It´s no secret the economic downturn has forced organizations to ask their HR departments to do more with less, but is it possible that they´re being asked to do too much? A new report says exactly that. By Michael O´Brien
Many HR professionals are spinning their wheels as they cope with a turbulent economy that presses on a number of hot-button HR issues, such as engagement and retention.
"In general, HR departments are conducting too many initiatives, with mediocre outcomes," according to Creating People Advantage 2010: How Companies Can Adapt Their HR Practices for Volatile Times.
"High-performing companies focus their efforts on fewer, more carefully chosen HR-related projects in areas such as recruiting and leadership development," it states
The report, by the Boston Consulting Group in conjunction with the World Federation of People Management Association, was based on a recent survey of 5,561 HR and business-unit executives from 109 countries and was supplemented by face-to-face interviews with 150 senior executives at multinational companies.
HR is currently at a crossroads between the transactional and the strategic, says J. Puckett, a senior partner at BCG´s Dallas office.
"At a high level, there´s a lot of day-to-day firefighting in HR, keeping the trains running on time," he says. "These won´t go away. But across the list of strategic projects, companies tend to select too many of those at any given time and push them all simultaneously and, as a result, they under-resource them and end up unsatisfied with the result."
Michael Custers, vice president of global marketing in the Norcross, Ga., office of HR services provider NorthgateArinso, says a lack of technology is part of the reason HR may feel overwhelmed by underwhelming results from initiatives.
"In a number of cases, HR departments are being asked [to do] too much because they have inherited multiple HR systems which are outdated, require manual processes and are not up to the task," he says. "This drags resources away from strategic work. The message here is: Get control over your execution and HR service delivery first, and that will free up time and resources for HR strategy."
Meanwhile, Sandi Guy, partner and executive director of human capital at accounting firm BDO USA´s Charlotte, N.C., office, says she completely agrees that HR is being asked to do too much.
"People are especially susceptible to pushing too many initiatives during economic downturns in an attempt to address employee morale," she says."The reason is that company leaders (and often those are HR leaders as well) hear about a new trend or ´tool´ receiving positive reviews at another business and seek to adopt it in their organization.
"But is the initiative really needed in your organization?" she asks. "How does it match up with your stated priorities?"
Too often, Guy says, when a leader asks an HR professional to do something, "they usually just do it. It is not typical that they push back."
Brian Hults, vice president of global organization and people development at Atlanta-based Newell Rubbermaid, says HR departments will benefit greatly by focusing on hard numbers when deciding on which initiatives to implement.
"In today´s numbers-driven world, HR must provide measurable results to show which initiatives will have the most positive impact on the company," he says.
"For example, is retention an issue forcing the company to spend more dollars on training new hires and finding outside talent to fill positions? Or is the administrative cost of payroll a burden?
"Find out what the pain points are within the organization," he says, "and provide a solution that puts HR in a leadership position, rather than a reactionary one."
That should be an annual process, Puckett says, noting that HR leaders need to engage in a "thoughtful" process to determine which initiatives should be pursued.
"Get agreement within your function, get executive sponsorship and then get the right resources in place," he says. "And don´t fragment resources."
When deciding which initiatives to pursue, Puckett says, HR leaders need to ask themselves whether the proposed initiative is aligned with the strategy and performance of the company.
"Is it something that, if you actually get it right, it will move the needle?" he asks, before adding that if an organization is trying to grow in developing markets, for example, then it needs to invest in talent and leadership capacity in that region.
"That is aligned to your strategy," he says.
Another consideration, Puckett says, is whether an initiative will drive some sort of competitive advantage for the organization if it does it right.
"If we can improve our people practices to the point that we are viewed as a top place to work, then we´ll have an easier time attracting talent on the supply side," he says.
As for HR executives who feel they may be caught up in too many initiatives, Puckett says, they should step back and be prepared to make some hard decisions.
"I would inventory what they´re doing right now, and ´rack and stack´ those existing initiatives on the basis of how important they are to the future success of the company and how much resources they´re consuming," he says. "Then I´d sunset or defer the other things, then focus on the one or two key topics that will most drive business results."
Shafiq Lokhandwala, an expert in HR management and the CEO of Andover, Mass.-based NuView Systems, says HR leaders need to use the "success test" in determining which initiatives to keep up with and which to place on the back burner.
"If it is not clear who benefits from an initiative, or the outcomes of the initiative are unlikely to be accepted for culture, timing or difficulty, then make a case to cut them," he says.