Splitting HR? No, It’s About Infusing It With an Operational Mindset

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Here we go again.

In the July-August 2014 Harvard Business Review, author Ram Charan writes that It’s Time to Split HR. He proposes two totally different units – one that handles “administration” which he says would be primarily compensation and  benefits. It would consist of “HR practitioners” and would report to the CFO.

The other would handle leadership and organization, report to the CEO, and be staffed by rotating high potential operational leaders.

Sound familiar?

Yes, we did something like this once before

Boomers probably remember the days when this was a matter of routine — not the split and different reporting relationships, but the integration of operational leaders into HR.

In some instances, this rotation was through a management training program designed to expose future leaders to the whole organization. In other cases, it was a staffing philosophy.

And most retail organizations (at least in the 1980s) required anyone going into HR to start on the sales floor. For those of us that managed to push our way in without that experience, we spent from the Friday after Thanksgiving until Dec. 24 in the stores supplementing the sales force. Oh yes, and learning too.

Our retail parent company, again in the 1980s, had the foresight to assign high potentials to teach in the Leadership Academy. It was a prestigious one-year assignment with a guaranteed spot back in operations after the year concluded. Those instructors brought an amazingly different perspective to their operational role, having learned and taught all aspects of the leadership role.

HR was strong then, even though we had an “administrative” name – Personnel.

Infusing HR with an operational mindset

But folks, we’ve been playing around with this dialogue about HR not being valued by operational leaders for decades. At what point do we see the urgency to change?

Charan expected opposition to his article, and got it in the form of an HBR blog post titled What Will It Take to Fix HR?, written by a Deloitte consultant (Dave Ulrich also weighed in with Do Not Split HR – At Least Not In Ram Charan’s Way.) The Deloitte consultant argues for the cohesion of all people decisions within one business focus, but agrees that infusing HR with an operational mindset makes sense. I think it is a valid point.

But, we certainly can accomplish this without splitting or otherwise tearing up a professional discipline (HR) that has an important role in any organization. We need to think differently, however, to do this.

Granted, HR has become highly complex in almost every HR sub-discipline, but here is a path we could take to quickly broaden our view of the organization and our opportunity to influence. Some suggestions:

1. Be clear about HR competencies

SHRM has an excellent competency model in place, but like everything else, it is important to prioritize because the “perfect HR practitioner” doesn’t exist.

What are the qualities HR needs to be effective in the business that you can’t easily teach? Find those, and teach that bright person the foundations of HR. Resources are everywhere, including partnering with peers who have different skills.

I have always looked for one thing when filling HR positions – intellectual curiosity. Armed with intellectual curiosity, a competent learner can grow and become proficient very quickly.

2. Fill the next HR spot with a high talent operational leader

This one is going to take some selling, particularly if HR is not well valued, but identify two or three roles that interact closely with the business (Compensation, Learning, and Talent management come to mind), and then find a high talent operational star and get them into HR, if only for a short term.

They will add value while in HR, and tremendous value after they leave HR.

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3. Listen to Operations

Bringing in a high talent operational leader into HR is worthless if all they hear is, “But we have to do this.”

Diversity of perspective is a crucial element to designing programs that truly add value and are seen as relevant to the business. Listen to those who can help you.

4. Encourage high talent HR pros to take a job outside HR

If that isn’t feasible, have the HR professional volunteer for a Board position in a not-for-profit. This is a great way to see the real world of operations – juggling budgets, customer demands, organizational strategy, business planning, employee and volunteer performance.

Every HR practitioner needs to clearly understand the burden that is on operational leaders in this day and age. While HR demands performance management, talent management, merit reviews, employee relations compliance, every other “overhead” department like Finance, Legal, and Marketing have similar demands on operational leaders.

HR needs to understand what it is like to be asked to do work that doesn’t relate to their real job, and try to juggle their customers and employees at the same time.

5. Get HR out of the office

This is a Catch-22 because HR has tremendous demands on their time, too. But talking with leaders and employees provides insight that is critical to adding value back to the organization.

And, don’t just float the conversation on the surface. Ask hard questions of the employees, listen carefully to their responses, and follow-up.

Being in the proverbial ivory tower is bad enough for leaders, but when HR sits in isolation behind a desk, that is a serious problem.

A fix is needed – but not wholesale disruption

Yes, we do need a change. We do need an HR “fix.” But, we can do this without disrupting the entire profession.

Start here: Ask your leadership team if they see the work of HR as adding value. If they do, great. If not, you have just opened the door to an amazing conversation leading to a new journey.

This originally appeared on the ….@ the intersection of learning & performance blog.

Carol Anderson is the founder and Principal of Anderson Performance Partners, LLC, a business consultancy focused on bringing together organizational leaders to unite all aspects of the business – CEO, CFO, HR – to build, implement and evaluate a workforce alignment strategy. With over 35 years of executive leadership, she brings a unique lens and proven methodologies to help CEOs demand performance from HR and to develop the capability of HR to deliver business results by aligning the workforce to the strategy. She is the author of Leading an HR Transformation, published by the Society for Human Resource Management in February 2018, which provides a practical RoadMap for human resource professionals to lead the process of aligning the workforce to the business strategy, and deliver results, and writes regularly for several business publications. Contact Carol at carol@andersonperformancepartners.com.


14 Comments on “Splitting HR? No, It’s About Infusing It With an Operational Mindset

  1. When done right, and there are plenty of places where it is, HR is unequivocally an operational function. I think the way Jack Welch engaged his HR team is a very good example. Love or hate his methods, there is no arguing that he recognized the critical impact that managing people well has on a business.

    If we in HR want to end the grating and endless “at the table” B.S. discussions, then we need to behave as business people who’s role happens to be is to ensure people are well managed and effective.

    Guess what our “business unit” is responsible for delivering? The workforce needed to deliver on every single aspect of a business! Can you define a more critical operational function?

  2. As a Chartered Accountant and a CHRP who has worked in both professions and in several industries for almost 25 years, I have yet to run across any HR professionals that truly embrace the business side of HR. There is so much talk about wanting to be at the executive table, however it appears to me that HR professionals generally dislike not only the financial side of business but also the financial people in it. How often have you heard an HR person lamenting the “darn controller who cut my HR budget!” – how about looking at the budget as something we all have to work within and coming up with effective business proposals? I have worked in both fields at the same time in a managerial or director role and understanding the financial side of things as well as the HR side has always led me to better decisions I had dreamed of helping merge these two professions by bringing analytical metrics to their table. However, I hold little hope at this point for HR getting to the corporate executive table as the norm because CHRPs insist on speaking HR speak instead of the industry speak they are in (not this is not business speak – it is specific to the industry) and they don’t seem to be willing to embrace the financial reality they have to work within. Consequently C.A.s have added this HR service as just one more that we can offer our clients – we have given up on the merging of these two professions. How very sad – but that is reality – so yes – I completely agree with the split – BUT I say – do the split and everything else listed in this article – they are terrific ideas and as a business person I like them. It is the only way that will work – history will repeat itself otherwise. Companies have survived for hundreds of years without official “HR” departments and they will continue to survive with or without them. But they can’t survive without accountants. I hope that HR gets time to grow up a little as a relatively new profession and have a spot at the executive table. But please try to remember what has always been true and always will be: Controllers and CFOs do not focus on the bottom line soley to protect their investors and to make money – they know that by protecting the bottom line they protect what matters most – their people.

    1. Miriam, I appreciate your perspective and while, like you, I haven’t had a lot of experience with financial types who “get” the people aspect, I’m glad that you do. I feel very strongly that HR has to approach their work as if they had to sell services and make a profit. That requires a strong understanding of all facets of the business, including finance. Where I think HR professionals can gain an edge is when they approach what they do in terms of what the impact to the bottom line of the organization can be, and then measure if, in fact, improvement occurred. Finance should be a close partner here.
      Thanks for your comment.

  3. Employ only operational people into HR. Would that spell the end of HR degrees?.
    Does this mean there will not be any need for “HR for Non-HR Managers” trainings.
    Why blame the function, structure, system, when the fault lies with employing the wrong HR guy to the job.
    Personally, I wouldn’t want HR to report to any Finance guy. period. If they want to take charge of payroll, not C&B, go ahead.
    More than 90 of businesses comprise of SMEs. They can’t even afford a HR generalist, let alone split it. All this lavish decentralize, focus, etc are lavish design fit for the big boys.
    If it works go ahead. At least, it will stop the bitching about HR having to earn a seat at the table.

    1. Good question Yuva, and all this is theoretical at this point. From my perspective, I think there needs to be a focus on “all things people” and given our regulatory environment, those dealing with people programs have to have the knowledge and experience to effectively manage those programs. Where I think the operational knowledge comes in is recognizing the actual work that is done by those who are facing the customer on a day-to-day basis, and that is an issue whether the organization is large or small. I like the concept of having both operational and HR knowledge and experience, and in my mind it doesn’t matter from whenst it comes, academic program or work experience. But one without the other, at least in my opinion, will be making myopic decisions. Thanks for your comment, Yuva

  4. Actually I like the HR model of Google. They keep HR staffed with only about 25-30% people with traditional HR people with traditional HR experience. The rest are divided between true strategists and analytics people—- neither of which have HR degrees or HR backgrounds. The true HR people do the HR admin and policy stuff whereas the strategists do the stuff HR people today say they want to do but avoid. Sounds like a good model —- and a way out of the “seat at the table” discussion that frankly is just nauseating to me.

    1. Hi Jacque – interesting concept – you are making the case for the split, and I need to think more about that. Two paths – 1.) the experience and knowledge needed and 2.) the organizational structure. I think it is imperative to infuse any organization or unit with diverse experience and background. I still think that the organizational leadership should be centralized with one group that focuses on improving and aligning human performance. Thanks for your comment.

      1. All three still under the Head of HR. But going ahead and getting some business grads in the strategist role. I’m afraid that as long as HR people keep getting BSHR and MSHR degrees they really won’t understand business. And one course in “business acumen” is not nearly enough. The analytics people have heavy IT backgrounds and understand all about how to pull data. The strategists with HR suggestions decide what data needs to be pulled. Just seems right to put people with relevant backgrounds into these roles. Trying to train traditional HR people in business and analytics now is not practical, takes too long and doesn’t serve the company which needs that expertise NOW. I realize this is not an approach that most HR people will not agree with but I applaud Laszlo (?) Bock for forging this new path with Google.

        1. Amen to that – I worry about the BSHR and MSHR degrees. Not only are they missing the business acumen but in the bit of informal research I’ve done, they are also missing the Human Resource Development side of HR. You can’t learn about organizational change, human resource development or the principles of effective leadership from HR Management curriculum.

    2. And where to these “strategists” come from if not from within HR? I believe that “true” HR people are strategists. You don’t have to write an algorithm to get analytics and to use that information to make sound business decisions.

      1. You not only don’t have to write an algorithm, you really can’t. There are too many variables involved in “us people” to measure accurately as a science. Without the art involved in human performance, we can’t be effective.

  5. Sorry to all the HR professionals who think splitting is a bad idea but after 40 years of HR and OD experiences to the SVP level, some of us are pioneers and some of you are settlers. We scare the crap out of each other. Let the Settlers take care of the things they love to do-administrative stuff. Let the Pioneers do their thing in the world of OD and Leadership Development. Can they convene at the quarterly conferences and show respect for the others’ strengths? Please do. But when the two day session is over, back to focusing on our strengths. Both need to be operationally focused and customer service centered. Don’t get sucked into the Fads of the Month (FOTMs). This stuff cycles like a washing machine. Find the real truths and live them.

    1. Wow. Interesting comment, Terry. I totally agree with you that the fundamental discipline of OD/HRD is where HR can shine, and most HR professionals are not knowledgeable about how this field can support the basic premise of HR – improving human performance. I have the same 40 years as you in both arenas, but differ in desired outcome I think. An eternal optimist, I believe we can help develop the HRD side of HR and make the whole field stronger. Those administrative things are actually quite strategic and support performance improvement – things like compensation, information systems, talent selection and employee relations. But you are so right – without the inherent knowledge and skill of the HRD discipline, it is inevitable to move from flavor of the month to the next.
      Thanks for your comment.

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