Some people say that the biggest threat to the HR industry is the robots who they say will become the workforce of the future, but I believe the robots are already here – and they are us.
Harsh? Maybe. But after 30 years of experience as a HR professional I am close to despair about the industry’s deepening crisis and increasingly concerned that it is hastening its own departure through lack of action, innovation, missing behaviours and competencies, mind-set and/or bravery.
This comes at a time when companies are increasingly treating their people like expendable pawns instead of recognising them as crucial to their company’s culture, existence, longevity and prosperity. We should be at the centre of business, but we are becoming an irrelevance, and our industry is to blame.
I know that I am not alone in having these thoughts, but I have a greater understanding of the situation having spent a year looking through the research and reading the previous and latest industry thinking on the way to writing a book about the state of HR today.
In many ways I was surprised that no-one had got there before me, but I could be wrong. The issues we face are so compelling that I thought surely someone had pulled together all the evidence and called for action. In fact, they hadn’t, at least not to any great extent, which is why no-one has addressed it.
So much of what I found surprised and disappointed me, not least the number of FTSE 100 CEOs who have a background in HR, which is zero. Instead, the best asset you can have if you want to become a CEO is background in finance.
The loss of ‘HRness’
For the HR industry, this is a catastrophe; for the business world and its employees, in my view, it is a disaster. This is not because I think financial people are unqualified to run a company, but rather that, while most people would agree that a company’s workforce is its greatest asset – a word I don’t like but which will do for now – the people who are best qualified to get the best out of them are seen as the least suitable candidates to be asked to do so.
This sobering fact is also compounded by the fact that history is littered with business decisions which were taken by finance professionals and which backfired spectacularly, losing their companies millions, because not only did nobody realise how they would play out in reality when human beings got involved, they didn’t even think it was important enough to consider what the effects might be.
Despite this patchy track record, the business world still rates finance people way above HR people, so the question is why – and what is the HR industry doing about it?
One answer behind the first question, in my mind, is because companies have lost what I call their “HRness” – that vital understanding that a business’s employees are more important to the business than the infrastructure and the finances, and that any decision should be made with them in mind.
When seeking greater profitability, it is easier to streamline and cut costs than it is to think about investing in the people who make up the business. So instead of doing this, HR departments are put to work updating the employee handbooks, looking after the hiring and firing and ensuring the company is compliant with the latest government policies.
This is all important stuff, but it’s coming at a price, because figures show that more HR work goes into ensuring that the company stays on an even keel than helping to set the ship’s course in the first place. (I set out the statistics in my book – and the data is startling).
Who are the HR robots?
The HR workers in these departments have become the robots I refer to. They are so busy looking after the paperwork that their people skills and understanding – with which they can inspire, influence and provide insight in order to bring about change – are going unused, while the job of change management is given to those with backgrounds in finance, sales and IT.
These are the people who are seen as the blueprint for what makes a good CEO, while HR people aren’t. This is galling, and the longer the concept of HRness is overlooked in the boardroom, the more it will be regarded as an irrelevance, making it even less likely that someone with an HR background will be selected as a CEO.
I don’t blame the companies for this. They are doing what they think is best, even if it has resulted in them adopting something of a fixed mindset. I don’t even blame the HR professionals – although I do despair at those who adopt a victim mentality and succumb to their fate, accepting that things won’t change and that they will never become CEO, rather than finding ways to change it.
Blame the leaders
Instead, I blame the leaders of our profession, who have failed to keep up with the times. I make no apologies here or in my book for the directness of my approach on this. Through their inaction, they are condemning the professionals in an industry, which I believe has the power to change the world to a career of limits.
When, as part of my research, I reviewed the website belonging to a body which represents financial professionals, I found a strong programme of courses and training opportunities based on a clear understanding of what its members need in order to meet the demands of doing business at the highest level in the 21st century.
This is in direct contrast to our industry, which has little to say on this area and no advice to give.
If the bodies around the world responsible for driving our industry forward – and yes, I am a member of one of them – has no plan for how its members can keep pace with peers working in other areas of their employer’s business then it is no surprise to me that HR professionals are increasingly seen as lacking the wide range of skills necessary to lead a company.
Where is our North Star?
Our HR training and approach is outdated, and we appear to have no vision or plan – what I refer to as a North Star – to guide us.
Instead, we are travelling towards the edge of a cliff, in danger of our functions being so downgraded they will be carved up amongst outside service providers, leaving companies vulnerable to repeating the mistakes businesses make when there is no HR input at a strategic level.
Article Continues Below
So, what do I suggest? I have a number of solutions in my book, one of which involves addressing our reputation as a discipline which people tend to fall into, either because they have been sidelined in the later stages of their career or by happy accident when other career moves failed to materialise.
We must also climb out of our silos to understand what it is to be a business partner in our company, not just the HR representative.
Justin King, the previous CEO of the UK company Sainsbury’s, was famous for having the human touch, but this was in conjunction with a wide range of other skills. We cannot hope to use our people skills if we do not understand how the rest of our company operates and where they fit into the equation – we must also learn other skills as well.
We also need to stand up for ourselves. What is it that we do and what more can we offer? How can we gain (and I do mean gain) the cut and thrust necessary to succeed in the board room?
It won’t be easy to make all the changes I set out, but I have seen in my own career that it is possible. Yes, many of my calls for a greater role for HR at board level have fallen on deaf ears – as a freelance HR consultant I can lead a horse to water, but I can’t make it drink – but I have also seen HR directors become excellent CEOs, who are using their people skills to shape their companies.
Sadly, they are in the minority and, as I found in my research, they are a dying breed. Therefore, it’s time to find our voice, raise our game and find a North Star to follow.
If we want to bring HRness back into the boardroom then we must start with the most important people of all – ourselves.