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Where is HR today & where are we heading ?
Human Resources » Certifications

Chrm Message From: madure Total Posts: 278 Join Date: 06/06/2006
Rank: Coach Post Date: 15/06/2006 08:18:44 Points: 1440 Location: Sri Lanka

As you read these findings, ask yourself the questions;  How do I perform in HR today and where should I expect to be in the coming years ?

Hope this will be a good eye- opener and get you more focussed on the challenges ahead.

HR function

In the CIPD survey conducted a few years ago the Respondents were asked ‘If you had to say what was the most significant change likely to affect the way in which the HR function develops in the next five years, what would it be?’ Some of the responses are quoted below and throughout the report.

‘HR needs to see itself as central to delivering business
objectives; CEOs need to see HR in the same way.’

‘Change in culture, resulting in line managers taking a
more effective and active role in managing their staff
and tackling HR issues.’

‘Greater involvement by HR in organisational
development as a whole.‘

‘It needs to be more strategic but also will have to
demonstrate its contribution to the business both in
terms of cost and value added.‘

‘The most significant change will be in HR’s specialism
to provide consultancy to line management and an
increasing input to board-level decisions/business

‘In my experience the HR function is more of a
legalistic department and, given changes in
employment law, is more likely to develop in this
direction over the next five years.‘

‘HR has to understand and influence business needs
and work with operational staff to achieve required
strategic outcomes. Don’t say no – find an appropriate
route to say yes.‘

‘The strength of the economy will depend on whether
HR is a “selling” or “buying” function, which has a
major impact upon the direction in which it develops.‘

‘The need for HR to fully understand both the
business and HR practices in order to deliver effective
solutions to maximise business performance.‘

HR survey  Summary of key findings

Seventy-two per cent of respondents say they have more influence in relation to senior
colleagues organisation compared with three years ago. . More than two in five say the HR function in their employs more people in total than it did three years ago; one in four says it now employs fewer.

Seven in ten respondents say their CEO believes HR has a key role to play in achieving business outcomes. A similar proportion report that the executive board frequently discusses HR issues and that HR managers are comfortable discussing business issues.

One in three respondents sees their current role as that of a strategic business partner; more than one in four see themselves as change agents. More than half would like to become strategic partners in the future.

Eighty-eight per cent of respondents say that business strategy and goals will be a very
important driver of change in people management policies and practices in their organisation in the next three years. This compares with 63% who see cost pressures as a very important driver.

Key priorities for the HR function are improving employees’ focus on achieving key business goals and developing employee capabilities.

HR has led responsibility for a range of activities outside those typically seen as an integral part of the HR function. These include organisational design (29%), internal communications (36%), health and safety (44%) and corporate social responsibility (19%).

Most respondents do not agree that the traditional HR function will cease to exist, but 72% agree that it will be increasingly difficult to define the boundaries of the HR function.

Thirty-five per cent of respondents believe the HR function in their organisation is currently too focused on operational issues, compared with 27% who describe it as heavily strategic. Almost half currently see the HR function as being more
reactive than proactive.

Delivery of HR practices by the line is seen as an area requiring substantial improvement, together with employee understanding of HR policies and practices.

Where is HR now?

HR priorities: the business

Looking at the priorities of the HR function within the organisation, senior practitioners are unashamedly focused on supporting the achievement of business goals (83%). More traditional goals, including employee resourcing, development and involvement
are also key priorities. They also place strong emphasis on improving employees’ focus on customer needs.

’Becoming more business- and customer-focused and demonstrating that it can add value to the organisation.’

In other words, HR appears to be focusing on its fundamental job of building human capital and ensuring that employee efforts are aligned with business objectives. Fifty-six per cent say that controlling costs is one of the top five HR priorities, while diversity, compliance with employment regulation and change management all come in the
same category in nearly a third of organisations.

HR and the business strategy

Seventy-one per cent of respondents say that their chief executive believes the HR function has a key role to play in achieving business outcomes; the same percentage say that the executive board frequently discusses HR issues. A similar proportion agrees that
HR managers are comfortable discussing business issues. Over half believe that HR issues are fully taken into account in the business planning process, though a significant minority of respondents clearly believe that more weight needs to be given to them. Seventy per cent have a defined HR strategy linking into the business direction.

Where are we going?

Dimensions of change in the HR function: specialism and strategy

’... a need for the function to become more strategic or disappear.’

The survey explored how respondents would describe the HR function on a number of key dimensions, and how far they believe it needs to change in the future
Focusing on their current organisation, respondents are inclined to see the HR function as more generalist and operational in nature, rather than highly specialist or strategic. Similar proportions see the function as predominantly reactive rather than as proactive. By more substantial margins, practitioners see HR as having already moved to providing tailored practices, rather than supplying off-the-shelf schemes, and driven by the demands of the business rather than employees.

However, respondents believe that HR needs to be significantly more business-focused and strategic in the future, also offering more specialist advice. This is in line with the finding that two in five organisations are making more use of specialists in areas such as
employment law and remuneration than they were three years ago. Early theorists of HR strategy who described it as the opposite of the traditional ’technical’ personnel management function are, according to the survey respondents, wrong. The contemporary HR function is having to move in both directions, adding strategic business value and providing the more specialist technical advice that is required. And so the vast majority disagree that the HR function will ultimately disappear into general management.

’The emphasis on raising and improving individual performance levels will increase as pressure on delivery of profit and value added intensifies.’

HR competencies

Capabilities and challenges

Four in five respondents agree that HR needs to develop new skills and frameworks to meet the needs of tomorrow’s organisations; almost half agree strongly with this statement. But what skills will be required?

’The demand for higher-calibre HR people by businesses and business leaders – especially those with a good understanding of business,

global/cultural skills, business transformation and change management skills ...’

The survey asked about the most important factors for establishing the personal effectiveness and credibility of HR practitioners, and which of these represent the
biggest challenge. Influencing and political skills emerge head and shoulders above the rest as the most important qualities that senior HR people believe they need. respondents also score strategic thinking skills highly; matching their belief that HR should
increase its strategic contribution.

It is often suggested that HR will win more respect for its contribution to the business only if it delivers consistent and reliable HR services and demonstrable business impact. It’s therefore no surprise that delivery against targets is also rated as one of the most
important capabilities for HR, ahead of leadership and business knowledge. Other capabilities, including understanding of HR practices, along with communication skills and integrity, are seen as less important, while negotiating skills and willingness to
innovate come at the bottom of the list. It is perhaps surprising that communication and negotiating skills do not rank higher.

’HR professionals need to understand business realities and create practical and pragmatic solutions to advise on best practice, meet legal requirements and be seen as an integral part of the business.’

HR strengths and weaknesses

Our survey asked what respondents themselves saw as areas of major strength within the HR function and what they saw as areas requiring significant improvement in their organisation. Again, respondents feel that a significant strength is the level of senior
management buy-in, and that HR activities are integrated with each other and the wider business strategy. They are also broadly content with the efficiency of HR administration. But HR communications with, and buy-in from, line colleagues and employees are generally seen as less impressive, highlighting further this implementation and delivery concern.

Is HR on the decline?

Not on the evidence of this survey. A substantial majority of respondents believe that HR’s influence with senior colleagues has increased, while the numbers employed in the HR function are also increasing. The shape of the HR function and the nature of its activities are changing, with more emphasis on specialist advice and strategic input. HR has a clear collective view of the direction in which the profession should be heading: a
third of all senior practitioners already see themselves as being the kind of business partner that most of the rest aspire to become.

How strategic is HR?

On the one hand, the survey confirms that practitioners are still inclined to see the function as more operational than strategic. On the other hand, they feel they have made progress and are looking to shift their focus further into strategic areas, including
change management. Clearly, the HR community has internalised the message that it needs to spend less time on administration and operational issues and
more on business strategy and adding value. It accepts there is some way to go in this direction, but the movement is well under way.

The findings indicate that HR activities are heavily business-driven and already strongly aligned with business needs. Business strategy and the views of senior management are seen as key drivers of change in HR. The shift in aspiration from a function concerned with reactive HR (fire-fighting) to one focused on adding business value has already taken place. This is reflected in respondents’ views on the key factors in establishing their personal credibility. Top of the list by a long way are influencing and political skills, followed by the ability to think strategically.

Although two-thirds of respondents say that business strategy is one of the three most important activities in which they personally engage, it accounts for a relatively small proportion of their time. The second most important activity, making a specialist HR input to wider business issues, also, they believe, merits more time than it gets. The single activity on which HR practitioners currently spend most of their time is reacting to line management needs.

So how does HR add value to the organisation?

Research by John Purcell, David Guest and others for the CIPD has amply demonstrated the way in which effective HR policies and practices can deliver bottom-line performance. This survey confirms that HR practitioners feel they are gaining, but still need to do more to develop, a more strategic role in the organisation. This comes out clearly in the degree of involvement and influence of the HR function in the business planning process, particularly at the earliest stages of that process. There is less evidence, however, from this survey that HR sees its mission as (in Dave Ulrich’s words) ’helping to move planning from the conference room to the market place’.

Prof. Lakshman Madurasinghe.,MA.,MS(Psy).,PhD., Chartered Fellow CIPD-Lond.,
Consultant Psychologist /Attorney


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