HR Growing Pains: Getting from Awkward to Accomplished
Vickers, Mark, Human Resource Planning
Today's emphasis on top-line business growth is creating "growing pains" for many HR professionals, according to the HR's Role in Organizational Growth Survey, conducted by the Human Resource Planning Society (HRPS) and the Institute for Corporate Productivity in June/ July 2007. The study shows that the function is not adjusting fast enough to the strategic challenges related to organizational growth, challenges that are changing the meaning of "strategic HR."
This failure to adapt has left many HR departments watching rather than contributing at a time when companies need help leading in new directions. To get through this awkward phase, more HR professionals must improve their reaction times, get off the sidelines, retool their skill sets, and look beyond the conventional HR paradigm. The growth survey also suggests that organizations in which HR has made such progress tend to have greater success in the marketplace.
Slow reflexes are one symptom of these growing pains. The HRPS/i4cp survey found that two-thirds of all respondents said that HR is not "responding fast enough to the strategic challenges related to profitable new growth."
Respondents were also broken into two performance groups, based on how they said their organizations fared over the previous five years in terms of revenue growth, market share, profitability, and customer satisfaction. They rated their performance on a 5-point Likert Scale, where 1 equaled "at an all-time-low level" and 5 equaled "at an all-time-high level." If respondents said their companies had seen significant improvement in all four of these areas, their companies were deemed "higher-performing organizations." Those were compared with "other responding organizations" (those that are not in the high-performing category) as well as with "all respondent" data.
Higher-performing organizations were considerably more likely than the other responding organizations to say HR was responding fast enough to the challenges related to strategic growth (see Exhibit 1). Clearly, though, even a majority of higher-performing companies believe HR needs to ramp up its response time to cope with today's growth-related challenges.
To discover more about those challenges, we asked participants about the factors limiting their ability to execute a growth strategy. Survey respondents, 84 percent of them HR professionals, said that the most serious impediments to change were a "reliance on old assumptions and practices," "inadequate communication," and a "culture not ready for change." Higher-performing companies saw such factors as less of a problem than did other responding organizations.
We can interpret these responses to mean that high-performing organizations are better at managing change, which is often a big part of growing the business. HR professionals in these organizations are almost certainly better at communicating the need for transformation and nurturing a corporate culture that is relatively flexible and open to change. Because such companies are not as reliant on "old assumptions," they are more agile and resilient than their competitors.
A previous study conducted by i4cp (formerly the Human Resource Institute) found that agile and resilient companies tend to be better market performers than are companies that are less agile and resilient. Such companies also tend to view themselves as having better change capacities at the individual, team, and organizational levels. They are also more likely than other organizations are to engage in strategies such as training to improve managers' change-management skills. Therefore, HR professionals in high-performing organizations probably place a greater emphasis on helping managers and teams develop the skills they need to master or adjust to a changing environment.
Making the organization more agile and resilient tends to work best if there is buy-in for such initiatives at the top levels. …