Those in the HR field often lament the things that are not going well. Every few years there are public critiques about the field of HR: Why We Hate HR; It’s Time to Split HR; and It’s Time to Blow-Up HR.
In the 25 years we have been collecting data on HR competencies, one theme is the HR professionals consistently rate themselves lower on domains of HR competence than both their HR and business peers. This self-flagellation is encouraged when leading magazines and HR thought leaders focus on what is wrong more than what is right in HR.
Let me offer an alternative approach. Some prophets see what is wrong, and tell the people they are damned and going to hell. Others see what is wrong and give them a pathway to heaven. From positive psychology we learn that successful relationships endure when there is a five to one positive to negative focus.
And much is going well for innovative HR.
First, HR is not about HR. In leading companies HR shapes business value because it starts with the business. The scorecard of good HR is the business scorecard. HR investments help deliver product innovation, geographic expansion, and customer intimacy growth strategies.
But beyond strategic HR – where business strategy is a mirror in which HR reflects business goals – strategy can be a window so that HR work is being connected to external customers and to investor confidence. Customers are increasingly involved with staffing (sourcing and interviewing candidates), training (designing, attending, and teaching), performance management (doing 720 feedback more than 360), and leadership (leadership brand).
Investor confidence improves when they monitor quality of leadership through a leadership capital index assessing individual leaders and human capital systems. HR investments drive employee productivity and organisation capabilities, which deliver strategies that increase customer and investor share.
The ideas in recent Harvard Business Review (HBR) articles about networking organisations, positive performance reviews, and collaboration among business leaders, finance, and HR are very helpful. They would be even more helpful if these internal HR practices started with and were connected to customer and investor results.
Second, HR is not just about talent. For 20 years HR has been focused on talent (called labour force, workforce, employees, staff, and people). The war for talent has been the dominant metaphor for HR. Leading organisations are now pivoting to a focus on victory through organisation. Individuals are champions, but teams win championships.
Leading HR professionals manage both the workforce and workplace, talent and teamwork, individual competence and organisation capabilities. Under the adage 'culture eats strategy for breakfast' HR insights on culture position HR as a leading contributor to sustained business results. The HBR focus on labour markets offers a good reinforcement of HR and talent, but HR can also affect organisation and leadership.
Third, HR for HR has arrived. Innovative HR practices have facilitated positive business results by focusing less on bureaucratic processes and more on simple and integrated solutions. Complex performance appraisals are replaced with informed conversations that ensure accountability.
Technology-enabled hiring, training, and compensation help deliver the administrative work of HR so that more attention can be focused on strategic HR. HR departments are increasingly becoming professional services units within their organisations where they turn their expertise (on people, performance, information, and work) into line manager client value. HR analytics have helped make HR investments that have business impact. HR professionals don’t just have competencies, they demonstrate competencies that deliver business results.
After decades of research we know how to invest in HR practices, governance, analytics, and competencies so that HR shapes talent, leadership, and organisation outcomes, which in turn deliver strategies that build customer and investor value. Many of these and other innovative ideas come from thought leaders who have published essays in the recent book The Rise of HR: wisdom from 73 thought leaders and elsewhere.
Often those critiquing HR are like those who wonder why the 20-year-old telephone, computer, or television does not deliver against modern standards. The dated strawman of HR is out of date. Innovative HR exists. Rather than lament the inevitable challenges to innovative HR, I hope we can appreciate the pathway to a better future.
Dave Ulrich is Rensis Likert professor of business at the University of Michigan and partner at The RBL Group. He is in the HR Most Influential Hall of Fame
