Lawrence Bossidy, former CEO of AlliedSignal, once said, “I am convinced that nothing we do is more important than hiring and developing people. At the end of the day, you bet on people not on strategies.”
Irrespective of the size of a business, its human resources department is its lifeline. The HR department is not just about hiring people; it is also responsible for engaging and retaining people and maintaining the culture of the organisation — all factors that tie into business performance. In fact, research from McKinsey indicates that when employees have a better experience at work, the amount of ‘discretionary effort’ that they put in is 40% higher than the average.
Despite their criticality to business outcomes, the HR function is often not taken seriously enough. It’s been an age-old refrain of HR leaders and professionals that they are not proactively given positions on their company’s boards or other contexts where strategic decisions are taken.
So, what can be done? If you are an HR professional and want to be taken more seriously, here are some of the value ‘talk points’ you can stress on.
How HR Adds Value to the Organisation
It has unparalleled people-related insights
The HR department has a bird’s eye view of the organisation, and should thus be the first to be consulted on any people-related decision: on office or headcount expansion matters; on remote work decisions; on compensation strategy; and on the human impact of business decisions. Insights like these are very crucial for organisations to grow.
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Its talent-selection skill determines the organisation’s future
According to one study, three in four employers find it tough to recruit talent. And, 75% of the companies report talent shortages, globally — the highest number seen in the past sixteen years. HR teams identify potential superstars who are a good fit for their organisation. They also work hard to retain top performers and make sure that the company has a leadership pipeline to guide its future growth.
HR drives growth and development
After hiring the right talent, HR constantly looks for opportunities to create an environment of learning and growth for the new team members. Having adequate opportunities to upgrade one’s technical skills, take on leadership responsibilities, or learn in cross-functional roles is a great incentive for employees to remain engaged and contribute to the company’s growth.
It is an expert at crisis management
HR departments are like a company’s emergency response team. Whether it is a health crisis like Covid-19, the stealing of top-level talent by a competitor, or logistical issues caused by bad weather - they must stay prepared for any crisis. Their crisis management ability was what kept companies running during the pandemic. During Covid-19, HR managers:
1. Oversaw the logistics of remote work
2. Migrated all processes online - from recruitment to on-boarding, training, etc.
3. Offered mental health support to struggling colleagues
3. Handled payroll and other extra responsibilities
4. Helped outgoing employees through financial assistance or outplacement support.
How HR Departments Can Play a Larger Role in Organisations
Now, let’s move on to some specific things you can do to better demonstrate the worth that HR brings to the organisation.
Turn your department into a profit centre
For years, C-level executives have seen the HR department as a cost centre. To change that notion, HR departments have to control costs or cash outflow, and demonstrate how it enhances revenues or profits.
To save cash outflows, HR teams can review and streamline their vendor hiring and talent sourcing strategies. Meanwhile, to demonstrate return-on-investment (ROI), HR professionals need to get better at using data analytics and presentation tools so that they can demonstrate the costs-benefit ratio of their initiatives.
To make the value-addition clearer, HR can compare the participants who underwent learning or engagement programmes with those who didn’t. This can highlight the business outcomes (e.g., productivity, revenues) attributable to the programmes, and thus convince the leaders of the strategic need for such programmes.
Work in other business functions
HR, like other functions, is sometimes accused of working in a silo. Hence, it’s always good to grab the chance to spend time with your colleagues in core business functions such as Product Development, Sales, or Customer Service.
You can also consider hiring HR managers who have spent time working in these core functions before, so that you and your team have hands-on knowledge about the struggles of the other teams.
Be vocal about your thoughts
Whenever key business decisions are being contemplated, HR must also pitch in with its own perspective. Proactively schedule time with company leaders and share your ideas with concrete data and case studies. Be persistent without being pushy. Before long, your leadership may gradually start involving you in such discussions without being prompted.
Build trust through open communication
Building trust is crucial for the HR team to be taken more seriously. The first step in achieving trust is visibility and consistently communicating with the employees and all the critical stakeholders in the organisation.
Whether it is policy updates, business goals, or employee feedback, HR needs to own internal communication strategy and implementation. This helps it become a bridge between management and employees, making it more valuable to both sides.
Did you find the above tips useful? Do check out our other blogs for HR professionals here.