The HR Paradox, Part 3 – The Value Worker Model

At the end of every day, company success is dependent upon every employee adding value in the area where they work. Otherwise, why pay them?

We believe that there are several types of employees. These differences are discrimination neutral and quite simple. Either they want to work and contribute to company success or they want to be paid without working or they are want to work but are so self-focused that company teams and other employees are adversely impacted. I call those who want to work and contribute to company success as “Value Workers.”

Those who want to be paid without really working, I call “Loafers” or “Blood-Suckers” (they suck the life blood out of companies). Those who are self-focused may appear to be highly successful but result in sub-optimizing long term results. I call this group the “Selfers.” They create a highly inefficient company that is usually inward focused, slow moving, and often bureaucratic.

Which group would you want in your company? Value Workers, Bloodsuckers, or Selfers?

Yet in most companies, all three profiles exist. What is that costing your company? How is that impacting client sales, client satisfaction, product quality, company branding / image, profit, response times, employee turnover, employee development, and company teamwork? How is it impacting your company alignment and leverage?

Yet somehow HR is expected to have a magic wand to “fix the problem.” Top management is busy focused on growing the business and assumes that just hiring a HR team will transform the organization, or just spending more money internally will fix the problem, or outsourcing HR will fix the problem. Unfortunately, even the best HR team in the world cannot “fix the problem.” That is part of the HR Paradox.

Just as finance does not create the money it helps to manage. Just as technology does not create the business requirements it seeks to automate. Just as procurement does not specify the products or services it seeks to purchase. HR is only one out of four components to “fixing the problem.”

Unfortunately, unless HR has the right team in place there is no one else in the company whose job it is to coordinate the solution. Executive management does not have time. Managers do the best they can but are time pressed and do not have the tools or training. Even if the rare manager “fixes her department,” that does not fix the entire company. The individual employee has the least personal impact, responsibility, authority, skills, time, or ability to help. Even Value Workers are impacted when Bloodsuckers and Selfers exist throughout the company.

So strategically, how can a company resolve the HR Paradox?

Next week we will discuss the HR Paradox Solution.

The HR Paradox, Part 2 – A Top Management Opportunity

C-Level Management is usually focused on three areas: product development, marketing, and sales. Everything else is in support of those three functions, unless the goal is to grow and flip (sell or go public) the company. Then strategic finance is added to the decision making table. Every other function is in support of or part of those areas. For example, R&D is part of product development. So are manufacturing, product outsourcing, and product management. But at the end of the day, if you have no product to take to market, no marketing effort to communicate that you have a product, and no sales effort, then you have no company.

In some cases the product is HR, Finance, IT, Consulting or other product/solution. However, even in those companies there is usually a distinction between what they productize for clients from what they run internally.

Of course you can outsource some product development (e.g. license from others), outsource portions of marketing, and even tactical sales but the strategic decisions of what products/services to develop, how to market, and how to sell is usually the primary focus of top management.

Support functions that are integral to the product or go-to-market process usually become part of the strategic trusted advisor team. Examples would be IT and Finance. However, HR is usually not integral in product development, marketing, or sales daily discussions and often becomes an afterthought.

We believe it is up to senior management to understand how HR could become a competitive differentiator and contribute to company profit. The challenge is that most HR organizations do not know how to cross that bridge and communicate the value that world-class HR organizations provide to the C-Level executive team. This gap is one of the reasons why we created Integrated Success™. We have strategic processes to help management include strategic HR solutions that add company value while providing a tactical umbrella to align HR support with the business and company direction.

Our model allows us to help top executives, support strategic HR executives, help HR learn how to become more strategic, and provide tactical processes and resources that add value to the company. 

If the company goal is to design the right structure with the right roles, hire the right people and put them in the right seats, help those people develop personal and team value, set up a culture of innovation and value add, and align with the current direction of the C-Level team while still fulfilling the daily tactical duties of HR, then we believe our Integrated Success™ model can help.

The HR Paradox

HR is a critical function in every company. However, not all HR organizations are fully appreciated, viewed positively by executive teams, and safe from being outsourced. From a HR perspective, their members are often overworked, focused on helping employees, and satisfying company and legal demands. So, where is the paradox?

There are often gaps between the CEO strategic focus and many HR teams who are tactically focused. For example:

• Many HR functions (and other support functions) do not have strategic minded people on their team. I define strategic as understanding the business, understanding executive needs and wants, and knowing how to create the vision, strategy, innovation, implementation plans and communication skills necessary to talk to and advise decision makers at the C-Level (CEO, COO, CFO, CTO…).
• HR can be seen as too employee focused, similar to a union or government bureaucracy mentality. Few support functions, including HR, realize that they are, at best, a trusted advisor to decision makers. They are to represent the company’s interests, which includes alignment of individual and team success toward creating value for company success. This misunderstanding often results in senior management assuming that HR may secretly be a union representative whose answer to employee turnover and productivity is spending more money on more programs.
• HR has so many laws and regulations to follow that the risk is to become a watchdog who says, “you can’t do that” instead of a trusted business advisor who says, “I understand what you want to do but to follow what I believe is the law/regulation means _____ in order to get what you want without legal exposure. We may also need to seek a legal opinion to be sure.”
• Many senior decision makers intuitively know that some HR theory is merely theory and not helpful to their unique business. By not learning the business of the company and what the executives need and want, HR’s value to the company is often perceived as tactical and subject to being outsourced.
• It is not uncommon to hear a CEO define HR success as keeping them out of jail, eliminating lawsuits, and taking care of the daily (tactical) work. The result is that most HR teams are not included at the decision making table.

So what happens? Management often assumes that they will handle the strategic and the management of employees while holding HR accountable for turnover rates, hiring right, motivating the workforce, keeping salaries and costs down, training without budgets, and a host of expectations that are often not realistic. Not only is HR undervalued but also the executive management team misses out on what could be a secret weapon for greater company profit and competitive advantage.

So, where is the gap? The gap is that while management may devalue, rightly or wrongly, their HR team it is the C-Level management team itself that is to blame. The solution starts at the top.

Next week we will discuss the other side of the paradox – why C-Level management is missing a tremendous opportunity. Later, in following blogs, we will suggest steps that C-Level management and HR can take to eliminate the HR Paradox for their company.