The role of Chief Human Resources Officer (CHRO) and the role of HR executive are two fundamentally different jobs. I have had the great fortune of being a CHRO for nearly 20 years and I must confess that I did not always operate as an executive despite serving on senior executive teams.
As I’ve written about in some of my previous blog posts, what separates the two roles is the goal, intent, and perspective about how HR should be practiced. The focus for HR executives can be summed up in four words: strategy and business outcomes. The emphasis is on the larger enterprise, not the specific HR department. To be an HR executive one must look outside of HR and solve organizational challenges using HR tools — not just deliver great HR programs and services.
The difference between a business focus and a HR focus
A few years ago, I was facilitating a focus group with several CEOs and one gentleman explained his reticence with HR. The CEO said that his HR manager was busy developing an impressive succession plan while he was planning to close the business due to the economic downturn. The manager had lost touch with the business itself. This is a good example of the difference between an HR focus and a business focus.
The CEO explained that the company only needed to retain 8 to 10 key people out of the approximately 300 total employees, restructure the organization, and realign the product mix. Only then would he be confident that the company could ride out the recession and be positioned for future success. The HR manager’s efforts were not totally misplaced; they were just moot in a time of company crisis. The analogy that I used to summarize the CEO’s perspective was that HR was promoting preventive health when the company was in need of radical surgery.
The lesson here is that like all executives, the HR executive must be focused on external matters — customers, costs, and competitors. They should share the same goals as their executive counterparts of increasing revenue, lowering costs, improving the quality of products and services, and improving customer service and market share.
HR executive: cross-functional support is a must
The challenge: how does HR affect these outcomes using good HR programs, services, policies, and activities?
One of the most effective ways to do this is to partner with line managers and leaders from other divisions. All HR programs should be sponsored by another executive. This partnership is vital for the relevance, viability and success of HR activities. If the program doesn’t have a sponsor, it’s probably not needed — or at least, not now.
To fully embrace the role of executive, CHROs must look outside of the company itself. They must help shape the competitive environment to help create advantages for the organization.
It’s time for expanded influence
In short, they need to be aware of and attempt to influence the context in which the organization operates. HR executives can and should influence employment legislation, know the talent practices of key competitors, use customer feedback to revamp training programs, encourage employees to be effective ambassadors for the company, and find ways to reduce personnel expenditures and improve productivity.
A new focus on improving organizational outcomes
I’ve certainly learned a lesson or two along my journey and I am proud of the fact that I have grown with the profession. Over the past two decades, the role of CHRO has shifted from being a subject matter expert on policies and laws; an effective manager of employment and compensation programs; a reliable business partner that helps line managers succeed to now serving as an indispensable peer in the C-suite boardroom who is focused on improving organizational outcomes (customers, costs and competitors).
The evolution of the role of the Chief Human Resources Officer is exemplified by accomplishments that improve the business through the effective deployment of human capital programs and assets.