strategic hr business partnering

January 2010

HRHR as a as a

Strategic Business Strategic Business PartnerPartner

Roy Mark FCIPDTotal HRM Ltd

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“The human resources trade long ago proved itself, at best, a necessary evil – and at worst, a dark bureaucratic force that blindly enforces nonsensical rules, resists creativity and

impedes constructive change …. It is a career graveyard for people who can’t make it in other parts of the business”

Non-HR PerspectiveKeith Hammond – Fast Magazine 2008

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“Leadership in HR doesn’t have the respect of organizational

leadership. Until that is resolved, we are an overhead”

HR Perspectivewww.hr.com Survey 2008

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http://www.hr.com/

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“we have made great strides in moving from a traditional/corporate

group to a business partner, with strong growth in learning,

leadership and talent. Developing a comprehensive people strategy is

one of the top three executive goals for 2008-09”

HR Perspectivewww.hr.com Survey 2008

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http://www.hr.com/

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“Rather than ‘can do’ I prefer ‘will do’ and more often than not ‘have done’.

For me HR Partnering is about engagement and involvement. Back to

the floor exercises, running a line department for a while, covering

holiday roles, taking projects outside their comfort zone and being

subsumed into the business while retaining an holistic view make HR a

relevant business partner.”Martin DorchesterMD DSGi Business

2009

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now

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“How many more PC’s will we sell.”

MD DSGi Business2005

(when presented with an elaborate succession planning process)

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04/10/23 Learn - Energize - Inspire 7

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dreamdream

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howhow

Strategies for HR to earn a place in the Boardroom

7 Key Beliefs:-7 Key Beliefs:-

• Customer 1Customer 1stst

• Speed of ExecutionSpeed of Execution

• Continuous ImprovementContinuous Improvement

• Constant respect for peopleConstant respect for people

• Uncompromising IntegrityUncompromising Integrity

• Lead by ExampleLead by Example

• Always seek win-win solutionAlways seek win-win solution

Customer Customer 11stst

1.1. Listen to customers Listen to customers

22 Treat customers as friends not enemiesTreat customers as friends not enemies

3.3. Be courteous , respectful and professionalBe courteous , respectful and professional

Speed of Speed of Execution Execution

1.1. Sense of urgency.Sense of urgency.

2.2. Be responsive .Be responsive .

3.3. Make fast decisions Make fast decisions

Continuous Continuous ImprovemeImprovementnt

1.1. Always believe there is a better wayAlways believe there is a better way

2.2. Challenge the status quoChallenge the status quo

3.3. Seek new ways of doing thingsSeek new ways of doing things

Constant Constant Respect for Respect for PeoplePeople

1.1. Focus on the issue , not the person Focus on the issue , not the person

2.2. Remember -- Everyone’s role is important Remember -- Everyone’s role is important

3.3. Seek first to understand. Seek first to understand.

BehaviorsBehaviors

UncompromisinUncompromising g Integrity/Trust Integrity/Trust

1.1. HonestyHonesty

2.2. Keep your wordKeep your word

3.3. Maintain confidentiality Maintain confidentiality

Lead by Lead by Example Example

1.1. Be supportive Be supportive

2.2. Say what you do and Do what you saySay what you do and Do what you say

3.3. Be a coach and role modelBe a coach and role model

Always seek Always seek win-win win-win solution solution

1.1. Be objective Be objective

2.2. Be open minded Be open minded

3.3. Collaborate and compromise. Collaborate and compromise.

BehaviorsBehaviors

What are Management What are Management Consultants and what can Consultants and what can

an in-house HR Team an in-house HR Team replicate?replicate?

Historical & Future TrendsHistorical & Future TrendsDatesDates FocusFocus HiresHires Typical FirmsTypical Firms

1890 – 1890 – 19401940

Technical AnalysisTechnical Analysis AcademicsAcademics AD Little, Booz, Allen, AD Little, Booz, Allen, Hamilton, AT Kearney.Hamilton, AT Kearney.

1940 – 1940 – 19701970

Strategic ManagementStrategic Management MBAs & MBAs & AcademicsAcademics

McKinseys, Bain & McKinseys, Bain & Co., Boston Consulting Co., Boston Consulting GroupGroup

1970 – 1970 – 19901990

Technical & Financial Technical & Financial SpecialismsSpecialisms

Graduates, Graduates, MBAsMBAs

Arthur Anderson, Arthur Anderson, KPMG, IBM, Deloitte, KPMG, IBM, Deloitte, Ernst&Y, PWCErnst&Y, PWC

1990 - 1990 - 20052005

Niche: outsourcing, e-Niche: outsourcing, e-business, BPRbusiness, BPR

Experienced Experienced hireshires

EDS: CSC: BPOEDS: CSC: BPO

2005+2005+ Business improvement: Business improvement: Change management; Change management; solutions not theorysolutions not theory

Broad Broad experience; experience; ‘done it before’‘done it before’

Consultancies: Consultancies: Independents: Flexible Independents: Flexible workers (semi retired); workers (semi retired); Collaborative groupsCollaborative groups

SegmentationSegmentation• IndustryIndustry

– TelcosTelcos - Health- Health– Digital MediaDigital Media - Manufacturing- Manufacturing– Finance & BankingFinance & Banking - FMCG& Retail- FMCG& Retail– UtilitiesUtilities - -

TransportationTransportation

• FunctionFunction– StrategyStrategy - HRM- HRM– OperationsOperations - IT (incl. e-business)- IT (incl. e-business)

• SectorSector– Non-profitNon-profit– PublicPublic– PrivatePrivate

1. If HR cannot provide the expertise needed, the organisation will sideline them and risk making poor decisions, or go outside for advice

2. The use of external consultants is often not due to lack ability to generate ideas/solutions, but a lack of senior management confidence in its internal HR’s implementation capability/record and ability to show a ROI or business benefit

3. Between Shared Services and external consultancy/interims rewarding work will be reduced for the HR Business partner team to non-strategic admin and fire-fighting

Why is it relevant to HR?Why is it relevant to HR?

What is a Management What is a Management Consultant? Consultant? 1. Not the brightest and the best

2. Not all Oxbridge MBAs or even business graduates

3. Not Magicians, Preachers or Witch-Doctors

Depth of expertise: skill or knowledge based

Broad set of general consulting competencies

Skill ProfileSkill Profile

Skills:• Outstanding interpersonal skills• Great Presenter• Excellent at writing reports

Knowledge:• Generalist business knowledge• Methods & Frameworks• In-depth specific skill

First impressions First impressions dodo countcount

Why Employ Consultants?Why Employ Consultants?

1. Expertise (a ready made solution, done it before)

2. Objectivity

3. Someone to blame

4. To save money

5. External knowledge (e.g. best practice, benchmarking)

6. Don’t care about internal politics (much!)

Types of projectTypes of project1. Providing Advice: should I launch this product?

2. Project Design: how should I launch this product?

3. Implementation: install a system that will improve my productivity and/or costs/profits

4. Functional Management: run our department for us

Working With ClientsWorking With Clients• Defining the projectDefining the project

– Open Open Closed questions: Predicament > Definition > Closed questions: Predicament > Definition > SolutionSolution

– Key Decision Makers Key Decision Makers

• Enticing the ClientEnticing the Client– Free analysisFree analysis– Free juniorsFree juniors– Corporate entertainmentCorporate entertainment

• Successful ProjectsSuccessful Projects– Contract clarityContract clarity– Clear goals, roles & proceduresClear goals, roles & procedures– Boilerplating & re-useBoilerplating & re-use– Quick measurable winsQuick measurable wins– Solid ConclusionsSolid Conclusions– Consultants cultural fitConsultants cultural fit

Initial Contact Definition Proposal & Contract Data Collection

Data Analysis

Decision-making,PlanningIntervention / implementation

Disengaging

Client / Project Review

The Consulting Life-cycleThe Consulting Life-cycle

MMEASURING YOUREASURING YOURHR BUSINESS PARTNER HR BUSINESS PARTNER

‘VALUE ADD’‘VALUE ADD’

HR Business HR Business Partner MetricsPartner Metrics

““If you can’t measure it, you can’t If you can’t measure it, you can’t manage it”manage it”

““If you can’t value you it why would I buy If you can’t value you it why would I buy it?”it?”

The Measures:The Measures:

– Input MeasureInput Measure

– Output MeasureOutput Measure

– Outcome MeasureOutcome Measure


Input MeasuresInput Measures: : The investment in people The investment in people for productive use.for productive use.

Typical input measure:Typical input measure:– TrainingTraining– RemunerationRemuneration– RecruitmentRecruitment

(needed to measure what the return from the investment is)(needed to measure what the return from the investment is)


Output Measures:Output Measures: This can be This can be considered in two waysconsidered in two ways

• Actual services & goods producedActual services & goods produced(Eg. No. of customers served per employee, project delivery, (Eg. No. of customers served per employee, project delivery, SLA’s, customer retention/satisfaction)SLA’s, customer retention/satisfaction)

• Key financial performance areasKey financial performance areas(Eg. Profit per employee / Revenue per employee)(Eg. Profit per employee / Revenue per employee)

HR Business HR Business Partner MetricsPartner MetricsOutcome Measures: Outcome Measures: These consider how These consider how

people respond. people respond.

• ThisThis describes a response of human describes a response of human resources to a set of conditionsresources to a set of conditions..

Examples: Examples: – Resignation rate Resignation rate

– Employee EngagementEmployee Engagement

– Sickness absenceSickness absence

– Internal career movementInternal career movement


Checklist of Measures:Checklist of Measures:

• Average Revenue per employeeAverage Revenue per employee

• Average cost per employeeAverage cost per employee

• Average Profit per employeeAverage Profit per employee

• Return on Human Investment ratio Return on Human Investment ratio Formula: (revenue - (costs - total remuneration)) The ratio indicates for every £ Formula: (revenue - (costs - total remuneration)) The ratio indicates for every £ invested in paying people, the return in profit generatedinvested in paying people, the return in profit generated

• Remuneration / RevenueRemuneration / Revenue

• Training costs as ratio of productivity Training costs as ratio of productivity improvementimprovement


Checklist of Measures: Checklist of Measures: (Continued) (Continued)

• Remuneration / Costs ratioRemuneration / Costs ratio

• Average Remuneration per employeeAverage Remuneration per employee• Absence rate Absence rate (Outcome Measure)(Outcome Measure)

• Resignation rate Resignation rate (Outcome Measure)(Outcome Measure)

• Training spend / Compensation ratioTraining spend / Compensation ratio

HR Business HR Business Partner MetricsPartner MetricsDATA AVAILABILITYDATA AVAILABILITY

• Available Data: Available Data:

Absence, Resignations, EOS, Absence, Resignations, EOS,

• Data to be available: Data to be available:

Costs, Remuneration, Revenue, Profit Costs, Remuneration, Revenue, Profit & Training investment& Training investment– Requires closer working with FinanceRequires closer working with Finance– Combined reporting not separate HR and Combined reporting not separate HR and

FinanceFinance


NEXT STEPNEXT STEP

Define:Define:

• Cost, Remuneration, Revenue & Profit. Cost, Remuneration, Revenue & Profit.

Identify:Identify:

• Sources of information/data. Sources of information/data.

• What data is relevant/of interest to What data is relevant/of interest to your customersyour customers


Conclusion:Conclusion:• The suggested metrics should help make The suggested metrics should help make

changes not simply a compliance tickchanges not simply a compliance tick

• Metrics not to be looked in isolation but from Metrics not to be looked in isolation but from a business perspective, eg, no use being on a business perspective, eg, no use being on budget if company is making a loss. budget if company is making a loss.

• These metrics should provide insights as to These metrics should provide insights as to how these factors impact and influence the how these factors impact and influence the business and by modifying them can aid the business and by modifying them can aid the business.business.

Don’t Re-invent the Don’t Re-invent the wheel!wheel!

Tools for CollaborationTools for Collaboration • Social Networks

– Facebook, MySpace– Flickr– YouTube– Linkedin

• Blogs

• Wiki’s

• Podcasts

Tools for Tools for CollaborationCollaboration

Thank YouThank You