Lessons from Tucson

Highlights from annual HRPS conference in Arizona

Highlights from the HRPS conference: In April, the Human Resource Planning Society held its 32nd annual global conference in Tucson, Ariz. Dave Crisp, lead commentator on leadership in action for the Strategic Capability Network, shares what he learned at the conference. For more information about SCNetwork, visit www.scnetwork.ca.

Lessons from Tucson

Economic crisis HR challenge, opportunity

SCNetwork’s panel of thought leaders brings decades of experience from the senior ranks of Canada’s business community. Their commentary puts HR management issues into context and looks at the practical implications of proposals and policies.

Lessons from Tucson

The theme of the 2009 Human Resource Planning Society (HRPS) conference, “Global Shift,” was chosen well before the economic meltdown. And nobody could have imagined the upheavals predicted by Eamonn Kelly, CEO of San Francisco-based Global Business Network and the highlight speaker at the 2008 conference, would come to fruition so quickly.

But that’s one of the great things about HRPS conferences — they seem to have a knack for delivering insights into the future year after year. Kelly was so compelling last year that he was invited back as this year’s closer. And he delivered once again, predicting the primacy of HR and judgment over numbers.

Having attended this year’s conference, held in April in Tucson, Ariz., here are a few things I took away from my time in the desert.

HR has a seat at the table: The most startling highlight from this year’s conference was HR’s search for a seat at the table is over. Partly due to its central role in recession-busting tactics, HR is clearly a front-line item in organizations. Now the challenge is to get the numbers that show how effective our strategies are and then get beyond the numbers — that will ensure the seat is permanent.

The struggle to develop global leaders: Some American presenters talked about the struggle they face in developing global leaders, peppering their presentations with humorous anecdotes — such as training teams in the U.S. holding conference calls with Asian colleagues at 4 p.m. U.S. time (when it’s 4 a.m. in Asia.) From sublime to ridiculous, global needs represent a continuing, growing challenge for all organizations. A number of U.S. companies have chosen their Canadian HR heads to lead international forays. They see Canadians as having a distinct edge in cultural understanding and abilities.

Why we choose poor leaders: One of the best speakers at the conference was Claudio Fernandez-Araoz, a partner with executive search firm Egon Zehnder International in Argentina. (Fernandez-Araoz will also be speaking at a Strategic Capability Network event in Toronto sometime in the next year.) He offered some great insights into why organizations so often choose poor leaders (again, providing echoes of how we got into the recession). And he showed the strengths and limitations of recruitment and selection processes too numerous to detail here. Separately, a panel of four CEOs unintentionally illustrated the finding that about 80 per cent of senior execs don’t have enough people skills.

Talent, engagement still reign supreme: Talent and engagement continue to be major HR strategy themes. Many breakouts and keynotes in Tucson focused on topics such as succession planning and performance management. What’s new was the emphasis on building judgment that goes beyond just looking at numbers. The need for better analytics in HR is now taken for granted. But the new mantra is going to be “numbers aren’t enough.” Judgment comes back into the picture with a vengeance after the debacle of number-crunching failures that led to the recession.

The ‘ReGen’ generation: Tammy Erickson, a Massachusetts-based consultant, turned the spotlight off the recession and put it on the generation following in gen Y’s footsteps — a group she called “ReGen” because of its keen interest in recycling and green activities. ReGen workers will continue with social network-friendly gen-Y characteristics, which suggests employers should drop rigid job classes, pay scales and titles that restrict junior managers from being allowed into key roles in innovative projects, she said. Humorously, she described the work-life balance expectations of younger generations: They can be encouraged to do their work very quickly but are shocked and dismayed bosses then expect them to undertake another project immediately. In their minds, the value of speedy achievement is “take the rest of the week off.”

Scenario planning: Worth noting, by its omission, was any discussion of scenario planning, the solution Kelly proposed last year. Everyone was caught a bit flat-footed by the recession, but if organizations do effective scenario planning (for best, worst and likely future scenarios), they can prepare responses to possible contingencies that might otherwise be overlooked. This is undoubtedly the way all strategic planning needs to be done. Shell, the Houston-based energy giant, developed great applications two decades ago that are widely discussed but rarely copied. These applications can be used as a model in every industry. Had financial institutions done scenario planning over the last decade, they might well have recognized the immense risks of over-leveraging and securitization that led us to the present mess.

The ‘black swan’ concept: One economist in attendance mused about the “black swan” concept — supposedly mythical black swans were eventually discovered to exist, albeit rarely. The black swan concept describes situations, such as the recession, that appear suddenly, unforeseen, massive and yet, in retrospect, were entirely predictable. Again, complexity theory would have helped but the principles are the same. The challenge is once you’re found one black swan, you realize there are more possible, massive surprises around the corner. Much of the conference was directed at “What do you do with this?’”

Recession hits conference: The economic downturn was evident at the conference itself. Attendance was reduced by one-half compared to 2008 and HRPS is scrambling to change contracts for future conferences to less “resort-like” locations near business hub airports. (The 2010 conference is scheduled for Atlanta.) The optics of HR people laying off workers and then attending conferences in spa-like settings such as the Tucson Marriot won’t work for the foreseeable future.

But was it just budget and optics that deterred attendance? Or have many lost faith in presenters’ strategic insights, given recent setbacks? Time will tell. For sure, many American attendees were more shaken by events than Canadians on hand who, in contrast, seemed less fazed by the economy.

Dave Crisp is a member of SCNetwork and a regular contributor to Canadian HR Reporter. He shows clients how to improve results with better HR management and leadership. He has a wealth of experience, including 14 years leading HR at Hudson Bay Co., where he took the 70,000-employee retailer to “best company to work for” status. For more information, visit www.CrispStrategies.com.

Economic crisis HR challenge, opportunity

SCNetwork’s panel of thought leaders brings decades of experience from the senior ranks of Canada’s business community. Their commentary puts HR management issues into context and looks at the practical implications of proposals and policies.

‘Fundamental flaw’ in current approach to management

By Tom Tavares

From one perspective, the trends identified at the 2009 HRPS conference indicate a global shift is underway, creating a new opportunity for HR. However, when viewed from another perspective, the patterns identified suggest a less stable place for HR at the management table. The highlights identified by Dave Crisp include the recession and the increasing complexity of the environment. Issues are festering below the surface and erupting in a seemingly random series of crises.

Many interesting trends are cited: generational differences, engagement, a lack of people skills among leaders and an emphasis on judgment versus numbers. Complexity theory and scenario planning are mentioned as potential solutions. However, how to operate differently to meet today’s complex challenges is left for next year’s agenda. The most startling highlight from the conference is the assertion HR’s search for a seat at the management table is over. HR is definitely “in” — if it gets its numbers right and applies judgment to validate its strategies.

However, there is another interpretation of what has been happening in organizations for the past decade, and the implications for the future of HR are far less certain. The current crisis is much more than a recession. As change accelerates, there has been an increasing frequency in management failures. The airlines, technology sector, automotive industry and financial services are in shambles. The buckling in national security, health care, education and emergency response also has been reported in detail.

Although not every organization is in crisis, clearly there is a fundamental flaw in the current approach to management. Leaders gravitate to tangible, quantifiable problems and ignore “softer” issues such as engagement. In the past, when the situation deteriorated too much to be ignored, HR was called in to clean up what were labelled “people problems.”

Rather than a “people problem,” what we have is a gap in knowledge about management. The psychological environment of organizations is profoundly isolating. Roughly one-half of employees are disengaged from their work. With 50 per cent of employee minds underutilized, the gap is growing between the complexity of change and the intelligence needed to respond. Though this situation is daunting, it is far from hopeless.

With a better understanding of the psychological conditions of organizations, seemingly random or unusual shifts that benefit companies — such as a team who unexpectedly gels or a new leader who better engages minds in problem solving — can be replicated on a sustainable and enterprise-wide basis.

More than complexity theory or contingency planning, business leaders need to improve their discipline in managing soft issues. Until this fundamental shift occurs, the pressure on companies will continue to build. “People problems” will escalate and HR will be much in demand at the management table. However, how stable is HR’s position if it is compensating for an approach to management that has proven to be unsustainable?

Tom Tavares is SCNetwork’s lead commentator on organizational effectiveness and a senior organizational psychologist. In addition to managing in large corporations, consulting in varied industries and coaching executives, he has written extensively about the relationship between business performance, behaviour and change. He can be reached at [email protected].

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3 ways HR can ‘get a clue’

By Karen Gorsline

Attending a conference provides the opportunity to step out of the day-to-day fray, hear experts with a number of perspectives, and share or commiserate with peers from a variety of organizations. Reading Dave Crisp’s conference highlights prompted me to think about how HR needs to look at strategic capability differently as we engage in global business. Here are three thoughts on how HR needs to “get a clue” to provide leadership for today and tomorrow.

Learn from the recession: This is not the first or last recession we will face. After it ends, the memory will fade and we’ll focus on more pleasant areas such as growth. Like the black swan, a recession becomes a myth until we are forced to confront it again. We may or may not be able to predict a recession, but isn’t it better to be prepared? Is anyone learning from this opportunity or are we just looking for a way out? At the end of the Second World War, the United States tried to understand what made successful combat leaders. They did not want to engage in further combat but wanted to take advantage of the painful experience to understand what was required if they faced it again. They wanted to be prepared. Is anyone researching and understanding what approaches, programs and leadership qualities work to help organizations through a recession? We have an opportunity to learn for the future.

Judgment or numbers? When judgment is not delivering results, we look to numbers for answers. When numbers are not delivering results, we look to “better” numbers or rely on judgment for solutions. We can use tools such as better analytics, scenario planning and complexity theory to help us structure our thoughts, but the bottom line is we need both numbers and judgment. Judgment puts the numbers into context.

HR, finally, at the table: Yes, HR is at the table as organizations retrench. They need to shed staff, reconfigure talent deployment and gain concessions. Although not always pleasant, these are busy days for HR. But at the end of the day, these are transactions — somewhat complex ones, but transactions all the same. The same is true when organizations face rapid growth. But what is HR doing to demonstrate it can lead the way to sustainable organizations in a range of economic scenarios?

HR is only one part of the management team, along with finance, IT, product development, marketing, operations and distribution. Teams are stronger when they ask hard questions of each other. How is HR participating with these other areas to shape the future of the company? What questions is HR asking? Are these questions just related to HR requirements or also to the business model and ways all functions contribute? Strategic capability goes beyond the HR function. Can HR demonstrate it has a stake in the game?

Karen Gorsline is SCNetwork’s lead commentator on strategic capability and leads HR Initiatives, focused on facilitation and tailored HR initiatives. She has taught HR planning, held senior roles in strategy and policy, managed a large decentralized HR function and directed a small business. She can be reached at [email protected].

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Future tough to predict but we can be ready

By Suanne Nielsen

I recently participated in a forum of HR executives to explore the impact of the economic crisis on our organizations as well as the implications for HR leaders. To set the context, we leveraged Boston Consulting Group’s (BCG) thought leadership in this area. In its Collateral Damage series, introduced at the HRPS conference in Tucson, Ariz., BCG offered a viewpoint on the background to the current troubles, analysis of actions being taken by governments and others and likely economic recovery scenarios. As well, BCG put forth a set of urgent HR topics gleaned from research.

The executive forum considered how HR agendas would need to be shaped to support three economic recovery scenarios:

• “V-shaped” — a brief downturn in 2009 followed by a quick recovery.

• “U-shaped” — the recession lasts until 2010 and has deep impacts.

• “L-shaped” — a long downturn until 2011 with slow recovery in 2012.

Most interesting were the common themes that emerged across all economic recovery scenarios:

Leadership matters: There is no more important time for leaders than during a crisis — they provide a vision for where the organization is heading, steer it and communicate through a period of uncertainty and change. Developing leadership capabilities at this juncture is critical, regardless of the economic outcome.

Know your talent: Whether it’s adjusting the workforce to align to changes in demand and supply, or acquiring or divesting of businesses, an improved understanding of the talent required and where it does or doesn’t exist today is essential to making the right people decisions.

Understand your business: Linked closely with understanding talent is recognizing the drivers of the business. When HR is faced with making choices about the correct business actions to take, data is crucial. Converting data to information will guide us in aligning people decisions so the right people are doing the right things in the right locations.

None of us can predict how the future will unfold. However, we can take actions to prepare our organizations, and ourselves as HR leaders, for a period of continued uncertainty.

Suanne Nielsen is a commentator on leadership in action for SCNetwork and senior vice-president and chief administrative officer for Foresters, a member-based organization that champions the well-being of families through quality life insurance, unique member benefits and inspiring community activities. For more information, visit www.foresters.com.

Next executive series

Would you like to attend one of the upcoming Breakfast Series in Toronto?

July: Engage and executive — productivity when values clash, with Dr. Linda Page, July 15.

August: Five unusual ideas about change, with John Oesch, Aug. 18.

December: Igniting the third factor — practical, insightful strategies for inspiring high performance, with Peter Jensen, Dec. 14.

Visit www.scnetwork.ca for more information.

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