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New study suggests HR function hasn't changed dramatically

New study suggests HR function hasn't changed dramatically

Reported in http://www.workindex.com/hrexecutive/cover.asp

1. Introduction

Contrary to a widespread perception, the HR function hasn't changed radically over the past several years.

So suggests the third periodic study on this subject by University of Southern California's Edward E. Lawler, professor of business at the university's Marshall School of Business, and colleague Susan Albers Mohrman (Creating a Strategic Human Resources Organization: An Assessment of Trends and New Directions, Stanford University Press). The survey-based study gathered data in 2001. Prior studies were based on data collected in 1995 and 1998.

2. Areas where little change is evident are the:

# Extent to which HR is a full partner in shaping business strategy;

# Amount of time spent "on various HR activities;"

# Rotation of individuals into, out of, and within HR;

# Business partner skills of members of the HR organization; and

# Overall effectiveness of the HR organization.

3. Areas where change has occurred

# HR is more likely to use service teams to support and serve business units;

# HR is more likely to have decentralized generalists support business units;

# HR is paying increasing attention to recruitment and selection and less to union relations and benefits management;

# Outsourcing for training, HRIS, benefits compensation, legal affairs and affirmative action has increased; and

# Employees and managers are increasingly serving themselves with Web-enabled systems.

4. Conclusion

Lawler's research suggests that CEOs haven't been pounding their fists on the table demanding more strategic thought on the part of their HR leaders. That may be due in part to a lack of any expectation that an HR professional could make that kind of a contribution, Lawler says.

In many cases, such CEOs pull in people from outside HR to run that department, Lawler says, especially if "they're fed up with HR and want a change agent."

Yet CEOs aren't all irrational. "CEOs and COOs need to see examples" of SPs before they can know what they're missing, he says. "And the HR community needs to make a better argument for what value it can add as a strategic partner, and what that means."

And, ironically, when a CEO has an epiphany about the vital importance of strategic HR leadership, he often concludes "that people management is too important to be left to the HR function."

"Look at accounting firms," says Lawler. "They often have weak HR functions. It's not that they don't realize that people are important; it's that they don't trust HR to do the job."

Still, there's hope. Lawler identifies at least two factors that can create more opportunities for SPs to flourish--or for HR professionals who haven't yet developed the skills and experience to become strategic players, to do so.

>> One is the use of sophisticated electronic human capital analytic tools and

>> Administrative systems.

The data gathered in the latest Lawler/Mohrman study "suggest that an investment in a high-quality eHR system should increase the HR function's credibility and the perception of the value that it adds, while decreasing the time the function spends on administrative tasks." (At both Sysco and GM, heavy eHR investments have borne out Lawler's prediction.)

And on a more macro level, Lawler and Mohrman point out, the proportion of "knowledge workers" at U.S. companies is on the rise, where human capital is a critical source of competitive advantage. "Our research clearly shows that where organizations focus on developing their competencies, capabilities and knowledge assets ... they make HR much more of a strategic and business partner."


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Gary Watkins

Gary Watkins

Managing Director


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