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more essential to firms

HR managers becoming
more essential to firms

The challenge that confronts today’s human resource professional centers on the need to strike a balance between the operational issues that constantly demand their attention and their need to become established as integrated, accepted partners on the business management team.
Often the operational demands become so overwhelming that there is little time left for tending to the strategic role of human resources. HR often finds itself faced with playing conflicting roles. Some examples:
–Follower vs. leader;
–Reactive professional vs. proactive professional;
–Administrator vs. strategist;
–Controller vs. business partner;
–Conscience vs. businessperson;
–Employee advocate vs. manager; and
–Doer vs. consultant.
The culture of the organization, its life-cycle stage and the role that human resources traditionally has played within that organization, are major factors in determining how readily a strategic role can be implemented and accepted.
Organizations in a start-up or growth of phase are ideal environments for HR to establish itself in a strategic, proactive role. Mature or declining organizations may first need to resolve any ingrained perceptions of HR as administrative, tactical functions in order to gain a better understanding and appreciation of HR’s potential as a proactive business partner.
A recent study by William M. Mercer Inc. revealed 64 percent of the companies surveyed were engaged in the HR transformation process, described as the “re-creation” or “reinvention” of the human resource function.
Clearly, human resource professionals are recognizing that they can have the greatest impact on the success of the business only when they are a strategic partner with the top executives.
To do this, they must:
–Participate in the development of the organization’s business strategy;
–Have an understanding of the business (i.e., financials, markets, products, key measurements, technology requirements);
–Focus on those HR practices that best support the business initiatives;
–Communicate how HR plans to support the business objectives to other function heads–that is to become a partner with them;
–Do all of the above while also being the confidant of the top executives and filling the role of being the conscience of the business.
It is a tall order for any function to fill.
Successful companies are those that recognize that human capital is a key strategic advantage. There are things that they must do in order to be or to continue to be successful.
These include:
–Planning with respect to recruiting, work-force skill requirements and training issues;
–Keeping abreast of legal issues in the workplace, interpreting new and existing legislation and recommending directions for dealing with employee issues in a way that minimizes an organization’s exposure to litigation;
–Managing employee issues related to reorganizing, mergers, acquisitions, downsizing or rapid growth;
–Developing compensation strategies in a way that maximizes an organization’s ability to cost-effectively recruit, retain and motivate the right employees; and
–Developing policies that effectively deal with cultural, legal and business issues on a domestic and international level.
Because HR professionals are expected to deal with a broad range of issues that are becoming increasingly complex, it becomes more and more difficult for an HR professional to be fully proficient in all of these areas.
An alternative to adding staff to gain the necessary expertise, companies typically consider the following solutions: outsourcing one or more functions such as staffing, training, and/or payroll and benefits administration; and/or contracting with external experts on an ongoing or project basic to address specific issues.
Shifting to external resources will usually give the HR function the flexibility it needs to change its structure and services in a way that keeps pace with an organization’s dynamics.
As more and more companies seek outsourcing partners, employers’ associations–such as the Industrial Management Council–are increasingly becoming strategic partners with their members to deliver the basics of human resources.
It has been demonstrated time and time again that those companies that outsource and move their human resource function to a more strategic role within their organization, find that it impacts the bottom line–on the “plus side.”
(Sandra Parker is president of the Industrial Management Council.)

3/19/99

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