What CEO's say they want Human Resources leaders to do in their organizations, and perceptions about the HR function in many organizations are as far apart as Terre Haute and Timbuktu.
Several years ago the cover of "Fortune magazine depicted an executive team seated around a mahogany table; telling and pointed was the vacant HR chair. Today, by expecting more sophisticated business acumen than ever from human resources professionals, "C seat holders have challenged HR leaders to redefine their capabilities and value to an enterprise. No longer are they frequently considered the "masters of morbid detail. Because HR transactional arenas like benefits, compensation, training and even recruiting are increasingly outsourced a clearly defined role for senior HR people is in fast cadence evolution. In reality, however, how often is the VP of HR present at the embryonic brainstorming discussions of new markets, new product launches, acquisitions, mergers or international site selection? Not often enough. Even senior managers in other functions sometimes believe HR is a corporate Siberia with no measurable impact or accountability for business results, and hence run from rotational assignments in the function.
So, what talents should HR executives be honing because they are factors most often desired by CEO's seeking top HR talent? Based on conversations with CEO's hiring their heads of HR, the HR literature and observations of outstanding HR leaders I offer some perspective.
In general, CEO's want HR professionals with voracious appetite for business, professional compatibility with other top executives, and innovative HR operational savvy. Even though some employees still might believe that HR is the place to get free therapy, happiness for lunch, corporate welfare and attagirls/boys, heads of companies expect HR to build people systems and processes to enhance company competitiveness and score well on employee satisfaction and retention. CEO's say they do not want trendy training and fads de jour, personnel administration, HR data that does not link to business initiatives, HR to run "programs, rather HR runs service and quality, drama, an insular vision or "we can't do it answers.
Creative Leadership
Being a trusted business advisor with courageous and sometimes counter-intuitive opinions who happens to head HR is one element of the HR leadership model. The sphere of influence in which a top HR professional operates is culture, organizational strategy, organizational effectiveness, and executive development. One CEO said he speaks with his Senior VP HR 40% of his working time; the head of HR executive should talk to the CEO more than any other business leader. The "talk is sound advice, translating mission, values, vision into viable actions, and the "fierce conversations a CEO needs to hear, and may not hear from other sources. The leadership qualities cited in a 2002 SHRM publication, "Global HR Leaders Agenda in the 21st Century are among others, ethics, cross cultural negotiation skills, context thinking, proactivity on ethics, diversity and retention, and a strong strategic viewpoint. Jim Myers, CEO of PETCO, commends HR's cultural leadership by noting one area of impact: "(HR) has been instrumental in helping PETCO's culture evolve into a performance oriented mindset. The performance and Learning group has worked closely with my management team to develop the PETCO Performance Initiative. Initial results are people more closely focused on getting results in the business. Creative HR leadership in today's roiling and churning companies is courageous and risky.
Talent Acquisition Expertise
The top HR title may not be "Chief of Talent Acquisition but that capability is a top priority with most company heads. How and where to recruit globally, how to spot and develop bench strength, and the ability to personally attract candidates to power build other company functions are all hands-on requirements for the HR head. HR is charged with spotting the next generation of managers and executives within the organization. CEO's want to know who the coming stars are, and how they are being developed and retained. Business units expect HR to staff their areas adroitly with the right combination of regular and contingency workers. CEO's are cited in a 2001 Conference Board survey of over 500 CEO's worldwide as "worried that they don't have the right kind of people for new market conditions. The same sourced indicates that competing for talent has now become the number three management challenge globally; it is number one in Europe, and number two in North America. For some CEO's finding, rewarding, keeping and measuring people results is the singular, hottest criterion of success.
Operational Excellence
The CEO of ITT Electronics in Orange County, CA, said the ticket to the executive table for his head of HR was delivering the basics of HR superbly well. In a presentation to HR leaders he advised them to build their own HR teams as inspirational models and evidence of an ability to deal with tough challenges, thus gaining respect for their work. Delivering transactional HR with speed, efficiency, and no glitches is basic, but imperative. Running a smooth HR shop is entry-level HR management. The CEO of small technology company who could not hire a software expert because HR botched the employee's visa was not amused. At the end of the day, CEO's do not want to hear from key players that they are not getting paid properly or enrolled in benefits correctly. Activities versus results? Business measures results. HR still too often measures activities. Technological know-how for driving both HR and business processes may be foreign territory to some HR experts, but leveraging technology is a "must have competency when CEO's want to improve productivity and reduce costs. E-management of remote locations rather than incurring HR labor costs at remote domestic or international sites is one such application. CEO's want HR executives to communicate operational deliverables and deliver on their promises.
HR Service Innovation
Decisions to make for a world-class HR operation are what functions to keep, what to ditch, what to change, e.g. turn into self-service delivery, what to re-engineer by automating (internally or externally) or by outsourcing. HR cannot 'do it all, so must figure out best practice tactics for day-to-day HR service delivery. Bill Gepphart, General Manager, Cox Communications, San Diego with 2400 employees, commented on the VP HR, Daryl Smith's innovative approaches. "The VP led his team through a strategic planning transition to a new HR service delivery model and a renewed focus on business outcomes. Now, the Performance Consulting team contributes directly to business outcomes by providing systems thinking, Six Sigma, project management, change management, team building and strategic planning to business units. While I have not historically received these services from HR, I couldn't be happier with the results.
CEO's want HR leaders to know what other companies are doing, what faster and cheaper technology can do for HR services, and who the best service providers are. Negotiating workable, favorable contracts follows. Innovation in outsourcing can make or break an HR executive's performance record. Done well outsourcing yields efficiencies and costs savings; done poorly, basic processes are quickly in disarray. HR needs to have thorough knowledge of not only all HR processes, but all business systems and operations to advise wisely on an outsourcing solution.
Business Know-How
Designing compensation plans is one level of know-how. C-suite holders are expected to comprehend balance sheets, understand business cycles and stay current on macro and micro economic and industry changes affecting the business. Analytical skills involved are data interpretation, bona fide trend identification and metrics that are useful to HR and the business. Merely knowing the facts on an aging population, workforce demographics, generational differences and world "flattening does not guarantee translation to effective HR and business initiatives. HR leaders need to know what to do with this information, and how to stay ahead of serious negative HR impact. Initiating ideas for customer service delivery, international site locations, and where to outsource manufacturing demonstrate HR contributions to shareholder value. Taking on business leadership during CEO change over, a merger, acquisition or global expansion signals confidence in one's business competency.
Tips for Working Well with a CEO
Presidents say they want their HR leaders to model their vision and company values. Garry Ridge, CEO of WD-40, applauded his VP of HR who "collaborated with the executive management team, and developed an integrated performance management program that links our company vision and values to learning, performance review, coaching and development. Other presidents offer this advice for working with them:
" Provide energy, passion and inspiration to others. Keep showing your passion.
" Get to know me and my expectations by asking questions.
" Jump over obstacles to get resources for HR.
" Manage tomorrow, today.
" Figure out how to deliver HR service better.
" Remember, your boss is Customer #1.
" Network internally.
" Focus on the company first, and the HR department second, once you have a world-class HR operation in place.
" Market HR to executives and managers.
" Visit customers with sales representatives, and be obsessive about service.
In sum, HR pro's are often perceived as only able to deal with the softer side of business because they are diplomatic, typically positive in outlook and gracious. Others are mocked as the "people police who demand proper paper processes. The CEO, by contract, seeks an advisor who tells him or her what the key people issues are, and who rigorously influences decisions, contributing value to every function in the company. Outcomes CEO's expect are a well-executed HR strategy, an efficient HR infrastructure, increased employee commitment and organizational renewal. To successfully deliver on these goods HR is advised to know the CEO well and collaborate credibly with senior executives on HR initiatives.
Companies are seeking stand-out HR leadership which knows the dynamic intersection of business results, customer expectations and people performance. HR executives can stay entrenched in comfortable HR zones, or confidently line up with the best and brightest corporate leaders.
@ 2008 HR Solutions, Inc.
