• HOW HR MATTERS IN CURRENT ORGANISATIONAL

CHALLENGES
• MYTHS VS REALITIES IN HR FUNCTION
• HR VALUE PROPOSITION

- Shantonu Dasmahapatra
- 6th July, 2013
CHALLENGE ONE : GLOBALIZATION

• HR will need to treat models and processes for attaining global

agility, effectiveness and competitiveness.

CHALLENGE TWO : VALUE CHAIN FOR BUSINESS

COMPETITIVENESS
• Competitiveness requires faster customer responsiveness –
innovation, faster decisions, leading an industry in price or value
, effectively linking with suppliers and vendors to build a value chain for
customers.

• To support value chain argument, research indicates that

employee attitude correlates highly with customer attitude.
CHALLENGE THREE : PROFITABILITY THROUGH
COST & GROWTH

• How can the organization create a commitment to rapid

growth and the culture that supports it while simultaneously
controlling cost.

• What are the HR implications of entering new businesses, of

leveraging core technologies that lead into unfamiliar
businesses.
CHALLENGE FOUR : CAPABILITY FOCUSED

HR professionals need to constantly seek the capabilities

necessary for success and routinely ask the following
questions:

• What capabilities currently exists and what will be required in

the future.

• How can capabilities be aligned with business strategies?

• How can HR practices be designed to create the needed

capabilities.
CHALLENGE FIVE : CHANGE, CHANGE, CHANGE

HR professionals need to help their organizations to change

and deal with following questions.

• How to encourage the risk-taking necessary for change

without putting the firm in jeopardy?

• How to determine which HR practices to change for

transformation?

• How to engage the heart & mind of everyone in the

organization to change?

• How to unlearn what has been learnt?

CHALLENGE SIX : TECHNOLOGY

• HR professionals responsible for redefining work at their firm

need to figure out how to make technology a viable &
productive part of the work setting.

• They need to be ahead of the information curve and learn to

leverage information for business results.
CHALLENGE SEVEN : ATTRACTING, RETAINING &
MEASURING COMPETENCE AND INTELLECTUAL
CAPITAL.

• Securing intellectual capital will involve learning to share ideas

and information throughout a company more quickly. HR
professionals must create the policies and practices that will
encourage such learning.

• Creating organization in which intellectual capital is constantly

updated will be a significant aspect of HR work in future.
 CHALLENGE EIGHT : TRANSFORMATION

• Transformation changes the fundamental image of the

business as seen by customers.

• Managers and HR professionals need to focus on

transformation to create fundamental and enduring change.
IMPLICATIONS OF BUSINESS CHALLENGES FOR HR
AS A PROFESSION

• As champions of competitiveness, HR professionals must

focus more on the deliverables of their work rather than doing
their work better.

• They must learn to measure results in terms of business

competitiveness rather than employee comfort and to lead
cultural transformation.

• The HR function has been plagued by myths. It is time these

myths are overcome.
MYTHS V/S NEW REALITIES IN HR FUNCTION
• People get into HR because they like
people.
• Anyone can do HR.
• HR deals with the soft side and
therefore cannot be measured and
linked to Business performance.
• HR professionals must create the
practices that make employees more
competitive, not more comfortable.
• HR processes & systems are based on
proper theory & research which needs
to be mastered.
• The impact of HR practices on business
can and must be measured. HR
professionals must learn how to
translate their work into financial
performance.
MYTHS V/S NEW REALITIES IN HR FUNCTION

• HR focuses on costs, which must • HR professionals should learn to

be controlled. add value and not reduce cost.

• HR job is to be the policy police • HR practices do not exist to

and the health and happiness make employees just happy but
patrol. to make employees committed
& competent.
MYTHS V/S NEW REALITIES IN HR FUNCTION

• HR professionals must see their current

• HR is full of fads. work as part of an evolutionary chain
and explain their work with less jargon
& more authority.

• HR is staffed by nice people. • HR professionals should be

confrontative as well as supportive.

• HR work is as important to line

• HR is HR’s job.
managers as are finance, strategy &
other support functions. HR
professionals should join with mangers
in championing HR issues.
THE PREMISE OF HR VALUE

• HR value proposition means that HR practices and

professionals are able to produce positive outcomes for key
stakeholders-employees, line managers, customers &
investors.

• When others receive value from HR work, HR will be

credible, respected & influential.

• Attempts at HR effectiveness without defining value will not

be desirable.
THE PREMISE OF THE HR VALUE PROPOSITION

• Influence with impact occurs when HR professionals start with

the beliefs and goals of the receivers.

• Who are the key stakeholders I must serve?

• What are the goals & values of the receiving stakeholders?

• What is important to them?

• What exactly do they want?

• When these requirements are fully understood, then the HR

professional can show an investment in an HR practice that will
help the stakeholders gain value.
THE EVOLVING PICTURE OF HR:
FROM PROFESSIONAL TO STRATEGIC PARTNER
• New economic realities are putting pressure on HR to widen its
focus from the administrative role it has traditionally played to a
broader strategic role.

• The new economic paradigm has highlighted the importance of

intangible assets, such as brand
recognition, knowledge, innovation and particularly human
capital.

• HR must move from a ‘Bottom – up’ perspective (i.e.

emphasizing compliance and traditional HR) to a ‘Top - down’
perspective (i.e. emphasizing the implementation of strategy).

• HR need innovative systems that will let them demonstrate their

influence on measures that is critical to business – namely
profitability and shareholder value.
HOW DO WE MEASURE THE VALUE OF HR
SERVICES?

• Two most common questions are raised by HR practitioners:

• How can we measure the value of what we do in HR in terms
that line and General Managers will understand and respect.
• How can HR metrics be incorporated in organization's
measures of business performance.

• To demonstrate its strategic contribution to senior managers, HR

needs a measurement system that focuses on two dimensions.
• Cost measurement
• Value creation
A SIMPLE ILLUSTRATION OF VALUE CREATION
____________________________________________
_____ Return of Capital
FINANCIAL Employed

_________________________________________________
Customer
CUSTOMER Loyalty

On-time
_________________________________________________
Delivery
INTERNAL/BUSINESS
PROCESS
Process Cycle
_________________________________________________
Process Quality
Time
LEARNING & GROWTH

Employee Skills
HR TRANSFORMATION WITH A VALUE
PROPOSITION HAS SIX IMPLICATIONS

• First : HR work does not begin with HR – it begins with the

business.
• To be real Business Partners , HR Professionals need the line
of sight between their activities and the best interest of key
stake holders .

• Second Two: The ultimate receivers of business reside in

market place that companies serve.
• HR should have a line of sight to the marketplace .
• Knowledge of market realities will enable HR in creating
Human abilities and organizational capabilities that generates
products & services that customer demands .
HR TRANSFORMATION WITH A VALUE
PROPOSITION HAS SIX IMPLICATIONS

• Third : HR creates value when it acts as an enabler to create

competitive advantage.
• Competitive advantage exists when a firm is able to do
something unique that competitors cannot easily copy .

• Four: HR professionals must align practices with the

requirements of internal and external stakeholders.
HR TRANSFORMATION WITH A VALUE
PROPOSITION HAS SIX IMPLICATIONS

• Five: HR professionals need to acquire the knowledge & skills

necessary to link HR activity to stakeholders value.
• When HR fails to make it , it allows gaps to occur between Hr
practices &stakeholder demands .

• Six: HR professionals need to view company’s key stakeholders

from a unique and powerful perspective.