An HR department does not directly make an organization money. Unless you’re a company providing outsourced HR functions to other organizations, I think that it is fair to say that Human Resources is not a profit-producing core competency of most businesses. Now, this doesn’t mean that an HR department cannot provide increased revenue to an organization, nor does it mean that HR isn’t responsible for the success of an organization.
It means that for HR to be an effective Business Partner in an organization, as Tyler described quite accurately in his most recent post, they need to know as much about their organization profit centers as the people who perform those jobs do.
To quote David Ulrich in his book HR Transformation: Building Human Resources from the Outside In, “If HR Business Partners are to truly serve as business partners, then their goals must be the goals of the business.” Most businesses don’t exist to give people a place to hang out for 8 hours a day, most businesses exist to make a profit. If an HR professional does not understand how their company makes its money they will be unable to support the goals of the business in general. Ideally, an HR department should focus less on the internal functions of their department and more on how their functions serve to facilitate growth and sustainability in the operations and profit-producing departments in the organization.
HR does provide an important administrative function, but an HR department is never going to provide value to their organization by moving paper well. On my first day at my new job, I was given this advice by a long-time (non-HR) employee: “Be smarter than the system.”
Processes in an HR department should exist for 2 reasons:
- To keep an organization’s operations in line with legislated requirements
- Provide a value –added service to departments external to HR
I realize that the above may be a gross oversimplification, but if an HR professional focuses on performing administrative functions without understanding how those functions create value, they will tend to put the needs of the HR department higher than those of the organization. This internal focus makes it difficult for an HR department to align their actions with the broader business goals of their organization and act as true Business Partners. You need to be “smarter than the system,” and be able to identify the “why” behind the processes of your HR department.
I am in an incredibly fortunate position in my new role as an HR assistant. My organization is making a concerted effort to help me build knowledge of how other departments function and how the business makes money. They realize that it is not sufficient for me to learn the processes of the HR department alone, and are creating situations where I am exposed to the broader operations of the company. In order to be effective as I develop in my career I must understand how the company functions in general, and how the HR department serves to support these functions. Instead of measuring my productivity and success by my ability to meet internal HR deadlines and requirements, I will be able to look past the system, recognize how these processes are providing value to other departments in the company and have a better understanding of why HR does what it does.
And that understanding is the first step in removing HR from the realm of being reactionary and putting it in a position where it can take a proactive, strategic role in creating sustainable organization growth.
Comments? Agree/ Disagree?
Tom Zabel
HR Assistant, Voice Construction Ltd.