Tying up loose ends in HR: using a value‐adding formula
| Pages | 8-9 |
| DOI | https://doi.org/10.1108/14754390680000932 |
| Published date | 01 November 2006 |
| Date | 01 November 2006 |
| Author | Robert Bolton |
| Subject Matter | HR & organizational behaviour |
8Volume 6 Issue 1 November/December 2006
HR at WORK
,
Short case studies that demonstrate best practice in HR
Tying up loose ends in HR:
using a value-adding formula
T
he idea of “Powerful Connections”
in HR has been around for nearly
10 years.1It’s the idea that HR can
be “architected” as a system in
alignment to an organization’s overall
business strategy, creating a distinctive
strategic advantage.
Maximizing HR’s impact
Powerful Connections aims to create
mutually supportive practices and
processes so that the whole of HR is
greater than the sum of the parts. For
example, in a strong team-based
environment, performance management
systems formally review team
performance. The reward system rewards
high-performance teams with the talent
management process, which helps to
identify and nurture team leaders. This is
the “2 + 2 = 5” factor in HR.
The Powerful Connections in an HR
system are unique to each company.
Perhaps that’s why so many
organizations, in our experience, have
implemented Ulrich-based2service-
delivery models, but unfortunately have
failed to design sufficiently inter-
connected processes and practices, so
end up with a case of 2 + 2 = 3.
Instilling robust procedures
An appropriately designed HR system
that’s distinctive and in service of the
core value-creation engine of the
business, is a strategic asset.
At pharmaceutical giant, AstraZeneca,
the HR system supports the growth of
talent for research, development and
marketing innovation and in UK-based
Nationwide Building Society, the HR
system supports mutual retail-banking
operational excellence and customer
service. At these organizations HR is
designed to specifically support and
enable the dominant value-creation
agenda in a way that’s unique to that
organization.
Four key factors for HR success
Given that so many organizations design
the service-delivery model as an end in
itself, we suggest that this is a root cause
of the 2 + 2 = 3 problem. However,
creating a highly successful HR system
can be achieved by following four key
principles:
1. HR design must focus on the
distinctive capabilities that the
organization must project into the
marketplace. Define the capabilities,
as well as the way in which they’re
developed in teams and individuals.
2. HR design must also focus on the
way in which value is created in the
organization. For instance, at UK
supermarket, Tesco, it’s combining
rigorous operational/supply chain
excellence with customer service and
working these disciplines across
multiple delivery channels. A few key
metrics will be the embodiment of
this value-creation engine that will
be the centerpiece in decision
making. It’s HR’s role to lock onto
these key metrics and discover how
to enable them.
3. HR must configure processes that
promote top-down and bottom-up
alignment between individual, team
and business unit goals. It’s often the
quality referred to as the “line of
sight,” and the connectedness of
those goals to strategy that’s
important. In our experience, it’s
performance reviews that seems to
promote greater alignment than the
up-front goal-setting itself. A
searching conversation with the
performance team, focused on the
future, should strike the right
balance between challenge and
support.
4. HR must produce a measurement
framework of a few focused
measures and key performance
indicators (KPIs) that help line
managers see the value created by
the function, in addition to the usual
measures of activity, efficiency and
benchmarks.
Three types of Powerful Connections
Atos has recently worked with three
organizations: a global oil company (see
Figure 1, right), a global law firm and the
Defence Logistics Organisation (part of
the UK’s Ministry of Defence). Each of
Using the “Powerful Connections” method, HR can significantly increase its impact on the organization and
veer away from non value-adding processes, says Robert Bolton, associate partner at Atos Consulting.
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