April 1, 2022 – Every leader seems to be looking for an answer as to what the “new normal” will look like. But as effects from the pandemic wear on, uncertainty will likely remain a lingering constant for organizations. Possibly more so than for any other role, chief human resources officers have faced mounting pressure from their companies due to the increasing importance and complexity of their role, according to a recent report from Egon Zehnder. They’ve had to lead the transition to remote working, support employee well-being in a completely new setting, instill a sense of community and purpose across the organization, learn new digital tools and help shape corporate culture – all while still managing the core responsibilities of the function, the firm notes.
To understand how these executives have navigated this reality and what pathways they see ahead, Egon Zehnder recently hosted an online forum with over 50 HR leaders and Egon Zehnder senior advisor Claire Thomas, who has nearly three decades of HR experience in global settings and most recently with GlaxoSmithKline.
Embracing Culture and Purpose
According to insights formed from the gathering, most HR leaders recognize the imperative for building new working models that are forward-looking rather than based on the past. Whatever this new model may be, it will have to be anchored. “There are two priorities for business as the pandemic wears on: culture and purpose. Human resources leaders will play a major role in shaping and building them both,” said Ms. Thomas.
According to Ms. Thomas, HR leaders are expected to play a more prominent role in shaping and building a thriving corporate culture and instilling a sense of purpose among employees. Strategically, these pillars will be critical in fostering loyalty among customers and employees – unsurprisingly so, as the pandemic propelled most to rethink not only their careers but their expectations as customers as well. “Covid has definitively changed the rules of the game,” she said. “There is now a greater expectation on how an organization behaves towards its employees and external stakeholders, and this raises a strategic issue on reputation. Managing people’s careers, needs and expectations was never easy, but the HR role is pivoting from a responder into a strategist. By helping set a roadmap for culture and purpose, the function will profoundly impact the entire organization.”
Another challenge and opportunity for the HR function is technology transformation, with emerging data and digital tools playing a significant role in better understanding employees and their needs, according to Ms. Thomas. These tools can not only predict who is at risk of leaving the company, but also anticipate well-being issues, in addition to supporting the management of talent attraction and acquisition strategies.
Balancing Well-Being and Performance
Another recurrent question for HR leaders is how to strike the right balance between well-being and the unavoidable focus on business goals. “The pandemic imposed a historical challenge by suddenly forcing people out of the office and into remote work, which naturally raised concerns about productivity,” said Egon Zehnder. “But whilst short-term performance hasn’t necessarily suffered in the past years, HR leaders carried the challenge of addressing their employees’ well-being and mental health.”
Finding HR Leaders and Diversity Chiefs Remains Hot Spot for Executive Recruiters
More and more, chief executive officers have recognized the strategic role that the human resources function plays in the core strategic issues their companies face, including growth strategy, mergers and acquisitions, restructuring, increased board oversight, and evolving governance and reporting. HR can also ensure that clear changes are made to recruitment and capability-building processes by determining the characteristics of a “purpose driven” employee and embedding these attributes within recruitment, development, and succession planning.
“In my 30-plus years of working with HR executives, this has been one of the most critical times I have seen for a company to have a highly capable HR function with strong leadership,” said Alan Berger, vice president, human resources search at StevenDouglas. “Setting and implementing a strategy of how to make sure the workforce stays engaged and highly productive in an onsite, hybrid or remote setting, with the headwinds of a labor shortage and unprecedented resignations, is incredibly challenging. In the end, the work has to get done and deciding on how that can be accomplished and under ever changing COVID rules and mandates falls squarely on HR leadership’s plate.”
Unquestionably, during intensive remote working times, it has been difficult for everyone to draw and keep the line between private life and work. At the same time, hyper-connection and a lack of opportunities to “disconnect” can lead to burnout. “For this reason, managers now recognize well-being as a strategic organizational priority,” Ms. Thomas said. “People care and performance are not in contradiction; they are, instead, in synergy.”
Building Credibility and Influence
In this challenging era, it is paramount that HR leaders are credible. “This starts with them understanding the business deeply, including the market, customers, shareholders and competitors,” said Ms. Thomas. “There’s no shortage of ideas when it comes to HR strategy; the key is understanding the current business context and having the judgment to know the right path and priorities for your business at any particular point in time. You will also then need the credibility and influence to take the organization with you. CHROs these days are expected to be public figures, able to engage and communicate authentically with the broader organization and the outside world.”
Along with business knowledge, influence and good judgment, HR leaders also have to have the courage and resilience to champion progressive employee engagement initiatives against a backdrop of constant restructuring and cost saving, according to the Egon Zehnder report.
Another crucial question Ms. Thomas points out is, who takes care of the HR function? “Sometimes we don’t practice what we preach.” she said. “As CHROs, we should also take care of our own function by investing in our development and capabilities for the future.”
Developing Stronger Adaptability and Caring
One of the main takeaways from the gathering was that to thrive, HR professionals will need to adapt their skills and personal traits: “We are now pretty much in a storm,” said Ms. Thomas. “If you asked me what are the key traits of leadership to develop, I would say adaptability. You don’t have to have all the answers, but you need to have an open-minded attitude and an evolving capability to go through the storm.”
HR was never easy. But the sudden changes that the pandemic generated require great determination to rewrite the rules of the function and truly make a positive impact on employees and business in equal measure. “The HR function has a moral responsibility to ensure employees remain central to any business success, and supporting their hopes, needs, motivation and health has never been so critical,” said Egon Zehnder.
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media