HR: Gatekeepers or Innovators? Joseph Ajuwon: success is possible by building an effective strand of operational excellence

Organisations now operate in an environment of increasing economic pressure on them to achieve competitive advantage, shareholder value, cost containment and profitability.

In response, businesses have realised they must adapt and redesign their business models faster and faster.

This is forcing executives to look hard at their operational functions, such as HR and finance, to see how they can best add value to the bottom line.

So, while it is important for the HR department to focus on its operational activities, it must also concentrate on its role supporting the business as it strives to compete in this ever-changing environment.

Typically, an HR professional addresses one step in many different flows of work. Often, this flow of work is interrupted by the HR function, usually for no other purpose than to validate the process, or to act as gatekeeper for information that’s been deemed too highly classified for the data owner.

In reality, no tangible, measurable contribution is made.

This role of HR as gatekeeper had some validity when access to the HR system’s database was an all-or-nothing situation – but technology has moved on.

Now controlled access to various parts of the database, for individuals and/or groups, is entirely feasible – and HR therefore needn’t get involved.

This gatekeeping role should be firmly laid to rest so that the HR function can move on – unless, of course, there are other business-critical reasons to justify such a responsibility.

The trend, therefore, is for the HR function to evolve its role beyond that of intermediary and to devolve decision making out to the appropriate people in the organisation – employees, line managers and executives.

This, however, is a significant cultural leap that can challenge the HR function and its management.

It is worth looking at how HR is making this journey and what else it needs to consider.

Building work Using the analogy of the organisation as a building, there are a number of people with different roles, responsibilities and skillsets involved in the

upkeep and successful maintenance of a building.

There is the architect, who designs the blueprint, creates the models and ensures they’re fit for purpose and aligned with the current environment.

There is the construction engineer who builds the structure. And within the fabric of the building, the electrical wiring, plumbing and water flows are installed to make the building usable.

With the occupants in, there is a need to maintain the structure, periodically attend to the plumbing and perhaps perform some rewiring.

If HR is to help the wider organisation get into a fit state to remain profitable, it must first put its own house in order.

The HR department needs to work out how to become effective as architects, construction engineers and maintenance people who contribute significant value to the organisation.

Paradigm shift The juxtaposition of where HR has been, what it should have learnt, and the impact of the still emerging internet-related technologies, provides an explosive recipe for dramatic change in HR and organisations.

To address this change, HR professionals should look at their performance processes, adaptive strategies and cultural dynamics within a global climate that is increasingly e-focused.

HR can take action from a number of different perspectives:

• The process perspective – focusing on how HR can get the fundamental building blocks (people processes) right and how to make them relevant at all times

• The event perspective – focusing on how HR can provide a framework that harnesses the organisation’s knowledge and deploys it through the individual, especially those people processes with high strategic value to the business

• The cultural perspective – recognising HR’s pivotal role in the proactive engagement of the entire organisation in a changing climate.

The first of these perspectives is the most critical for organisations today: it represents, in effect, getting the plumbing right.

Without operational effectiveness at the process level, any strategy or culture programme delivery will be fundamentally flawed.

Addressing the process perspective essentially means seeking to continuously improve the effectiveness of core operating HR processes, in order to achieve organisational performance objectives.

These processes generally consist of isolated pieces of data and information

shaped by applying business rules that have been defined according to local, regional, corporate, industry, compliance, cultural, historical or regulatory logic.

Operating effectiveness depends on the HR function having well-defined objectives – and understanding how meeting these objectives contributes to the competitive advantage and/or shareholder value of the organisation.

For organisations and HR functions, there is a need for operational excellence – the effective delivery of HR operations to strategically meet business objectives.

Last decade, business process re-engineering (BPR) exercises for HR were very useful in identifying ‘best practice’ for specific companies in specific industry sectors facing a particular set of people issues.

But these exercises, which were aimed at process innovation, ended up producing a static set of answers for new streamlined processes that became obsolete once the organisation or the issues or the business landscape changed.

There were three ingredients lacking:

1. An appropriate channel through which to engage and help change the entire organisation at all levels

2. The ability to execute and sustain such change

3. A cost-effective, fit-for-purpose technology platform that enables the collaborative sharing of organisational knowledge within defined user communities.

This knowledge is acquired by capturing learning/experiences and re-used for continuous improvements.

Innovation In the current environment, it is essential to identify key strategic HR processes and focus attention on those that are directly linked to increasing performance/competitive advantage.

This kind of process innovation focuses on achieving dramatic, sustainable improvements in operating effectiveness through the fundamental reshaping of these critical HR processes and supporting systems.

Organisations need to be prepared to review their existing practices and change them accordingly.

There are four key areas of change:

1. HR strategy

This involves the ability to recognise the organisation’s business

transformation strategies. Issues that could be addressed here include:

• How do we know the recruitment process is critical to our business transformation strategy?

• How do we know if we need to have a recruitment strategy?

• How do we align our recruitment strategy with the transformation objectives, the process steps, the participants and the supporting technology?

2. Technology

The requirement here is to deploy state-of-the-art, inter-networked business applications with high impact and value to a wide variety of stakeholders, including the capability to interact with individuals and businesses outside the organisation.

Questions that could be addressed include:

• What if we have a mixture of legacy systems in different locations?

• Would we be able to address recruitment across these geographies?

• Can we avoid multiple entries of data from various sources?

• How can we ensure integrity of data with multiple access?

3. Knowledge

Companies need to be able to capture, organise and utilise their intellectual capital in ways that promote high levels of customer service.

Typical issues include:

• How can we ensure we’ve captured learnings from our experience with certain job agencies who don’t know enough about our business needs to provide smart profiling and filtering of candidates?

• Have we understood enough about our decision makers and their working patterns to give them remote access to support tools so business-critical decisions continue to flow?

• Are we able to have our candidate interview scheduling sub-process smart enough so we can select within one or two rounds of interviews and not lose good candidates?

4. Measurement

This means developing the capability to use quantitative and qualitative measures to understand process performance levels in the current environment. For example:

• How long is the process taking? What is the quality of the new hire

three, six, nine months hence?

• How much did we spend on media advertising and agencies?

• What synergies might we gain from an e-recruitment application service provider (ASP) model?

• How will that impact on our employee branding objectives?

Summary The increasing drive by companies to find competitive advantage – especially in times of economic downturn – is being shaped by the knowledge that simply deciding to introduce complex technology solutions, or embarking on corporately designed strategic HR programmes without the effective operational layer to deliver them, will not ensure successful results.

However, success is possible by building an effective strand of operational excellence – by defining and extracting the knowledge to sustain the strategy delivery framework.

This needs to be executed within a cultural environment that recognises competitive advantage comes from the sum total of individuals’ knowledge and the knowledge-enabled activity within the organisation.

It’s more than innovating and/or streamlining your HR processes; or building an HR portal or introducing a culture change programme.

It’s about weaving together all three in a way that sustains change, engages the entire organisation and deploys the organisation’s knowledge assets to gain competitive advantage and deliver profitability, even in times of economic downturn.

• Joseph Ajuwon is an independent change management practitioner. Tel: +44 (0) 7792 069898 Email: jajuwon@gmail.com