HR must take a risk to be a business partner

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first_img Comments are closed. Previous Article Next Article Everyone wants to be a business partner these days. Yet very few HR peopleare prepared to share the risks that are inevitably part and parcel of”partnering” senior management. While HR’s aversion to risk is legendary, it has not stopped manypractitioners falling in love with the title in much the same way as the”reps” have their egos massaged by the title of area sales manager. Being a business partner also fits in with the current mantra of the CIPDthat effective HR practices have an impact on the bottom line. To back up thisclaim the CIPD lined up a group of academics and researchers to unearth acorrelation between best practice in HR and successful businesses. But research such as this fails to question the role of HR in failingbusinesses. Just as HR can have a positive impact on the bottom line, can itdamage it? The HR team at Marconi probably likes to think that it makes a businesscontribution – but does it take a share of the blame for the failed businessstrategy? It must share some of the responsibility if it aligned its HRstrategy with Marconi’s business strategy. A reasonable defence might be to claim it was using best HR practices. Whatvalue can we place on “best practice” in such circumstances? The onlyHR practices that can be called best practice are the ones that help anorganisation achieve its own strategic objectives. What works for oneorganisation may not work for another. This means best practice can only bejudged within its own particular context, not as an “industry standard”.If HR practices do correlate with business results, in Marconi’s case, itsHR practices must be about as far from any notion of best practice as it ispossible to be. I haven’t got a problem with HR wanting to act as business partner. Indeed,I have actively promoted the idea for years. However, to really earn the title,HR people have to accept they, too, have direct responsibility for all the keyperformance indicators of sales volume, profits, ROCE/RONA (if you need to lookthese up you have failed the first test as a business partner), p/e ratio andEBIT (or even EBITDA). Even more importantly, HR business partners should also spot when their CEOand finance director are sending the business down the tubes and be in aposition to actually do something about it. So we should ask the CIPD whether this changes the conclusions of itsresearch. Either this supposed correlation is just too simplistic anexplanation of HR’s contribution, or HR has to accept that its contribution isbound to change in line with a normal cycle of market changes. It cannot claimcredit without taking a risk. By Paul Kearns, Senior partner, Personnel Works HR must take a risk to be a business partnerOn 4 Dec 2001 in Personnel Today Related posts:No related photos.last_img

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