Why Rename HR or HC to HI (Human Investment)?

After all, what is in a word change?

1. Perception.
1. Instead of using others up, you are building others up.
2. Instead of being a cost center, there is an expectation that you will create a ROI (Return on Investment).
3. Instead of being tactical and operational, you are expected to deliver strategic results
2. New Paradigm
1. The HI employee team will realize that instead of “managing” people and processes, they now have to “create value” (a return on investment) with people and processes. That includes being willing to outsource part of their function if that decision creates a greater value, lower cost, and frees up staff to focus on higher value activities.
2. HI internal clients (other functions and departments) and their employees can now be shown how they need to consider investing in themselves, making personal changes, and adding value in order to survive and thrive in tomorrow’s company. It also fires a warning shot to Bloodsuckers and Selfers to start aligning with the company and adding company value.
3. New Value Proposition to the C-Level
1. Instead of a cost center, a true HI organization will create, measure, and report how the new model creates a contribution to profit, productivity, client service, innovation, etc. These are the key words that C-Level executives will be interested in hearing. The HI organization’s value is in serving other organizations to help them add value to the company’s success. Therefore these metrics are cross-functional team metrics that senior management can use in their company performance dashboard.
2. The value proposition becomes part of your departments internal branding and positions you as a value contributor, not merely staff who handles “stuff no one else wants to handle.”
3. Signals to line managers how, if you can live up to your new name, you need to become part of their team to help them create Value Workers in Value Teams contributing Value to the company – resulting in the line manager getting recognized for their value contribution. This process integrates you into the product and go-to-market process – which is where the C-Level is focused.

Now, if you like our word change, there is a catch. Before you try to sell management on your new role, you have to create and demonstrate the model within your own organization. So, I recommend holding off going to the C-Suite until you are hearing their subordinates taking notice and talking about the value, ROI, and changes that you implemented. In other words, you need to create yourself as a product demonstration before trying to market yourself and sell yourself internally.

However, if you are serious about wanting to make a difference, help the right employees to get on the bus, in the right seats, aligned for company success, and adding recognized value then you need to start with a vision of where you are going. I suggest that vision is as a Human Investment Manager.

The next several weeks we will be discussing concepts and steps you can take to become successful – and recognized as successful by top management.

Next week, we will start by explaining, “Why CEOs should Develop Strategic Human Investment Organizations.”

 

Redefining HR into HI (Human Investment)

You probably think I have gone mad! How dare I suggest redefining an entire function.

Please hear me out – then call me crazy. If you read my background, I usually redefine functions from a business and CEO perspective. I am not trying to impact best practices except to add a strategic viewpoint and, later, suggest additional best practices that you may not yet have in your tool bag.

First, what does HR mean? Obviously, it stands for Human Resources. Great! What does the word “resources” mean? The dictionary defines it as a source of supply or support. So, a human resource professional refers to the people who supply or support the processes in business.

What is wrong with using the phrase “Human Resources?” A resource is something to be used up and then discarded or to be refined/developed for a higher value use. Take mineral resources, the resources are found, mined, and then used in other processes such as manufacturing or jewelry.

People resources are often viewed as either a commodity (tactical worker who is easily replaced with another tactical worker) or a Valued Worker (someone who strategically adds value, knows how to communicate their value, and develops relationships with decision makers to understand how they can add more value…). Commodity workers are often viewed by senior management as dispensable, easily replaced, easily outsourced, and easily taken advantage of or mistreated.

The typical experience is that hiring quality people who want to work is a hit and miss experience. Many executives, with significant hiring experience, have agreed with me that a 50% success rate is quite good. That means that at least 50% of hired employees are either dragging down the company or need to be trained or replaced. Good companies emotionally often keep them as non-performers and eliminate only the worst offenders. The result is often a misaligned, dysfunctional, sub-optimized, and non-competitive organization. The only good news is if your competitors have a higher percentage of dysfunction.

Recently, I have seen some HR organizations change their name to HC (Human Capital).

Essentially, capital is merely one form of a resource. Capital can be defined as “the amount of cash and other assets owned by a business. These business assets include accounts receivable, equipment, and land/buildings of the business. Capital can also represent the accumulated wealth of a business, represented by its assets less liabilities.” (Source: http://biztaxlaw.about.com/od/glossaryc/g/capital.htm). In other words, people are still seen as items to be used.

Instead, I am recommending a rethink of the entire process beginning with a new naming paradigm. Instead of HR or HC, I recommend HI or Human Investment. Titles would be Human Investment VP, Director, Manager, etc. Separately, we have created a new leadership model called the Human Investment Leadership™ model.

What is the difference? Resources and capital are typically commodities to be used up except for high performers, high potentials, or political favorites. Commodities are often paid commodity wages, think like commodities, and act like commodities. That is, you can train them until the cows come home but while the trainer is speaking they are daydreaming, updating Facebook, checking emails, or other activities because they don’t really want to change. Of course, a popular alternative is to find a highly entertaining trainer. At least now the commodities may pay attention but often subject interest, retention, and application into their daily work is little to none. All of us have seen examples. Unless the employee is internally motivated to change, change will only happen under stress and reversion often occurs when the stress is relieved.

So why rename the function Human Investment? I will explain in next week’s blog.

The HR Paradox, Part 4 – The Solution

What we are about to describe is theoretical. Few companies will have internal staff and resources to implement the solution. Most companies will need assistance from qualified advisors, consultants, coaches, and third party knowledge resources.

We will paint the strategic picture but every company will need to decide whether to pursue as a company-wide strategy or as a tactical piecemeal process. In every case, how it is implemented within your unique company, industry, culture, value-system, structure, and political environment will differ. That is why we are teaming with advisors, consultants, coaches, and best of breed partners who can apply the solution within your unique situation.

So, what is the solution?

Step One: Decide strategically, at the CEO level, whether having the right structure with the right roles, the right people in the right seats, helping those people add personal and team value, and developing the right culture of innovation and value add with organizational alignment is worth his or her personal attention. If not, consider tactical piecemeal steps for tactical improvements co-sponsored by a line decision maker and HR.

Step Two: Analyze and Evaluate the existing organization for weaknesses and HR Paradox gaps.

Step Three: Diagnose and Prescribe what actions, tools, and resources would be recommended for strategic and tactical improvements. The C-Level team should decide whether to self-treat with existing resources or to engage professional assistance.

Step Four: Implement the treatment plan utilizing the recommended resources and tools. This will take time, will impact people (especially blood-suckers and selfers), and will take an investment of money and management resources. However, the ROI impact will be obvious:

Studies have shown that:

1. Actively engaged employees make up less than 1/3 of the workforce. Source: Gabriel Institute
2. 60% of failures are due to people problems. Source: VC Industry / Gabriel Institute
3. Nearly 80% of job turnover is due to hiring mistakes. Source: Harvard University
4. The cost of a bad hire can range from 1.4 to 10 times (or more) of the annual salary. Source: Right Path Resources

This list does not include the additional costs of internal conflicts, lack of alignment, and a host of other HR Paradox symptoms.

What impact do these examples have on your business? 

What impact could reducing the HR Paradox have on your business? 

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.

What is Integrated Success™?

Think of a three-legged stool. One leg is Leadership. The second leg is the Organization comprised of individual teams. The third leg is the Individual contributor who is also a member of one of the organizational teams.

If any of those stool legs are broken, wobbly, or not strong, the risk of the stool falling over is high. Have you ever tried to sit on a one or two-legged stool? Any strong breeze or movement shift can cause the stool to shift or fall over. In today’s turbulent markets, there is more than a strong breeze blowing.

Most solutions attempt to focus on one of the three legs. For example, you may have a management consultant helping with leadership, a communications consultant helping with the communications gap externally and internally, a HR consultant helping one area of the organization, and a career or executive coach helping individuals.

Integrated Success™ recognizes that strong companies (stools) must integrate each of these three legs with an integrated approach. In other words, Company Teams Aligned with Leadership Direction and Empowered by Motivated Individuals are the Key to Organizational and Individual Success.

From the executive perspective, it means organizations aligned with leadership direction with the right employees on the bus, in the right seats, going in the right direction, and producing the right results.

From the organizational perspective, it means learning the business and leadership direction, designing which seats belong on each team, filling each seat with the right individual, fostering teamwork, and creating the value needed to support the company direction.

From the individual perspective, it means finding the right bus, being in the right seat, supporting their team, and producing value to both the team and the company.

At a high level, Integrated Success™ is a combination of common sense, best practices, new tools, resources, and knowledge applied to helping companies, organizations, and individuals all become more successful and competitive in a rapidly changing world. The model applies strategic consulting with tactical processes and tools for every level of the organization.

At the next level, it is a gap and best practice process. We look for gaps in typical companies, try to understand the root causes of those gaps, and then apply the best practice, and best of breed tools.  Then we offer solutions to companies, consultants, coaches, and anyone who wishes to learn and apply the model internally or with clients.

How strong is your company’s three-legged stool?

 

 

Why are we qualified to create an Industry Paradigm Shift?

Because that is what we have done before, enjoy doing, and will continue to do.

Here are examples of what we have done before:

• In finance we re-engineered how solutions were to be developed, partnered, priced, and sold in ways that were innovative and created a new industry within a traditional company. The results were spectacular new revenue growth.
• In supply management (procurement), we created many best practices with twenty different paradigms of how to create globally competitive, world class results within a total supply chain. The results were tighter partners, channels, and both revenue and profit improvements.
• For job seekers, we repositioned many of the “best practice” concepts by rethinking the entire process from a CEO and Business-to-Business perspective. We endorse HR and recruiter practices but see them as just one piece at the end of the job seeker best practice process. Our outplacement resources explain under the Jobpreneurship™ model.
• Last week we announced Integrated Success™, which is a major paradigm shift to create individual career success, organizational alignment, and higher company performance. To accomplish this we tackle three discrete areas normally managed by three distinct groups: executives, HR, and employees. We recognize that outside advisors are normally three distinct groups: management consultants, HR consultants, and career/executive coaches. Our program is the integration of all three areas combined with teaming with all three outside advisor groups. We will discuss more detail later.

Here is why we enjoy creating new models and paradigms:

• We have always believed in working smarter, not harder. As the world, business, technology, and people change the best way of working smarter is to look at the big picture and ask, “Why?” By eliminating processes, reports, and ineffective approaches (that used to work in prior years), you can focus on the big picture and create a rifle shot approach to today’s best practices.
• We love to “connect the dots”. There are hundreds of viewpoints. Most are from among the trees of individual ideas and processes. We love to look at the forest to see the big picture and then pick which trees to connect for the most effective approach to success.
• We love best practices. There may be a thousand ways of doing something within your industry, competitive environment, size, culture, and political environment. However, there are only a few best choices for competing today. Some of these practices are strategic and apply as general roadmaps. We focus on the strategic, and with our partners, customize or personalize to each unique situation and environment. We also train others with the strategic roadmap who can then apply the roadmap tactically to each unique situation.
• We love to have executive, competitive, and customer input. Customers can say what they want. Competitors can often identify innovation amidst traditional approaches. Executives can contextualize through real world cultural, political, and business reality. All we do is “connect the dots” and then ask our customer and executive friends for input. A good idea can come from anywhere. Our job is to pick the best of the best thought leadership, as a knowledge company, for our clients.
• When we complete our programs, verify their validity, and actually help others become more successful, we know that we are adding client value.

Why will we continue to innovate and contribute as a knowledge company?

• It pains us to see good people and good companies be misled by out-of-date thinking, hype, or reactive approaches. We want to help those who wish to succeed to see how to do so.
• The world is continuing to change rapidly. We will have to continue innovation and modifying best practices in order to help others.
• Because that is who we are, our niche, our passion, and our value to others.

Is our approach of interest to you? Let us know what you think.

Expansion Announcement – Integrated Success™

We are pleased to announce a major breakthrough and strategy expansion.

Our expansion adds to our job search and outplacement focus three related initiatives combined into one global solution that we call Integrated Solutions™. Integrated Solutions™ addresses three major components of company success. The first is Leadership. The second is Organizational Transformation and Company Alignment. The third is Individual Personal Transformation (Career Success) and Team Alignment.

In other words: Company Teams Aligned with Leadership Direction and Empowered by Motivated Individuals are the Key to Organizational and Individual Success. Our model shows you how to strategically and tactically win at all levels. We will explain more details in future blogs.

So, why are we expanding our scope and offering?

1. Job seekers still need individual and outplacement assistance to compete in a global economy to find work. This emphasis will continue.
2. When job seekers land as employees, managers, or executives they need assistance to survive and thrive. Survive when the average job may last two years. Thrive in developing career success. So, we have expanded Jobpreneurship™ to include seeking one’s dream job in both the job search and company environments.
3. Employees succeed most when they are on the right bus (company), in the right seat (role), and going in the right direction (alignment with company and team goals). We will be soon announcing a new Career Success and Mentoring Program beginning with our new guide entitled Jobpreneurship™ 201. The guide is designed to help both the employee and the company to improve everyone’s success.
4. Poor teams, misaligned teams, dysfunctional teams, or any other description that results in low performance and low productivity impacts individual employee success, the team leader’s success, and ultimately company success. We have created a new organizational improvement model called Teampreneurship™ which helps company executives and leaders to either strategically pursue transformative changes resulting in high performance success or tactically pursue performance improvements depending upon the cultural and leadership environment. This model is designed, from a company perspective, to find the right people to put on the bus, to be in the right seat, to go in the right direction, to personally develop more value for the company, to have more career opportunity, and to be sure the right people are let off the bus. Teampreneurship™ is designed to help individuals, teams, and the company win together against a global, rapid changing and highly competitive marketplace.
5. With partners, we offer company executives assistance to improve their direction and communication to their organizations. Clear company strategic and tactical direction is the foundation for companywide synergy that helps organizational teams align with top management and gives individual employees a roadmap for career planning, development, and success. Top performing companies focus on leadership direction, team alignment, and employee development, value, and results.

By combining all three initiatives we believe we can help companies, teams, and individuals succeed together in a challenging world. That is why we call our new model Integrated Success™.