In
an exclusive interview, CIPD director-general Geoff Armstrong talks to Noel
O’Reilly about the after-effects of 11 September, challenging ‘sacred cows’ and
influencing business leaders
Q
Will the economic impact of the events of 11 September lead to good or bad HR
practices?
A
"I think you’ll see a mixture. The airline industry has jumped straight in
to deal with pressures that were there anyway… I don’t want to be unkind about
it, but in many cases they piled into the opportunity to really cut costs and
cut capacity that was uncompetitive anyway.
"There
are some companies for which 11 September has been the final straw. It has
triggered very Draconic cutbacks, possibly more Draconic than in fact the
economic prospects would justify – I don’t think we’re into a global recession
or a pan-sector recession. I think it’s sector specific.
"More
and more you’ve got to think about the war for talent, to use the clich, you’ve
got to think about the psychological contract.
"If
what you do is treat people as disposable human resources then as soon as they
have the chance they’ll be off.
"Don’t
jump for a fortnight – reflect a bit, think about where you are going to get
your skills in the future, what skills you are going to need and think about
the psychological contract – it’s not just the people who are going, it’s the
people who are staying you have to worry about.
"You’re
not going to have the choice in the future of not developing and continually
upgrading an employer brand."
Q
How do you respond to criticism that the CIPD should be more of a political
lobbying organisation, along the lines of the US HR body SHRM?
A
"We don’t see ourselves as lobbyists or shop stewards for the profession.
We influence quietly, we don’t wave banners about.
"I
serve as non-executive director on the management board of the Cabinet Office –
we are very close as an organisation at a whole range of levels to the senior
Civil Service and ministers. We take part in confidential focus groups and
regional and national workgroups where ideas are floated before they ever see
the light of day.
"They
(employers and the HR profession) have other outlets for campaigning and
lobbying – the CBI, the Chambers of Commerce or trade bodies.
"You
have to remember what we are: we’re a professional institute of individual
members.
"Our
members come from right across the political spectrum, public, private and
voluntary sector and they don’t have a united view."
Q
Many of the directors taking up the new HR roles emerging in the knowledge
economy are not from a HR background. Is this a threat to the profession and
does it undermine the institute’s chartered status?
A
"It’s always been this way – the change-makers have always been different
sorts of people. You have to be prepared to challenge the sacred cows and the
established ways of doing things and you can do that from within the profession
or you bring in things from outside the profession.
"We’re
not trying to be an exclusive sect that keeps other people out. If the ideas
come from marketing or strategy so be it, if that’s where the leaders come from
for a time – and that’s one of the reasons why we’ve been working for years now
to look beyond just people management."
Q
The CIPD has acknowledged that too few boards have adopted progressive people
management practices. What is the CIPD doing to influence business leaders and
to build alliances with them?
A
The CIPD’s research about the business case for HR has been broadly accepted
now.
"They
take it as proof that human capital and the value it can create is a primary
driver of shareholder value and of business performance. So the case is
made."
The
institute is working hard to persuade companies to implement HR strategies,
however.
"Board
executives still take a view that HR is a bit flaky, HR isn’t as quantitative,
isn’t as business related as a range of activities – they’re not so much
criticising the profession or the function, they’re just saying these things
are hard to get to grips with.
The
CIPD is working to persuade employers to use its research as a diagnostic tool
to develop HR strategies.
An
example of how Armstrong is building alliances is that he has recently been
asked by Institute of Chartered Accountants to stand on a committee to discuss
strategy.
Q
Should details of human capital appear in company reports?
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A
"I’m not of the view myself that we should ever have a standard accounting
practice on human capital in the way we have on the evaluation of stock, but I
think it’s perfectly possible as people professionals to be able to identify
what we’re doing and put targets in business terms that can be measured and
evaluated in their effectiveness."
