The debate is still raging over the need for HR to sit on the board. This
issue has gripped the imagination of senior practitioners, academics and the
media and is in danger of deflecting the debate away from where it should be –
the impact of HR.
Complaining about the lack of HR representation on the board is victim
behaviour and damages the long-term credibility of HR.
I have just finished reading a new book by Jack Welch, ex-CEO of global
giant General Electric, and it has prompted me to revisit the debate. There can
be absolutely no doubt that Welch and GE achieved successful business
transformation through people.
Welch had a passion for people excellence and GE is uncompromising about the
standards it sets. It has a robust HR system in place, which is respected by
line managers and demands the very best from people managers right through the
business at all levels.
What is interesting about the GE situation is that the head HR person, Bill
Conaty, does not have a seat on the GE board. But I doubt this concerns Bill
too much. He is too busy developing the GE strategy and making a difference to
the bottom line every day. I also doubt it inhibits his ability to influence
and wield the power necessary to make change happen on a global basis.
Boards have a fiduciary duty to act in the interests of their shareholders,
but in great companies, so does everyone else. GE has a reputation for
systematically getting people excellence driven through the business. It has a
focused performance management system built within a learning and development
culture. It is a true employer brand.
Analysts on Wall Street are clearly aware of the strength of the people and
business processes and it affects its share price. It seems to me this is the
Holy Grail for HR – direct bottom line linkages between business strategy and
HR strategy and practice.
Influence is about being good at what you do and having the courage to stand
up to the CEO – it is not about what table you sit at.
The debate about HR on the board waters down the real issue for HR people,
which is the active pursuit of making a difference on a systematic, predictable
and consistent basis.
So, let us not get hung up on where we sit within the organisation, but on
what we deliver and what our influence is at every level of the business. If HR
is good enough, low and behold we will end up on the board anyway – and not
just because of a notion that there has to be a functional representation at
that level.
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Let us make sure younger HR people aspire to making a difference rather than
sitting at the top table, and I suspect if we do this the rest will take care
of itself.
By Chris Matchan, Vice-president consumer practice, Korn/Ferry
International
