How HR Can Add Value
As the pressure to do more with less increases and as the human or organisation factors become ever more important, human resources (HR) must be transformed.
The transformation of HR matters to CEOs who want to turn strategy into sustained results. The transformation of HR matters to employees who realise that their competence or ability to do their job and their commitment or ability to focus their attention derives in part from how the HR practices affect them. While these two internal groups (line managers and employees) recognise that HR must be transformed, the realisation now goes outside the firm as well.
Customers who desire to maintain long term and increasingly complex relationships with a supplier recognise that a supplier’s HR practices help assure them a steady flow of products and services they desire. Investors who realise that intangibles determine a large source of a company’s wealth, increasingly look to HR as a source of a firm’s market value. For each of these stakeholders: line managers, employees, customers, and investors, the transformation of HR revolves around a simple idea, value. All HR investments in a firm (practices, departments, and professionals) must deliver value. As the administrative and transaction work of HR is being automated and/or outsourced, the remaining work must create value.
To create value, we propose an architecture for the HR Value Proposition (see Figure 1). Using the logic in this figure, we may specify 14 criteria for HR transformation. In doing HR transformation, the ideal logic is to move through these five elements sequentially, following the solid lines in the figure, but sometimes it is useful to follow the dotted lines instead. For example, you might start your transformation of HR with a competency assessment of your staff (box 5 of Figure 1), but to ensure that this competency assessment leads to an integrated transformation, it must be connected to the other elements of the overall blueprint. Or, you might start by investing in e-HR (box 4 of Figure 1), then move to the other four boxes to complete the transformation.
Each of the five basic elements define criteria for what makes an effective HR function. In presentations and team meetings to initiate your HR transformation, these criteria should be discussed as a way to envision the future. (Note that this logic can be applied to other staff groups by changing ‘HR’ to IT, Marketing, Finance, Legal, and so forth. Each of the five elements could be used to create a template for the transformation of any staff function.)
This section was taken from Dave Ulrich and Wayne Brockbank, article titled "How HR can add Value" to access the full article click on the below link. This article which was reprinted with thanks from Executive Excellence.