When I speak with client CEO’s or Business Owners, the subject of HR is always there. These leaders frequently profess that HR is an insignificant necessity, mostly existing to demonstrate some type of pro-active defense should these companies ever be sued, or some similar purpose.
That always gets my dander up. However, from my own observations and what these business leaders tell me, there is validity to these perceptions. Perhaps it is because HR is not properly focused.
For many businesses, HR creates an “us vs. them” compliance activity Their focus is on compliance efforts and not on the “how can we help this business be successful” efforts. Transactional activities reinforced by a “do it this way or it is illegal” message that continues to reinforce the “we vs. they” culture is the norm. The focus of HR is purely on HR, protecting the company from employee actions or advocating for employees against management. In these instances, HR becomes “Human Resistance” instead of Human Resources. The positive impact HR has in these organizations is negligible, or imagined.
Over the last decade or so many points have been made regarding what HR must do to impact organizational performance. Some of these are:
Ensuring the workforce engages in the right behaviors which then produce the right outcomes and consequently helping the organization achieve its financial goals.
Identifying organizational core competencies and focusing significant effort on them.
Management of operational processes that emphasize performance, productivity, and efficiency.
Aligning HR processes with organizational strategies instead of HR strategies.
HR is a necessary process for any organization. Whether it is done internally or externally is more a matter of the size of the company, as well as its actual value added, than anything else. Smaller companies should never have HR internally.
Your human resources costs can sometimes be as much as 65% of your operating budget. The effective and accountable measurement of your HR processes is critical to the success of your company. All companies should focus their resources on investing in leadership instead of on administrative processes that can more inexpensively be obtained elsewhere. Larger or midsized companies should give greater thought to automating or outsourcing the transactional administrivia that aligns with HR and focus its dollars on investing in highly competent and experienced leadership and organizational development experts.
Ensuring that you have the right accountability and participation from your HR leadership is critical to that goal. The real focus should be on leadership and for that, a leadership expert is better suited. Notice I said leadership, a method of self-directed empowerment that has sustainable accountability. I did not say, leader, an others directed process relying on a personal style that is not sustainable. Focusing on leadership ensures the long-term strategic direction of the company is properly defined, navigated and accomplished. It survives the natural departure of leaders by ensuring a replicable and consistent conductor culture for the company.
All organizations should, if they want this talent in-house, direct their investments in the direction of leadership development experts. If they are small or wish to have these resources available for other functions, they should outsource these activities to a reliable source that comprehends not only leadership but can develop a system of measurable outcomes from leadership development that is actually supportive of the company’s strategic objectives. While ideally, you would want a leadership training program custom designed for your business this may not be a current reality for you. A short-term option may be a generic local program that covers much of what you believe important until such time as you can obtain a custom Leadership Development program. This is a hugely critical function that companies should give deeper and more critical thought to. While the price may be important it should never be the driving force behind the decision. Further, this is not something you take to a “training” specialist be they internal or external. You need an integrated holistic application of this aligned with your organization’s strategy and providing a measurable outcome. This requires a well-rounded professional who understands Leadership, measuring leadership training outcomes, business, and training. In many instances, that is neither your HR function nor its members. But it should be.
It is a question of value and focus. A value in the understanding that Leadership drives everything in your business and the focus to know how to properly develop it. Start that change today.