A New Mandate for Human Resource Should we do away with HR? In recent years, a number of people who study and write about business--along with many who run businesses--have been debating that question. The debate arises out of serious and widespread doubts about HR's contribution to organizational performance. Dave Ulrich acknowledges that HR, as it is configured today in many companies, is indeed ineffective, incompetent, and costly. But he contends that it has never been more necessary. The solution, he believes, is to create an entirely entirel y new role for the field that focuses not on traditional HR activities, such as staffing and compensation which are considered value sapping, but on business results that enrich the company's value to customers, investors, and employees. Traditional HR is defined by ‘what it does’ and not by ‘what it delivers’. Ulrich focuses that in modern times HR will be a major force in delivering organizational excellence. Today’s competitive advantages due to cost, technology, distribution or manufacturing can be copied and will become table stakes and will only be essential to survive in market but to become a winner, an organization will need to develop capabilities such as speed, responsiveness, agility, learning capacity, employee competence and HR will be responsible to deliver these capabilities. Ulrich elaborates four broad tasks for HR that would allow it to help deliver organizational excellence. First, HR should become a partner in strategy execution where it can bring plans from paper to reality. Second, it should deliver administrative efficiency by reducing costs and maintain quality by becoming an expert in the way work is organized and executed. Third, it should increase employee contribution by enhancing employee commitment and morale to deliver results. And fourth, it should shape processes and culture to improve an organization’s capacity of continual change. Fulfilling change. Fulfilling this agenda would mean that each of the activities of HR would, in some concrete way, help a company better serve its customers or otherwise increase shareholder value. It is important to note that external factors will also justify the significance of HR. All industries today face five critical business challenges; HR will play a leadership role in enabling the organization to meet these competitive challenges. First, Globalization will require organization to move people, ideas and products globally for which HRs will have to increase their ability to learn, collaborate and manage diversity, complexity and ambiguity. Second, for achieving growth, organizations will have to opt for innovations, collaborations or mergers and acquisitions, with all of them requiring the integration of work process and culture with HR. Third, Technology will require the organization to continuously think of making technology viable and a productive asset, for which HR will have to ensure that the organization stays ahead of the information curve and leverages information for better results. Fourth is Intellectual capital, and accordingly, knowledge economy will be the future and HRs will have to find, assimilate, develop, compensate and retain talented employees for the
advantage of critical intellectual capital. Fifth is Change, wherein future will demand dynamic organizations which adapt to fundamental and enduring changes. Ulrich emphasizes HRs new role of quickly turning strategy into action. For this, HR needs to define an organizational architecture by using robust and well est ablished frameworks such as Galbraith’s star model and 7-s framework. By explicitly articulating the architecture, the managers can clearly understand that the driving force behind strategy execution is structure along with systems and skills within the organization. The accountability for conducting an organizational audit also lies on the shoulders of HR. To reinforce this HR imperative, the author outlines a framework for the audit process which includes questions based on competence, governance, leadership and change capacity of the organization. The audit is critical in helping the managers identify which components of the company must change in order to facilitate strategy execution. By defining the organisation’s architecture in terms of its culture, rewards and work processes, the HR can ably guide a discussion of ‘fit’ and how to obtain or develop whatever is missing by identifying and evaluating the gap between company’s current practice and best practice. On further assessing the role of HR as a strategic partner, the author describes the methods for renovating parts of the organizational architecture by bringing in state of the art approaches. HR also needs to set clear priorities and take stock of its own work by coordinating with operating managers to assess the impact of each of the initiatives and accordingly prioritise systematically. Initiatives that are really aligned with strategy implementation should be given immediate attention. To adapt itself into the new role of HR as a strategic partner, new skills and capabilities need to be imparted to the staff so that they may perform in-depth analysis. Administrative expert The HR managers are tagged as administrators who make policies. In order to remove this tag, they should focus on increasing the efficiency of their own functions as well as of the organization. Apart from cost benefit, this will also help HR managers in building their credibility which in turn will help them in becoming partner in executing strategy. HR managers can also help in creating centres of expertise that share important information between different business units. Employee Champion Companies cannot prosper unless their employees are completely engaged. These employees are those who believe they are valued- they can share ideas, work harder than the minimum required and relate better to customer. So, HR managers should make sure that the employees are engaged. They can accomplish this by,
Training the line management in methods of achieving high employee morale- by organising workshops, written reports and employees ’ surveys. Becoming the employees’ voice in management discussions-employees must be informed about this, so that they can communicate their opinions to HR.
Change Agent It is important to adapt changes in today’s competitive environment. The HR’s role as a change agent is to replace resistance with resolve, planning with results and fear of change with excitement about its possibilities. GE follows a change model for this. According to this model change begins by asking who, why, what and how. This helps an organization to identify the key success factors for change and assess the organization’s strength and weaknesses regarding each factor. The important challenge many companies are facing is changing cultures. HR manager can help to bring new culture by following the four step process
Define clearly the concept of culture change
Articulate why culture change is important to business success
Define a process for assessing the current culture and the desired new culture, as well as for measuring the gap between the two. Identity alternative approaches to create culture change. HR can be architect of cultural change but to do so, its purpose must be redefined.
New HR Mandates
It requires Senior Managers to change their outlook towards HR, on their expectations and behaviour towards HR.
CXOs relying on HR - If the CXOs and the line managers take HR seriously, they set an example for everyone to consider HR in a more serious manner. This would also enable the operating managers to include HR during strategic decision making. Making HRs accountable - The management should ensure that specific goals are set for HRs which can be clearly measured and rewarded. This will give a better chance to the company to achieve its goals. Innovative HR practises - Just like other business units invest time and effort in developing new practises, HR should also devote a significant amount of time in such activities. HRs should remain up to date by attending HR conferences and reading latest literature available on HR. Not just that, sufficient time should be given to understand the HR practises being followed in other organizations. An inside out approach should be followed here, by adapting to technologies which best suit the company Best HR Resources - The HR team should comprise of the best HR talents who are well versed in business, HR, strategy, marketing & economics. Sometimes, additional training provided to the existing staff can yield better results. Also, hiring people from outside can be a solution.
Critical Review In A New Mandate for Human Resources, Dave Ulrich describes the current beleaguered reputation of HR and how HR needs to be defined not by what it does but by what it delivers. He gives his views through this article, describing the challenges that HR faces and subsequently outlines step-wise processes to bring about a change in the way it works. Also, his descriptions of instances wherein companies have undergone successful transformation of HR, support his agenda of bringing a radical departure from the status quo. Ulrich explains the significance of HR for organizations and transformed roles of HR which enhance organizational excellence. But to put these into execution, there are some challenges which have not been evaluated by the author. HR may not be ready for extended roles and responsibilities such as to become a strategic partner or organizational architect. For doing so, HR will have to understand business, roles of managers and their works at a very granular level, but traditionally they have been restricted to training, compensation and staffing. Therefore, their competency in taking such roles is questi onable. As stated in the article, a CEO was not comfortable in making HR a partner in strategic business processes until the HR staff proved they could streamline the organization’s systems and procedures. Since senior management itself has a low opinion of HR, the credibility of organizations as a whole accepting HR in such roles is doubtful. It can be considered that senior and middle level management could prove to be better in delivering administrative service rather than HR. The article talks about defining the role of HR based on outcomes rather than on activities. But what the author overlooks is that HR cannot be directly associated with the outcomes due to its non-involvement in the executory processes at the basic level. Also, the accountability of HR cannot be quantified. To get better employee contribution by enhancing employee commitment and morale is more a role of immediate managers in the hierarchy and not HR. In order to represent the employees in management discussions, the HR needs to take preemptive steps for building trust among employees. The new roles and agenda for the HR field that Ulrich presents are interesting and he does a good job of proposing these roles by substantiating with ample examples of organizations such as General Electric, Amoco, Sears and Hewlett-Packard. However, his writing is weakened by the presence of bias towards the delivery of organizational excellence by bringing a reform in the functioning of HR department. Organizational excellence is not solely dependent on HR, it is an outcome of a well-knit organization. Moreover, the overarching assumptions he occasionally makes for the implementation of these HR imperatives do not seem to be feasible at times.
