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Is HR strategy a dead concept?



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Ilja Rijnen, HR director for Emerging Asia, Beam Suntory, reveals the three things HR needs to focus on to become a true partner to the business. 

It has been about 15 years since the current HR business partner model has been introduced. Right now, it is about time for the next stage of evolution for the HR function. Instead of trying to manufacture a 5-year strategy that will be outdated just after it’s been launched, HR needs to take a step back and focus on the things below so it can support instead of block business performance:

  • 1. Simplify its model
  • 2. Focus on the future and anticipate future changes and be able to translate these to current actions that the business needs to make
  • 3. Radically move to automation and technology as driver of HR forecasting

1. Simplify its model

Over the past decade many MNCs have embarked on HR transformations to make the setup of its function more efficient and able to keep up with the changes in business strategy. The underlying core driver for this transformation usually has been to streamline processes, execute faster, with fewer resources as a response to ever increasing pressure on HR headcount.

So instead of really reviewing the actual setup and value of the HR model, most CHROs would have focused on process alignment to deliver the same standard with a smaller HR team. This has put the HR function at a distance to the rest of the business as the model itself is still not optimal and focused on the real core value of HR.

Looking at the functional model before taking strategy into account, the HR department could be radically revised, focusing only on activities that give competitive edge. Taking this as a starting point, around 80% of the activities in HR are substantially similar from company to another. These include all your core HR functions.

The 20% where HR should put all its focus is on landing the “business partner” concept.

If HR wants to be ahead of its game, all these areas should no longer be made into “best in class” by an in-house HR function. These processes are important to an organisation as they tie to a simple and basic need that employees and line managers have. They need to be well in place, efficient and well governed. The suggestion, however, would be to bundle these activities with other MNCs and outsource them.

2. Focus on the future and anticipate future changes and be able to translate these to current actions that the business needs to make

The 20% where HR should put all its focus is on landing the “business partner” concept. Since its development by Ulrich and Brockbank around 15 years ago, the model has ensured HR has earned its seat at the business meeting table.

Though once seated at the table, most HR people feel lost as they don’t have enough business understanding and commercial anticipation. HR therefore should focus on building real business understanding to avoid having a system of commercial people that are core to the business and the HR business partners who are merely serving the business.

The “partnering” model that was once introduced has usually resulted in an “transactional” model that is based on business needs and demands: the business tells their needs, HR providing the solutions. This model is unidirectional and not based on any equal partnership.

In the current setup, it is impossible for HR to create a 5-year strategic plan that can inspire, drive and anticipate business growth. At best in current setup HR can only create a rolling plan, that follows the business and focus on the current. Assuming HR has a bigger aspiration and courage than this, it will have to develop itself to the 21st Century – it is time to progress towards a relationship of equals with business and its leaders.

Whether an HR “generalist” or ‘organisational developer’ or other categories, there is a choice to challenge and lead the business.

3. Radically move to automation and technology as driver of HR forecasting

Whether an HR “generalist” or ‘organisational developer’ or other categories, there is a choice to challenge and lead the business – come to the table with real skills and capabilities or stay in the serving role of human capital services.

In order to get to the real partnership, HR will need to radically change its approach. As shared at the start of this article, it needs to build skills outside of its core HR skills, focusing on its competitive advantage.

In order to understand the business and anticipate trends it needs to have deep commercial insights. The real competitive advantage, though, sits where HR is able to combine their business understanding with a deep understanding of the organisations and external environments, people trends and data analytics; and combine these with future trends. HR therefore will need to make a radical move to automation and technology as driver of HR forecasting.

HR strategy is it currently is, is a dead concept if it is based on the wrong model, limited business understanding and isn’t funded on real people data insights. If HR can focus on the above, it can start working on longer term strategies, as value adding partner of the business, instead of merely serving the business.


About the author:

Edrington_Ilja
Armed with more than 16 years of HR experience, Ilja Rijnen is currently Beam Suntory’s HR director for Emerging Asia, based in Singapore. As part of the Emerging Asia leadership team, Rijnen manages a team of 10 HR professionals and has HR oversight and management for the Emerging Asia region covering all of Asia apart from Japan and India.

Prior to joining Beam Suntory in December 2017, Rijnen has gained significant HR experience through Edrington Asia Pacific and Diageo, with his most recent role being regional HR director Asia Pacific and India, Edrington.

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