Making Human Resources a better resource

In this post, I will share my reflections on ‘A New Mandate for Human Resources’ by Dave Ulrich for HBR. I would like to caveat that I am quite new to HR as a subject, and am writing some small articles on it as I am exploring moving into HR in the near future. Hence, some of my musings would likely have been addressed by other writers or fields of research; it would be helpful if you could share resources to help answer my questions.

Another caveat is that the article in question is pretty old, dating back to 1998. However, I do think that some of the points remain relevant in this day and age, and I hope I can make that clear in my reflections.

Preface: What is HR?

Let’s stop for a moment here and consider the term HR, or Human Resources. I think it’s worth delving a bit into the semantics here to consider the many inflections of the term. It’s broad enough to mean many different things, which can result in confusing debates on the subject. I can’t go in-depth into what HR really means, but right off the bat, I can already tell that it might refer to one of the following things:

1. HR as a function: Referring to job roles in HR, such as recruitment, training and development, planning, compensation, etc.

2. HR as process: Refers to systems and processes within an organisation. This is debatable, but I raise this because Ulrich argues that HR should ultimately be responsible for the way work is organised and executed, which basically points towards a system and process issue. Some of this can be attributed to HR information systems, but the focus can also be on workplace architecture-type subjects, such as re-organisation, scoping of jobs, etc.

3. HR as an outcome: Referring to “people issues”, such as job or workplace satisfaction, employee motivation, performance, etc.

4. HR as change management: Probably the most suspect candidate on this list, but have kept it in for now given how some HR issues (in #2 and #3 for example) are closely tied to change management. The main distinction is that the organisation has embarked on some level of transformation and needs to change mindsets and behaviour to make the effort successful and sustainable.

5. HR as a philosophy: The overall approach to managing one’s workforce, which has some overlap with the Vision, Mission, Culture and Values of an organisation. Much of this is closely related to management philosophy (project management approaches come to mind), which in itself is closely linked to people issues, and hence can also fall under the realm of HR. You can already see why talking about HR can be so confusing.

Many business terminologies tend to suffer from a similar shortcoming as HR. Don’t get me wrong; jargon serves as shorthand and can be useful to cut to the chase and get things done quickly. But it is sometimes useful to take a step back from the jargon and articulate clearly what exactly is the issue or the root problem of the discussion to avoid confusion.

Key ideas

Ulrich begins this article with the premise that HR does not have a good reputation (and I think that might still stand today). There are “serious and widespread doubts about HR’s contribution to organisational performance”. There is also good reason to believe this given HR can be “ineffective, incompetent and costly”.

Ulrich argues that despite this, HR is more important than ever. This is because organisational excellence is often a result of “learning, quality, teamwork and [process] re-engineering”, which are in turn driven by how organisations get things done and treat their people. The italicised words are what Ulrich considers to be fundamental HR issues.

Ulrich argues that the HR of today can add value in four ways:

1. Become a partner in strategy execution. HR should be a key partner of a company’s executive team when discussing organisational strategy. Ulrich is really saying here that HR should expand its traditional functions. In addition to just the administrative matters, HR should be involved in determining how the organisation should be structured and designed for success. It should then audit the organisation, and guide it towards success in its weaker areas. HR should take the lead in proposing the best remedial solutions for this. Finally, for HR to be effective at strategic work, it should set clear priorities for itself. This means it should work with the ground to prioritise initiatives with the highest impact, so that the effectiveness of its work is sustainable.

2. Becoming an administrative expert. I also think a large part of what gives HR its bad rep is in this area. Too often, we’ve heard horror stories of mistakes being made, recruitment candidates being dropped or lost to long turnaround times, cumbersome processes for simple administrative matters that bog employees down, and so on. Ulrich rightly points out that for HR to be granted a seat at the strategy table, it must clean up its act, and hold itself to the highest standards of professionalism and excellence. This means reducing the number of professional mistakes (he cites an example of typos in employment contracts). This can also mean constantly seeking to improve the employee experience, through offering the best employee services, refining and streamlining administrative processes, making effective use of the best and latest analytic tools, and so on.

3. Becoming an employee champion. It’s a common saying that HR exists to milk the most out of its employees, and I would hazard a guess that this was more common in 1998 when Ulrich wrote this article. It’s probably less common today, with social media platforms being used by the common man to expose poor employment practices, and with values and morality being increasingly core to company image. The age of the Internet has also given webpages like Glassdoor and apps like Google Reviews that give more avenues for employee feedback. Nevertheless, there is room to improve in this area. Ulrich argues that HR should be held accountable for making sure employees are engaged. This includes knowing the morale on the ground, understanding the roadblocks to engagement, and playing a key role in ameliorating morale issues. This is not to absolve line managers of their responsibility in managing well, but more of partnering and educating them in these areas to increase their effectiveness. Finally, HR should advocate for employees and represent their voice. To quote Ulrich, “[e]mployees must know that HR is their voice before they will communicate their opinions to HR managers”.

4. Becoming a Change Agent. Ulrich posits that HR should be the function that leads change management in an organisation. It should lead the development of an organisation’s capacity for embracing and capitalising on change. It can do so by drawing out a model for change, and facilitating senior management conversations on how to chart the organisation’s progress (HR might not decide what changes the organisation should embrace, but it will “lead the process to make them explicit”). It should also play a leading role in culture change.

For the HR function to be truly transformed, HR professionals must change the way they think of their role and profession. Senior management must also “change what they expect from HR and how they behave towards HR staff”. Essentially, this means demanding more of the HR function, not just in terms of raw output, but in terms of the strategic, quality value add that Ulrich described above. HR professionals must also upgrade themselves, not just in terms of HR domain knowledge, but also in having strategic knowledge (e.g. knowledge of global market trends, economy, and their industry), and expertise on process re-engineering.

Reflections

While 22 years have passed since Ulrich’s article, I do agree that HR as a function and profession can continue to upgrade itself as described. Ulrich has laid out a very thorough and exciting vision of how HR as a profession can evolve. Despite the drastic changes in the labour market landscape and the movement toward a knowledge economy, I do think many of his points still stand today, which is a testament to the viability and insightfulness of his vision. As I work towards building my knowledge in HR, I will indeed bear many of his points in mind.

I think though that it isn’t always the case that HR adopts the additional roles that Ulrich suggests. I can see why HR could be the function to adopt these roles, given its potential to be the expert on people issues, and I can also see why HR should expand into them to polish up its professional qualities. However, depending on the organisation’s context and needs, it might be the case that some of these roles are adopted in other ways. For instance, it might be more impactful for a cross-domain team (composed of influential thought leaders of diverse backgrounds) to lead and drive change management in a large organisation, especially when a drastic overhaul is needed. Having Change Agents “from the ground” sometimes lends credence to more radical, counter-cultural ideas. Then, at a later stage, the HR function could be the leading voice to carry on change management work to completion.

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