What does a successful HR Transformation look like? (RBL Institute Q&A, June 2010)
QUESTION: What does a successful HR Transformation look like?
ANSWER: We found that there are four phases to an HR transformation:
1. Context: HR transformation begins by knowing the context of the business that explains why the transformation is occurring
2. Outcomes: HR transformation requires clear outcomes from the transformation. These outcomes are the capabilities the company needs to succeed and become the deliverables of HR.
3. Redesign: HR transformation requires changes within HR in three areas…
o HR Department: how the HR department is organized and the goals
o HR practices: how HR practices around people, performance, information, and work are aligned, innovative, and integrated
o HR professionals: how to upgrade HR professionals.
4. Accountability: We believe that HR transformation requires transformation with multiple groups
o Line managers as owners
o HR professionals as architects
o Employees as users
o Advisors as thought starters
QUESTION: How do you properly prepare for HR Transformation?
ANSWER: The first step is getting ready for HR transformation, to know that HR transformation will help the business reach its goals. This means that senior line managers and senior HR professionals will recognize that an effective HR transformation will deliver value to the business.
QUESTION: Your HR Transformation model focuses on building HR from the Outside‐In. Very innovative companies like Apple or Google understand their capabilities or potential capabilities and then identify which of these are opportunities for competitive advantage. What about the Inside‐Out perspective?
ANSWER: Inside/out is valuable in that companies need to have a core set of values and identity that makes then unique. But, if that uniqueness does not add value to external stakeholders … customers who buy products or services, investors who invest in the future, and communities who depend on the reputation. It is not enough to “build on your strengths” … it is important to build on your strengths that will strengthen others.
QUESTION: Does your model need to get adapted when small or medium sized companies want to transform their HR departments?
ANSWER: We find that in general small or medium sized enterprises (SME’s) are more able to transform HR since these companies have a stronger capacity for change in general. SME’s cannot afford to have weak talent or HR functions. These are the organizations most dependent on people to build success.
QUESTION: HR is about building the right competencies to help companies to create sustainable competitive advantage. Is there a set of “new” competencies that many of the companies will need to build in the near future (e.g. Scanning, Visioning, Creation, Resilience, Agility, Adaptation)?
ANSWER: In the leadership area, we found that there are five core dimensions of leadership that all companies must master. These include:
1. Strategist: able to set a future global vision and to engage people in that future
2. Executor: able to make sure that things happen, on time and within budget, with clear accountabilities
3. Talent manager: able to make sure that employees are competent, committed, and contributing
4. Human Capital Development: able to invest in future leaders
5. Personal Proficiency: able to build trust with key people.
We call these five factors the Leadership Code (see rbl.net) and successful leaders need to master all five of them. We also found that these five factors explain 60 to 70% of effective leadership. The other 30 to 40% are the unique or differentiating skills based on what customers expect of the company. We identify this by defining what the firm wants to be known for by its best customers (a firm brand), then identifying the leadership behaviors consistent with this identity.
QUESTION: How do you build effective HR Transformation teams and responsibilities? What should be the role of HR in a successful HR Transformation (e.g. HR as Leaders and/or Facilitators of Transformation)?
ANSWER: HR transformation is a team game, not an individual sport. It requires cooperation of the line managers who are ultimate owners of the agenda, senior HR staff who direct the effort, HR professionals throughout the organization who change their skills, employees who take personal accountability for change, and external advisors who help others go through change.
QUESTION: In these challenging times of leadership, how should HR contribute in a meaningful, sustainable and recognized way to the outcomes of creating value and driving performance? Which skills are now “mandatory” for HR professionals who potentially want to make a difference in their organization?
ANSWER: We have identified three types of general outcomes from good HR work:
1. Talent: Because of HR work, individuals will be more productive, which comes from their competence, commitment, and feelings of contribution.
2. Organization: Because of HR work, the organization culture or pattern of activity will be aligned to customer expectations
3. Leadership: Because of HR work, the quality of leadership within the company will be prepared for the future.
These generic outcomes are likely to be tailored to specific requires of a business. We found that for HR professionals to deliver these outcomes, they have to have six sets of skills:
1. Credible activist: the ability to have relationships of trust and a point of view about the business
2. Business acumen: the ability to know and talk about the business
3. Strategy architect: the ability to shape and implement strategy
4. Operational excellence: the ability to do the day to day HR practices with excellence
5. Talent and organization: the ability to integrate HR practices to assure talent and organization
6. Change and culture: the ability to make change happen and manage a culture
QUESTION: Can you see a paradigm shift in HR?
ANSWER: Most surveys of CEO’s or C‐suite leaders who talk about challenges ahead, include issues such as: making strategy happen, building future leaders, managing talent, changing culture, changing quickly to respond to customers, gaining strategic clarity. These are all capabilities that HR can make happen. HR matters not because HR professionals declare it, but because line managers demand it.