Having attended Dave Ulrichs Michigan course I know that the business partner model is often not implemented properly; primarily by failing to, as a first step, ensure HR really understands what the organisation and their line counterparts do. This lack of understanding leads to HR using “assumed” need rather than “real” need and the subsequent delivery of “HR best practice” which the line doesn’t need or want. Further the lack of clarity between the roles and responsibilities of line managers, senior leaders, HR and individuals relating to managing people and improving organisational performance inevitably leads to critical things being ineffective, eg performance management.
Even where HR enthusiastically tries to “serve the business better” it is sometimes counter productive. What operational line partners want is not always what the organisation needs most. There is frequent lack of alignment between operational and strategic objectives at mid and lower levels. If HR delivers to the operational but not strategic agenda it won’t add full value. Further the lack of clarity round roles, objectives and priorities between the line and HR causes confusion. This leads to complex HR strategic initiatives for senior management and HR “sticking plasters” at operational level neither of which align to each other nor to the delivery of key organisational objectives in a prioritised way. Being “responsive” doesn’t mean always doing whatever the business wants if it doesn’t add value. The result of this is a potential underperformance by most organisations of between 15 – 25%.
The business partner model must be significantly adapted to ensure that critical elements which deliver this organisational performance improvement are either emphasised more or added if missing. Key are focus on business driven prioritisation, alignment to key objectives and delivery with clarity and simplicity. It must take a proactive, not reactive, approach as a key part of the business not a separate “partner”. Many insightful CEOs say this is what they need, and if HR can’t deliver they will get someone who will. In reality CEOs don’t care about HR best practice they just want the best bottom line. HR must reflect this by thinking and delivering in an innovative business future driven perspective not a traditional risk averse HR process/ legacy driven one. We must be HR entrepreneurs not just business partners.
The HR entrepreneur is an individual, at any level or location in HR, who
- Has good professional HR knowledge
- Has good non HR business knowledge, eg project management, customer service
- Understands operational activity nearly as well as the line managers they support
- Understands the wider organisation and its strategic objectives possibly better than the line manager
- Understands the environment and market within which the business operates
- Is constantly looking outward benchmarking the organisation not just against last years performance but at least peers and possibly best in class standards.
- Has an innovative and entrepreneurial mindset to
- be proactive in identifying ways to drive better business, not just HR, performance by looking for opportunities to improve external delivery
- suggest lean initiatives which deliver maximum ROI for minimum resource and manage risk effectively by reducing process where possible.
- focus on delivering what the organisation needs strategically to sustainably improve for the future.
This change is important as it matches the development of the entrepreneurial leader within world class organisations where a proactive, innovative and flexible approach to business leadership is being developed. It is vital that HR reflects this by building business savvy. However the HR entrepreneur can function even without the line being entrepreneurial. HR entrepreneurs can be a catalyst to help develop entrepreneurial line management.
The HR entrepreneur is not another level above transformational HR. The HR entrepreneurs single objective is to support the maximisation of organisational performance; that must be the benchmark for all activity. So entrepreneurial HR principles have to be applied everywhere, in both transactional and transformational activity. Not only that but we must be prepared to remove HR activity that does not add optimum value to the organisation even if it is seen as “best practice”. There is recent research that complexity in organisations that exceeds the need to deliver objectives and manage risk has significant cost and impact on engagement. Over complexity is a risk in itself.
As entrepreneurs HR must focus on outcomes not roles, titles or process for process sake. Everyone in HR has to think as an Entrepreneur, accurately assessing the situation, innovating, being flexible and taking managed risk to drive better business bottom line. There is no “best practice” only the “best current outcome” and this will vary between situations, organisations and times. This matches service delivery to organisational need.
So how can HR, both individuals and functions, become entrepreneurial? To start a set of simple steps sets the overall agenda. These can be developed in a proactive way simply and quickly with the right approach.
1. Before you do anything ensure that you understand, that’s understand, not just be aware of :
a. The operational activity you support in depth
b. The strategic vision, objectives and values of your organisation in detail
c. The market environment together with the challenges the organisation faces in detail, its competitors, and the future prospects, including a SWOT analysis.
d. The key research and principles around the improvement of organisational and individual performance, eg around leadership, engagement, project management, process design and delivery, quality customer service and brand development.
2. Review current service delivery, in both transactional and transformational HR
a. Discuss with the business where the process could be improved to produce better outcomes, be made simpler or use less resource.
b. Review those areas and, bearing in mind risk management requirements, make changes to:
i. Reduce the complexity, time or effort required
ii. Add more value
c. Review whether current service delivery is aligned to the achievement of critical strategic objectives or just operational objectives.
d. Prioritise work of strategic benefit with senior leaders then align operational activity to support that. Take a holistic view.
e. Ensure clarity of responsibilities between HR, line and senior management.
f. Don’t announce that you are an HR Entrepreneur, just deliver the service.
3. Review the organisations current strategic and operational objectives and identify additional potential support that HR could provide that would enhance the delivery of those objectives based on the knowledge gained in 1 (above)
4. Constantly review what is being delivered through the filter of improving organisational performance and customer service not the HR “best practice” filter.
The organisation doesn’t care what HR people are called as long as they get things done. So the HR Entrepreneur should be an internal aspiration of what good HR people do not a new title. Entrepreneurial HR is the key to the future, the reactive implementation of the Business Partner has helped us on the journey but its now time for all in HR to move up a gear, become HR Entrepreneurs and show what HR can really do for their organisations. If you don’t someone else will.
Entrepreneurial HR Basic Model
Everyone in HR no matter what their level should have all of the above developed proactively by their organisation using internal business faculty and external support.