HR and the CEO; Mind the Gap.

Despite boards frequently ranking human capital as a top priority, two thirds of HR professionals believe that the most senior HR professional is undervalued by the CEO, and almost fifty percent believe that the thoughts of the HR leader are considered as less imperative to those at the top table. This is according to our sixth annual Harvey Nash HR Survey, which collates the views of 1,253 HR Leaders spanning thirty countries across the globe. When deliberating how HR is perceived amongst the wider business, beyond the boardroom, two thirds of HR leaders are satisfied with the repute of their function; proposing that whilst HR is performing well, HR is still not viewed as a serious contributor to strategy. So is there a void between what the CEO wants from HR, and what HR is providing as a function?

I think it would be fair to say that it is difficult to come across a CEO who does not openly discuss the relentless demands on their markets amongst the increasing complexity that the modern world of business encounters. A persistent pace of change amongst a mass of competitors, has transformed the workplace, as we know it, and as a result has shed light upon a new set of challenges for HR to manage. We are hurtling towards a new corporate world; business models are changing, social media is affecting relationships with customers, and the global economy is shifting to the East. So what does this mean for the future of HR? 

Next stop, a seat at the table.

HR too has changed and diversified immensely in the last decade alone. Evolving from a reactive transactional service to an impactful strategic partner, HR can no longer act as a tea and tissues distributor, instead it must strive to be an innovative visionary who understands the objectives defined by the CEO. So is this archaic persona, which is so extensively associated with the HR profession, diluting HR’s influence at the board room table? Could it also be that HR doesn’t get in the trenches enough? Do HR professionals need to be shouting louder in order to stop HR issues getting ignored in the heat of battle? Or could it be a mixture of all three?

As the HRPA reported in 2011, CEO’s also think that some HR professionals can fall short of truly getting to grips with understanding business challenges. HR leaders are now advisers to the board, equipped with a crucial understanding of how to engage the workforce, as well as the ability to form judgements about how individuals, teams and the company perform. They therefore need to have a firm understanding of how performance can be achieved, and in order to do this HR has to have a greater connection to the business in order to fully embed its value.

 Full steam ahead; future challenges that the CEO expects HR to manage.

• Four Generations in the workplace

All CEO’s want HR to help manage and forecast four generations in the work place, whether this be in terms of recruiting, business structures, dealing with change or the monstrous task of motivating  and engaging employees of all generations. It will also mean treating retirement as a phased process, rather than a sudden event marked by a sentimental speech and a gold watch.

• Employer Branding

Keeping and engaging talent continues to be an area of need. Most specifically, it is a need to connect the company’s culture with its own objectives as well as communicating and clarifying what makes an organisation a fantastic place to work.

• Talent & Succession

All CEO’s recognise a growing need for talent, and understand that HR needs to play a key role in identifying and developing this talent. Further, globalisation has put HR in prime position, as the world becomes the battleground in the ‘war for talent’. The board is putting pressure on the CEO to uncover what their organisations are doing about this internationalisation of the talent pool, and the CEO, is looking to the HRD for answers.

• Technology

Another priority for CEO’s and business leaders alike is the technology and metrics needed to gauge the effectiveness of HR interventions. Just like their colleagues in Finance, HR is an accountable function by bringing its analytics to the C suite. For HR professionals this is crucial, it justifies the need for investment in HR activity and arms them with the key to the boardroom door.

As Ann Pickering (HRD at O2) comments in her recent article with HR Grapevine, a HR professional needs to be as comfortable talking costs, profit and risk management as they are about discussing talent and reward; ‘You are a business professional first, HR second.’ Ultimately, any HR strategy must be built on a strong business case, and this can only occur if a HR Director really understands the commercials of a business. If you can’t understand your business in detail, then you can’t be effective in HR; only this will close the gap.

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