The HR Business Partner: An Oxymoron No More
By Kevin Oakes from i4cp | October 17, 2012, Issue 559
While the lack of business acumen in the HR field is editorialized to death, a quiet evolution is taking place in corporations across the globe.
Over the last few months, i4cp interviewed over 70 of the most prominent CHROs in many of the world's most recognizable companies. Among the topics discussed were the complexities of global HR, global talent management, leadership development, metrics and analytics, HR technology and future competencies needed for the profession. One theme continuously came up in these discussions: the role of HR business partners.
According to the human capital executives interviewed, the HR business partner is at the forefront of the function's evolution, redefining the role and scope of the traditional HR professional. This includes a new mindset about the profession's core strengths, along with a new and complex set of competencies that will be needed to achieve business impact in the future.
The picture drawn for a successful HR business partner portrays a trusted advisor and strategic resource for business leaders who can help drive organizational performance. For HR, the compelling challenge now is finding and developing talent to fill that strong business partner role.
Today's top CHROs say that probably means looking beyond HR.
Today's top CHROs say that probably means looking beyond HR.
Moving from Generalists to Strategists
The business partner is an established, if somewhat flexibly defined, HR role. Many organizations use the term generalist to describe a position that often operates at a lower or mid-level in the business that touches multiple aspects of HR. However, in top companies the generalist function is giving way to a more strategic role, which combines in-depth business savvy and trusted consultative skills in order to coach leaders of business functions on how to be more competitive and productive. In i4cp's upcoming report Future of HR: The Transition to Performance Advisor, research shows that HR business partners have a presence in 43% of high-performing organizations - based on profitability, market share, revenue growth and customer satisfaction as compared to five years previously.
One HR leader explained that the traditional, lower-level generalist "doesn't do strategic work. Generalists execute the strategy. In contrast, the HR business partner is someone who can have robust conversations about people issues in the business. He or she knows how to identify potential problems and brainstorm creative solutions."
Donna Morris, SVP of HR and CHRO at Adobe, concurs, characterizing "the role of the business partner as someone who can work at the strategic level, diagnosing and determining what the people needs are for the respective businesses. Defining best reward mechanisms, best people, right processes. That's the partner."
Refined Structure + New Competencies = Business Partner Excellence
HR leaders see the need for change behind the scenes to accommodate the added knowledge, advisory capabilities and stature required for a successful business partner.
John Lynch, CHRO at GE, feels that "with technology, outsourcing and COEs (centers of excellence), there are ways to do the transactional work so that HR professionals inside the business really can add value. You have to be efficient and at the same time more effective in transactions, in relationships and as leaders of the business. That's a real change for HR - from the early industrial relations experts of yesterday to the growth leaders of tomorrow."
Morris explains how a center of excellence model empowers the partner: "Behind the partner it should be seamless to the business," she says. "The people who are masters at building compensation or reward programs, attracting great talent, developing talent, etc. - the functional experts - they help support the business partner's mission."
Paul Humphries, EVP of HR and president medical, automotive and aerospace at Flextronics, agrees. "We've been trying to shift away from HR as an administrative function to more of a strategic one," he says. Moving transactional work to a shared services center is part of the effort. So is implementation of a more extensive HR information system. "It's having the objective of supporting the business, putting the organization and skills in place to do that, and then taking the other work away" that enables HR to maximize strategic impact.
Sterling Bank EVP of HR Karla Gehlen observes that the COE approach enables the HR business partner to become a single, consistent touch point. She says that "the people who are interfacing with clients - the business leaders - must be one voice to the customer so the customer has a one-stop shop. That's the HR business partner who understands leaders' needs, knows the organizational structure, helps with talent assessments and understands what leaders are trying to accomplish. The partner becomes the one voice of HR, whose goal is to support that business leader."
Backed by an enabling structure in the HR function, the business partner of the future will need to bring a more sophisticated set of competencies to his or her work. CHROs paint a picture of an evolved partner who will function fluidly as trusted advisor, business guru, chief supporter, devil's advocate, brainstormer and creative problem solver. One HR leader described the role as "the consigliere model - more counselor than technical expert; the person who is there to listen and provide advice on the very complex subject of human behavior, but who also understands legal requirements and other aspects of HR."
Gehlen says that the role will not only encompasses a basic understanding of "how the business works and how the company makes money," but also the ability to be a skilled questioner in order to elicit information needed to help leaders identify issues and leverage opportunities. CHROs named organizational development or design skills, change facilitation, coaching, integrity and influence among the attributes they view as essential for the accomplished business partner. High-performing organizations add more competencies to that list, including: strategic thinking, strategic execution, strategy development, business ethics, decision-making, team-building and understanding of technology.
Where's the talent? Not in the usual places
The CHROs who spoke with i4cp for the Future of HR study agree that finding the kind of talent needed to staff the business partner role will be challenging. Many affirm that the typical HR degree doesn't adequately prepare graduates. An HR leader in the financial field says, "If a college student came to me and said ‘I want to major in HR,' my first question would be why? And my comment would be, ‘I wouldn't recommend that.' I think we need people who are interested in HR to get business or finance degrees, then learn about HR."
Some CHROs choose to work with colleges to refine curricula, but others say that catching HR professionals early in their careers and adding experiential learning - including operations rotations - is a better approach. Still others, like Barb Magusin, SVP of HR at Premera Blue Cross, look beyond HR for likely candidates. "I've been hiring into the business partner job people who don't really have any HR experience," she says. "They come out of finance or IT, and we teach them enough of the HR stuff to help them become a partner to the business. We support them with HR generalists from below."
A CHRO in a large educational firm concurs: "The best HR people I know either started somewhere else or stepped outside of HR for a few years and got experience their HR structures wouldn't allow. I find my best Hi-Pos and give them every management assignment I can find." Indeed, rotations outside of HR rated highly with the leaders i4cp interviewed. They added the observation that HR's evolution will have come full-circle when other functions regard a rotation through HR as must-have preparation for all future business leaders.
As HR continues its quiet evolution to organizational performance advisor, the business partner role will continue its shift. The sourcing of this role will evolve, as will the competencies companies are looking for and the organizational structures they put in place to support it. High-performing organizations of the future are ready for this shift. Are you?