Seats on board do not equate to influence

The conditions are now right for HR to have more involvement in strategic
decision-making, explains the IPD’s Ward Griffiths

Based on the Cranfield Survey findings that "only half of HR directors
have a seat on their organisation’s board", Personnel Today’s Comment (18
January) rues the apparent inability of many senior HR specialists to win
sufficient confidence to be the "first port of call" for strategic
advice on people issues. While organisations may understand the competitive
advantage of people strategies, they are not always, it seems, turning to their
HR director when they want a solution, but often use management consultants.

Care must be taken with survey results. It is not long since Personnel Today
reported a survey by the consulting group DDI, working with the IoD, which
showed "a dramatic increase in HR representation at board level".
Their annual survey of HR directors in 1,000 UK firms showed the proportion
with a seat on the board rose to nearly three quarters, up from 55 per cent in
1998. "HR directors rightly believe they are well placed to play a more
critical role in their organisations," said DDI consultant Michael Gregg.
And survey data presented by respected UK academics Hall and Torrington in 1998
led them to conclude that, "the HR function is involved in strategy to a
greater extent than previous research has generally indicated".

Moreover, the comprehensive WERS 98 survey includes data which is consistent
with a view that people management and development is becoming a wider concern
of managers generally, with the HR specialist being able to spend more time on
strategic and wider business issues.

The particular issue of boardroom representation for HR is often regarded
within the function itself as a red herring. Debates over which side of the
boardroom door the profession should find itself seem rather tired, often
focussing more on the issue of representation than what really counts –
contribution. Board membership itself does not equate to influence.
Non-membership does not mean the personnel director has no influence on
strategy. Some boards are constituted to provide particular strength on
governance and shareholder relationships, while others are set up to drive and
develop the business. The more important issue for many practitioners is the
strengthening of HR’s operational and strategic role, with a key driver of the
on-going business being the executive team – where the specialist HR presence
is almost universally represented. There is strong demand for good HR people at
such levels, as a glance at the recruitment advertising pages of People
Management and Personnel Today will show.

Presenting its own survey results on HR skills, Personnel Today also calls
for the HR function to do a better job of demonstrating its capabilities. There
can be no argument with the need for personnel professionals to show they add
value to the business. They should be highly qualified in specialist personnel
matters and have a sound understanding of business issues. The numbers of
personnel specialists with a formal, related qualification are increasing, and
the numbers taking the IPD professional scheme qualification continue to rise.
The IPD has long recognised the importance of relating the professional body of
knowledge to the wider business context through the professional qualifications
scheme.

In summer 1998 the IPD also conducted interviews with 30 of our senior members
in many of the UK’s best known private and public sector organisations, which
showed that a strategic contribution to their business was their first
priority. They are increasingly focussed on business performance challenges and
the critical need for people-based organisational strategies as the factor
which will make a difference. The senior practitioners we talk to wish to be
proactive on these issues, including developing coherent frameworks for
evaluating their contributions.

The WERS survey shows that there is now an increased number of HR managers,
covering a larger number of UK employees.

Increased attention is also being given to people management by
non-specialists. With more and better qualified specialists operating in an
environment where people management is being taken more seriously, the
conditions are right for growth in the profession’s involvement in strategic
decision-making.

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