HR thinkers: The guru circuit

Optimising his use of time is more of an obsession with Dave Ulrich than most. The human resources guru – best known for a string of best-selling management books including The HR Value Proposition, Human Resource Champions and Why the Bottom Line Isn’t – has built a highly successful career advising organisations how to manage their people to best effect.

So using the Chicago layover on a recent transatlantic flight from Dublin to Utah to discuss the latest management thinking around HR beats killing the time with an airport novel, says Ulrich. It’s also a question of snatching time amid a travel schedule that would leave a touring rock band in a head-spin. Ulrich’s February itinerary included speaking engagements and consulting gigs in Milan, Helsinki, South Africa, Iceland and Ireland, not to mention travel within the US, for the likes of Nokia, Heinz, IBM, Kellogg’s and the Irish Management Institute. All of this on top of his ‘day job’ as professor of business administration at the University of Michigan, to which he commutes from his Utah home.

He is handsomely rewarded for his troubles and admits the fees he commands are “obscene”. “Think of a number and double it,” he adds sheepishly when pressed. Demand for his services could easily keep him on the road “six to seven days a week, 50 weeks a year”, says Ulrich.

Preaching common sense

Ulrich is not alone. There is a growing cast of HR thinkers – mostly other US academics – making vast amounts of money by continually preaching what most HR professionals would consider common sense.

Luminaries such as Mark Huselid, professor of HR strategy at Rutgers University, New Jersey, US, and rising British star Lynda Gratton, professor of management practice at London Business School, have talked up successful academic careers and brisk book sales into thriving consultancy practices.

This has been driven by a stronger emphasis on personnel issues within management thinking, particularly in light of the UK government’s proposals to make people reporting an obligation in company financial results or ‘business reviews’, should they go ahead.

Waves of downsizing, business process re-engineering and other efforts to lick companies into leaner, meaner shape, mean that people – their know-how and capacity to innovate – are one of the last frontiers of competitive differentiation. Workforces have been recast as ‘human capital’, a corporate crown jewel that sound HR management holds the key to unlocking. And the gurus are capitalising on this trend.

“Firms with the right workforce, and workforce management systems, are the ones that prosper, because they are able to innovate and adapt,” says Huselid, co-author of The Workforce Scorecard and The HR Scorecard, with Ulrich among others. “As a result there’s a lot of interest in HR, as ‘architect’ of the infrastructure that delivers the workforce the business needs to succeed. The question is: are we, as a profession, ready to deliver?”

Huselid’s own work offers a matrix of considerations to match people policies with strategy, forcing HR to ask questions such as: ‘Have we got the right culture and climate?’, ‘Have our employees got the right skills?’, and ‘Are they motivated to perform?’.

Ulrich’s HR value proposition, meanwhile, urges HR managers to think deeply about how their role fits into the bigger picture of their employer’s performance, and to align personnel policies with delivering business results.

And in her books The Democratic Enterprise and Living Strategy, Gratton calls on HR staff to focus less on financial incentives and more on “creating challenging, interesting jobs and fulfilling relationships – putting people at the heart of corporate purpose”. But what use does this advice offer to those who deal with HR challenges on a daily basis?

Pam Kimmet, senior vice-president of HR at global communications giant Lucent Technologies, credits Huselid and Ulrich’s The HR Scorecard with giving her company’s HR team “new ways of thinking and talking about their work in more business-focused language”. This book, coupled with research into HR practices at Cornell University, were influential in a new initiative to measure the effectiveness of Lucent’s recruitment by tracking employee advancement and retention more closely.

“It sounds simple,” Kimmet concedes. “But the information hasn’t necessarily been mined as diligently as it could be.”

Neil Roden, group director of HR at the Royal Bank of Scotland, dished out copies of Ulrich’s HR Champions to his team five years ago, and says he has been adapting ideas from it ever since, including deploying HR staff in project-based groups across the business.

Against psychobabble

But others are sceptical. Paul Kearns, director of HR consultancy PWL (see below) derides what he sees as too many eggheads spouting warm and fuzzy “psychobabble” and over-complicated, jargon-ridden theorems and approaches to HR strategy that fail to pin down, upfront, expectations of concrete business benefits.

“If you’re going to do training, are you going to get more output, are you going to reduce costs, are you going to get more revenue or are you going to improve quality? There’s nothing else,” he says.

However, Ulrich responds: “A lot of management thinking is common sense. To win the soccer match you have to score more goals. But you must also have a strategic plan.”

Where people are involved, things are not always reducible to hard numbers, says Gratton. “You need to think about metrics and performance, but people are different from technical resources – they have needs, search for meaning and have a soul. It’s yin and yang. You can’t do one without the other,” she says.

Ultimately, the best way to view the glut of management gurus may be with less literal expectations and more in the spirit of seeking general inspiration, concludes Johnny Taylor, senior vice-president of HR at US internet conglomerate InterActiveCorp.

“The best management thinking is thought-provoking and helps you see things using different constructs,” he says. “It is up to practitioners to come up with some practical solutions.”

In short, the advice of management gurus can never be a panacea. Effective, well-run HR strategies in tune with the business will go a lot further. 

How to become an HR guru

Why the wheels have come off the US HR model

Paul Kearns, director of HR consultancy PWL, explains why he favours common sense over guru-speak.

“Any HR directors who have hitched their wagons to the Ulrich model may soon find their wheels falling off. In his latest book, The HR Value Proposition, Ulrich cites General Motors as an exemplar of HR best practice. This is surprising as General Motors’ credit rating is currently junk bond status. One can only deduce from this that Ulrich sees no contradiction in praising a company’s HR efforts while the business is going down the pan. What an odd state of affairs for a supposed HR guru and American academia to be in.

“But then this has always been on the cards. Most, if not all, of the seminal theories espoused by Ulrich et al (HR champions, the employee-customer profit chain, core competence theory, balanced scorecards, HR scorecards) were predicated on the decidedly shaky premise that
HR effectiveness can be correlated with historical business performance. Current business performance is proving otherwise.

“So what does HR do now? There’s no point looking to the European ‘excellence’ model as there’s precious little evidence that this has made Europe’s economy stronger, while accreditations such as the UK’s Investors in People are, in my opinion, well past their sell-by date. There’s no way out other than starting with a clean sheet. Only this time the first heading should read: ‘follow my own common sense’.”

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