The New Frontrunner

THE CHIEF HR OFFICER IS NOT THE UNDERDOG ANYMORE. HE HAS A CRITICAL ROLE TO PLAY IN CREATING VALUE FOR EVERYBODY IN THE CORPORATE CHAIN.

The Chief HR Officer is not the underdog anymore. He has a critical role to play in creating value for everybody in the corporate chain

I t is not a cliché to state that it is not the businesses that create value, but the people. On average, the workforce roughly comprises 70 per cent of a company’s expenses. It will be less of a surprise to know that today’s increasingly competitive environment is putting immense pressure on businesses and their CHROS to play a more critical role in driving business outcomes. Yet, the vast majority of HR organisations still lack the workforce intelligence capabilities required to strategically analyse, align, and act on critical workforce issues.

It is important to examine the present

status of CHROS and understand the value they are creating in businesses against what is expected of them.

In the Indian business landscape, presumably, only a handful of HR leaders have made a mark, contributing significantly to the overall business milieu. There are possibly rare cases where CHROS also have had the sharp corporate acumen to head operations of organisations. The indicative ratings (see The HR Scoreboard) can simply not be an average of gloomy opinions or biases against CHROS; yet, there must still be hope for HR to be considered relevant in the hyper-competitive business scenario of tomorrow.

There remains a growing disbelief in HR as a truly strategic function in the organisation helping align the workforce strategy with the business strategy. Generally, it is observed that CHROS are too swamped with administrative and day-to-day issues; they are either unable to put in time and efforts in understanding business intricacies or are too fatigued to willingly do so. Some try to run away from number crunching or expanding their scope of work or profile. Excessive use and preference of email communication over one-onone personal interactions have also resulted in HR’S diminishing role. Senior executives often think that HR is limited in their business thinking and work away in an ivory tower of impractical, far-fetched HR jargon, not aligned to business strategies. But is it the mistake of CHROS alone that they cannot focus on supporting the overall business strategy?

On one hand, the function of HR certainly has to upgrade – get out of the IT backlog, stop excessively waiting for new HR systems to be implemented, and enable its business partners, leaders and managers with intuitive, collaborative workforce intelligence solutions. On the other hand, CEOS must also focus on upgrading HR. Most often, they use them as supporting players brought in to implement decisions that have already been made. CEOS are too drowned by short and long-term numbers. They want everything fast and on the spur of the moment. Consequently, they lose sight of the criticality of the HR function. They feel disillusioned by HR’S purpose but do nothing to elevate it.

Elevating HR requires redefining the work content of CHROS. Boards have to step in, spell out expectations of CHROS and not leave it to the CEO alone, who is also caught in the quagmire of top and bottom lines. CEOS and the boards must jointly identify HR’S key professionals and their potential; then train them and provide exposure to strategy and business so that when one of them takes over as the CHRO, he is fully equipped to handle the stress of balancing talent management skills with the leadership role. Akin to succession planning for positions like a CEO or COO, CHRO is a longdrawn process.

In July 2014, in one of his articles for HBR, celebrated Indian corporate author Ram Charan argued that most CHROS have not proven themselves to be the business partners CEOS want. He wrote that HR must be

THE NEW CHRO IS AN ASSERTIVE, DATA- DRIVEN, STRATEGIC LEADER WHO DEMONSTRATES BUSINESS CONFIDENCE AND CREATIVITY

split into two functions – one to primarily manage compensation and benefits, reporting to the CFO, and another, focused on leadership, organisation, strategy, and improving talent, to report to the CEO. The second team “would be led by high potentials from operations or finance whose business expertise and people skills give them a strong chance of attaining the top two layers of the organisation” he explained. Responding to Charan’s article, Dave Ulrich, a consultant and professor at the Ross School of Business, University of Michigan, wrote that top HR professionals already add strategic value, and the majority of the rest could be “trained” to do so. He stated that sometimes HR is hindered by its own lack of ability, and added that often HR professionals are blocked by senior leaders who don’t appreciate the value they offer.

CEOS must use CHRO’S knowledge of people to assess the chances of meeting business goals and suggest appropriate ways thereafter to fit with teams, leadership and the overall culture of the organisation. He must proactively assist finding out gaps and prescribe actions. Many HR people treat all employees equally, but as per Peter Principle, HR treats those 20 per cent super important people who achieve 80 per cent of the organisation’s goals differently. CHROS must work collaboratively with managers and CEOS to assign KPIS, map relevant talent against targeted objectives to assist everyone involved in the task to achieve desired outcomes. If necessary, they must change and develop new metrics and reward systems if need be.

CHROS should also be able to make meaningful predictions about competition. They should conduct periodic SWOTS of each vertical from the viewpoint of people, cultural-fit and handpick related issues to suggest interventions or improvements. CHROS must also go in depth and diagnose how the various parts of the social system of the organisation work systematically, looking for activities that are causing bottlenecks or unnecessary friction and try ironing out the wrinkles. Most of the times, these crucial issues are ignored, leading to irreparable loss for the organisation.

CEOS must be enlightened to give due credits to deserving CHROS and oversight in underperformance must also be strictly avoided. CHROS and their teams must be able to create measurable business impact by identifying and focusing on the most urgent workforce priorities. They must be able to connect with the business with a holistic view and understanding of workforce costs. The new CHRO is an assertive, data-driven, strategic leader who demonstrates business confidence, creativity and innovation. He does not shy away from taking on the responsibility of contributing directly to business performance, and arms his organisation with the solutions needed to be more proactive and factbased in workforce decision making.

The CEOS or the boards must facilitate for CHROS all that is required for them to be the frontrunners. It’s time. ~ The writer is a management thinker & philosopher, a mentor and a strategy consultant, and a veteran of consumer durables and retail industries. He was formerly associated with LG Electronics as its COO and Director

CEOs AND BOARDS MUST IDENTIFY HR’S KEY PROFESSIONALS, TRAIN THEM AND PROVIDE EXPOSURE TO STRATEGY AND BUSINESS