Years ago when I interviewed youngsters for a position in human resources (HR), I would invariably ask what attracted them to the job. Nine out of 10 would say it was because they “liked people.” Well, that’s a relief, I guess! But, how many accountants do you know who were hired for their love of money? Jokes apart, if only it were as simple as that.

It has been many, many years since the HR management function outgrew its rather constrictive nomenclature. Today HR is no longer a mere provider of support services, nor is it there to just fill the seats or author the much-reviled employee manual. And while I won’t go so far as to say that it is a business itself (a legitimate claim in the services sector), I have no hesitation in saying that HR has come a long way since the old days of “personnel management” to emerge as a core business function.

In professional circles, there’s a raging debate about the role of HR in present day organisations. Is business HR’s role primary business or is it people? Is an HR leader a people’s champion first and business manager later? Or are we in the business of people? Let’s start with the current — and perfectly acceptable — view of HR as a C-suite equal.

Creation of business value:

The HR value proposition must address not just its traditional stakeholders — employees and the internal organisation — but also customers, investors and influencers, such as analysts, business alliances and regulators.

What constitutes value to these stakeholders? In simple terms — something that helps them achieve their objectives. To the business, HR creates value by anticipating labour market trends, forecasting skills, addressing talent shortage, entering new markets, optimising costs, building brand and last, but not the least, ensuring corporate governance For employees, HR creates value by enabling learning, investing in careers, creating a fair and secure workplace and most of all valuing the happiness quotient of employees. For the society, HR creates value by creating employability, building a healthy workforce and donning the mantle of transforming the labour market of tomorrow. For investors, HR creates value by demonstrating superior returns on human capital asset.

Changing dynamics

Clearly, the tools, techniques and theories of old no longer apply (at least not without considerable alteration) to this new context. HR leaders who were successful just a decade ago might be out of their depth today, unless they acquire the requisite competencies and skills to drive the revised agenda. Again, while there are many points of view of what these competencies are, most veer around the following:

Business acumen: Well, good luck to you if you can’t read a balance sheet! Head honchos and leaders-in-the-making are now expected to possess business and organisational knowledge in addition to functional expertise. An “outlier” characterisation of HR leaders (that I’m personally ambivalent about) is that of a business person first and an HR person next.

Passionate leadership: All of the above takes passion, vision and commitment. If that means jumping right into “other people’s business” and asking uncomfortable questions, so be it. (We’re notorious for it, anyway!) Although HR leaders must align with the organisational agenda, the best ones will not hesitate to question something that isn’t being done right, or to propose a better alternative. Leadership is part vision, part undisputable business logic, part consensus, and part motivation by example.

Global perspective: Senior HR leaders must have a broad worldview in order to be effective in today’s globalised business environment, with its geographically dispersed ecosystem, distributed workforce, diverse customer base and onerous legislation.

Change management: Those leading HR, like all other functional heads, have to adapt to change, but unlike the rest, must also initiate, lead and sustain change within the organisation. In their revised role of business — as opposed to employee-advocate — HR leaders need to put business interest ahead of all others, which in today’s dynamic environment usually means changing the status quo. This is when they will have to summon their powers of persuasion and communication, which was the stronghold of “traditional HR,” to convince staff of the need for change and reassure them that it will leave them better off than before.

Nurturing creativity

Seriously, will the guys who wrote the rulebook now champion creative thinking? You better believe it. Fostering a culture of creativity in the organisation and adopting innovative HR practices to deliver business results, is part of the HR key result areas.

Technology savvy: Payroll automation, HR outsourcing, computerised assessments — these seem like mere flirtations compared to the liaison developing between HR and technology, as HR practitioners leverage exciting new channels of mobility and social media to connect, enrich and engage employees. Going forward, tools of analytics and reporting must also make their way into HR front and back-end operations. That being said, good intentions of linking HR to business performance remain just that, unless the results are measured early and often.

Analytics can really help companies track progress and make timely, insight-based adjustments to plans. It can also lighten the drudge of reporting. If HR decisions are to drive the business, then the decisions themselves must be driven by data. It falls upon the HR leader to drive home this point.

Credibility and trustworthiness: Between having the CEO’s ear and being the employees’ advocate, it’s tough for the HR leader to appear unbiased and enjoy the trust of both parties. Worse, some organisations see HR as the compliance police, waiting to fire. I can see you’re smiling. Sadly, there’s no silver bullet for trust. Like any other employee, the HR leader, too, has to build relationships brick by brick, by personally upholding the principles of transparency, integrity, honesty and fairness. But in times of corporate crisis, it is the HR that must spearhead ethical leadership.

Effective communication: HR is usually the conduit of communication between employees and management, as well as between the organisation and external stakeholders. For an HR leader, the art of communication starts with listening; conveying the right message simply and clearly comes next. Effective communication is also strongly linked to persuasiveness — the ability to win over “adversaries” or get employees to come around to a different way of thinking.

Where does this leave the debate we started out with? I know some HR leaders who believe that their days as nurturer are over, and that the future is all about creating a successful business. Some go so far as to say that employee happiness is overrated. Personally, I find that hard to accept. For where would business be without people? There’s enough evidence to show that emotion does have a place in business. Emotional quotient, which indicates the ability to use emotions to facilitate collaboration and productivity, is an important tool of workplace effectiveness. Ultimately, it’s employees who make a dream company. So, the bottom-line for HR leaders is to convince the business that employees are their greatest asset.

(The author is a senior vice-president and group head, HR, Infosys)

(This article was published on August 23, 2012)
XThese are links to The Hindu Business Line suggested by Outbrain, which may or may not be relevant to the other content on this page. You can read Outbrain's privacy and cookie policy here.