The human resources department, previously referred to as “personnel”, is believed to have been first established in 1901 at the The National Cash Register Company. When it first began, the role of HR was more compliance-based, along with a slew of administrative based tasks.
Now, over a hundred years later, not much has changed regarding the function of HR, as business leaders continue to run HR with compliance and administrative tasks as their main point of focus. HR has shown success in its quest to educate business leaders on the importance of talent in the workplace, involving mainly recruitment and acquisition. However, despite their continuous efforts, HR has demonstrated limited progress in the management and enhancement of the workforce.
The HR Dilemma of Perception
Earlier in the month, TLNT published a piece in response to an article appearing in both Marie Claire and Esquire named Sex, Lies and Human Resources. In truth, the piece, commenting on the series of cases that broke out in Hollywood, mentions little on the part of HR. The writer, Carol Anderson, a strategic leader, business owner and veteran HR professional, however, illustrates her frustration in the TLNT article, towards the unfair burden of responsibility that is placed on the shoulder of HR and HR professionals as such.
The problem? HR departments are all too often seen as the ones responsible for the faults in the company, yet they are rarely (if ever) credited for stellar performances in the company. A 2005 article illustrates the HR dilemma as such:
“The human resources trade long ago proved itself, at best, a necessary evil — and at worst, a dark bureaucratic force that blindly enforces nonsensical rules, resists creativity, and impedes constructive change.”
Now, over ten years from when this comment was first made, it’s fair to say that the HR function in many businesses has evolved, at least in the part of perception. However, it is still the case that HR professionals are caught in an uncomfortable position, as they are viewed as the “unofficial” mediator in the company.
So, what is it going to take for HR leaders to be perceived as less of an administrative branch and more of the visionary and true driver of strategic decisions in the business?
HR Professionals Falling Behind in the Corporate Race
It is no secret that the business environment is becoming increasingly digital. However, as depicted by DDI’s Global Leadership Forecast, only 16% of HR leaders feel prepared to operate in a highly digital environment, compared to 37% of all leaders in the survey.
The study also examines the capability of leaders across various business challenges and found that HR leaders lagged in all areas of performance, as depicted in the image presented. In every case, HR leaders felt less prepared than their peers in other leadership roles, a concerning truth for HR leaders that begs the question: How are HR departments supposed to help grow others in the business when they themselves are not prepared?
All this might seem to paint a dire reality for HR professionals, but, in reality, realising these facts is the first step to achieving a high performing HR function.
HR’s Great Potential for Change
A major frustration people have with HR is the discrepancy between the vision and the delivery. From nurturing the stars, fostering a productive work environment, to creating the ideal culture to attract and retain good talent, HR is the corporate function with the most potential and a lot to show for. However they are also the ones that most consistently under deliver, leaving the others in the company scratching their heads at what it is that they actually do.
The first step to combating this and achieving a high performing HR function is to identify the HR goal, or ideal scenario. So what does a high functioning HR department look like?
For a long time, HR has chased after the role of becoming the strategic counterpart of business leaders, being “seated at the table” of where decisions are made. Yet, to do so, it is important for HR leaders to become visionaries with a clear insight on the company, a task easier said than done, and harder, still, to be measured properly.
Defining the HR Role
Next is to evaluate the current status quo objectively. By understanding the business’ current HR positioning, HR leaders can better navigate their behaviour and attention towards the goal. Through determining the best practices and which areas may need more work, HR leaders can help guide the team to making a difference in the company.
A helpful way to look at HR is through the three following positions:
Responds to business needs accordingly; ensures compliance with policies; carries out basic HR initiatives to facilitate and support the proper functioning of the company.
Works in tandem with line managers towards mutual goals; shares an adequate level of understanding and communication with leaders and teams regarding HR issues such as talent gaps; provides HR solutions.
Uses data and analytics to forecast talent needs; ensures high-quality talent and functions through HR insight and strategies; connects talent planning with business planning and projecting possible gaps and needs.
A study comparing how HR professionals saw themselves to how other leaders perceived HR indicated a discrepancy in how HR teams were being classified. The finding was quite interesting, as indicated in the diagram below. From 2014 to 2017, there was only a 1-2% change in each category, as the majority of HR leaders viewed themselves as being the partner of the business.
The external perception of HR’s role was more intriguing, however. In 2014, the majority of leaders saw HR as playing a Reactor role, whereas in 2017, HR was most commonly classified as a Partner to the business. Though this may initially seem like an improvement, the data actually indicates that the reason for this was due to a decrease in HR being classified as Anticipators.
Overall, HR leaders were perceived as less progressive by external leaders, where the majority of the vote landed on either Reactor or Partner. Now that we know this, what can HR leaders do to perform better?
Focusing on Bringing Strategic Value through HR Insight
In 2018, HR teams are actually in a very beneficial position to lead. As technology advances in the realm of HR, there are more tools that are readily available in the market to help HR professionals gain insight into the business.
For HR to function at a high level, it’s important that HR leaders guide their team and equip them with the right tools to help direct focus on building higher value capabilities. Payroll and HR outsourcing is becoming common practice across different industries for a reason, and that is because more HR leaders are finding the need to transition from Reactors, to Partners, and then to Anticipators.
Links International is an industry leader in innovative HR outsourcing with services such as payroll outsourcing, visa application, Employer of Record (EOR), recruitment and more! Contact us for more information on how we can help leverage your HR function.