THE WORK OF HR
Unfortunately, many business leaders do not fully understand the HR function’s priority areas of work or how those areas support the overall business strategy. To address this issue, Weiss recommends using HR’s Triangle Chart. This chart shows three areas of work:
1. People capabilities. This reflects the flow of people through the employment life cycle.
2. Organizational capabilities. This reflects the flow of work from beginning to delivery of value to external customers.
3. HR value proposition. This is the top priority people capability or organizational capability that mitigates a critical business risk. If HR delivers on its value proposition, the organization has a greater likelihood of attaining its strategic goals.
In addition to serving as a tool for communicating with senior leaders, the HR Triangle Chart is also a good way to set expectations with HR employees about what they need to accomplish through their work.
As HR teams go through the process of lightening their work loads, the HR Triangle Chart can be a helpful aid. Each team member should identify how his or her current work time is currently allocated to the three sections of the Triangle Chart. Then each team member should look ahead one year into the future and decide how their work time would be allocated to add maximum value to the organization and to external customers. The output of this exercise helps HR determine how to reallocate its work assignments.
One of the best ways that HR can be recognized as a leadership-driven function is by focusing on people capabilities and talent management. Effective HR teams find the best talent, ensure that employees benefit from professional development, and take measures to retain good performers.
Finding the best talent means identifying candidates from outside the organization who would be a good fit, discovering hidden talent among existing employees, and developing an onboarding approach that ensures that new hires are well adjusted to their new work environment.
Developing the people capability focuses on talent management, total rewards, and the voice of employees. Weiss believes that HR should focus on five principles to create an environment of continuous learning:
- The main reason for training is to teach people how to self-learn.
- Business leaders must be held accountable for creating an ongoing learning environment.
- All employees are accountable for their own learning.
- Learning occurs “just in time” — that is, it occurs when and how it is needed.
- The entire organization should share what has been learned.
Total rewards address the portfolio of monetary and non-monetary rewards that motivate employees to stay with an organization. A best practice is for HR to provide each employee with a total compensation statement each year that raises awareness of their total rewards package.
By acting as the voice of employees, HR can help employees voice their opinions, concerns, and ideas to senior leaders. In this role, HR helps executives see what employees are thinking and feeling about the workplace.
In the area of employee retention, HR must work to prevent key talent from leaving the organization. In the event that this does occur, the HR team should take action to transfer knowledge from departing employees to other team members.
To be most effective, HR must understand how work flows into the business, how it is processed, and how it delivers value to external customers. This knowledge supports several essential organizational capabilities:
*Restructuring and design. By understanding the organization’s flow of work, HR professionals have the knowledge needed to contribute to restructuring discussions. It is important to remember that structure should follow strategy, not people. The goal of structure is to establish the best possible workflow to deliver the strategy.
*Organizational alignment. It is important for organizations to have a business strategy and a structure, but the presence of these two things does not ensure organizational alignment. There are several types of alignment, including alignment among executive team members, alignment between cross-functional areas, and alignment among strategic teams. HR professionals are uniquely qualified to champion organizational alignment and to help make it a reality. This can be accomplished through discussions, leveraging internal best practices, and running HR as a best practice model of cross-functional alignment.
*Return on investment in human capital (ROIHC). HR teams should secure human capital investment by leveraging ROIHC. This requires quantifying results as much as possible, identifying benchmarks and best practices, and creating what-if scenarios to identify potential losses if action is not taken.
THE HR VALUE PROPOSITION
The HR value proposition is defined as the promise to deliver a top priority HR solution that is targeted to mitigate a critical business risk. When HR commits to delivering on its value proposition, it becomes an essential part of the overall business strategy. Weiss has found that HR value propositions always focus on a people capability or an organizational capability. To develop an HR value proposition, teams should follow seven steps:
- Identify the business risks facing the organization.
- Explore how those risks will affect people and organizational capabilities.
- Identify the top business risk that is associated with people and organizational capabilities.
- Develop an HR value proposition that mitigates the top business risk.
- Confirm with business leaders that the HR value proposition is the right solution.
- Align HR’s work so it delivers the value proposition.
- Monitor progress on the HR value proposition regularly and report outcomes at executive strategy meetings.
Three planning approaches may be used to ensure that the HR value proposition truly does reduce business risks and advance organizational goals:
1. Focus on the business strategy. A common technique is for the business to develop a strategy using the assumption that they have the necessary people and organizational capabilities. After this has occurred, the HR team identifies what people and organizational capabilities must be developed to minimize the risk associated with the strategy.
2. Focus on the people strategy. During a people strategy planning session, HR and business leaders create a plan that identifies ways to achieve competitive advantage through people and organizational capabilities.
3. Focus on the best assumptions about what is required. The least effective approach occurs if organizations have not defined their business strategy or the business strategy does not clarify assumptions about people and organizational capabilities. In this situation, it may be necessary for HR to make their best guesses about what is needed.