Always a bridesmaid, never a bride

Too many HR leaders watching as other VPs move to CEO
By Sandy French
|Canadian HR Reporter|Last Updated: 05/20/2004

W

hy aren’t executives from HR promoted to CEO?

Most internally hired CEOs come from senior positions in finance or sales and marketing, not human resources. What’s going on here? Aren’t people a company’s most important asset, and doesn’t HR own the people function?

The traditional model of installing leaders who understand how to maximize the bottom line makes perfect sense. If a company isn’t profitable it won’t be around for long and, equally important, the people who run it won’t be either. So practically speaking, someone with a strong background in numbers is considered the best candidate to deliver results, keep the shareholders happy and maintain employment levels. It’s a model that protects everyone’s interest…or does it?

On the surface it’s hard to argue the logic, but is leadership that transparent? I don’t think so. In fact, I believe there is a huge leadership vacancy waiting to be filled, and the want ad may read something like this:

Desperately wanted: a new type of leader for our company.

You are a people person. Getting along with our board of directors and shareholders is critical (they are a surly lot these days). But even more important you are someone who understands that if we engage employees we will outperform the competition. (If you do this the board and shareholders will forgive everything.) Employees are the foundation and the engine of our success — satisfied customers and shareholder value can only come from motivated employees. Attraction and retention are priorities for us — it’s worth millions to our bottom line (all the surveys seem to support this, so we’re in). And speaking of profits, you need to know your numbers and how to work them. If the numbers ring up then you will have carte blanche.

Let’s take a walk on the wild side for a minute and assume you wanted to respond to this ad. What would it take? How does someone who understands what makes an employee tick, and how culture can be a lasting competitive advantage, further develop the necessary skills to land a promotion to the top?

First, you would embrace the fact that business is and always will be about profit and the bottom line. You would need to convey this understanding in every opportunity that comes your way. Projects, initiatives, plans and presentations would include hard data supporting your work, conclusions and recommendations. The test to your success in this arena would be at business gatherings, where you would actually be mistaken for a finance person.

Second, you would arm yourself with whatever knowledge it takes to become fluent in “number-speak.” Understanding a balance sheet, an income statement, cash flow, ROI and the like. Night school, anyone? It would mean talking strategy in the context of profitability and making business decisions that drive the bottom line. You would be thinking about how the company can make money, not spend. This is what gets the attention and respect of the people making the decisions about promotions.

Finally, you would incorporate this new bottom-line focus by demonstrating ways in which profits can improve employee engagement. You would help the leadership team and shareholders understand that employee engagement and profits are not mutually exclusive, but actually support each other. And you would encourage the company to take care of its greatest assets by becoming as sophisticated, aggressive and measurable in its investments with employees as it does with its customers. Senior leadership would see that strategic people decisions are good for the business.

Do all of the above and you will become a full-fledged member of the inner circle with an eye on the top prize. It will only be a matter of time before the promotion comes your way and you are being named CEO of the Year.

For too long, companies have been run on the belief that to drive profits, the right thing to do is to maximize investment in customers and minimize it in employees. Staff are seen as overhead, a cost that doesn’t deliver a return on investment. This thinking is outdated. But no viable alternative has emerged. No one has stepped into the void and convinced the board and shareholders that they can deliver profits and create a sustainable business through employee engagement.

Come on, HR professional, make this a reality. Lead the charge and prove me right.

Sandy French, president of Northern Lights, a Toronto-based marketing and communication company, is a regular contributor to

Canadian HR Reporter

’s Insight section. He can be reached at (416) 593-6104, ext. 222 or sfrench@northernlights.ca.

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