The Challenges for the Strategic HRD

1. The Challenges for the Strategic HRD Patrick M. Wright William J. Conaty GE Professor of Strategic HR Cornell University

2. Questions • What would you say is your CEO’s agenda for HR? What are his/her top three deliverables?

3. CEO’s Agenda for HR US % Europe % Talent 9293 Cost Control 19 19 Succession Planning 1929 Employee Engagement 18 10 Culture 17 20 Org. Effectiveness7 26 HR Excellence 1 23 Comp. and Benefits 12 3 Exec Compensation 10 3 Change7 3 Performance Management0 10 HR Alignment 19 13 Workforce Planning 3 13 Cornell/CAHRS 2011 CHRO Survey: Building Organization, Functional, and Personal Talent

4. The Strategic HR Director • Four Roles • Implementer – Contribution through Execution • Subject Matter Expert – Resource at the Table • Facilitator – Process, not Content Focused • Full Contributor – Business Person First

5. Implementer – Leader of the HR Function • Must be able to link strategy to people issues, i.e., see the implications • Focus on building a competent function and holding the function (in particular, direct reports) accountable • Competency – Leadership • Challenge - Resources

6. Questions • What would you say is the greatest obstacle to your HR function being able to deliver on the CEO’s agenda for HR?

7. Obstacles to Achieving the Agenda US % Europe % HR Competencies 5897 HR Resources 3425 (funding, # of HR people) Organizational Talent 25 19 Regulatory Constraints 136 HR Technology (systems) 10 25 Line Support 6 25 HR Processes 529 Cornell/CAHRS 2011 CHRO Survey: Building Organization, Functional, and Personal Talent

8. Facilitator – Counselor/Confidante/Coach • A group process/team building expert • Focus on managing the ELT meetings to ensure maximum team functioning and decision making • Competency – Emotional Intelligence • Challenge - Maintaining Independence

9. Subject Matter Expert – Talent Architect/Strategist and Workforce Sensor • Source of People Expertise • Can provide answers to relevant HR/people questions • Can share people perspective on strategic issues • In essence, helps the business by seeing it through an HR lens • Competency – Analytics • Challenge – Narrow Reputation

10. Full Contributor – Strategic Advisor • Eliminates Business/HR distinction • Focuses on business excellence through a business lens, not through and HR lens • Requires depth and breadth of business expertise, both general (e.g., finance, economics,) and specific (firm’s customers, business model, etc.) • Competency – Business Acumen • Challenge – Reputation Credibility

11. Business Facilitator Full Contributor The Strategic HRD Process-Focus Implementer Subject Matter Expert HR Business Content-Focus

12. The Personal Talent Challenge • If it’s not an either/or, but an “all of the above” role, it requires both broader and deeper competencies • How can you seek to increase your effectiveness in the HRD/CHRO role?

13. Best Practices for Building Effectiveness in the Role US % Europe % Learn from External Network 2220 Business Focus 1613 Build Internal Networks 1510 Build Great HR Team 15 3 Self-Development Activities 913 Build Effective HR Processes713 Values-Based Communications 710 Listen 6 7 Spend Time with Customers 3 0 Prioritize 0 7

14. External Networking Examples • Actively networking with great CHRO's who set the bar for all of us. I'm personally committed to be a life long learner in the Art and Science of the HR function. • Building a strong professional network so I can learn from and leverage my peer group in my industry and beyond. • Actively maintaining external networks with fellow CHRO's has been a valuable tool to calibrate a sense of relative effectiveness for me and my HR team. • I have built a strong CHRO network externally, across multiple industries, which I utilize to understand and share challenges and potential approaches/solutions to issues I'm dealing with. The diverse perspectives & knowledge shared by this group have been invaluable. • Joining four university boards to gain new knowledge and provide balance to private sector.

15. Business Focus Examples • Getting to know the business and not being afraid to ask lots of questions about it. And based on what you learn, being willing to speak up and weigh in on an issues or decision, even when it may not be what is traditionally viewed as something that the HR person would be weighing in on. • Making sure I truly understand the workings of our business and how we make money. This becomes the lens I see my role through, which keeps me relevant and hopefully adding value to the business. • I have always been strong in the financial and quantitative areas regarding business analyses. Remaining business-focused pre eminently has helped fuel my success. It has been necessary to partner with the CFO in particular, to assist him in developing concrete, practical initiatives affecting our balance sheet and portfolio. Learning from and leveraging outside resources for very technical and analytical support, (law firms, McKinsey, Mercer etc) has helped make me a better CHRO.

16. Internal Network Examples • I meet formally with the CEO every week to ensure alignment and communication of the strategic focus of the H.R. function to the overall company. I also have formal meetings set with each member of my executive peers. This allows us the time to focus on long-term initiatives vs. just the day-to-day issues. • Making time in my daily schedule to have drop in meetings with the executive team members. These informal, impromptu meetings have a more open and reflective tone, so they have considerable impact. • Taking time to build relationships not only with the Sr. team, but at all levels of the business, so that information bubbles up to me quickly. • Feedback is very difficult to get from CEO unless he's unhappy about something. Therefore, self-confidence is everything. I've found that my self-confidence is highest when I feel my CEO and CC chairman are well informed. Have breakfast or dinner with CEO at least once a month with check-ins as needed. Same with CC chair. Not always easy to find calendar time which is probably the biggest challenge but it's no excuse for not keeping them informed.

17. Build HR Team Examples • Empower senior HR leaders; decentralize decision-making where possible through streamlined approval requirements and organization structure • Employing a terrific executive assistant, a very strong direct staff, and -- every few years I consciously fire myself, develop fresh spec's for the CHRO position for the current challenges, and rehire myself with those expectations. • I have surrounded myself with some of the best lieutenants in the HR business. My team consists of only top subject matter experts who are outstanding performers. This allows me to focus on Board and executive team issues. • Chief of Staff - no longer a "luxury," but is required to make better use of time. Also greater delegation of compensation committee management to head of Comp and Benefits • Surround myself with people who are smarter than I am (in their functions) and ensure they work well together as a team.

18. Self Development Examples • My focus on and development in the areas of economic thinking and financial acumen have served me well. • I work with a coach regularly. Also, I go through a 360 process every year for feedback.

19. Values Examples • Remain an honest broker. If you are seen as too close to the CEO you limit your ability to actually do the HR work required to grow the organization. • Actually I have two: 1. Establish a clear voice as "conscience" of the firm and 2. Pick my spots. • Being totally and continuously transparent. The perception that the CHRO does not have a hidden agenda or unseen motive results in great dialog, engenders trust and confidence, and provides access to more info and insight. • Ensuring I remain in touch with my values, maintain objectivity and always focus on what's best for the company.

20. Key Skills for Strategic HR Professionals • Analytical skills to interpret developments in business, market, regulatory and social environments. • Business acumen and a good understanding of customers, investors and other stakeholders. • Understanding business metrics and being able to describe, and justify, HR’s contribution to business results. • Personal credibility so as to be taken seriously as a strategy contributor. • Deep knowledge of HR tools and techniques and their application to business strategy and issues.

21. Recommendations from our Research • Know how your people enable business success and ensure strategic priorities support this • Support “emergent strategy” by building mechanisms for sharing customer and business insights • Build the “facilitator” role by helping the executive team develop strategy better • Improve your HR data and use this to provide strategic insights to the business • Bring a fresh perspective on the outside world through information on demographics and societal changes • Review HR’s role in communicating and evaluating strategy • Know the business and know the people

22. Conclusion • Today’s HRD/CHRO role has broadened and deepened • Both the challenges to be addressed and risks of failure have increased • You achieve success to the extent you can deliver organizational talent, build functional talent, and continue to develop your own personal talent