Good HR looks a lot like good business

C-suite executives, including Chief Human Resources Officers (CHROs), require broad business acumen 

I was speaking with a client recently who asked me what I thought good HR “looks like.” My answer was swift and simple: Good HR looks like good business.

Within the various siloes of an organization, subject matter experts are valued for their deep areas of expertise. To achieve higher levels of leadership within an organization – to lead a business or functional area, for example – a broader set of capabilities and experiences is needed. Many leaders have cultivated an overall understanding of the business through multiple lenses.

HR professionals don’t always have the breadth of capabilities or confidence to make business decisions

HR should be no different. Chief Human Resources Officers are responsible for roughly half of a firm’s operating costs (in the form of payroll and compensation), and are therefore in a prime position to provide counsel and serve as high-impact decision-makers. Unfortunately, HR professionals don’t always have the breadth of capabilities or confidence to make business decisions. Although they may be well versed in human capital and benefits, many HR leaders lack the requisite data, analytics and operations experience to maximize HR’s value.

Moving forward, there’s an industry imperative for HR leaders to seek breadth – not just depth – in their skillsets. HR simply has to get better at the non-HR skills.

Changing course for CHROs

HR leaders must think of themselves as business leaders, and as such, they need to know everything they can about the business. I’ve worked with clients who can discuss corporate strategy, economic forecasts, financial statements and diversity in labor markets with ease. These HR pros have honed their skills over time in a variety of roles.

Scott Sherman is a great example. As executive vice president of HR at Ingram Micro (a technology and supply chain services company), Sherman looks back with gratitude to his early days in a sales role at Exxon.

CHROs should have a blend of hands-on business and HR experience that starts (or continues) through university curricula

He says it was one of his most formative experiences. He learned how the business operated; how Exxon in that part of its business made its money. And he told me that CEOs want HR pros that come with that business perspective.

Later in his career, Sherman had appointments in Europe, where he was required to learn business within a global context, as well as cultural awareness and adaptability.

While some of these skills are naturally acquired over time, they should also be part of a well-thought-out academic and development pathway. CHROs should have a blend of hands-on business and HR experience that starts (or continues) through university curricula.

New York University’s School of Professional studies, for example, offers a master’s of science in HR management and development, which includes a curriculum of one-third HR specialization and two-thirds business courses, including strategy, financial management, information technology and analytics. NYU’s approach, according to clinical associate professor of human capital management, Anna Tavis, is to develop business professionals with an HR specialty.

Good HR looks…promising

We’ve all read stories about CEOs choosing non-HR professionals – people from finance, marketing, operations, or other areas of the business – to lead HR within their organizations. In fact, a recent analysis by Willis Towers Watson showed that 1 out of every 5 CHROs had no prior experience whatsoever in HR before they accepted the top HR job in their company.

It’s certainly understandable. Changing workforce demographics, automation, artificial intelligence and ever-growing globalization present a number of challenges — challenges that leaders with experience from other areas of the business might be better equipped to address.

This presents a fantastic opportunity for HR to spread its wings. “Good HR” is extremely achievable, if CHROs take a page out of their own book: learn and grow through professional development – not just in HR, but in a variety of disciplines and through a diversity of experiences. Seek coaches and mentors in other business areas. Be curious in order to become creative. In doing so, CHROs will acquire the skills expected of every other business leader and deliver value that goes well beyond the traditional realm of HR.

About Karen O'Leonard

Karen O’Leonard is Global Client Solutions Leader for Willis Towers Watson, based in San Diego. Karen joined Wi…
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One Response to Good HR looks a lot like good business

  1. Ama Ampadu-Kissi says:

    Good HR definitely looks like Good Business!
    This is such an interesting and exact piece. “…if CHROs take a page out of their own book: learn and grow through professional development – not just in HR, but in a variety of disciplines and through a diversity of experiences.” This is an important part of the article that I believe everyone in business should pay heed to.

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