In the previous recession, in the early 1990s, many saw HR as having a limited role to play – that of the ‘executioner’s assistant’. Of course, the function has a necessary and important role in ensuring that organisations manage redundancies fairly, legally and efficiently this is a role it will no doubt play again with a quarter of UK employers planning redundancies.
The risk for both the practitioner and the wider organisation is that this represents a small part of the contribution that can be made by HR, both operationally and strategically.
There is anecdotal evidence that short-term cost savings and headcount reductions do not necessarily have enduring benefit. Recovery from past economic downturns has been hampered by the lack of capacity and capability in organisations to respond as conditions improve. This affects both organisational recovery as well as the upturn of the wider economy.
Blackest day benefits
The 26 January was one of the blackest days since the start of the economic downturn, with more than 70,000 people estimated to have lost their jobs in the US, Europe and Asia on that day alone.
Yet this is the very time when organisations can get the greatest benefit and strategic contribution from HR. The question is how well has a decade of business partnering equipped HR professionals to both hold their nerve and take up the roles that truly add value?
Roffey Park’s 2009 Management Agenda research looks at the key challenges facing UK managers. It reveals that while 64% of managers believe their HR function has credibility, less than 33% believe HR adds value to their organisation.
This needs to change quickly and the most effective way is for HR to select priorities for the next 12 to 18 months. From our research, organisations seem to be adopting a ‘wait and see’ strategy – a view confirmed to me last week by the head of strategy at a leading bank.
Performance and participation
Further findings from the survey show some recurring themes, which will help HR professionals to know where to focus their attention.
First, organisational performance is a concern for organisations large and small. One in five believe they have under-performed. HR professionals can help support organisational performance and guide employees to perform to their best ability.
Second, selecting the right strategies will be vital for business success. The HR function should add value by participating in decision-making during these difficult times. Yet a lack of clarity regarding strategy and direction means any remaining ‘Dunkirk spirit’ may ebb away. A real strategic contribution from HR will be to work with managers to find a way to offer focus and direct energies, however uncertain the future may seem.
Third, change management continues to grow in prominence. This is HR’s opportunity to link strategy and performance objectives. For example, are employees clear about how the new business priorities translate into their day-to-day work? Do they understand what is now expected of them and do have the right skill-set to deliver?
Effective change management can help businesses withstand the current challenges and it also provides HR with a great opportunity to demonstrate its value. How can any business resist the opportunity to have internal experts showing them how to support their people through this time of unprecedented change?
Reeling in the line
Most important of all is how HR works with line managers. Any hope HR has of adding more strategic value relies on a genuine working partnership with senior leaders, which needs to be cascaded down the organisation so that, with the support and coaching of HR, all managers feel committed, clear and equipped to do their job.
In short, if HR can support and enable managers to get the most from their people in these tough and potentially demotivating times, then that will be a contribution worth its weight in gold.
The time of large functions with transactional focuses has past HR now needs to develop a culture of partnership with senior leaders and line managers to help motivate employees and encourage teamwork for those facing today’s challenges.
HR has a wealth of knowledge and now is the time to share it openly. The impact of this will help HR to gain further credibility and not worry itself about the threat of restructuring or downsizing its own function.
by Jo Hennessy, director of research, Roffey Park