Human Resources - 'The NEW CEO'?

‘ We are pleased to announce that the new CEO is our longstanding head of Human Resources…..’

Sound a bit odd as far as appointment notices go?

The reality is that the Human Resources department is, arguably, the last place organizations would normally turn to as a potential source for its top leadership candidate. Yet it is the one department which oversees the organization’s single greatest asset – its human capital - and its one true source of sustainable brand value.

That department generally owns the processes that attract, select, train, nurture and develop the single most significant variable that will decide how well an organization’s value proposition, products and services travel across the organization, through the various divisions, business units and into the heads, hands and hearts of its customers.

It sets the stage for the environmental and cultural conditions that make sustained high performance, strong levels of employee engagement and corresponding productivity possible.

But is HR central to the performance of your organization today?

HR, Employee Engagement & The Money Trail

Let’s face it – strategic plans and their execution don’t flow through magic pipes, functions or departments; they flow through real people, one at a time, linked by a human value chain. 

The levels of alignment and engagement of the people in an organization is the single most significant factor in creating customer or client outcomes that ultimately determine financial success – loyalty, revenue, margin, profitability.

The linkage between employee engagement and enhanced financial performance is not theoretical, it’s fact. Study after study, including our own case histories, demonstrates that organizations that place a priority on building high performance cultures driven by high levels of engagement (not employee satisfaction!) lead their sectors on a wide variety of financial and productivity performance measures.

Current Organizational Alignment Reality

Most organizations create ‘the strategic plan’ with little regard to sharing and communicating its relevance broadly, clearly, or in a compelling way to the human capital internally.

The results are fractures in alignment, inconsistent service delivery levels, and uneven employee productivity and dedication… resulting in inconsistent customer loyalty and brand value in the market.

Compounding this very common condition are the multitude of disconnected performance measures across the organization, conducted through vertical silos (business units, HR, marketing, finance, etc.) and seldom able to be ‘plugged’ into one clear, integrated line of sight as to where the employee engagement model is performing or underperforming.

Ask yourself these tough but vital questions.

• How many employees can recite the core mantra of the strategic plan seamlessly across functions and levels?

• Do your key measurement criteria in the strategic plan include data on employee engagement?

• Does HR include the leadership team as part of any engagement audit?

• Do employee engagement reviews include measurement of core strategy implementation factors, or are they more of a measure of employee satisfaction; a shallow and lukewarm ‘hug’ score?

• Can you consistently link employee engagement scores through the leadership team, across business units and the broader employee base, to their impact on customer engagement… and ultimately your topline revenue?

• Is there a single, unifying set of metrics that aligns all the data points and performance measurement criteria, and connects them visibly to the same set of core strategic imperatives across all departments?

If you answered ‘no’, or ‘somewhat’, then your organization is most likely underperforming against its potential.

The Business Case for Alignment and Engagement

The evidence continues to build. Organizations which invest in true, integrated alignment and foster engaged, high performance cultures enjoy the following outcomes:

• They make more money! Lots more money!

• They enjoy far superior levels of organizational clarity

• They build and nurture environments that provide the human capital with the tools and support to execute flawlessly

• Their employees are more productive (freely give more discretionary effort), loyal (stay longer and have more emotional ‘skin in the game’) & customer centric (are brand advocates and good ambassadors)

• Their customers buy more, more often, at higher levels of revenue & profitability and act as unbridled advocates and ambassadors themselves (word of mouth)

• Their leadership creates horizontal alignment and accountability from planning to the customer and back again

You entrust to HR a vital function – the care and feeding of those who ultimately determine your brand value, your people.

So, if your next hire asked the following question -

‘Would this organization ever elect someone from HR to lead the enterprise’?

How would it resonate? Silly? Impractical? Or is it time to set higher standards for HR and task them with driving higher standards through the rest of the organization?