The status of HR remains one of the persistent love ‘em or hate ‘em leadership debates of our time. After two decades of business transformation experience at the sharp end, despite the ravages of time, I still stand squarely in the HR camp.
This is largely because I believe passionately in the importance of behaviour to brand and organisation performance and that the enlightened CEO should embrace rather than marginalise the HR function.
To transform an organisation successfully and sustainably from within, the CEO and HRD need to work shoulder to shoulder as the most important custodians of organisation culture.
The CEO always has demigod status whether they cultivate it or not. And first line managers are of course, the critical behavioural pivots around which organisation culture revolves. But when I reflect on the many culture transformation programmes I’ve led or facilitated down the years, there isn’t one that was successfully achieved without first transforming HR.
There are two very good reasons why:
- Like it or not, the HR function owns most of the people processes like recruitment; induction; performance management; reward; training and development and even internal comms. And we all know what happens to the house if we don’t take care of the plumbing
- HR professionals, in my experience, tend to have highly-tuned survival instincts that enable them to adapt to the needs of the most vociferous business leaders, fly the people flag yet avoid alienating themselves from their more left-brained colleagues. However, rather like litmus paper they soak up and reflect prevalent leadership cultural norms.
You have to transform the HR department if culture change is going to stick. So it makes sense to ensure that the HRD plays a leading part in the business improvement programme or process.
There’s clearly little doubt that HR has a lingering and possibly worsening image problem, however. According to a very recent survey of 418 C-suite managers, for example, conducted by the Economist Intelligence Unit and sponsored by management consultancy KPMG:
-a mere 17% believe that HR does a good job, with many seeing it as a non-essential department.
-75% of those questioned pointed out that their workforces were becoming increasingly global, virtual and flexible, yet only 25% believed that HR excelled at projecting the employer brand and finding and retaining international talent.
-A worrying 24% also warned that HR teams were simply unable to support the company’s globalisation strategy
Not the greatest endorsement from this group of internal customers, albeit the research was undertaken in an age when we’re hardly being overwhelmed by positive leadership role models generally.
I’ve been in fine company when I’ve called for culture change, not just in Financial Services, but within the boardrooms of many of our FTSE organisations. The Governor of the Bank of England; the CEO of the CIPD and many organisation leaders themselves have recently acknowledged the role that culture has to play in sustaining business and brand equity. Businesses and brands aren’t built on promises but on the cumulative weight of the everyday actions of workaday employees. Culture is the sum of that behaviour. Terms like presenteeism have recently been dreamt up to describe the invidious impact of rotten culture. It’s what happens when employees turn off yet dangerously still turn up. My shorthand for them is the walking or working dead* and in the current business climate, if we’re to believe the overwhelming evidence of the more credible engagement research it’s unsurprising that shambling masses are seemingly shuffling to work in the undead equivalent of droves.
The term culture change rolls easily off the tongue. But it’s tricky to implement, especially when you’re part of the problem and are too close to the key issues. No CEO can fix corporate culture alone. If the likes of Stephen Hester at RBS are serious about a culture-led transformation of their brands, it’s time they stopped filibustering about values and behaviours hoping for favourable PR. They need to start inspiring and empowering their HRDs who in turn clearly need to become more than yesterday’s seemingly safe pair of hands. And if they don’t believe in their HR leadership the time may well have come to seek out more proactive talent to help wake the walking dead.
* Brand Engagement (PalgraveMacmillan 2007)