Strategic CHRO: Bridging the Gaps To Drive Rapid Growth From Disruption

For the next installment of our interview series with leaders who are transforming the role of the chief human resources officer, David Reimer, CEO of The ExCo Group, and I sat down recently with Paul Baldassari of Flex. He has powerful insights about the opportunities for CHROs to drive collaboration in companies and to scale for rapid growth. Stay tuned for more interviews with other HR leaders.

Bryant: What have been some key insights for you about the best way to approach the CHRO job?

Baldassari: As industries overlap more and more, innovation is not happening anymore in silos. Innovation is happening where you can connect the dots between technology and market know-how and growth between industries, like autonomous cars, digital health, the smart home, smart cities and so on.

I see the same development in companies. The strategic challenges for companies are accelerating. Companies get disrupted really fast, but they also have huge growth opportunities if they can react quickly. That’s where the strategic element of the CHRO function comes into play. Innovation is happening between the operations function, the HR function, the engineering function and the IT function. You need to be able, as a CHRO, to bridge that gap and have a holistic view about combining all of that and making a new strategic service available in the company. It’s about changing our company’s strategy around talent so that we connect the dots going forward between all those different industries for the “people supply chain.”

"People in HR are super-smart in the function, but they’re also a little bit insecure about their ability to excel in other roles."

In the past, our engineers would love to sit in front of a computer – and I’m talking about myself because I loved doing this – and come up with a great design and see it somewhere in millions of applications. That was nirvana for an engineer. Now everything is so complex and dynamic that you really need to talk to engineers in other areas, in addition to talking to customers and working with technology partners.

You may be an introvert engineer who loves to sit in front of a computer, but suddenly you’re in a role where you need to facilitate among all the other introvert engineers, make them work together, and come up with something new that breaks the boundaries between different industries. That is the other place where HR has a very strategic role because we create that opportunity to connect the dots and come up with new insights and new innovation.

Bryant: What new muscles have you had to build in your department to excel in that role?

Baldassari: One big challenge I saw was that the people in HR are super-smart in the function, but they’re also a little bit insecure about their ability to excel in other roles. There’s very little rotation into HR and out of HR beyond the CHROs. So forcing that rotation and bringing the view of HR into other functions was important to connect the dots – and the other way, as well, by bringing other functions into HR.

Suddenly more people in the company can appreciate how tough the HR role is and what it involves. It’s also helping to bridge the gaps organizationally so that you come up with new solutions that you might never have thought about before, like connecting the dots between operational planning and analytics.

Reimer: You didn’t come to the CHRO job with a deep background in HR. Did you have to do anything to earn credibility within the HR world?

Baldassari: I said to my team, “I will never know HR as deeply as you. You are the experts, but I will try to support you as much as possible on creating credibility for the HR function by providing real value and helping you to better understand what’s going on in the rest of the organization, to create that seat at the table.”

Reimer: What did you do to get people across the company feeling comfortable about HR playing that kind of role?

Baldassari: You need to add value. As soon as you add value, people entrust you to do more, and they come to you with more of their concerns. This kind of service approach – where we always need to add value, regardless of which function we are in – is most important. That’s not only in HR. That’s the same thing for IT or for engineering.

"You need to be able to support the people who have to provide value to the customer."

Businesses are getting tougher and tougher, so being in front of a customer is the toughest job that you can have in an organization. You need to be able to support the people who have to provide value to the customer. I learned that early in my career, and that has been my north star in any function I’ve been in.

Bryant: Other thoughts on how you make the idea of collaboration real, rather than just a buzzword?

Baldassari: We sell it as part of our employee value proposition – in Flex, you can go really broad and do a lot of different things. You’re going to see a lot of different industries but you’re also going to see a lot of different functions. Tomorrow we may need 500 engineers somewhere, and only 50 finance people. If you happen to be a finance person, you better help on the engineering side, because otherwise it’s going to be difficult to succeed for our customer.

Reimer: You have an engineering background, as you mentioned. What was the biggest surprise for you stepping into the CHRO role?

Baldassari: The biggest gap we see overall today from a people perspective is that there is the political message that we need to bring more jobs into Country X – and it’s not just the United States, because we have the same political message in Europe and Asia. But in reality, employment is at a record high and unemployment is at a record low. So there’s definitely a people challenge, and we produce 10 percent more product every year. And this year we’re producing 42 percent more product, and we have to do that with the same number of people. It’s a scaling problem. It’s not an employment problem.

And for people to succeed and prosper, they need to upgrade their skills. Today, a lot of the conversation is about how we can provide more training. I can provide as many training courses as I want, but if there is no pull from the teams – if you don’t communicate the need well and why it’s important and why it’s beneficial for all of the individuals in the organization to upgrade their skills – you will not succeed. You need to create that pull, that motivation for people to want to spend another hour or so in on-the-job training or in front of their computer after their long workday.  

Reimer: You’re playing a broader role in people’s lives, to some degree, beyond just being an employer.

Baldassari: We kind of stumbled into that as a company when we started our large footprint in China in 1998, and came to appreciate what that actually means. You’re not only responsible for a good work environment for your staff, but you’re responsible for a good living environment, the dormitories, the health services and three meals a day. You become like the mayor of a big city. In India, we are the first employer for most of the people on our shop floor, and many of them didn’t have the opportunity to even finish high school, so we train them to do a lot of different things.

Bryant: When you’re interviewing candidates for a direct-report role with you, how do you assess them to make sure they have that mindset of collaboration?

Baldassari: I say to people, “This is a crazy environment, and things are changing all the time. If you want to come into an organization where it’s always going to be clear how you fit in and what’s going to be your job for the next five years, then please don’t come because you won’t like it and it won’t be good for us either.” You immediately see their reaction. Some people say, “I like this. I absolutely love the chaos.” And some people are more reserved, and actually decline after the interview.

I also ask people about their career aspirations to understand what they want to do in the future. If someone says, “I’m in executive compensation and I love executive compensation and I want to be in executive compensation forever,” again, that won’t be the right fit for us.

Reimer: What about you personally? What’s been the most important leadership lesson for you over the course of your life?

Baldassari: My biggest leadership lesson occurred when I got demoted once. I was in IT and I thought that every problem was an IT problem. My boss at that time said, “I can’t deal with that because I have so many things on my plate. Why don’t you work for one of your colleagues?”

I was shocked, but after thinking about why that happened, I realized that I did not connect the dots. So I went to him and said, “I got your message. I need to do this, this, this and this.” So my biggest leadership lesson was, don’t come with a siloed view on a problem. Come with a broad view of solutions.