HR not measuring up

2007

HR departments have come under fire from both their management colleagues and their own HR directors for failing to address the strategic or people challenges facing their organisations.

The emphasis on business expansion is creating growing pains for many HR departments, according to a study carried out in the U.S. by the Human Resource Planning Society (HRPS) in partnership with the Institute for Corporate Productivity (i4cp).

The study found two-thirds of respondents believe that HR is not reacting fast enough to the strategic challenges related to organizational growth, with a similar proportion saying that the emphasis on growth in their organizations is changing the meaning of "strategic HR."

Meanwhile, a separate survey from research company Corporate Executive Board found that nearly nine out of 10 HR executives are not only unhappy about the strategic impact their function is making on their organisation but are also critical about HR's basic effectiveness at managing people.

To make matters worse, the Board's survey suggested that six out of 10 front line managers under-perform during their first two years, leading to performance gaps and staff turnover across the entire front line.

"Targeted skills upgrades, new hiring profiles, competencies management and career path strategies" will help organisations improve management and business impact, according to the Board.

Jay Jamrog, i4cp's senior vice president of research, said that there were a variety of reasons for HR failing to keep up in high-growth companies.

"Those firms are not only scrambling for the talent they need to keep growing — they tend to have a strong focus on issues such as meeting customer needs, delivering quality products and staying innovative."

"A lot of HR pros don't have much expertise in these areas. It requires a different kind of strategic HR to help drive growth."

The i4cp study also found that many HR directors are struggling to play a key role in their organizations' growth strategies, with a third viewed by colleagues as being sidelined by issues such as talent acquisition and integration.

Another one in 10 said that HR leaders weren't involved in growth strategy at all, with almost a quarter felt that overall role is "below the executive-team level."

That leaves just a fifth of respondents who believe that HR directors are critical members of the executive team, while just 16 percent feel that the HR function plays a key role in promoting organizational growth in their companies.

"Even though they are in the minority, these are the HR professionals who are probably the true business partners," Jamrog said.

"They understand the executive point of view and know what it takes to help their companies grow. But even if they're not represented on the executive team, HR can provide a crucial supporting role to leaders who are focused on growth."