Dave Ulrich on Why HR Should Be at The C-Suite Table
HR, love'm or leave them? Early in my career at IBM I was taught that HR were people to be avoided, they generally got in the way and were mainly paper pushers. That was a long time ago. However, closer to today, in 2005, Fast Company's Keith Hammond had a scathing article, Why We Hate HR. Hammond argued, "HR is the corporate function with the greatest potential - the key driver, in theory, of business performance - and also the one that most consistently underdelivers." Today HR still has mixed rep but Dave Ulrich, a great HR thinker is pretty convincing on how we should rethink our view of HR. Though it may be HR themselves that need to grasp the nettle.
Here is the text of the interview or you can watch by clicking on the Youtube video below.
This is Karl Moore of the Desautels Faculty of Management at Ï㽶ÊÓƵ, Rethinking Leadership for the Forbes. Today I am delighted to speak to David Ulrich, who is a senior professor at the University of Michigan and one of the top H.R. (Human Resources) people in the world.
Good morning David.
DAVID ULRICH - Good morning Karl, it is great to talk to you.
KM - It is good to have you back in Montreal as well. Dave one of the things you focused on for the last while is getting H.R. at the table. What do you mean by that and how does H.R. accomplish that?
DU - A very simple challenge, in coming out of the recession in western Europe, America and in Asia a lot of leaders have said that we've got to manage our people and resources better, and so the people organizational issues have been centre stage. Where do they get advice? H.R., they are not going to always get it from finance or strategy or marketing; H.R. folks should sit at the table. And when they sit at the table they should add value by helping the business leaders do things that will help their companies be successful.
KM - Why isn't H.R. at the table already?
DU - Well, in good companies they are. I always argue 20 /60/20. Twenty percent of the good companies and the good H.R. people work together, twenty percent will never get there- the manager may not get there, the H.R. person may not get there- and it is the sixty percent in the middle that through training and teaching, we're trying to move them to the twenty. So, some are there, some will never get there. I can show you some companies that just would never have good H.R.
KM - So what are some of the strategic issues that would bring H.R. to the table, in your mind, these days?
DU - Let us pick 3 or 4 that are hot issues for some big companies. How do we compete in an emerging market? We want to go to one of the next eleven markets- not Brazil, Russia, India or China- but we want to go to Vietnam, we want to go to Indonesia. What are the talent implications; how are we going to get the right people there? How are we going to source them? How are we going to find them? How are we going to develop local talent? One company has a clever strategy they call it "two in a box", they take their western leader, who has kind of career plateau'd, and they put him or her "two in a box" with a local leader and in the two years or three years they are there they have to transfer their knowledge to local leaders, those kinds of issues.
The other one is how do you bring the culture? So for a global company we have a great way of working, how do we transfer the culture from west to east; from mature to new, and from new to old? One company I was with, and I won't name it, they said in the new markets the culture that made us a great company exists, in our home markets we've become bureaucratic and slow, so H.R. has got to take the culture from the new market and bring it back into the home country.
KM - For most of my career at least, it was kind of the west teaching the east, but you are saying that it is actually a two way street, now.
DU - Yes it is a two-way street, some of the most innovative things we see going on, go on in Saudi Arabia they are going on in U.A.E., they are going on in Asia. In fact, Asia is growth rate of 5 to 7 percent is forcing some new leadership and new management practices that will then transfer, we hope, to the rest of the world. We clearly are a management global village.
AFTERTHOUGHT My friend, Dr.Samar B. Srivastava who is VP of HR for Jet Airways at their headquarters in Mumbai had some insightful comments I wanted to share.  Samar believes that HR will find itself at the table only when two pre-requisites are fulfilled. "One is that the Company's Board/CEO/Senior Managers believe that HR is as central to the success of the organization and is just critical as having the right strategy and effective operations." In my recent travels in India we meet with a number of Indian firms, including Wipro, Infosys and Jet Airways. A central issue for them was hiring thousands of people a year, in this environment it much clearer how important doing this better is. It has huge impact on retention, employee performance and the bottom line. The McGill students and I were astounded by the Infosys and Wipro campuses we visited in Mysore and Bangalore. At Infosys they train 7,000 new recruits, average age 22, just out of university for six month, every six months. These students are very attractive to other firms in the area and so Infosys must work hard to retain them and get the most from them. No wonder HR is seen as strategic for these firms, it obviously is!
Samar went on to add, "After having this enabler in place, the next requirement is to have the right HR professionals who have the right qualifications, experience, penchant for understanding finance and the business, have the attitude and are passionate about bringing about change. Once these two things are in place, we are sure to have the HR folks would be sitting on the strategy table. I therefore agree with Dave that it would be only a small percentage of companies where you would find this happening."
Samar's comments here strike me as a wakeup call to senior HR people to pick up their game if they really want to have the influence that they need, deserve, and want. What we want in any C-Suite executive is to be a functional or silo expert and a businessperson who gets the firm's strategy and is a integral part of a team all rowing together in that direction.
A CEO friend, Joseph Iannicelli of Standard Life Canada, told me that, "I always preach that people are our most non-easily imitated competitive advantage and HR is a huge contributor to the talent we bring in, our development programs, talent deployment, engagement and motivation. Great people make up for a lot of not so great things - good people overcome a bad structure, good salespeople can figure out ways of selling poorly positioned products, etc. The talent piece has become an integral part of our strategic planning process - do we have the right people to carry out what we want to do? HR is a big part of this. Simply put, I think people are everything."
Clearly this is a CEO who has seen HR as central to his role and has managed to recruit the right kind of HR executive!
I look forward to reading your comments on the situation in your firm and country.
-Article by Karl Moore
Read full article: , May 30, 2011
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