Interview: How Healthy is HR Now and What Does the Future Hold? (Part 2)

October 20, 2010 – Chris Roebuck advises organizations on delivering organizational performance improvement through people. He is visiting professor of transformational leadership at Cass Business School in London and he has held senior HR roles at HSBC, KPMG and UBS where the project he worked on is now a Harvard Business School case study. Mr. Roebuck also writes for CEO and HR Magazines, frequently speaks at leadership events and is regularly interviewed on television channels such as BBC World, CNBC and Bloomberg. In the following interview, Mr. Roebuck discusses the current state of the HR sector and how the position is evolving.

How do companies cope with doing more with less people?

Companies can take steps to do more with less, but the key factor in terms of how much less is not an HR issue but a customer service issue. There is a tipping point beyond which cuts to headcount impact negatively on customer service and this can quickly lead to damage to the brand. This must be avoided at all costs. There is also little business sense in initiating across the board percent cuts as this is unlikely to target areas of real waste. But this is all too frequently the blunt instrument used to try to save money. Yes it is possible to do more with fewer people but only if those people are able to deliver and want to deliver – they need an efficient process and the motivation and support to deliver. That doesn’t just happen by chance it has to be planned.

Can companies remain competitive and get the work done with less resources ( less money and fewer people)?

We have seen from the figures quoted above that it is possible in most organizations to get possibly 30 percent more effort from 60 percent of staff, but that’s “discretionary” effort, i.e. they will only give it if they want to and you can’t tell if they aren’t giving it through performance management. Its just as much about hearts as well as minds; interesting new research by the Corporate Leadership Council suggests that the decision by employees to give high performance is based on 57 percent rational factors and 43 percent emotional. That’s something we should all think about very seriously as corporate leaders – that the emotional element is nearly half the decision – that has significant impact on how we get our staff to find ways of doing more with less. To make an organization that has grown inefficient lean and effective needs careful planning and the implementation of new performance initiatives, primarily driven by the CEO and facilitated by HR. Most people view the downturn as a threat but with the right approach it can be used to take organizations to a higher level of effectiveness if line management and HR work together effectively.

Discuss the importance of succession planning/talent development within organizations? How important is this for creating a talented work staff?

Some might say that any organization which does not have succession planning by now should get a new HRD and CEO, its that simple! In 2010 not having potential successors for key roles places the organization and its investors at significant risk; this is not acceptable from the perspective of shareholders. Some organizations haven’t even decided the roles within it that are “key” and therefore present a significant risk if not covered by succession planning. Further, succession planning is often mismanaged and used as an anointing of the chosen heirs of the current leadership. This is not what good succession planning is about – it is about finding the best person to take a role to maximize the future performance of the organization. That best person may not be a clone of the existing leadership – in particular when comparing the leadership present before the financial crisis and that required afterwards. Talent management and development is the means by which you grow your succession pools to ensure that you have a good choice of potential successors for key roles. It also creates a culture in which development and high performance go hand in hand which should have the effect of not only building capability for the future but also to maximize bottom line in the present. It needs to be remembered that everyone in the organization has talent and that they deserve to have that talent developed. Whilst some may have higher levels of potential at certain points in their careers which justifies greater investment than the norm forgetting the majority of employees to concentrate on an elite is a mistake that can turn a good talent pipeline into a divisive mechanism that will damage both culture and performance.

What are some effects that the economy has had on HR professionals? Do you anticipate an overall improved recruiting market for 2011?

Some of the corporate responses to the economic downturn clearly resulted in cuts in HR functions that have impacted so severely that they can hardly deliver a basic transactional service, let alone add strategic value. Others have done better and with the support of good CEOs and boards actually expanded leadership and talent activity. It is clear from a number of studies that unlike 10 years ago a significant percentage of CEOs now recognize the importance of some of the transformational services that HR can deliver, e.g. talent and leadership development, over and above the basic transactional services such as pay and policies. This group is increasing and as it does so HR is no longer being seen as a place to make cuts because cuts in HR have an impact on the business. Therefore in many good organizations there is much more reticence now in cutting HR than before. However, many HR functions still fail to make the compelling business case for transformational delivery that they could and this inevitably means that they are likely to get cut more as their real “value add” is not appreciated. The best way for HR functions to minimize the likelihood of cuts in staff is to demonstrate the business benefit of what they do and that they are business focused. In reality those HR functions that do a great job at this are less likely to get cut than those that don’t. That should be a good incentive to deliver what the business wants through top quality HR!

This concludes Part 2. Stay tuned for Chris Roebeck's broader views on the executive search industry which will be featured in the coming weeks. In the meantime click here to view other recent publications from Mr. Roebeck.

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