HR ... Still Searching for an Identity

I have been following on LinkedIn several group discussions regarding HR issues.  One topic that seems to re-occur involves the HR Role.  Apparently the obvious seems to elude many practitioners.  

As a retiree, I do have the luxury of Monday morning quarter-backing, to own up to my biases and pet peeves, and to even meander in the controversial realm.

So permit me to say that this continuous conversation about the HR Role leaves me wondering what cool-aid are we still drinking in the 21st century.   

A Little History

It is no news that HR is held in low esteem by many managers and employees.

In my view, management and employees might have solid reasons for their disdain.  It is also no secret that HR is often seen as a black hole ... where resumes disappear, where grievances or suggestions vanish, where sense of urgency and practicality  are absent, where form seems more important than substance, where change is advocated but hardly enacted, and where slogans are often used to mask left field solutions.  My list is incomplete.

I also want to point out that not all HR departments are the same.  There is a noticeable minority that is  doing an exceptional job in a sea of obstacles, dilemmas, and elusive solutions.   This number has been growing steadily over the past 25 years.  

I do remember a study conducted some time ago.  Eighty organizations were polled: the CEO's, the top HR executive, senior management, a slice of the employee population, and the entire HR staff.  The key questions addressed:

1.  The extent to which the HR department was seen as a functioning business partner.

2.  The extent to which the HR staff understood the key business issues.

3.  The extent which the HR staff performed "completed staff work."

4.  The extent to which HR contributed to the resolution of key business issues.

The results?  Most top HR executives and HR staff members  rated their function as truly functioning as a business partner, while most CEOs and senior managers rated the HR function poorly as a business partner.  The study went on to point out that most HR practitioners lack the rounded preparation needed to fulfill the coveted role of business partner.  The perception of the employee population slice mirrored the view of their management.  

The lesson?  Wishing it to be so is not akin to being so .  Business partner is not a job descriptor, in my view, but the result from providing exceptional HR work.  Beauty, they say, is in the eye of the beholder -- management (HR's client) and the employee (the user of HR services).  Changing our name to one in vogue at the time gives us the illusion that we are changing and that we are keeping pace, when in reality, when we are merely improving incrementally rather than transformationally.

During the past quarter century, much developmental emphasis has been placed on the "soft" skills, relegating the "hard" skills to the dustbin of the "old" ways.  Soft skills include interpersonal competence, internal consulting skills,  facilitation skills, coaching, problem solving, and so on.  Hard skills include the technical skills to effectively design and implement HR policies and practices such as selection, compensation and benefits, safety and health, succession planning, organization and job design, and so on.   We have also come to realize that leadership and management do matter.  In my view, soft and hard skills are two sides of the same coin.  One is not better or more essential than the other.

Research conducted some time ago at Arizona State University, Santa Clara University, and the University of California Irvine, regarding the role of service organizations, revealed an important differentiator:  Skills and knowledge needed to make you successful in the front room activities are not the same as the skills and knowledge needed for success in the back room. The front room, where service provider meets service seeker, must be staffed by individuals with superior interpersonal skills and generic knowledge of the service options, while in the back room what counts more is in-depth technical skills and knowledge.  The research went on to suggest that selecting and rewarding service staff must take these difference into account when deploying and motivating staff.

So what is the problem?

Unlike finance, engineering, marketing, and other technical functions, HR folks do not share a common education or similar experience. Its roots are quite modest.  It emerged as a separate function when the people-related amount of administrative work required exceed management's span of attention.  As a result, the "HR" work was assigned to the best possible administrative staff member, often the CEO's secretary.  As collective bargaining emerged, complexity gave way to the realization that legal and negotiating expertise were required.  The technical HR elements were farmed out to the industrial engineering department, seen as more capable of addressing issues of compensation, job analysis, and selection methods.    In the past 75 years, we have seen the level of complexity increase whereby other disciplines have been brought in to improve the quality of selection, team development, job design, change management, and so on.

A side problem that remains is the perception that HR is a necessary evil, rather than an essential component to the success of an organization.

Experience teaches us that management's expectations are quite different than the employees'.  Management wants compliance and flexibility, while employees clamor for more involvement and participation in decisions affecting their work, as well as better or more (financial and non-finacial) rewards.  HR can play a great role in mediating this exchange.  There are many opportunities available to the HR professional to help improve the organization's ability to engage people through more better job design, tailor-made compensation and benefit schemes, to encourage strategic conversations between employees and senior management, to build effective areas of practice, to celebrate the unique value of each person, and to create a superior work environment.

There are many other areas where HR can shine ... I am sure you have your own list.

So let's stop debating the HR role and instead focusing on making HR contributions felt and more relevant to the business demands.

Enjoy your ride along the learning curve!  

In Search of Elixir ...

Definition

The dictionary defines elixir as the philosopher's stone.  The term comes from the Arabic word al-iksir -- a word to describe alchemists' attempt to find the potion that would turn ordinary metals into gold.  Another definition describes it as sweetened aromatic solution of alcohol and water containing, or used as a vehicle for, medical substances. Synonyms include: cure all, panacea, principle, solution, and remedy.

A Little History

During medieval times, obsession for ways to prolong life indefinitely reached its peak. Experiments abounded in all walks of life. Monks started to distill essences and spirits in their quest to create the ultimate liqueur. Some derivatives were even forbidden by governments because they believed, that drinking them, would surely drive people crazy.  

During the frontier days, the wild West was invaded by so-called "snake oil" salesmen. Men that would go from town to town selling concoctions that would cure any and all ills. Soon the term "snake oil salesman" became synonymous  with untrustworthy sales people.  

This preoccupation, and indeed obsession, with the "magic bullet" is nothing new.  People have been looking for the remedy of all remedies for centuries, if not millennia.  No culture seems to be immune to it.  We all seem to be looking for that extra something that would give us an edge, that would enhance our success, and improve our lives.  

Management Education

I have seen the mania for elixir cross into American management education.   

It started, it seems to me, during the 1960's with Robert Blake and Jane Mouton's Managerial Grid. Their model of managerial styles suggested that there is a perfect style for managing people and that they had a way of measuring it.  Thousands, if not millions, attended the Managerial Grid phase 1 seminar.  Participants discovered their style and received suggestions for improvement.  Blake and Mouton were proponents of the one best style where the management leader shows high concern for people and high concern for results.  

During the 70's two professors from Ohio State University, Paul Hersey and Ken Blanchard, argued that there is no one best style, and that it all depends on the maturity of each subordinate. Their argument was convincing enough to generate a large scale movement toward Situational Leadership.  The seminars that follow taught management leaders how to be an effective situational leader.  Hersey and Blanchard's work generated many copycats and contributed to increased availability of off-the-shelf questionnaires that people could use to measure and analyze their own style.   

Concurrently, psychologists began offering interesting ways to examine more deeply one's behavior and motivation, and assess one's personal strengths and weaknesses. More questionnaires generating more data for the layperson to interpret and draw conclusions from.  

Mainland Europeans were initially skeptical. They saw the Americans' preoccupation with styles as a superficial and a meaningless exercise.  They watched with amusement what Americans were up to, but were reluctant to join the parade.  Soon, globalization changed all that as American multinationals began to export their management development practices to their subsidiaries and branch offices.  As managers and executives began to migrate from company to company, and from industry to industry, and as Europeans began to populate American business schools' programs, the all-on-board movement gained speed.

So What?

At this point you might be wondering what is the point of this blog.  After 50 years of experimentation, the market has pretty much reduced the number of copy cats and it has forced the distillation of what I believe is the essence.

My conclusion?  There is no one best way to lead, that it all depends on circumstances.  

The management development market is quite efficient. Over time, it eliminates the stuff at the edges, the fads,  programs of the month, and concentrates its attention to the more serious findings.

Successful leaders are remembered fondly, not so much for their style, but for what they managed to accomplish during their tenure, and, of course, the legacy they leave behind. They are also remembered for what they stood for much more so than what they were against.  They are easily forgotten when people cannot associate results with them.  They are vilified whenever their leadership caused physical or mental anguish.

I have grown skeptical of the premise that starts with "everything being equal..." this is better than that.  Little or nothing seems to be equal from one organization to another ... Cultures, product cycles, market conditions, technology, history, and other factors make it almost impossible to generalize one company's experience, let it alone, duplicate it.

Having the wind behind one's sails can make heroes of most of us.  As Elvis Presley was quoted to have said:  You cannot knock success!  Being at the right place, at the right time, with competent and dedicated colleagues is certainly the best wind behind a leader's sails.  Innovative products and a friendly market place cannot hurt.

I have become partial to leadership development programs that teach us how to to capitalize on our core strengths rather than focusing on our weaknesses.  I have become an advocate of programs based on sound research data, and I have grown distrustful of personal leadership philosophies. I am now more and more keen of programs that focus on continuous learning rather than programs that promise magic bullets or been there, done that.

Old age or wisdom?  You decide.  What are your thoughts regarding leadership and management development?

More on Inequality ...

A few years back in graduate school at Oxford, I learned, that we face two types of problems in life.  The majority of problems are "tame" -- that is, there are specific solutions in place to address them.  A few, called "wicked," are extremely difficult to handle.  There are no easy solutions for them, and no one has the ability to solve them alone.  These problems require the involvement and participation of many.

Growing inequality in America is indeed a wicked problem!

A couple months ago, I wrote a long blog on this subject.  While traveling through Europe late in December, I ran into an article posted in the Wall Street Journal by Robert E. Grady, managing director of the private-equity firm Cheyenne Capital Fund and chief economic advisor to Governor Chris Christie. 

The article was commenting on the speech by President Obama on the growing inequality in America.  In the article, Mr. Grady challenges the President's assertions and assumptions.    After reading the article, I concluded that I should include the highlights of his argument in my blog to round out the picture I presented in my previous blog.

Lee Ohanian and Kip Hagopian, in their seminal paper "the Measure of Inequality" (Policy Review, 2011) point out that the Census Bureau's definition of income leaves out taxes, transfer payments such as Medicaid, Medicare, nutrition assistance, the Earned Income Tax Credit, and even costly employee benefits such as health care insurance.

Thus, we are reminded, that "the data conventionally used to calculate the so-called Gini coefficient -- the most commonly used measure of income inequality -- ignore America's highly progressive income tax system and the panoply of benefits and transfer payments." 

Messrs. Ohanian and Hagopian go on to tell us that "once the effect of taxes and transfer payments are taken into account, inequality has actually declined by 1.8% during the 16-year period between 1993 and 2009 when the Gini coefficient dropped from .395 to .388."  

In his speech President Obama cited a study by economists from Columbia University to bolster his case.  But, this study also found that already enacted benefits and tax programs have reduced America's effective poverty rate by 40% since 1967 -- to 16% from 26%.   Mr. Grady points out that this observation makes Ohanian and Hagopian's research more accurate, and less than an outlier.  

The Congressional Budget Office (CBO) released a study in October 2011 that came to a similar conclusion.  In it, the CBO study picked an artificial starting point of 1979, amid a a crushing period of stagflation.  Yet it showed that family income, including benefits, on average, experienced a 62% gain above inflation from 1979 to 2007.  It also showed that all five quintiles of the income distribution spectrum experienced real gains in family income.  This study seems to contradict President Obama's claims during his 2008 run for the presidency that the middle class was "falling behind." 

The real concern, it seems, is that some people were getting too far ahead.

Longitudinal studies conducted by the Treasury Department have found that there was "considerable income mobility" in the decades 1987-1996 and 1996-2005.  Roughly half of those in the bottom income quintile in 1996, for example, had moved to higher quintile by 2005.  

So what is the bottom line, according to Mr. Grady?

In periods of high economic growth such the 1980's and the 1990's, the vast majority of Americans gain, and have the opportunity to gain. In periods of slow growth, such as the past four and a half years since the recession officially ended, poor people and the middle class are hurt the most, and opportunity is curbed.   

If the goal is to deliver higher incomes and a better standard of living for the majority of Americans, then generating economic growth -- not income inequality or the redistribution of wealth -- is the defining challenge of our time.  This is the conclusion Mr. Grady makes.  

What do you think?