achieving hr excellence: a global and evidence-based view - from may 30 presentation with john...

© 2012 University of Southern California

Achieving HR Excellence:A Global and Evidence-Based View

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Dr. John BoudreauResearch Director, Center for Effective

OrganizationsProfessor, Marshall School of Business

University of Southern California213-740-9814

[email protected]://ceo.usc.edu/

mailto:[email protected]

http://ceo.usc.edu/

http://ceo.usc.edu/

© 2012 University of Southern California JB_W

Is it “Time” for a Change?

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What’s Changed in 24 Years?

• Skinner, Wickham. (1981). Big Hat, No Cattle: Managing Human Resources.” Harvard Business Review.

• Stewart, Thomas. (1996). “Taking on the Last Bureaucracy.” Fortune Magazine. Why not blow the sucker up? Improvement’s for

wimps. I mean abolish it. Deep-six it.

• Hammond, Keith. (2005). “Why we Hate HR.” Fast Company

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How HR Spends Its Time Now and Recalling Years Ago (Lawler & Boudreau, “Achieving Strategic Excellence” 2012)

Means5 – 7

Years AgoCurrent

Maintaining RecordsCollect, track, and maintain data on employees

23.2 13.6

Auditing/ControllingEnsure compliance to internal operations, regulations, and legal and union requirements

15.2 12.5

Human Resources Service ProviderAssist with implementation and administration of HR practices

33.0 30.4

Development of HR Systems and PracticesDevelop new HR systems and practices

13.5 16.7

Strategic Business PartnerMember of the management team. Involved with strategic HR planning, organizational design, and strategic change

12.1 26.8


HR’s Actual Progress Since 1995(Lawler & Boudreau, “Achieving Strategic Excellence” 2012)

Percentage of Time Spent in the

Role1995 2001 2007 2010

Maintaining Employee Records 15.4 14.9 15.8 13.6

Auditing and Controlling, Ensuring Compliance 12.2 11.4 11.6 12.5

Providing HR Services and Implementing Programs 31.3 31.3 27.8 30.4

Developing HR Systems and Practices 18.6 19.3 19.2 16.7

Strategic Business Partner 21.9 23.2 25.6 26.8


Time Spent Matters!(Lawler & Boudreau, “Effective HR Management” 2012)

Correlation with HR Role in Strategy

Correlation with HR

Effectiveness

Correlation with Reported

Organization Performance

Maintaining RecordsCollect, track, and maintain data on employees

-.18* -.42*** -.12

Auditing/ControllingEnsure compliance to internal operations, regulations, and legal and union requirements

-.17* -0.30*** -.13

Human Resources Service ProviderAssist with implementation and administration of HR practices

-.18* -0.24** -.23*

Development of HR Systems and PracticesDevelop new HR systems and practices

.05 .12 .16


.31*** .54*** .27**


Finance Spends Less Time on Strategic Partnership(Boudreau, CFO Magazine online, 2012)

CFO’s400 in 2012

HR100 in 2010

Maintaining RecordsCollect, track, and maintain data 24.9 13.6

Auditing/ControllingEnsure compliance to internal operations, regulations, and legal requirements

16.2 12.5

Human Resources Service ProviderAssist with implementation and administration of practices

34.1 30.4

Development of HR Systems and PracticesDevelop new systems and practices

12.5 16.7


12.3 26.8


Why Might Finance Spend Less Time?

• Finance is actually a less frequent strategic partner

• Finance since 2008 is under such pressure to report and audit that it has dropped its time on strategic partnership

• Finance achieves “strategic” influence through its other activities

• Finance “counts” differently when you ask about strategic partnership


HR Organization Design, Activities and Skills

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• Shared Services Have Increased and Relate Positively to HR’s Role in Strategy and to Organizational Performance

• Varying HR Practices Across Business Units has Decreased, and Relates Negatively to HR’s Role in Strategy

• Shifting Transactional HR to Self-Service Has Slightly Increased and Relates Positively to HR’s Role in Strategy

• HR Talent Rotation (from and to other functions and within HR) is Not Common Yet Relates Strongly to HR’s Strategic Role and to Organization Performance

• HR Activity Areas Continue at Stable Levels, but Increases Relate to HR’s Strategic Role and Organization Performance in all Areas Except HRIS, Metrics and Union Relations

• HR Skills in Technical Areas, Interpersonal, Business Partner and Metrics Rated Higher by Non-HR and HR Leaders, and Relate to HR’s Strategic Role and Organizational Performance


Is HR Becoming More Strategic?

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• HR Is Less A Full Partner and More An Implementer Over Time

• Less than 1/3 Report Full Partnership

• Non-HR Sees Less Implementer and More Implementer and Full Partner Over Time

• Non-HR and HR Perceptions Are Similar

• China Sees No Role or Implementer Role More Than Developed Regions

• HR Involved in Organization Diagnosis and Change Rather Than Strategic Direction (Mergers, New Business, Options and Choices)

• HR Strategy Activity Relates More to HR’s Strategic Role and Not Strongly with Organizational Performance

• China Rated Lower on All Strategy Activities than Developed Nations


Is HR Using Advanced Strategy Activities?

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• Advanced Strategy Activities Include • There is a human capital strategy that is integrated with business strategy• Provides HR data to support change management• (HR) Drives change management• Data-based talent strategy• Provides analytic support for business decision-making• Makes rigorous data based decisions about human capital management

• All are at Only a Moderate Levels, and Even Lower for Data, Analytics, and Decision Rigor

• All Relate to Both HR Strategic Role and Organizational Performance

• China Rates Lower Than Many Industrialized Regions

• Your Organization Matters : Bureaucratic and Low-Cost Operation Negatively Related to Advanced Strategy … but High-Involvement, Global Competitor and Sustainable are all Positively Related


Is HR Advancing A Decision Science?

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• Decision Science Sophistication Relates Significantly to HR’s Strategic Role and Organizational Performance

• Non-HR Leaders Believe They are Somewhat Better at Human Capital Decisions than HR Believes They are

• All Decision Science Items are at Only Moderate Levels, with “Educating Business Leaders” Particularly Low-Rated

• Business Leaders Who Report Greater Sophistication Also Report a Strong HR Strategic Role


Style of Organizational Engagement

DecisionsHR systems that achieve goals by

“teaching” participants and providing the tools to improve decisions

Talentship

ServicesHR implements

changes by “encouraging”

Human Resources

ControlHR systems that achieve goals by

“requiring” participants to do what they must

do

Personnel


Is HR Evolving its Paradigm?

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• All Three Rated at Moderate Levels

• Non-HR Leaders Rate Decision Science Somewhat Higher Than HR

• Non-HR Leaders Rate “Adding Value Through Compliance” Significantly Higher than HR

• All Three Relate Strongly to HR’s Strategic Role and to Organizational Performance

• Your Organization Matters : Bureaucratic and Low-Cost Operation Negatively Related to Advanced Decision Science … but High-Involvement and Sustainable are Positively Related


Are HR Systems Advancing and Adding Strategic Value?

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• System Integration and Automation Increase Over Time

• Integration and Automation Show Slight Positive Relationship to HR’s Role in Strategy and Organization Performance

• China Significantly More Likely to Report “No Information Technology” than Industrialized Regions

• Functional HRIS Outcomes (Efficiency, Cost/Headcount-Reduction, Employee Satisfaction, Speed) Are More Extensive … But Not Often Related to HR’s Strategic Role and Organization Performance

• Strategic HRIS Outcomes (Improving Decisions, Creating Social/Knowledge Networks, Strategic Information, Measure HR Impact) Are Less Extensive … But Often Related to HR’s Strategic Role and Organization Performance


Efficiency

Impact

Anchor Points

Effectiveness

Three Anchors in Decision Analysis


Is HR Evolving It’s Value Proposition?

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• Most Commonly Efficiency, Rather Than Effectiveness or Impact

• Slow Increases in Effectiveness and Impact But Still Relatively Rare

• Particularly Rare on Tracking Leader Decision Quality and Pivotal Role Differences

• Measuring Efficiency and Effectiveness Relate to HR’s Strategic Role,

• But Only Measuring Effectiveness and Impact Relates to Organization Performance

• Measuring the HR Function, HR Operations and Strategy Contributions All Relate to HR’s Strategic Role

• But Only Measuring HR Strategy Contributions Relates to Organization Performance

© 2011 John W. Boudreau. All rights reserved

Beyond Data: The “LAMP” of evidence-based change

What is the Talent-Strategy Connection?

(Competitive Advantage, Pivot Points)

“The Right Logic”

What’s the Persuasive Story?(Values, Culture, Influence)

“The Right Process”

What’s in the evidence?(Information, Design, Statistics)

“The Right Analytics”

HR Metrics and Analytics That Motivate

Strategic Change

What are the Numbers?(Timely, Reliable,

Available)

“The Right Measures”

Why are you searching under the streetlight?

Because that’s where the light is.

© 2011 John W. Boudreau. All rights reserved

Is HR Using LAMP to Create Transformative Evidence?

Is HR Using LAMP to Create Transformative Evidence?

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• All LAMP Elements Rated Less Than “Somewhat Effective”

• Yet All Relate to Both HR’s Strategic Role and Organizational Performance

© 2011 John W. Boudreau. All rights reserved.

Extending the ParadigmExtending the Paradigm

Decisions

Services

ControlMaintain compliance

and control

Provide effective services

Improve organizational decisions

Personnel

Talentship

Human Resources

achieving hr excellence: a global and evidence-based view - from may 30 presentation with john...

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