Where did the business partner model go wrong?

by 15 Apr 2008

The business partner model was supposed to be the superhero solution, the HR silver bullet to give the profession the recognition it deserves but it didnt work out that way. Personnel Todays Ross Bentley investigates

Hailed as the approach progressive human resources departments should be taking in the 21st century, it would seem the jury is still out on the HR business partner model.

That is according to research from consultancy Roffey Park, which found that less than half (47 per cent) of managers think the HR business partner experiment has been a success in their organisation.

What’s more, a quarter (26 per cent) went as far as to say the system was not effective at all, while the remainder said it was too early to tell.

Hardly a ringing endorsement for the HR model launched by leading HR academic Dave Ulrich in his 1997 book Human Resource Champions: The next agenda for adding value and delivering results.

At the time a groundbreaking read, Ulrich argued that the roles of HR professionals must be redefined to meet the competitive challenges organisations were facing then and would face in the future. He set out a structure where basic administrative HR is taken care of by low-cost, shared-service centres, while a small team of ‘business partners’ are given higher-paid jobs concentrating on people strategies. In the middle are teams of specialists.

But although this approach does seem to have been successful in a lot of organisations, why has it also failed in so many?

According to Nicholas Higgins, chief executive at human capital management consultancy Valuentis, a common pitfall is for HR departments is to get hung up on implementing structures without actually developing their strategic influence.

“It’s easy to change a structure, but if there’s no clarity around what HR is supposed to deliver once this structure is in place then nothing will change,” he says. “In a lot of the companies, it’s not always clear what HR is there to do.”


Part of the reason for the confusion over the role of the business partner, he says, is that Ulrich defined four distinct roles for HR professionals within his model – strategic player, administrative expert, employee champion, and change agent. In some cases, the lack of clear definition for these roles has stopped the business partner model from being truly effective and meant the HR delivery has not lived up to the expectations of the business, according to Higgins.

He also feels there is a question mark over whether there are enough HR people capable of delivering the business partner model and feels there are many people in HR who don’t have the expertise or competencies to make the jump to a strategic role.

“Role fulfilment can only happen if the requisite talent is there,” he says.

This point is picked up by Jane Clark, senior HR business partner at aid agency Christian Aid. She says HR business partners require a whole different skill set compared with traditional HR generalists, and in some organisations HR has been expected to make this transition without adequate support.

“If you re-badge people without giving them training and awareness, you are setting them up for failure,” she says.

For Clark, a strategic HR business partner must be focused on looking forward, “anticipating change, understanding its impact on the people side of the business and managing this change”. She says they must be comfortable working with senior people from the business on an equal footing and acting as an internal consultant within the business.

Outside experience

But many HR practitioners who have spent all their working life solely within the function will struggle to tick all these boxes, according to Clark. She believes her experience of working outside of HR in an international development role for many years has helped her develop her strategic focus.

She recommends giving HR business partners secondments to other functions in the business as a way of expanding their strategic and commercial nous.

At international law firm Bird & Bird, head of HR Johnny Nicholls previously worked as a lawyer as well as an HR practitioner for a recruitment firm. He says this blend of experience, and cross-fertilisation of ideas it has produced, has enabled him to make the step to business partner and given him “a different view on timescales and the business process”.

“I consider my role to be about adding value to the business and understanding the business model,”he added.

Nicholls says while the business partner model sounds good in theory, where it falls down in a lot of organisations is the hiving off of administrative roles to a shared-service centre. According to Nicholls, the shared-service model only truly bears fruit in larger organisations. In smaller companies, it is the administrative and transactional tasks that give HR the opportunity to interact with the business and offer good service – facets of the role that help build credibility with the business.

“Anyone who feels they can just deal with the strategic piece and not get their hands dirty needs to look at a position in a really big company,” he says.

A good working relationship between line managers and HR business partners is also essential if the model is to work, according to Gary Miles, a principal consultant responsible for strategic HR at Roffey Park.

Work with line managers

He says line managers are the key enablers of an organisation’s strategy on the ground, and therefore they need to understand how they fit in and what HR business partners are there to do.

“Business partnering is only effective if line managers have been prepared beforehand and know what to expect from this new HR approach,” he added.

This issue, according to Paul Kearns, director of HR consultancy PWL, strikes at the heart of why many business partner approaches fail. He says if HR is to be effective into the future, something must be done about improving the quality of line management rather than HR per se.

“Managers use very old techiques, such as profit and loss auditing, and see people and training as overheads, and until they are educated otherwise HR will find it very difficult to offer them a better service,”Kearns says.

“Most HR teams have not educated their management teams about what HR-focused management is. They should be going out into the business and explaining their vision.”

Kearns says that despite the cool response to the business partner model from some quarters, HR must never give up trying to work closely with business managers.

“The need for a business-focused role for HR is more important today than it has ever been,” he says. “Globalisation means more competition, and more competition means getting more out of people.”

But if the business partner model is not delivering, does Kearns feel there is an alternative structure that will be more effective?

Not so much a different structure as a totally different approach altogether, says Kearns, who believes the model that splits HR into transactional and strategic is a false dichotomy.

“If companies have very complex pay schemes that cost a lot to administer, the answer is not more efficient administration, but better designed, simpler pay schemes.

“In other words, better strategic HR decisions will lead to more efficient administration – not the other way around.”

Career paths for HR business partners

While the RoffeyPark research may suggest an element of uncertainty for HR practitioners who have made the move to a business partner role, Paul Kearns believes their future is bright.

“For a business-focused, totally professional, modern HR person who creates lots of value, the sky is the limit,” he says.

Kearns says with the topic of human capital management high on the corporate agenda, effective HR business partners are well-placed to play a central role within their organisations.

“With many of the low-skilled jobs going to Indiaand China, Western organisations are focused on getting the best out of their people and moving up the value chain.”

For Jane Clark at Christian Aid, strategic HR business partners, who have developed commercial skills, have a choice of career paths.

“They are well-positioned to move into an HR director’s role, but equally could make the step into a senior management position on the top table, and even the chief executive role,”Clark says. Consultancy work is also another option.”\

Thoughts from the profession

"Ulrich's original thesis was an excellent piece of work and very influential. It stimulated a lot of thinking in HR and encouraged the function to be more strategic. It was a wake-up call." - Jane Clark, senior business partner, Christian Aid

"HR business partnering can be effective and there are a number of organisations out there that are doing things right." -Nicholas Higgins, chief executive, Valuentis

"Ulrich is an academic and has never been an HR manager, never mind a business partner. Like many academics he produced a model that looks okay on paper but his research was seriously flawed." - Paul Kearns, director, PWL

"Only a limited number of HR people are capable of taking the step towards being a business partner." - Johnny Nicholls, head of HR, Bird & Bird

Courtesy of Personnel Today. www.personneltoday.com