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Cath Everett

Sift Media

Freelance journalist and former editor of HRZone

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News: HR is “ineffective” and “non-essential”, say senior execs


The majority of senior executives believe that the HR function is ineffective and consistently fails to provide value to the organisation.

According to a survey among 418 C-suite managers 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.
Robert Bolton, a partner at KPMG management consulting and global lead of the firm’s HR Centre of Excellence, said: “At the very least, HR has a perception problem, though in some cases, it may have actually failed to deliver real value.”
For example, while three quarters of those questioned pointed out that their workforces were becoming increasingly global, virtual and flexible, a mere quarter believed that HR excelled at finding and retaining international talent.
A worrying 24% also warned that HR teams were simply unable to support the company’s globalisation strategy, even though being able to hire international talent was a key priority for the average ‘globally-minded CEO’.
Meaningful and intelligent information
Moreover, despite the fact that 55% of respondents recently took on more contractors and temporary staff than permanent employees while three out of five increased their use of virtual workspaces, some 76% professed to be unhappy about their HR department’s ability to support a progressively virtual and flexible workforce.
To make matters worse, the report entitled ‘Rethinking HR for a Changing World’ indicated that a huge 85% felt that HR professionals were unable to provide insightful workforce information that could be used for forecasting purposes.
As a result, some 31% said that data analytics was the key area between now and 2015 to which they were most likely to assign investment.
But Bolton warned: “Taking full advantage of data is not something that can happen overnight. HR needs to develop its abilities in a data-centric environment and then educate the business about how to analyse the available information.”
But the process was a long one because, even though organisations were currently submerged in data, it was challenging to transform it into meaningful and intelligent information.
As a result, “HR teams must now seize on this as an opportunity to shift from being seen as providers of operational delivery to advisors providing counsel on business direction and strategy”, Bolton said.

3 Responses

  1. HR ineffective?

    I agree with the outcome of this survey however I feel that it is all about the approach of HR, and HR professionals need to engage in essentially a "HR PR Movement" in order to turn itself around.

    Previous HR departments that I have worked in have an almost Catty approach and do generally feel as if they are the "backbone of a company". They are not.

    HR is a purely supportive aspect of a business and should work WITH colleagues in order to provide the best service possible. I do not think that the HR function is ineffective but I believe that the mindset of a majority of HR professionals is.

  2. One of you has to go…

    If commercial management take such a dim view of HR but HR believe commerciasl management undervalue their contribution then it’s only a matter of time before ‘somebody’ has to go. My money is on commercial management surviving. HR people – can you hear the Meteor approaching? The same one that wiped out the dinosaurs?

  3. Agree – HR’s #1 job is to make itself obsolete

    I recently wrote this blog post that relates to this article.  HR is ineffective because it needs to be placed into the business, not standing outside the business.  Here is how you can make HR functions more strategic – move them into your business.  

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Cath Everett

Freelance journalist and former editor of HRZone

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