Between statistics and common sense (editorial)

Yes, HR professionals as a group have to improve their business acumen, develop the ability to influence and learn to speak in terms of ROI. That much is clear from the Canadian HR Reporter survey HR’s Quest for Status: Fantasy or Reality? But there are also cases where HR is capable of playing a more strategic role and is denied the opportunity.

It’s usually a case of the CEO or executive team needing to be sold on the value HR can add to productivity, strategy formation and the bottom line. (And yes, sometimes it has more to do with the CEO being unimpressed with the HR head’s ability to deliver.)

Experts say HR needs to hone its business skills and learn how to play in the boardroom arena — and that’s good advice for a profession still coming into its own.

But there are also times when an organization’s leaders seem wilfully determined to ignore the prudence of sound HR management and the ability of the HR department to deliver value-added services.

In many cases, HR should be providing figures on the return on investment in the department. In our other national survey, released in October, HR Management Systems: Are They Making a Difference?, barely half of respondents said they were able to provide “estimates” of the total cost (including staff time) of their HRMS implementation. Not a good statistic if you’re trying to prove value.

But there are also times when the quest for ROI seems excessive. This is when common sense should make the case, such as in the area of wellness. But as the analysis of our HR status survey shows, HR still needs to make the financial case for organizations to act on wellness (see Art. No. 1509).

Having to make the argument that an unhealthy and mentally and physically stressed workforce hurts performance seems a waste of time and energy. Yet HR is forced to come up with the stats to put wellness on the corporate agenda. Sure, we all love accounting, but the paperwork can be a bit much.

There are many places where ROI is necessary and HR needs to get its act together, but there will always be areas of people management where sound strategy can be developed without a team of Harvard researchers. This means the senior team must place trust in HR’s ability to manage people and apply organizational design and behaviour principles.

It can be hard to estimate the savings accrued when an HR professional stops a valued manager, stressed over his superior’s behaviour, from walking out the door. Because of confidentiality, senior management will often not know how HR has boosted retention in this way. And, how does one quantify HR’s capacity to breakdown silos and stop costly infighting between departments?

HR shouldn’t have to spin its wheels trying to get common sense onto the corporate agenda.

And, what about those senior executives who seem blind to the value-added role a well-equipped HR department with a licence to pursue organizational effectiveness can play?

While our survey can track how HR is progressing as a group (and as this is the first instalment of a survey to be conducted annually, we’ll be able to do just that), individual growth is another matter.

For many professionals ready to take on strategic HR it won’t always come down to convincing the executive team to value HR. Instead it will be a matter of finding another, more progressive, employer.

Next year, we’ll ask: “Are you looking to leave your organization in search of more strategic opportunities?”

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