The meaning of personal responsibility for HR
Chris Roebuck highlights the distinction between the HR business partner model and his new proactive HR Entrepreneur model that and argues, not for more HR savvy, but business savvy.
Speaking in measured tones, Chris Roebuck makes a compelling case for why HR needs to embrace a more entrepreneurial approach. During our hour-long conversation, it became clear that he not only understood where the major challenges lie for HR but also how best these can be addressed. To put it bluntly, he argued that the degree to which you, in HR, become a trusted advisor to the business is the measure of if you have got it right.
From 2002-2006, Roebuck was Global Head of Leadership at UBS and it was during this period that the bank won Best Company for Leaders in Europe 2005, and Best New Global Leadership Academy at the Best Practice and Excellence Awards. Also during this period the market capitalisation of the bank rose by 15 per cent and the project is now a Harvard Business School Case Study on transforming organisational performance and delivering results.
What does it really mean to lead?
Nominated every year since 2010 as one of the top 20 most influential HR thinkers, Roebuck serves as Visiting Professor of Transformational Leadership at Cass Business School, London. Our conversation was aimed at discussing what personal responsibility means for HR and what work we can do to develop a more business savvy approach, that will serve both HR and the organizations it supports well.
The key test in whether HR is taking initiative is whether it is being perceived as adding value by the organisation. Yes, HR genuinely tries to make a positive difference whether it be to help individuals or the organisation perform better but it may not be perceived as such by those it is being offered to.
What, in your opinion, is the impact of HR taking initiative as well as the role of personal responsibility in HR’s drive to gain greater relevance in business decision-making and organisational performance?
Roebuck : The key test in whether HR is taking initiative is, whether it is being perceived as adding value, by the organisation. Yes, HR genuinely tries to make a positive difference whether it be to help individuals or the organisation perform better but it may not be perceived as such by those it is being offered to.
What HR has to remember that it is selling its ideas and services to the organisation just as much as the organisation is selling its ideas and services to its customers. If HR doesn’t think this way it often ends up going down a process driven bureaucratic and risk-averse approach or an over complicated “best practice” route.
Then from the very start, those receiving the service are negative as they don’t feel they are having their real needs met. Remember beauty is in the eye of the beholder, not the giver. This is not to say, however, that HR shouldn’t challenge or change things. Above all, it is about how you position and sell what you propose effectively.
I often present evidence that shows HRs financial benefit, in general terms and for specific initiatives. I present this evidence, not just to HR audiences, but to the C-suite – CEOs, Deputy CEOs, Chief Legal, Risk or Finance Directors. Surprisingly, these C-suiters wonder why they have not been told about this evidence previously and that should the evidence be correct, then doing what I suggest is a no-brainer – in fact, so obvious that they should have been doing it for years. Hearing these comments does make me wonder what their HR functions have been doing for all those years.
For example, there is evidence that a good line manager can reduce the likelihood of a competitor stealing your talent by up to 87 percent, that managers explaining the line of sight from individual or the team objectives to the strategic can increase performance by as much as 36 percent.
It’s about showing HR can offer the organisation simple practical things that make a real difference – and if possible, don’t cost the organisation any money !
Another challenge for HR is its tendency to portray HR work as complex, even mystical. The reality is that leaders don’t want mystical or complicated – they want effective, practical, simple and quick. That’s what gets their attention – mystique founded on technical jargon, telling others you know what they need more than they do and being an organisational “policemen” rather than “trusted advisor” won’t get you to be a trusted advisor.
But that’s not always right and the business doesn’t care if it’s best practice or not anyway. What they want is something that can either solve a current problem or improve their current situation.
So why does this happen ?
Primarily because we in HR often think what the organisation needs to maximise effectiveness is “best practice”. But that’s not always right and the business doesn’t care if it’s best practice or not anyway. What they want is something that can either solve a current problem or improve their current situation.
“Best practice” may not be the most appropriate solution. The organisation may not be ready for it yet due to culture, process or market influences at this time. Often half way between where they are now and “best practice” is a good compromise, however.
For example, an organisation trying to find who its talent is, what they should do with them and where they should put them to get maximum ROI does not need a complex and integrated talent identification system like the one that we built in UBS. Such a system would probably not fit with the organisational culture or processes at that point in time.
The system that we introduced to UBS did work there as it was the right thing at that point in time for UBS, given the systems, culture and the organisation’s determination to be the best. Therefore, in HR what we need to do is to provide the best and most appropriate solution for the organisation at that point in its development, not force “best practice” onto it ,because in the end most people just won’t use it.
To be fair these issues don’t only effect HR, they affect all support and governance functions. So IT, Risk, Finance have many of the same issues for example.
You mentioned in an article you wrote for the Chartered Institute of Personnel and Development (CIPD), Swapping Best Practice for the Bottom Line, that “in reality, CEOs don’t care about HR best practice : they just want the best bottom line… to be business savvy, we must, therefore, be HR Entrepreneurs, not just business partners.” Quite aside from the obvious, why do you think CEOs are particularly concerned about the bottom line?
Roebuck : Historically, shareholders and the market have measured the organisation and the CEO on its annual results ie a bottom line financial focus. Therefore, essentially, short-term financial objectives. The problem that HR has is that the transformational HR agenda often includes many initiatives that take more than a year to show benefit and this is often outside the thinking and timescale most CEOs focus on, ie the next financial result.
To show value and relevance, even if the project will take years, and the major UBS project I worked on took four years, you need to have a KPI or annual milestones that you can deliver in each financial year to prove success and benefit. That also gives the CEO something for the annual report. So HR has to think not from the perspective of HR but from that of the receiver, ie the CEO and Board.
The most sensible of CEOs will say that the organisation needs to deliver both short and long term. To deliver this year’s results and deliver sustainably in the future to meet the demands of both shareholders and the market.
Here is a great opportunity for HR – to create an HR plan to integrate with the strategic plans of the CEO and within a timescale where significant benefit from transformational HR can be proven. If the CEO and the board are beginning to think long term, then that opens the door for HR to propose some really significant initiatives to make a real difference to the bottom line.
HR assumes that all that is required is some high level and generic overview of what the business does. That’s wrong. What’s needed is detailed knowledge of day to day activity.
There are a number of approaches as to how HR can be better equipped to carry out their role. One such approach is the business partner approach. One model, which you advocate, is for HR to become far more entrepreneurial. Are the failings of say, the business partner approach, to do more with how it is being implemented, rather than the theory of it or are there major changes we need to agree on, that justify a different approach?
Roebuck : The majority of problems related to the Ulrich Business Partner model come from ineffective implementation.
This means that overall its impact has been less than it should. The model says that HR must absolutely understand the business it supports before it can start to really be a business partner. But often this doesn’t happen.
HR assumes that all that is required is some high level and generic overview of what the business does. That’s wrong. What’s needed is detailed knowledge of day to day activity.
Thus, “business partners” sometimes have no credibility with the business from day one, as the business knows that despite the name change to “business partner”, those involved still know as little as before about what the business does and needs.
The reason that we need to take a new entrepreneurial approach now is to make up for the ineffective implementation of the Business Partner model. It places a level emphasis on the actions HR has to take to deliver to be effective.
However, in the real world, the pressures on HR are not level and consistent, eg there is a greater emphasis on operational delivery than strategic integration, so to counter-act this effect, you need to put more emphasis on making sure people do think about strategic plans as well as operational delivery.
It’s the same as developing any performance – if someone is weak, in an area which is critical, you need to put more emphasis and effort into that area to bring it up to the required standard and less in those other areas that are already being delivered to a good standard. That’s the issue – the business partner model doesn’t pick up on those critical areas of weakness that extra effort needs to be applied to for success whereas the HR Entrepreneur does.
So, the HR Entrepreneur model makes clear the key capabilities HR people must develop and actions they must take to deliver best outcomes in the real world.
It does not assume that all HR people will understand what they have to do, how much they have to do and then focus making it happen. To be effective and really change behaviour, any approach must put more emphasis on those critical activities that are likely to be missed, forgotten or have a low priority in the real world to re-balance that.
The HR Entrepreneur picks up on this real world effect to “over” emphasise key areas to make sure that they are not missed, forgotten or given a low priority. Thus, the practical effect is that everything that needs to be done gets done and that it gives a clear and simple roadmap to HR to improve.
What do you need to do then to be an HR Entrepreneur ?
Roebuck : To be an HR Entrepreneur aside from good HR knowledge, you need an understanding of core business principles and your organisation.
Do you understand good project management principles ?
Do you understand the basics of profit/loss accounts ?
The basics of the processes that your organisation employs?
If you work in plastics, for example, do you understand the theory of how plastics work?
That is critical information that HR must know even if it is at the most basic level.
The next thing the HR Entrepreneur needs to do is to understand, on a day to day level, what happens operationally almost to the point that they would be capable of covering the line manager’s role in the event that individual were unwell for a day. That’s a real test of how well you understand what’s going on.
The HR Entrepreneur then needs to really understand the critical strategic deliverables the organisation has. That’s because HR needs to be a check on the line management cascade.
The assumption is that the line management system tells all line managers what a CEO thinks and believes is important so they focus effort on operational activity that supports strategic delivery. Sadly, that’s often not the case.
The communication down the line is often not that good. Middle and junior managers often work hard to deliver what meets their operational objectives but it may not align to supporting key strategic objectives which it should. If the HR Entrepreneur is aware of these strategic critical deliverables, and can see the line manager is concentrating on the things that don’t support these, then it gives HR the ability to help the line manager redirect their effort to the right things. It is usually the case that only HR is in a position to see this divergence when it occurs as the line manager is usually too busy delivering the operational objectives to notice it.
The more control systems you have, the more steps there are in a process, the slower things happen – which is the last thing you want when dealing in a dynamic market and trying to meet customer needs.
At the next level, the HR Entrepreneur needs to be highly aware of what the regulators, economy, market and competitors are doing and how these are making an impact on the organisation. Sadly, I find that this is the kind of information that many HR business partners lack.
Finally, the key thing is the entrepreneurial mindset which incidentally is the most difficult to achieve. Many in HR have over the years been trained to, or come to think, in a structured and bureaucratic way which is aimed at minimising risk. You need to realise, however, that by minimising risk you are also slowing things down.
The more control systems you have, the more steps there are in a process, the slower things happen – which is the last thing you want when dealing in a dynamic market and trying to meet customer needs. You want to optimise risk, not minimise risk.
But to do so you must understand what the business does and how, only then, are you in a position to contribute. Everything must focus on the end customer. You are not only providing HR services to the business; you should be providing opportunities for the business to improve the service the customer gets and thus win competitive advantage.
The next part of the entrepreneurial mindset is the ability to take a proactive response and act as if it is your money and your business – you can’t just sit back and wait for the business to ask you for help, you need to proactively help them get better.
So you must also have the ability to manage change, to constantly be creative and look for an opportunity to innovate. The organisation must be constantly improving, including HR. That includes how HR delivers its services. HR must match how it does things to what the task needs now and in the future. So when considering change, how many in HR consider whether their legacy systems are still fit for purpose in today’s world, or do they just tinker and tack new things onto a broken old system ?
How can you check if you are getting more entrepreneurial ?
Do a SWOT analysis on the organisation externally (from a customer service view) and internally (from an effective management view).
If you have got to the point where you understand the organisation enough to do the SWOT analysis, you can then provide HR advice that deals with the real strategic and operational challenges; addresses weaknesses and threats as well as supports the organisational strengths.
Try it, and if you think you have it right, discuss it with your line management colleagues to check it is and thus show your determination to understand and help them and then ask them what you do to achieve that.
You’ve also said that line managers don’t have HR savvy, so they don’t know how HR can help them, so ‘business savvy’ enables HR to suggest the most appropriate support rather than standard ‘best practice’. What do you believe are three things that HR can do to become more business savvy?
Roebuck : Firstly, if you have the opportunity in your career, spend time in a non-HR part of the organisation, preferably where you’re dealing with customers. Whether it is for a month or a week, anything that gets you some practical experience in the day to day reality is good.
Secondly, design a course of personal study to give yourself an understanding of the organisation suggested in the Entrepreneurial HR model, covering areas such as organisational strategy, what the different business units are doing, talking to line managers and looking at performance against financial targets. Doing so will mean that you can start to understand in detail what the business challenges are. This should include a basic working knowledge of core business skills, eg project management, financial understanding, operations management, marketing etc.
Thirdly, look at the big picture. Study the organisation, its position in the market, your industry sector and understand the challenges and opportunities that your organisation is facing. Then, do the SWOT analysis suggested earlier – and sit down and discuss your views with your line management colleagues.
Finally, the ultimate test is the response you get from the business directly – are you a trusted advisor? If key line managers and other key people are proactively interested in talking to you about their needs and how you could help them, then you are doing your job well – you are starting to get the return on investment for your time spent building your HR Entrepreneur credentials.
Professor Chris Roebuck gives an overview of how his unique Masterclass helps leaders get the best from their people and focus that on what delivers success using their own experience.
Chris Roebuck is Visiting Professor of Transformational Leadership at Cass Business School in London. He has held senior roles at UBS, HSBC and KPMG, has served in the British Army, and is one of the top 15 Human Resources (HR) thinkers in Europe. As Global Head of Leadership at UBS, he helped deliver leadership and development strategies, resulting in one of the most successful recent corporate transformations. This is now a Harvard Business School Case Study on transforming organisational performance.
A sought-after advisor and leading authority on entrepreneurial, engaging, ethical and effective leadership, Professor Roebuck shares his insights and experience to help audiences develop a simple route to rapidly become a member of the elite group of truly effective, inspiring and respected leaders in their organisation, today and in the future. This is achieved via his new approach to leadership – Mach 2 – that has been described by a leading Professor of Psychology as a “breakthrough” in thinking and which Harvard Business Review have interviewed him about in Beijing.
Author of Lead to Succeed, he has advised major global organisations at board level on improving performance through their people, including the UK National Health Service (1.4m staff), global banks and law firms, and organisations in sectors such as logistics, consultancy, transport, engineering and healthcare, even the Chinese Space Corporation. Local governments and non-profits, including the Red Cross, have also benefited from his expertise. His speaking engagements regularly take him to cities across the USA and Europe, to Moscow, Dubai, Singapore, Malaysia, Myanmar and Hong Kong.
Often quoted in globally recognised publications, including the Financial Times, Wall Street Journal, Le Monde, New York Times, Time Magazine, Straits Times, China Securities Journal and Gulf Times, he has been interviewed on leadership and management issues more than 230 times globally on BBC, Sky, Bloomberg, Al Jazeera, Swiss and Russian TV, ITV, CNBC, CNN, Voice of America, the BBC Today programme and World Service radio. He is a regular author for CEO and HR Magazines.
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Close to the edge image courtesy JoeyMC86@freeimages.com. This article was originally published in the April 2012 issue of HR Matters Magazine (now known as Accelerate Magazine).