HR comes in for its fair share of criticism from business managers, with accusations of being too warm and fuzzy or lacking any firm grasp on business reality. But it need not be so. Craig Donaldson speaks with Westpac’s Ann Sherry about the shortcomings of the HR profession and the steps practitioners need to take in order to graduate to being true business partners
HR comes in for its fair share of criticism from business managers, with accusations of being too warm and fuzzy or lacking any firm grasp on business reality. But it need not be so. Craig Donaldson speaks with Westpac’s Ann Sherry about the shortcomings of the HR profession and the steps practitioners need to take in order to graduate to being true business partners
It’s rare for a HR professional to become a CEO. Ann Sherry, former group executive of People & Performance for Westpac Bank has managed to do it twice so far. She has served as CEO of the Bank of Melbourne, and currently serves as CEO of Westpac New Zealand. Sherry is also widely tipped as the successor to David Morgan, Westpac Bank’s current CEO.
So what does it take for a HR professional to scale the lofty heights of CEOdom? Sherry has been instrumental in transforming Westpac to such a degree that Morgan boasts about its management strength and staff retention rates. Formerly head of the Federal Office of the Status of Women, Sherry has been responsible for developing best practice affirmative action strategies, championing mature age workforce initiatives and providing Westpac staff with paid maternity leave and other leading work/life practices.
Given her extensive experience in HR and people management, Sherry provides a number of unique insights into the state of the HR profession and how it can best make a meaningful and strategic difference to any organisation.
Generating employee engagement
Employee engagement is a relatively new buzzword in the HR arena, but its true drivers are often not understood. While no two organisations are the same, Sherry believes that generating employee engagement is possible for any organisation, given the right conditions.
Common elements to employee engagement include challenging and motivating work, an understanding of individual roles in the context of a bigger organisational picture, having managers who can add value and provide employees with a sense of direction, fair reward and remuneration, constructive feedback – and putting it all together in a way that actually generates return, Sherry says.
“Quite frankly, I think it’s the same irrespective of the company because of what people want from their jobs. All those ingredients are common to engagement regardless of where you work – banks or otherwise. A lot of those things aren’t easy to do. If they were we’d have lots of fantastic companies, but they’re at the core of driving most businesses,” Sherry says.
“So the engagement of HR in that space has got to be: what are the core things that really make a difference in this business at this time? How do we make sure we’ve got the right people for the jobs? How do we make sure they’re motivated to do the best they can at whatever the task is? It’s the same issues really. And whether that’s assembling cars or serving retail customers, there are people who are great at those things who are motivated to do it in the right environment, so we’ve got to make sure we have that in place.”
Motivation and job fit
One of the keys to motivating employees is understanding what makes them tick. However this is where many organiations fall down. Given that many individuals don’t understand this themselves, it’s no small feat for organisations to understand this, let alone articulate it and then match it against a particular role.
Sherry agrees that organisations don’t understand this process very well, but adamantly believes it’s one of the differentiators between ordinary businesses and great businesses. “When you understand what motivates people you can harness that in a way that benefits both the business and themselves. If you don’t understand it, then you’ll always be pulling against them and your business will be running at less than optimal. I think it’s really critical.”
However there are steps HR professionals can take to bridge the gap, which are all common to best practice companies, according to Sherry. “You’ve got to be able to listen for a start,” she advises. “Often when you have expertise you don’t think you need to listen to anybody. Rather than being dogmatic and didactic about what you think is the right system or process, it’s really about listening, understanding and empathising with others by putting yourself into their shoes. Once you can do that, then it’s about translating that into something a bit more meaningful in the context of what they want out of their work.”
Balancing business and employee advocacy
In an age where companies are under increasing pressure to cut costs and generate greater shareholder returns, HR could be seen as between a rock and a hard place when it comes to balancing business and employee advocacy. However Sherry’s experience is that it’s not necessarily so.
“The reality is you do your best for your people when your business is doing really well. You can afford to do more, so there’s a cycle of success around having a great business and great people,” she says. “So part of me says business and employee advocacy are the same thing, but when you get down to an individual level they often aren’t.”
Sherry believes the concept of business and employee advocacy is sometimes a two-way street. If things are clearly not working for an individual, this could point to deeper problems such as unworkable management structures which adversely affect employee performance, for example.
“I think HR people need an ear to the ground so they hear those things. Part of HR’s value add potential is that they can become a trusted conduit for that information, because if it’s getting in the way of the business working really well then it’s getting in the way of everything. So part of their role should be to pull that stuff up and part of the management role, of course, should be to fix it as well,” Sherry says.
Ignore the noise around HR
Much is said about what HR should be doing, both from the industry’s own point of view and management’s perspective. Sherry often talks about this ‘noise’ around HR, and believes it’s best ignored. In an effort to get a seat at the executive table and be taken more seriously, she believes HR practitioners have built an unnecessary complexity into their role.
“That’s not a positive outcome, as we’ve lost sight of some of the real value add that we give in trying to demonstrate our worth as a profession,” she says. “We’ve spent a lot of time making things feel more complex than I think they need to be, which can make them seem unusable and therefore get in the way of actually delivering on the outcomes they’re meant to produce. We have to get out of mystifying what HR does and get back to simplifying it.”
She encourages HR professionals to simply focus on helping businesses and managers execute the basics of people management well. Great employees who are well-trained, focussed on the job, receiving good feedback and healthy rewards drive employee commitment and satisfaction. While many companies hire consultants from the big consulting houses to help them achieve these goals, Sherry states that in reality most HR professionals already have the organisational capacity to achieve them.
HR’s lack of confidence
Sherry puts this failure to make the most out organisational capacity partly down to a lack of confidence within the HR community in knowing that the simple things are levers for driving the business. “It’s more of a mindset,” she states. “It’s about being confident that the HR role is critical to the business and the sense of knowing that and acting accordingly.”
One of the critical capabilities for HR professionals is the confidence of knowing when you’re doing the right thing and having the courage to see it through, Sherry believes. However, this must be articulated in a way that is good for the business if this capability is to be effective. For example, this could involve working with senior management on the people principles that drive a business and coming to a mutual understanding, she says. “That provides greater clarity around your role in the business. If you don’t know why you do what you do, then you’ll always feel like you’re going to be the meat in the sandwich.”
When HR professionals do understand the power of effective people management and the contribution it can make to businesses, Sherry feels this becomes a positive spiral, on both micro and macro business levels. “If HR professionals exude confidence and are out there standing shoulder to shoulder in businesses, they draw people to them and they draw people to the profession,” she says.
Sherry believes the lack of confidence stems from an ingrained perception of HR in the business community.
“I think the greatest misconception management holds about HR is that they wouldn’t know a business problem if they fell over it. And I guess the greatest misconception the other way is that no manager really cares about their people – only HR does. There’s probably an element of truth in both.”
Driving business outcomes through HR
One example Sherry gives of HR’s ability to drive business outcomes in a simple way is through performance management. An organisation might have good technical processes in place for performance management, however they might be either hard to understand or they go unused by managers.
“So it’s about not just focussing on the process but the usability and the effectiveness of what drives those processes,” Sherry says. “Because ultimately performance management processes are about lifting performance. And if you’ve got great performance management processes but your performance isn’t lifting, then arguably you’re not actually delivering. Instead of just focussing on the potential technical capability of processes we should be looking to drive the outcomes originally sought for the business. I think that’s one of the great value-adds, but I’m not sure that’s been that harnessed.”
For HR professionals of the future this will be a given, Sherry predicts. “Increasingly we’ll be looking for HR people who understand the outcome of what they’re driving with a wider and longer-term view. That will be really important because that provides the connection to the business.”
HR skills and the CEO role
Sherry believes that working in HR can provide a number of useful insights for those aspiring to senior management and CEO roles. “My view is that CEOs should probably pass through HR as one of their steps to becoming CEOs, because you get to understand what’s happening in your organisation’s people processes,” she says.
As most executives will point out, broader business skills are vital for the top job, and this is where HR often falls down. HR practitioners often take a blinkered approach to working in organisations, which contributes towards a lack of credibility amongst their business peers.
“If individuals working in HR want to be CEOs, then they shouldn’t necessarily stay in only HR roles – broadening their skill base through lateral movement is important,” Sherry says. “Also, don’t restrict yourself to just knowing about HR when you’re in that role. When I sit at the executive table I have a view of everything irrespective of which role I sit in – not just my particular discipline.”
Specialist professions such as HR often run into problems when people get to the top and then decide they want to do something else, Sherry says. “In reality you need to start broadening yourself potentially before you get to that point. It’s a risk you run in any specialist field, where you become so specialised that people don’t see you as having the breadth or capability to do anything else. You box yourself in. Of all the people who should know that it should be HR people – we talk to everyone else about it all the time.”
As a former head of HR and now CEO, Sherry believes HR professionals should come with a number of skills and capabilities in order to be effective in the wider business. “What I look for is people who can work with their line business peers to really understand what they need. They have to be outcome-focused if they’re going to bring HR and people expertise to the business table. I want them to demonstrate the behaviour that we require of leaders in a business. And I want all of my HR people to have the energy and capacity to sell the bank as the employer that everyone would want to work for,” Sherry says.
