangible vs. tangible value compared to our leading competitor?
What can we do to increase our intangible value?
How can we include investors in designing and delivering our HR practices?
To what extent do we use HR practices to build long-term connections with target customers?
Creating customer value comes from products and services, but also from relationships. Long term customers often find parity in price and product mix, then differentiate based on relationships. 20% of the customers who represent 80% of the firms revenues deserve special attention. Customer share replaces market share. How do we work with them? As HR professionals we can play a major role in connecting with these target customers.
The importance of bonding customers through HR can be demonstrated with a simple examples: restaurants. Imagine that you own a small restaurant. Your goal is to increase revenue. This would likely start by identifying target customers, or those who live with 15-20 minutes of your restaurant and who eat in restaurants 15 or more times a month. These are the target audience and those you want to go after. They already spend the money on eating out, so your job is to get them to spend this money on you. Take a specific customer who might now eat in your restaurant 3 times a month, or have 20% customer share (3/15). Your goal might be to increase this customer's share to 40% (6 times a month in your restaurant). You would do this by include this customer in all sorts of decisions like product mix (what you serve), but also decisions around culture (ambiance, setting) and people (who you hire, how you train and pay them, and how you communicate with them). By including customers in traditionally internal practices, they become more bonded to you and may increase their share.
More complex examples abound. Customers may be involved in staffing by helping define the criteria for future employees, by recommending future employees, or by interviewing potential employees. They may be involved in training by designing the curriculum, by attending the courses, or by helping teach the courses. They may be involved in rewards by defining the standards for performance, by participating in the performance reviews of those standards, or by directly or indirectly allocating rewards. They may help with communication by sharing information about what is desired.
By talking about investors and customers we are pushing ourselves out of our traditional HR comfort zone. When we go outside to create intangible value for investors and customer share for targeted customers, we deliver enormous value to our organizations.
To what extent do we create value for line executives by auditing and creating organization capabilities that will turn strategy into action?
Once we turn our attention inside the organization, we also deliver enormous value. We do more than design HR practices or do activities related to HR; we create capabilities. In recent years, organization changes have focused on downsizing, restructuring, and reengineering. All of these efforts are viable and worthy of attention, but all are based on an assumption that an organization is a cost that must be cut. We would rather think of organizations as capabilities that can be leveraged.
When you think of an organization, you don't often think about how many levels of management it has, how it is organized, or how it manages its processes; you think about its identity, its reputation, and what it is good at doing. These factors are the capabilities of a firm. The capabilities of a firm are the deliverables of HR. We should measure ourselves by these deliverables more than the doables. Think of a matrix with rows and columns. Often we think about the rows (or activities of HR): staffing, training, paying, communicating, etc. But, unless these rows are lined up with the columns (the deliverabvles of HR), we are not really adding value. Activity without outcome is random and senseless. We used to talk about the importance of everyone receiving 40 hours of training a year, but when you think about this for a minute, it hits you that the activity (40 hours of training) is less important than the outcome of the activity (our organization is faster to market than someone else). The outcomes or deliverables of HR are the capabilities of an organization. These capabilities might include things like speed, collaboration, learning, accountability, leadership brand, talent, shared mindset, or other things that give your organization its reputation. The capabilities of a firm represent the deliverables of HR and the intangibles that investors value and the shape the connection that customers value.
To what extent do we have a clear employee value proposition that lays out what is expected of employees and what they get in return?
We are finally going to talk about people. Yes, we are "human" resources and people or employees are a key stakeholder, but no longer our only stakeholder. We build an employee value proposition when employees who give to the firm get something back from the firm. Employees give by providing competence and commitment to the organization; and in return those who are competent and committed get back good things like meaning, vision, opportunities to learn and grow, money, community, etc. We should help guarantee that each employee has both the competence and commitment to perform at high standards. Competence ensures that employees have ability; commitment that they have desire and dedication. And, when employees demonstrate competence and commitment, they get back from the organization things that matter to them. Our challenge and opportunity is to ensure that we create an employee value proposition . Employees who give and contribute to the firm should get back from the firm.
Many companies have employee value propositions where employees give a lot and get a lot back in return. The get back may be financial (stock options at a growing firm) or relational (the opportunity to work on teams). HR professionals who build an employee value proposition deliver value.
So far, we have focused on what is outside the direct purview of HR: business realities and 4 stakeholders, 2 outside the firm and 2 inside. If we master these contextual factors, we can then shape HR.
But, HR may mean a lot of things. Let us suggest three: [1] HR practices, or the policies, procedures, and work we do. [2] HR departments, or the organization we create. And, [3} HR professionals, or the people like us who chose to create these practices and work in these departments. Criteria 6, 7, 8, and 9 refer to HR practices; 10 and 11 to HR departments, and 12, 13, and 14 to the HR professionals.
HR Practices:
The work of HR includes many practices and activities. The array is long as evidenced in many great books or training programs that talk about a lot of HR work. At the risk of grossly oversimplifying the complex work of HR, we have created a typology of four flows of HR work. Each flow represents a critical resource to the firm: people, performance, information, and work. Each flow has the requirement to deliver value to stakeholders. For each flow, we can create a menu of choices that can be used to figure out which HR practices work best. A menu is a simple, but useful metaphor. In a good restaurant, the menu tells me the things I could chose to eat, depending on my desires and needs. Likewise HR menus allow HR professionals to select the HR practice (in people, performance, information, or work) that best meets the needs of the business, given its strategy. The menu approach does not say that one size fits all, but it suggests that good HR Professionals help managers pick what will work best given the business strategy.
To what extent do our HR practices that focus on people (staffing, training, development) add value?
Clearly HR should take the lead in managing the flow of talent in, through, up, and out of an organization. We do so by buying, building, borrowing, bouncing, bounding, and binding talent. When the flow of people in an organization is right, investors have confidence in management, customers build relationships of trust with key employees, and line mangers are assured that their strategies will be accomplished. Our profession has rapidly grown to offer insights on this people flow, from 360's, to learning agility, to behavioral based interviews, to internet hiring, to leadership development, to referral networks to outplacement to outsourcing to action learning in training, to learning from experiences to contracting for employees to retaining the best talent to removing the worst talent to promoting those who have the most skills, and to other people practices that continue to affect how we treat people in organizations.
To what extent do our HR practices that focus on performance (setting standards, allocating rewards, providing feedback) add value?
We in HR also manage the performance flow in an organization. Through managing performance, individuals face positive and negative consequences for their performance and become accountable for it. Compensation systems should be open to investors so that they have confidence in what management is encouraging and rewarding; they should also be transparent to customers. If a customer could design a performance appraisal form that highlighted the prototype employee the customer would want, would it look like the appraisal you are using? Do the investor and customer voices get heard when evaluating employees? Are 360's being turned into 720's where those outside the firm are also participating in evaluating performance?
A lot of performance comes from follow up. When we consistently report on how we are doing and hold people accountable for doing, they do more.
People and performance have traditionally been the "strike zone" for HR work. We have been and should continue to be known for innovative and impactful HR practices in people and performance. But, we can go beyond this.
To what extent do our HR practices that focus on information (outside-in and inside-out) add value?
Within any organization the flow of information sends signals about what matters most. When HR professionals participate in turning external information into internal actions, they deliver value. When they help line managers tailor and shape messages so that they penetrate all organization layers, they deliver value. And, when they help share information across organization divided by function, product, or geography, they deliver value. Good information is timely, focused, consistent, tailored, and simple. When we know why we do what we do, we accept the what.
To what extent do our HR practices that focus on work flow (who does the work, how is the work done, and where is the work done) add value?
Organizing work so that it is done both efficiently and effectively can come from insightful HR professionals who are gifted at managing teams, organization designs, work processes, and work settings. Knowing what type of discipline to put on how work is done will HR investors believe that resources are correctly allocated, enable customers to smoothly interact with the firm ( e.g., with a customer account manager, for example), and help line managers ensure that the structure follows the strategy. One of the emerging areas for HR practices is work space. Work space sends a cultural message about the company's values; it also enhances productivity and increases employee retention. HR professionals can and will engage with architects and facility managers to create great places to work.
As HR professionals, we should feel an obligation to build emerging HR practices in people, performance, work, and information. When these practice domains are aligned to employees, line managers, customers, and investors, we deliver enormous value.
HR Governance
We need to think of HR like a business. As a business, we have to to organize and govern our own resources. HR departments often are the last to be reorganized and transformed, when we should be the model that other staff functions should follow. There are two basic elements of putting our own hose in order.
To what extent does our HR strategy process turn business goals into HR priorities?
We need to think of HR as a business and a business starts with a strategy. Where are we going? What are we trying to do? What are the key investments we need to make to succeed? What is our vision for HR? What are our goals? A business needs a Vision, Goals, Actions, and Follow up. An HR strategy offers this methodology to our function. Our HR business plan turns external business realties into on going HR investments. The strategy should not be an afterthought to a business strategy nor an isolated thought relevant to a business strategy. It should be an integrated component of what the business is doing and help every line manager know that aspirations will lead to actions. The HR strategy is simple: strategy from the business, capabilities from the organization, and action from HR leads to results.
To what extent is our HR organization (e-HR, service centers, centers of expertise, embedded HR, and outsourcing contracts) aligned with the business strategy?
And, with an HR strategy in place, HR can now be organized appropriately. HR organizations are currently being split in two. Part of HR work deals with the administrative and necessary processes for organizations to operate. People have to be hired, trained, relocated, paid, and given benefits. Many of these tasks are standard, routine transactions that can be done more efficiently. And, they are being increasingly done through service centers, e-HR, and outsourcing. The criteria for these administrative tasks is efficiency, doing more with less and thus reduces costs that adds value to investors and customers.
But HR is also about transformation not just transaction. As HR professionals help line managers deliver strategy through capabilities; employees gain abilities, customers develop relationships, and investors increase confidence, they transformation the way work is done. We have found that the transformation of HR does not end by putting in an new HRIS system or by form ing centers of expertise. It requires a complete overhaul of the HR organization to assure that HR will be governed in a way to deliver on strategy.
HR Professionals
Now, we get to me. What does this new HR value proposition mean to me? I work in compensation doing market analysis, what value do I add? I work as a trainer or facilitator, how does all this talk of investors and customers relate to me? I work as a plant HR manager, what can I really do?
We suggest that each of us in HR should become more professional by recognizing and playing the right role, by gaining competencies required for success, and by investing in ourselves.
To what extent do our HR professionals play employee advocate, human capital developer, functional expert, strategic partner, and leadership roles?
In the 1990's we talked about 4 roles for HR: strategic partner, change agent, employee advocate, and administrative expert. Each of these roles defined the deliverables of HR: strategic partners helped make strategy happen; change agents managed change; employee advocates nurtured employees, and administrative experts did HR work efficiently, In the value driven world, these roles have shifted somewhat. We still need employee advocates who care about, defend, and manage employees. But, as intellectual capital becomes ever more scarce and the war for the right talent continues, we also need HR professionals who are developing future human capital, who envision what individual abilities will be required of the organization in the future and finds way to get them. We also need HR professionals who are not just administratively efficient, but functionally expert. There is a body of knowledge in compensation, training, work redesign that an HR Professional should master. Being competent in what we are expected to do requires continual education. HR professionals must continue to make strategy happen by being able to turn strategies into actions. They should be able to do organization audits that identify gaps and then they should be able to fill those gaps. And, finally, all HR professionals should become leaders who take responsibility for their own development and the success of the company.
To what extent do our HR professionals demonstrate competence in strategic contribution, HR delivery, business knowledge, personal credibility, and HR technology?
To fulfill these roles, HR professionals must be competent. We have collected data for about 18 years from nearly 30,000 people on what makes a competent HR Professional. We have collected this data in waves and across nearly all continents. We now can say with some assurance what HR professionals must know and do to be not only be seen as competent by those who rate them, but also to contribute financial value to their firm. And the competencies are:
Strategic capability: HR professionals must help a company deliver strategy
Personal credibility: HR professionals must gain the trust of those they serve
HR mastery: HR professionals must become experts in their chosen domain.
Business literate: HR professionals must be able to communicate in business terms
HR systems: HR professionals need to learn to use technology
We now know what it takes. We know the roles we should play and the competencies required to play them well.
The final criteria is that we should invest in ourselves.
To what extent do we invest in improving the quality of HR professionals through training and development?
As the profession changes, so must we. The half life of knowledge in our profession is changing. Much of what we knew when we entered HR as a career has moved. We need to continually invest in learning through reading, listening, observing, and practicing. Our colleagues have shown that those who are learning agile are far more successful. The same applies to each of us.
So, for the trainer or compensation specialist, let me pose some questions. What roles do you play today and what should you be playing tomorrow? Once you have mastered being a functional expert, can you begin to apply your knowledge to the other roles? How do you rate against the 5 competencies we have identified for successful HR professionals? Where do you need to improve? What investments are you making to read, listen, observe, and practice new skills. Are you building on what you have known to create your future.
Can we really change?
The theory and journey laid out in this logic is intense and extensive. Again, it is all based on a simple principle:
HR must create value
And, this principle breaks into five factors:
HR value is created through
Knowing the business realities
Serving key external and internal stakeholders
Adapting HR practices
Aligning HR departments
Investing in HR professionals
To do these five factors, we have identified 14 criteria to judge the new HR. These criteria become the requirement for reframing and transforming HR. These criteria become the basis for our journey ahead.
Now for the application. The bottom half of the diamond.
3 conversations:
As a result of this theory and logic, we would suggest that HR professionals engage in three conversations.
Conversation 1:
With your business leader
Sit down with your business leader. We listen carefully to the realities that our business is facing. It might be a competitive threat, a customer bailing ship, a technology discontinuity, or a leadership shortage. Help the business leader see that we can add value to their problems. We can help investors make intangibles tangible and increase confidence in our organization. We can bond with targeted customers and gain their customer share. We can help line managers make their strategies happen by building stronger organizations. And, we can ensure that employees have both the competence and commitment to do their work.
This conversation may be private between you and your business leader or it may be in a staff meeting where you begin to describe how you will help key stakeholders get what they need. This conversation may be part of an on-going dialogue you have already begun or it may be a new discussion where you test the HR value waters for the first time.
Conversation 2:
With your HR team
When talk about HR Value proposition to line managers, they generally start very skeptical. OK, here comes another slogan or platitude about people as our most valuable asset. But, when they start to realize that through value based HR, their stock options will be worth more; their key customers will give them more money; their strategies that they have been forming for months or years will happen; and that their employees will actually engage in the work, they begin to see the light. Their eyes sort of light up and they say, "give me what you propose ... where do I find it." When I suggest the look into their HR department, sometimes the guffaw and laugh.
We have to change this image. Now. We have to have hard, candid conversations within our HR community. We can add value. The path to doing so is clear. Now, we have to do it. If HR professionals in your organization want to languish in the past of security based and risk-free HR doing routine and standard work, engage them in what can be. We are players today who can not idly stand by and watch as our opportunity for impact passes by.
If you are the team leader of an HR team, challenge your HR professionals to play the roles they must and to master the required competencies to be a valued player. If you are a team member, propose a new view of HR. Paint the picture of HR that engages others in a new dialogue.
Conversation 3:
With yourself
Talking to yourself can be dangerous at times. But, it can also be healthy. Look at the 14 criteria. Am I really ready to play a value based game with investors, customers, line managers, and employees. Can I manage the HR flows with people, performance, work, and information? Can I help craft an HR strategy and design an HR organization that will deliver value? Am I ready to play? In all likelihood the answer is 'maybe" ... in some areas, I am close and in other areas I am not. So talk to yourself. Commit to yourself and others that you will make a difference and play a contributing role. Improve yourself.
1 principle
5 factors
14 criteria
3 conversations
1 enduring thought and reminder
Now, at the end of our HR value journey, let me touch on and highlight some things I have learned in the past three years. This is not the forum to discuss a lot of the details, but I have had the privilege of sitting knee to knee, eye to eye, and soul to soul with hundreds of people who want to find a direction in their lives.
A major reason I am choosing to stay in the HR profession is that we are the soul of our organizations. We continue to help the helpless and offer insight to those in need. We are about business and competitiveness and winning. But, HR value is more than numbers, it is building the value of responding to a set of universal needs.
I have learned in the past few years, that there are universal needs: needs for:
The peace from meaning: a sense of purpose, an identity, a sense of pride in oneself
The resilience of hope: a sense of the future and what can be, an ability to change and become something new, to make the next two years of your life the best ever
Growth through learning: a sense of personal learning one step at a time through successes and failures, an ability to try and move forward
Joy of relationships. We are not on an isolated island. We live with and through others. We find the greatest joy and sorrow within those relationships.
The universal needs for meaning, hope, learning, and relationships go beyond work, but work is the place where these relationships are played out in what Kenny Moore calls a universal language. Meaning comes as we articulate values and set visions; hope comes through our goals and strategies; growth comes via education, training, and job experience; and relationships come through mentoring, teams, and work design.
I am proud to be in HR because we offer meaning, hope, growth, and relationships to those we serve. Ultimately, we create organizations we are proud of, not just for the business value, but for their personal values.
Let us not lose sight of this remarkably important and enduring source of energy that unifies all of us in this noble HR profession. We create value. For each individual who crosses our path or who is touched by our efforts. And as a result of our work, their lives are a bit richer and more abundant.
From India, Mumbai
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