HR business partner models fail to add strategic value, study says

While HRDs generally have good business knowledge those lower down are failing to add value

HR business partner models are failing to add strategic value to businesses, according to a Henley Business School report seen exclusively by HR magazine.

Andrew Mayo, professor of human capital management at Middlesex University and co-author of the HR with Purpose: Future Models of HR report, said that many business partners (BPs) are underprepared to view the business strategically.

“In my view, the CIPD wants business partners to be strategic but it doesn’t train people to provide that,” he said. “The top levels of HR understand the business well, but the levels further down do not know how to contribute.”

Part of the problem, the researchers argue, comes from patchy implementation of the recommendations of various theorists, such as Dave Ulrich.

In 1997 Ulrich first described his model, which combines HR business partners, centres of excellence and shared services.

Kathryn Pritchard, group chief people officer for Odeon UCI Cinemas Holdings, suggested that the implementation of the Ulrich model does not always present opportunities for BPs to add value. “The effectiveness of the BP model, like lots of things in business, depends on the capability of the BPs and the context they work in,” she told HR magazine. “Sometimes it adds value and sometimes less so.

“Where I have seen it add less value is where HR models have evolved very strategic and commercial centres of excellence and have evolved their analytics function. When both of these are working well, and alongside an efficient ‘business as usual’ transactional arm, there is less opportunity for BPs to add strategic value.”

Mayo added that in some cases BPs do not have the time or energy to offer a strategic contribution. “You see this where the HR department has been cut down to the bone,” he said. “There’s simply not the capacity to do anything other than the transactional. There’s not enough time to be strategic too.”

When approached by HR magazine Ulrich responded that while implementation can sometimes be behind the failings, this does not mean the model is flawed. “Like using the full services of a smartphone you cannot blame the phone for bad apps when the users do not know how to use them,” he said.

Instead businesses should be adapting the partner model. “HR structure should match business structure,” he explained. “We argue that emerging HR practices should be aligned, innovative, integrated, and simplistic.”

However, the report suggests that other areas of the business do not view HR in a positive light, which could be hampering partnering. The research cites 2016 research from Bersin, which found that while 29% of those in HR class their performance as below adequate, 38% from other areas of the business believe they are under-performing. Similarly, while 39% of HR staff believed they were good or excellent, only 28% from those outside HR agree.

Mayo suggested that HR professionals and aspiring BPs could learn to become a better partner to the rest of the business by spending time in another function. “A six-month secondment in another area of the business will provide a different perspective,” he said.

Pritchard added: “I think we as HR professionals need to develop critical expertise about organisation performance and capability and then bring that to life in new and creative ways for the businesses we work in. Great BPs should be leading their businesses in understanding how to achieve optimal organisation performance, developing a sense of where value is being created and lost in a business, and finding ways to increase value as core parts of the role.”