HR Manager's Bookshelf<br>Authors provide strategic HR roadmap

Strategic HR is more than a question of what issues or programs are being considered, or how an HR practitioner spends his or her time. It’s even more than the CEO’s understanding and expectations of the role HR can play in leading and supporting organizational results. It is a deep perspective that HR professionals bring to everything they do.

The HR Scorecard provides a manifesto and comprehensive roadmap to strategic HR. This is not a fast read, nor a source of quick fix ideas. It is a corporate-wide approach to reinvention of HR’s role and contribution based on a disciplined measurement foundation. Readers will recognize the name of co-author Dave Ulrich from his other books, including Human Resource Champions (Harvard Business School Press, 1997).

Also in this edition of HR Manager’s Bookshelf are a number of other titles offering ideas to aid readers as they tackle strategic change:
•a look back at the thought leadership provided by Douglas McGregor, and his present day relevance to management and organizations;
•ten tasks or facets of organizational change;
•advice and stimulation for leaders in an atmosphere of ongoing uncertainty;
•thoughts on reducing costs in areas other than headcount; and
•finally, a guide to effective utilization and dealings with external consultants.

The HR Scorecard
By Brian Becker, Mark Huselid and Dave Ulrich, 235 pages (2001), Harvard Business School Press. At bookstores or 1-800-565-5758.

Already well known in senior HR circles, this book outlines a step-by-step approach for designing and implementing a strategic HR measurement system. From the book’s jacket: “Providing the tools and systems required for leading a ‘measurement managed’ HR architecture, this important book heralds the emergence of human resources as a strategic powerhouse in today’s organizations.”

The scorecard concept underlying this book is attributed to the works of Robert Kaplan and David Norton: The Balanced Scorecard (1996) and The Strategy-Focused Organization (2001), both published by Harvard Business School Press.

The first chapter takes a solid look at human resources as a strategic partner: “How can we ensure that HR is at the table — and not on the table?” Here readers are introduced to the research, based on hundreds of firms, linking specific HR practices and outcomes to overall organizational performance.

“The evidence is unmistakable: HR’s emerging strategic potential hinges on the increasingly central role of intangible assets and intellectual capital in today’s economy.”

In the second chapter, strategy maps show how HR capabilities and contributions are connected to business outcomes including customer behaviours, revenue and profit.

Four levels of HR measurement are described, ranging from traditional HR operational measures (cost per hire, activity counts) through to HR policy impact on corporate performance.

An HR scorecard comprises leading, lagging, cost control and value creation measures, and the third chapter provides hundreds of examples in three categories:
1) High-performance work system measures (for instance, backup talent ratio, incentive compensation differential between low and high performers, number and quality of cross-functional teams);
2) HR efficiency measures (absenteeism rates, cost per trainee hour, workers’ compensation costs, turnover); and
3) HR performance-driver measures (employee competency growth, employee clarity about firm and individual goals, planned development opportunities accomplished).

The last chapter in the book applies change management lessons to HR scorecard implementation. Challenges include leadership, building commitment, demonstrating progress and making it last.

Other chapters along the way address specific technical and fundamental measurement issues:
•cost-benefit analysis and ROI on HR interventions;
•principles of good measurement; and
•measuring HR alignment with the requirements of the firm’s strategy implementation process.

Readers with a serious and long-term commitment to the field will also find a lot to think about in a chapter on competencies for HR professionals — the skills to manage a strategic HR architecture.

The authors review five key competencies emerging from University of Michigan HR competency research:
•knowledge of the business;
•delivery of HR practices;
•management of change;
•management of culture; and
•personal credibility.

These are overlaid on the dimensions of strategic performance management:
•critical causal thinking;
•understanding principles of good measurement;
•estimating causal relationships; and
•communicating HR strategic performance results to senior line managers.

Examples include the application of these competencies in multi-year HR professional development approaches at PPG Industries and GE.

All in all, The HR Scorecard demonstrates how the HR profession is being transformed, at both the individual practitioner and leader level, and also at the institutional level with a comprehensive measurement and strategy orientation.

Douglas McGregor Revisited
By Gary Heil, Warren Bennis and Deborah Stephens, 196 pages (2000), Wiley. At bookstores or Wiley Canada, 1-800-567-4797, www.wiley.com.

Douglas McGregor’s vision of a more humanistic workplace was profoundly influential in his time, and this new book stresses its even greater relevance today.

Readers already familiar, and newer managers and HR practitioners not yet familiar with McGregor’s rich perspectives, will be struck by his fundamental insights and challenges including:
•Theory X and Theory Y (in McGregor’s words, “not managerial strategies. They are underlying beliefs about the nature of man that influence managers to adopt one strategy rather than another.” X sees employees as cogs in a machine, while Y views them as living beings with individual goals and commitment.);
•open book management, promoting joint labor-management participation and productivity bonus sharing;
•building co-operation instead of internal competition; and
•building the intrinsically motivating, actualizing organization.
McGregor’s articles and essays reprinted in this new book include: “New concepts of management” (1961), “A philosophy of management” (1954) and “An uneasy look at performance appraisal” (originally published in Harvard Business Review, 1957). His best known book was The Human Side of Enterprise (MGraw-Hill, 1960).

Ten Tasks of Change
By Jeff Evans and Chuck Schaefer, 270 pages (2001), Jossey-Bass. At bookstores or Wiley Canada, 1-800-567-4797, www.wiley.com.

This book on “demystifying changing organizations” will appeal to organizational effectiveness and OD consultants as well as HR leaders. It outlines an approach to change that is logical but not linear, recognizing that change happens, and cannot be fully managed or controlled.

The authors are U.S. consultants who say that the ten tasks don’t comprise a methodology or a step-by-step process. Rather, “it’s more useful when seen as an overarching checklist of what to pay attention to as you apply your own logical thinking to accomplish the change.”

There’s a chapter outlining thought processes, tools and frameworks for organizing each of the ten tasks, including:
•evoking change leadership;
•expanding understanding and commitment;
•analyzing processes;
•designing processes, work and boundaries;
•establishing metrics; and
•managing transitions.

As a sample of the detail covered, the chapter on planning implementation covers:
•validating the design based on mission and core values, stakeholders’ expectations, ability to control variances, and quality-of-work-life values;
•identifying further design work;
•establishing timelines for design work;
•establishing a transition management process;
•establishing integration processes and issue resolution forums; and
•identifying individuals or teams to complete the work.

While written in down-to-earth language, the book is solidly grounded in research and insights from numerous experts in the organization change field.

Relax, It’s Only Uncertainty
By Philip Hodgson and Randall White, 217 pages (2001), Prentice Hall. At bookstores.

How can business leaders stop trying to control what cannot be controlled and become more comfortable with the unknown? How can they lead with confidence and flexibility, in the face of ambiguity?

The journey here is organized by enablers like risk tolerance, tackling tough issues, creating excitement, flexibility, and “being a simplifier.” On the other side of the coin are restrainers like muddy thinking, complex communication, getting hooked on detail, narrow-band thinking, and fear of conflict.

The writers have four audiences in mind:
1) High-flyers — ambitious people who need to be on top of the latest thinking and are keen to apply it;
2) High-learners — people who have even greater curiosity than ambition, and know they must modify their skill set to take on higher levels of responsibility;
3) High-worriers — people concerned about the rate of change in their organization and their industry; and
4) High-carers — often found in HR departments, these are the people developers and sponsors in organizations and communities.

Profit Building – Cutting Costs Without Cutting People
By Perry J. Ludy, 200 pages (2000), Berrett-Koehler. At bookstores
or 1-800-565-5758.

This book may be a helpful resource for identifying options to downsizing, as a route to financial improvement.

The author is a senior corporate executive who believes that laying off people is at best a short-term solution. He describes the profit building process, putting in place a team to manage it, generating creative solutions, documenting results, and action steps for immediate profit improvement.

How to Use a Consultant in Your Company
By John McGonagle and Carolyn Vella, 278 pages (2001), Wiley. At bookstores or Wiley Canada, 1-800-567-4797, www.wiley.com.

Strategic HR initiatives often require the astute use of outside consultants, and this book offers some practical rules:
•Get it started with a handshake; you can always do the paperwork later;
•Let the consultant define the task and make sure it gets done; and
•Don’t worry about supervision and reporting. The consultant is an expert and you are merely the client.
Of course, these are some of the “top 10 ways to make sure you do not get value from your consulting relationships!” The book also covers common errors in determining whether you need a consultant in the first place, selecting the consultant, and in written contracts.

Other questions answered include:
•What is the legal context of consulting?
•What should a company policy on consultants cover?
•Are you buying or are they selling?
•How can you recognize and avoid disputes and conflicts of interest?

Readers will also find advice on handling proposals, fees and terms, estimating the services and costs, co-operation and co-ordination, and winding up the relationship effectively.

High Performance HR: Leveraging Human Resources for Competitive Advantage
By David S. Weiss, 320 pages, (1999, 2000) Wiley. At bookstores or Wiley Canada, 1-800-567-4797, www.wiley.com.

Originally published under the title, High-Impact HR: Transforming Human Resources for Competitive Advantage and reviewed in the August 9, 1999 issue. This is a reprint of that review.

Canadian consultant David Weiss describes “how the HR function should be positioned for the future – as a strategic business partner, not simply as a service function” in the following ways:
•aligning HR to deliver value to the external customer;
•redefining HR’s relationships with internal clients: executives, managers, employees;
•using “disciplined abandonment” to dump, delay or distribute elsewhere, work that can better be replaced with higher value initiatives;
•organizing and prioritizing core people processes including selection, performance development, retention, compensation and employee services; and
•applying TLC (technology, learning, consulting) to effectively deliver organizational benefits.

A substantial part of the book is devoted to HR’s role and contribution in strategic business areas, such as cultivating a flexible culture, implementing change and transition, and optimizing investment in human capital. Weiss also offers systematic approaches to strategic alignment and business transformation, emphasizing these as areas for HR to establish its influential leadership role.

High Performance HR concludes with consideration of structure and roles for HR, based-on a model comprising a high-level HR strategy council, HR process owners (subject matter experts) and HR strategic partners (day-to-day generalists).

Intended audiences include HR practitioners, general management, consultants and the academic community.

Recently reviewed books
The following books on strategic HR were reviewed by Ray Brillinger in past instalments of the HR Manager’s Bookshelf.

The ROI of Human Capital
By Jac Fitz-enz
Reviewed Feb. 26, 2001
Article number: 721

Strategic Human Resources Planning
By Monica Belcourt and Kenneth McBey
Reviewed June 5, 2001
Article number: 1005

The Strategy-Focused Organization
By Robert Kaplan and David Norton
Reviewed May 21, 2001
Article number: 1100

•Talent Flow
By Joseph Rosse and Robert Levin
Reviewed Sept. 24, 2001
Article number: 1384

To read the reviews of the above books go to www.hrreporter.com and search our archives by the article number.

Ray Brillinger is a senior consultant with the IBM Consulting Group. He provides change management, business transformation and organization effectiveness services to client organizations. He can be reached at (905) 316-8733 or [email protected].

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