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Should HR be split?

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HC Online | 07 Aug 2014, 10:27 AM Agree 0
A controversial article calls for HR to be split into different roles to better serve businesses. Is it time to say goodbye to the traditional HR department?
  • caca | 07 Aug 2014, 11:07 AM Agree 0
    I think HR has changed and developed so much that the typical structure hasn't kept up.
    I find there is such a wide variety of things that many people feel HR is/should be responsible for and can fall under the department.
    Splitting up perhaps HR-Legal, HR - Payroll/Finance, HR - Training/Leadership/Benefits. I think we should move away from pure generalists and have more specialties within organisations.
  • Graham | 07 Aug 2014, 11:10 AM Agree 0
    Complete nonsense!

    As an HRD with an MBA and significant experience in manufacturing I agree with the comment that HR leaders must understand the business and how decisions are made, but to refer to things like compensation as adminstration and to suggest it report to the FD suggest Charam under appreciates or misunderstands the strategic importance and value that comes frim a great HR function...
  • Anne-Marie Orrock | 07 Aug 2014, 11:36 AM Agree 0
    CEO's being disappointed in their HR people is a reflection of their ability to be great leaders. Great leaders don't surround themselves with poor CHRO's and then blame them for being 'process-oriented generalists'. CHRO's presumably get their mandate from the CEO, so if they are being process orientated generalists, or don't know how key decisions are being made, or can't analyse the organisation is because the CEO is either not involving them in key strategies or decisions or is poor at building a strong team around him/her. Point the finger and three are pointing back at you.
  • Michael | 07 Aug 2014, 12:17 PM Agree 0
    I'm not sure what Charan basis his views on but I disagree. HR has very much an input in the strategic operations of an organisation. Not including HR in strategy / operations is a short sightedness that is not a reflection of HR, as such.
  • kevin | 07 Aug 2014, 12:38 PM Agree 0
    I have read some rubbish before but for this to be linked to the HBR is an insult to HBR.
    HR has basically become the catch-all for the organisation and required to develop strategies to respond to external factors, mainly compliance because the business cannot rely on the line managers to do so.
    What I have found is that it is not the skills or ability of the HR managers to be involved in strategic directions but rather the volume of work and lack of resources to provide time for that work to be performed. It appears that Central, decentralise and specialise or whatever restructuring is the answer. In most cases this just shifts the problem around. All that is need is to resource HR properly to provide the time for stategy development. How other departments hope to rollout a strategy without the people is mind blowing so unless the HR Exec is involved inthe development of the strategy could be the reason most strategies fail or at least fail to achieve their potential.
  • QLDHR | 07 Aug 2014, 12:39 PM Agree 0
    I constantly read the need for HR to have a focus on business and commercial acumen. And how the MD's and GM's are not 'happy' with their HR? Then why not tell them what you need??

    Like any employee, you sit down, set KPI's, targets, expectations in a clear framework, they achieve it (or not) and the rest takes care of itself.

    However, I constantly read these articles calling for HR to be more a business partner and at the round table. And I agree. They do. HR most definitely need to be there and know what is going on in the business to make a true impact with its people. So my question is....why aren't the MD's and GM's engaging them to do that? If your HR team isn't performing either tell them what you want...or if they aren't capable, ship them out and focus on a HR leader that can do it?

    Changing titles, departments etc won't solve the problem. Communicating and investing time in your HR team like you would any front-line manager will.

    Two way street people.
  • DG | 07 Aug 2014, 01:51 PM Agree 0
    Mr Charan wouldn't be a finance person by chance?

    I'm tired of HR being the punching bag for an organisation's woes. We want to work with the line, who are often incompetent and unwilling to listen. The greatest change comes when a manager accepts they are not people experts, and ask for assistance.

    HR wants to and should be at the leadership table, but instead, we're often lumped under a Corporate banner with Finance/IT etc, who are all important, but perform very different work -this is then compounded by having the department typically managed by a CPA or Finance person who do not and will never understand HR.

    I and many of my HR colleagues understand that HR covers from the frontline to the bottom line, but rarely acknowledged for this, and made to be the scapegoat when things aren't working.

    HR has evolved alot in the past 15 years, where now HR practitioners are more formally and informally qualified, and adding value to the business, whilst managing the constantly changing face of industrial realtions.
  • Kevin Herring | 07 Aug 2014, 01:57 PM Agree 0
    I understand the motivation to split HR. Many of us have touted for many years the need to drop transactional HR activities in favor of those that supported achieving better business results.

    The problem with labeling compensation and many other functions as purely transactional is it ignores the strategic role they play in the organization.

    A better solution may be to separate strategic activities that solve business management and production problems or that target needs anticipated by market demands from transactional or common and redundant activities used to support the strategic ones. In many cases, the latter activities can and should be outsourced..
  • Robin Pollock | 07 Aug 2014, 03:32 PM Agree 0
    Many organizations are already doing this; at least it means that HR is not left out of key meetings and is treated with the respect it deserves. But as long as there are dinosaurs remaining in senior management ranks, HR will still continue to play catchup.
    It's a good idea and I've seen it work well but perhaps more suited to larger organizations for now at least.
    However, I also see a need for HR generalists but many need to pick up their act and gain some business nous and work with the org, not against it.
  • John | 07 Aug 2014, 04:32 PM Agree 0
    A good thought provoking article. The idea of having line staff taking on Function roles is not new and is quite common in Japanese companies.

  • BB | 07 Aug 2014, 05:41 PM Agree 0
    I agree with the sentiment here. HR Professionals know what companies require however it is often the very person at the top that does not think HR adds any value and would not allow for them to be a true partner to business however make sure the HR function is just their administrator...

    I have been offered a role within a group of companies overlooking HR for 5 countries with 100+ expat employees working across these countries and yet I would not get assistant/administrator, the company would not invest in HRIS and leave national HR in hands of labour broker because employees are not directly employed by the company. When I tried to improve efficiencies in regards to administration of approvals and use internet I was told by the GM I do not want IT to waste time on my issues....
    I could go on and on, I decided to stick it out for another year and take it as a challenge and if it won't work I will move on...
    If you do not give the tool, authority and responsibility to people you cannot blame them for delivering only what you allow them to deliver.
  • MW | 08 Aug 2014, 11:13 AM Agree 0
    I have been very lucky to work at the HR executive level of a 1,200 employee strong organisation where we made the HR unit centralised and all-encompassing... and the results were outstanding.

    We were able to use the 'transactional' information to assist our business partners make better decisions, both at the employee and strategic levels. After some time, the various levels of management knew that my team were business-minded enough to jump from the 'small issues' to the 'big issues' that they faced.

    Key to achieving this, I insisted that my team members attend 'toolbox' talks/team meetings held by the various business units and whilst this was seen as 'big brother' keeping an eye on them to start with, they soon learned that we were just as keen to fix their problems as they were and become advisors in the groups.

    The other key to this was me acknowledging that I didn't need to report to the CEO (especially when my reporting line changing to the CFO), in fact I held the view that so long as I had very few barriers to achieving the outcomes then I could do my job regardless of my reporting line... and it was very interesting to have the opportunity to influence the CFO in regard to staff sentiment and culture :-)

    When I first started the option of disbanding my team was constantly raised but the CEO insisted that we remain together as a team and after a few years the option was very rarely tabled at the executive and middle management table. I think it's because we made the HR structure work for our organisation!
  • Michael | 08 Aug 2014, 11:57 AM Agree 0
    There is a fair amount of merit in Charan's thinking. All to often HR people resort to a play book of processes adhering faultless to them with some times great results some times with disasterious results. The disconnect begins when a business situation arises that calls for intellegent analysis of the cause and effect and then some times just requires you just to go with your gut. In my experience the use of your gut or going off book with a decsion is discouraged with in HR disiplines. There is a place for entrepreneurial players in HR the trick is getting the process drivers and the business drivers to agree that they are on the same team/page.
  • Dan | 08 Aug 2014, 12:52 PM Agree 0
    I think this needs to be put into perspective in regards to where both the business and CHRO sits upon an HR Maturity Scale. CEOs want to see bottom line results, and wants the team around him to use their expertise to affect this.
    There always needs to be a commerical aspect to every maturity level of the HR spectrum, from cost efficient administration tasks to staff engagement strategies that result in greater retention of top performers and commercial advantage through innovative thinking and practices.
    I would hazard a guess that what Charan is eluding to, is frustration from CEO's that their HR professionals get stuck being an advocate for the employees to the detriment of a commercial people strategy. You can then see how CHRO's that have come from a Financial or Operational background are better grounded in being able to think commercially in delivering people strategies and achieving outcomes aligned with CEO expectations.
  • Amanda Rochford | 08 Aug 2014, 02:46 PM Agree 0
    HR doesn't need to understand the business (more). Business needs to understand HR. People are the means to the end (or outcome). The ends is never the way to the people. It is not HRs role to increase profits. An organisation can (only) achieve profits through the work efforts of its staff. The more discretionary effort from staff, the higher the profit. Higher discretionary effort depends on stronger engagement. Engagement is the responsibility of HR, team leaders, management, and the C suite. Leadership is all about people and the relationships you forge with them. Once you have the relationship established then you look at what outcomes you want to achieve. If you havent achieved your outcome then somewhere, at some time, a relationship has fallen down. If the CEO doesn't have a relationship with HR, and if the C suite dont have a relationship with HR then there is no hope for achieving anything.

    The following excerpt from the article is interesting and fully achievable.

    They would like to be able to use their chief human resource officer (CHROs) the way they use their CFOs – as sounding boards and trusted partners – and rely on their skills in linking people and numbers to diagnose weaknesses and strengths in the organisation, find the right fit between employees and jobs, and advice on the talent implications of the company’s strategy,” he wrote.

    What's stopping the CEO from doing that?
  • Catherine Cahill | 08 Aug 2014, 05:26 PM Agree 0
    Yet another person stating that HR should have no genuine knowledge and experience in in people management - and prescribing non HR professionals as the solution (because they will won't annoy you with the advice that the best way to improve the bottom line is to actually invest in your people - in people leadership, development and attraction). This is very similar to the CFO's who complain that they only want their HR people to talk in numbers!
  • Kevin Herring | 08 Aug 2014, 05:26 PM Agree 0
    It's important to remember that HR is not the point of the business. HR is a support to the revenue generating elements of the business. It's up to HR to figure out how to create a compelling business offer to the rest of the business.
  • Michael | 08 Aug 2014, 05:54 PM Agree 0
    Is this getting more attention then it deserves? Just a thought. Could be that it's brought out all the frustrations that HR experiences.
  • Paul | 08 Aug 2014, 07:10 PM Agree 0
    There could a little truth in this – I do say a little only. There are some very average HR people around. I have to clean up a lot of messes in my time in H.R.

    But should HR be spilt? Well that depends on what the business seeking. Unfortunatly no two business are the same.

    There are a lot of disgruntled people around and here is a great example of one. This guy was probably terminated by a HR Manager in his past and today still has the grudge.

    But really! Why waste your time Charan trying to prove that HR is under finance, has little value or is not valued by CEOs.

    Why don’t you show us your business acumen and create a worthwhile product that we or other can benefit from and then commercially sell you product to provide solutions to people needs and get rich in the process. This is business acumen.

    You really are nothing but a disgruntled ex employee who is still trying to deal with your past grievance obviously involving HR. You would benefit by getting some counseling as opposed to crusading against HR. Oh boy…get a life !!!!
  • Alastair Mitton | 11 Aug 2014, 11:33 AM Agree 0
    My title is Human Resources and Governance Manager. I really enjoy the dynamics of working in a fast paced industry. The business model is extremely flat in senior management roles which makes all managers operational based. I pride myself in the interactions I have across all levels of the organisation. To split my team would serve no purpose as I already adopt duel roles in the administration support with overlap into accounts payable.
  • Celine | 13 Aug 2014, 05:43 PM Agree 0
    It will be interesting if Prof Ram Charan analyses CEO responses on HR with CEO strengths/ behaviors when it comes to people matters. As coach and advisor he will have data that can be usefully analysed to see whether there are any patterns that emerge that can be used to address gaps/ find solutions/ move ahead.

    In my experience a number of CEOs are more comfortable dealing with process level issues rather than people level issues, whatever the numbers and analysis that may or may not be there to facilitate a strategy or decision in HR. These CEOs are often primarily responsible for reducing HR to an administrative kind of role.
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