Register for free to become a member and enjoy access to all HRD content.
Member benefits:
Register below, or sign-in if already a member
HR thought leader Dave Ulrich outlines outlines 5 competencies and actions for HR and business leaders to follow to leverage and create human capability that delivers value to all stakeholders.
Recently, I’ve heard a lot of metaphors about how to face the new future of work: reboot, reimagine, reinvent, remake, reset, revitalize, and so forth. In this article, let me explore one further metaphor to capture this future: renewal, with the prefix “re” meaning again and again, building on the past and the “new” in innovative ways.
Renewal comes from being competitive in a changing marketplace. Traditional sources of competitiveness (low cost, product differentiation, or operational excellence) are easier to copy than human capability. Human capability refers to the right talent who can deliver strategic goals, culture that links customer expectations to employee behaviours, leaders whose actions build confidence, and HR departments and practices. These human capabilities add value to customers, investors, and communities and are difficult to copy.
From our research on HR Competencies & Capabilities Study (HRC2S) during the pandemic, we identified five competency domains (defined as verbs not nouns) for HR to deliver value and positively impact the individual, stakeholder and business results. Each competency is outlined in the figure below.
To accelerate business results, HR should be active in six dialogues paramount to today’s business success. The below figure lays out six current business conversations about intangible value, technological change, government (SEC) regulation, business roundtable priorities, and World Economic Forum and National Academy of Corporate Directors emphasis on culture.
Leaders must also understand HR’s ability to contribute to the above conversations. To do so, they can use an audit seen in the figure below. HR professionals can use this diagnostic to engage business leaders about HR’s role in responding to these business challenges.
HR should not focus their discussions on HR but on helping an organisation succeed in the marketplace.
The “HR” field has come to mean anything to do with people in an organisation, and it includes many terms, initiatives, and actions. This can cause confusions and problems when measuring the success of HR. To combat this, a standardised framework can enable investors to compare efforts across companies in the same way that GAAP accounting did to compare financial results. With such a framework, business and HR leaders can make better decisions about their people and organisation investments.
Our human capability blueprint offers four pathways to capture the array of “HR” initiatives:
Using this human capability framework, current business agendas about investor confidence, technology innovation, government regulatory reporting, ESQ, competitive differentiators, or culture that arise can be accomplished through integrated human capability solutions around talent, leadership, organisation, and HR.
HR contributes insights on human capability (talent, leadership, organisation, and HR practices) to deliver value.
Human capability work is both an art (creative ideas) and a science (evidence-based solutions). We have seen four stages of work on how HR can mobilise information to improve business outcomes.
Historically, HR used information from scorecards and dashboards to benchmark how they were performing relative to others and then sought to gain insights from best-practice firms through predictive analytics that highlight why they are best practices.
We have evolved this logic to “impact” where HR professionals access information to guide human capability investments. In the four human capability pathways, we have identified 37 initiatives and been able to assess the extent to which they deliver employee, strategy, customer, investor, and social citizenship outcomes.
The below summary grid reports preliminary research from the Organization Guidance System (OGS), with information from over 1,200 organisations and 3,000 respondents. The columns show the five stakeholders for any organisation – employee, strategy, customer, financial and social citizenship. The four pathways of human capability each have specific initiatives related to that pathway: talent 10, leadership 6, organisation 12, and human resources 9. The colours in each cell represent high (green), medium (yellow), or low (white) relative impact of the specific initiative on the stakeholder outcome.
HR should provide information to guide and prioritise human capability investments to make sure that they deliver the greatest impact on stakeholder outcomes.
In our research on creating an effective HR department, we found that a positive relationship within HR and between HR and all stakeholders (employees, leaders, customers, investors) had more impact on stakeholder outcomes than the design of the HR department (see the last row of above figure).
Collaboration begins within the HR department when HR professionals in various roles (specialists or generalists; administrative or strategic; technology or face-to-face; corporate or business) work well together.
Based on studies in personal and marital relationships, we have identified six keys to an effective relationship that apply to HR (see table below). In addition to HR relationships within HR, when HR engages with other business leaders in team or other settings, they can and should be aware of ensuring positive relationships.
HR models positive relationships within HR and facilitates positive relationships within all business settings.
Ultimately, HR turns aspirations into actions by turning complex options into simple solutions. HR models and embeds the discipline of simplicity by encouraging divergent thinking that explores options and then facilitating convergent thinking that focuses on solutions. By so doing, HR makes knowledge productive.
HR helps create simple actions out of complex options and creates disciplines to make things happen.
The epidemic to pandemic to endemic challenges have placed HR at the centre of business today. Our HRC2S and other research leads to five expectations from HR professionals. These expectations allow business and HR leaders to create human capability that delivers value to all stakeholders. These results enable HR professionals to demonstrate unique contributions to stakeholder success.