HR … DOES PERISH COME NEXT AFTER PARTNER AND PLAYER ?

I have long believed, written and spoken about the fact that HR organisations need to go through a major transition to be allowed to survive as a business unit, rather than just ending up handling administrative functions in a shared service centre in some low cost country. (see “HR … Polite to Police to Partner to Player” posted August 26, 2010).

Author: indo consultores; CC BY-SA 3.0 license; via Wikimedia Commons

I have based this belief on the fact that if HR organisations cannot transition from a “run the company” position to a more strategic “change the company” role, they will continue to come under pressure to do more and more with fewer resources, as companies drive hard to cut costs to be able to survive the new economic realities which we all face today. I have therefore felt that becoming an “HR Business Partner” is not enough, as a partner is someone who may be asked to help implement the strategy built by others, but an “HR Player” is someone who is actually an integral part of the creation of the strategy. This ensures that the strategy is built around people, and takes into account critical issues such as ensuring that the strategy is actually supported by, and synchronised with, the corporate culture, and that the skills and competencies needed for strategy execution can be developed and/or acquired.

I have also long believed that a critical element of any corporate success is the commitment to building “management as a profession” rather than just a vocational add-on, which unfortunately tends to be most prevalent in European companies today. A critical part of professional management is an understanding of how to recruit, lead, motivate, develop, challenge, evaluate, reward and inspire your people, in other words those areas of concern that are generally associated with HR.

I had therefore concluded that the stronger and more capable is the management of the company, the less does the company need to be dependent on an HR organisation to identify and take responsibility for human issues.

Hence my belief that for HR the future is to either transition to a more important strategic role, or just stagnate as merely administrators of payroll and personnel records, roles that could easily be outsourced or even taken over by a capable F&A organisation.

However, I recently had the opportunity to hear an exciting young man called Heiko Fischer speak at a conference in Zurich, who made me wonder whether I needed to add another word to my alliteration to make it “Polite to Police to Partner to Player to Perish”, and whether the true ultimate goal of HR is to make itself totally unnecessary, by making management more capable.

Heiko is the founder of Resourceful Humans Consulting and he believes that the word “perish” should apply to our traditional understanding of management as well as to HR. He believes strongly that companies that adopt the principles of resourceful humans can do away with both HR and middle management.

They believe (from their web site) ….

“ … to sustainably produce meaningful contributions for your customers in the 21st century marketplace, a few great leaders are simply not good enough. To succeed in such highly demanding environments you need a critical mass of great people who can all lead and innovate when needed. To that end the RH-Way combines a proven entrepreneurial management mindset with a shared leadership architecture from the Gaming Industry. The Way of Resourceful Humans helps you enable your people’s potential, by relentlessly structuring the enterprise around their desire to produce results.”

Heiko postulates that while we all want to live in a democratic country, we do not translate the core elements of democracy to the way we work, and particularly as companies grow. He believes that the key elements to building companies that can succeed through continuous innovation is firstly to understand that making a profit is necessary for a company to survive, but that contribution to the entire ecosystem of staff, customers, partners and community should be the primary goal, and if successful then profit is one of the valuable by-products.

My simplified interpretation, of his three critical elements (in the space available) are:

– Democracy. Note that he does not advocate anarchy nor the abolition of management, but that its function is to create the minimum structure needed for an environment where people can be successful through having a greater say in what they do and how they do it. He sees our current management structures as being like a hamburger where management is the oversize bun, and where the people are what tends to be a very small patty squeezed in between. Heiko feels that modern structures need to be more like a burrito where the wrap is very thin and the major part is the filling.

Author: Pete Souza; via Wikimedia Commons

– Information. We need to ensure that people are kept informed of what is going on in the company at all times so that they can manage their own behaviour and actions based on what is needed. His belief is that if you give people the chance to work as entrepreneurs within a company environment, they will do so, and they will work towards their own success and therefore that of the business.

– Gain sharing. His feel is that the way that we reward people today is all based on management handing out largesse, whereas a more realistic way to reward people, particularly in a networked environment, is to base it on company success, but on value and contribution to the team as viewed by their peers.

Heiko uses the example of the Starship Enterprise of Star Trek. James Kirk is the captain and sets their direction under their broad strategy of going “where no man has gone before”, but doesn’t spend a lot of time telling people what to do, as his team understand their roles and how and when to perform them. On top of that, no-one on the Enterprise has been ever known to pick up a communicator to talk to HR.

Author: McFadden, Strauss, Eddy & Irwin for Desilu Productions; via Wikimedia Commons

I am not yet a total convert to the concepts of “resourceful humans” as seen by Heiko Fischer, though I may not be a long way away. I do believe in simple, flat management structures and am an opponent of complexities such as matrix management (see “Stupid management ideas” posted August 29, 2011). I also believe that skilled management includes being very people focussed, and that many tasks generally seen as belonging to HR really belong with line managers. However, I will need to have some more discussions with Heiko Fischer to decide if I am really ready to add “perish” to my transition list.