Whether they realize it or not, companies are in the people business. Without people, there is no business. Companies are changing and evolving at break-neck speed to keep up with customer experience, expectations, competition, innovation and digital disruption. Business models are changing so that companies can stay relevant and viable. The people business must keep pace in order to add value, and that usually results in “HR transformation”. But that term implies a crescendo of intricate plans and execution followed by a decrescendo to stasis. Rather than slide into complacency, we must apply the “HR Perpetual Transformation” mindset by continually assessing our methods, assumptions and operating models.
Forward-thinking HR Business executives need to operationalize a transformation that includes a change management plan, redesign of HR and a people strategy.
HR Transformation
Change Management (Strategy for the Strategy)
Change management is often the red-headed stepchild of any implementation, mostly ignored and a lot of work. Without a strong strategy for the strategy though, transformations will be hard pressed for success.
Sometimes we know the right path to take. We research, ask questions, know the external and internal environment and understand business goals. However, before we put our foot on the first steppingstone, we must assess our readiness to walk the path. We must ask ourselves before we embark on our “HR Perpetual Transformation”:
- Are we strong enough?
- Do we know our direction?
- Will others support us in our journey?
Any strategy must consider: “Are we meeting the realities of the company, culture and leadership?”
Although we may think we know our key business customers, consider other influencers who are not on our radar. Do some research and use Organizational Network Analysis (ONA) to find and connect with the influencers. A small investment in the analysis is an essential ingredient to the strategy-for-the-strategy.
We can have the best strategy, but if our key customers and stakeholders are not ready to consume it, then its successful execution is already compromised. We build credibility by understanding current customer reality versus defending HR’s perspective. We must accept executive readiness for the required and necessary change, without judgement, to make the path straighter, smoother and quicker as we embark on our journey.
Redesign of HR
For HR to deliver on the business strategy, it must be organized in a way that delivers on current and future needs. Redesign should begin with a thorough objective assessment based on future business needs and critical capabilities.
The assessment should include meetings with key stakeholders, understanding key processes and business plans, reviewing metrics and key data and benchmarking against highest performing organizations. The HR senior leadership team should review and filter the initial observations and recommendations, considering the business’ tolerance for change. Once the final recommendations are crafted, they should be shared with the key stakeholders to obtain feedback and ensure alignment with the business and its expectations of HR.
Once the redesign plan is finalized, a formal governance structure is created to oversee the various workstreams, with assigned project sponsors to ensure accountability. Redesigning HR is foundational to ensuring the right HR capabilities, and should be included in the people strategy.
People Strategy
Without a North Star, you can chart a course, but you won’t arrive at your destination. The same is true in HR. We can come to work and do our jobs, heads down, every day. But being mired in transactions leads to little or no value for the people or the business.
The goal of a CHRO is to construct a strategy in partnership with the C-suite that is relevant and impactful. Staying current with workforce trends and research is an important input to any plan. The first step is to conduct a SWOT analysis to understand the current state and inform the future state, identifying the key internal and external business requirements. Once the key goals are created, the next step is to identify and define the enablers to the strategy. These may include areas such as:
- technology and digital transformation
- creating a high-impact HR team that has the required skills and talents to support the strategy
- data insight capabilities to help the business and HR make decisions based on easily consumable trends and key data points
The next step is to identify the workstreams for each goal and enabler. Be very selective with the first-year objectives as they should be impactful not voluminous. Focus on the most immediate and critical workstreams that will have the greatest impact on the business.
For example, talent acquisition in healthcare is a hot zone. With the dearth of clinical talent and the many non-traditional entrants into the healthcare market (like CVS), there is exponential increased demand for nurses. Since this talent is critical in delivering care, the people strategy should focus on talent acquisition.
An often-overlooked component of the strategic plan is an HR governance structure to formally connect the HR agenda to the business. This may include a key leader committee that meets with HR senior leadership regularly to provide feedback and input on the HR agenda.
The plan should be evaluated each year to ensure it is aligned with business objectives. And, most importantly, if the plan is misaligned, HR must be agile enough to pivot and correct course.
Bottom line, this is not your mother’s HR. Tomorrow’s HR demands sophistication, razor sharp business acumen, relevancy, and deep integration with the business to ensure success. Get ready!
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