JULY 2008

Trends
In the spotlight

As CEOs realize the increased value of human and knowledge capital within their organizations, a trend is emerging to bring in outsiders to run the HR function reports The Wall Street Journal. A recent article entitled, To Find a Head of HR, More Firms Look Outside of It (June 23, 2008, B6) states that there has been a substantial (33%) increase in the practice of handing over the reins of the HR realm to executives who more easily ignore the narrow boundaries that have guided its practices for so many years. The reasons cited by the article include:

• Increased “importance placed upon recruiting, retaining and grooming employees.”
• “Perception that some traditional HR professionals lack the deep understanding of the business and financial issues that CEOs increasingly want.”
• The ability to “understand in great detail the challenges of the business.”

In recent years I have observed increased pressure placed upon improved measurement and evaluation practices. CEOs are now looking for a tangible return on their training investment and they don’t care about trivial metrics such as attendance or employee enjoyment of a program—they want documentable results.

Today’s business landscape is harsh and unforgiving and senior executives are forced to successfully navigate their companies through uncertain and unrelenting economic stresses and mounting competitive pressures. As such, they need to develop a workforce that can adapt and perform regardless of these demands, while increasing performance and productivity.

“Today’s business landscape is harsh and unforgiving and senior executives are forced to successfully navigate their companies through uncertain and unrelenting economic stresses and mounting competitive pressures.”

Another problematic area that many companies are struggling with is the strategic alignment of training to performance strategies, goals and objectives. This includes aligning measurement and evaluation to the performance of the employee. CEOs need to know how (or if) their investment in training is paying off. This means documenting individual performance increases after training has been completed. Quite often this requires changing old approaches and adapting to the organization’s new needs.

This trend reflects a growing frustration from senior executives concerning the pace of change expected from the HR and L&D functions. Many managers within these areas have developed their own comfort zones and their resistance to change is obviously present when their departments are forced to exhibit the same performance goals the rest of the organization must achieve.

Rather than deal with these entrenched managers, outside executives are brought in to elevate these areas to the point where they can produce value for the company through increased workforce performance. This often means change, as they understand that the status quo is no longer acceptable.

What does this mean to you? If you haven’t already experienced increased pressure to change and improve performance, you will. Human resources and learning and development are assuming an increasingly important role within your organization and this places them squarely in the spotlight. For some who are reluctant to change, this can be frightening. For those willing to rise to the occasion, it presents opportunity.

It’s not a matter of “if,” but “when” these changes will impact you. As such, it’s better to prepare yourself and begin laying the groundwork to demonstrate your value before you are asked. The other option is to ignore the unavoidable and hope for the best. But hope is not a viable strategy.

Timothy F. Bednarz, Ph.D.