The Crucial Role of HR in Enabling Growth


I’ve had the chance to do a lot of work with HR leaders and their firms recently in strategic implementation.  One of the most frequently asked questions is this: what is our role in helping to drive new growth in the firm?  

Implied in the question is the idea that they are passengers on the plane rather than active members of the team.  It is easy to see how “staff” roles like CIO, CHRO and Counsel may sense that they are in a supporting role when it comes to implementing strategy.  But the truth is that vibrant firms integrate the full range of talent at the innovation table – and that includes HR.  

Getting execution of the plan has always been hard.  We are now in a very unique time of having four active generations in the workplace, which makes the role of HR crucial.  Why is this?  In addition to the traditional challenges of getting sales to work with operations (and operations to work with product, etc.), we have the additional demographic gaps of communication styles, expectations and mindset.

Fundamentally, HR sets the team up to be able to develop and deploy talent at Internet speed.

Creating the Structure (Which is Only a Great Starting Point)

One of the first things I ask for when onboarding a new client is their org chart.  Invariably I get a sheepish response, and an apology that it’s not “up to date.”  

Having an org chart you’ve outgrown may be a very healthy sign

A truly growing firm that is challenging the status quo and creating growth is always outgrowing its org chart, because it was built to implement strategy that is anchored in the past.  As the firm was built, the org chart was set up to deliver the customer promises and benefits that were foundational at that time.   By definition, new products and services place new demands on the firm that lead to the need for new relationships, new roles and ultimately new structures.

The truth is that org charts as we know them are only indicative of a small portion of the disciplines needed for a growth machine, that being the vertical management structure of the firm.  We spend an inordinate amount of time managing the solid lines, dotted lines and counting boxes, when in fact this work is only a good start.  This is not to say that we don’t need to do it well – we absolutely need to have clear structure for decision making, solid and specific job descriptions and clear accountability for decision and budget.

But the significant truth is that customer value is developed in the white spaces between the boxes.  When you work in a firm, you quickly realize that anything of consequence gets done horizontally, or from function to function or team to team.  There is a famous approach of “stapling yourself to an order” and following the value delivery path of your firm.  It will always be a path across the chart – not up and down it.

The Rub

We humans are pattern-making machines.  We like to minimize our cognitive load on a daily basis, so we park in the same spot, buy our coffee at the same place and put our notebooks in the same spot in our backpacks.  The same thing holds for organizations: we get comfortable with them, and honestly, we resist the new demands that customers place on us to stay in that comfort zone.  

For example,  in growing firms the person who was good at accounting frequently becomes the logistics leader as the firm grows.  But what was a great set of skills for limited geographic domestic work is completely overwhelmed by the demands of international expansion and the work needed in security, taxes and treasury.  These legacy positional mismatches are quite common and need to be addressed to avoid anchoring the firm in the past.

Supercharging the Way Forward

Once the basic work is done, how do we really unlock the talent in the firm?  Simply put, how do we quickly put in a temporary organizational structure that allows people to work together in the ways that our customers are demanding of us?

This is why the cross-functional team is the tool of choice for agile and growing firms.  It’s an incredibly powerful tool that allows talent to be quickly reconfigured to take advantage of opportunity that comes upon us at Internet speed.

I’ve written a great deal on launching cross-functional teams (see here, here and here), and suffice it to say, it’s the most powerful tool in a firm to quickly deploy talent and gather value.

Ok, I Can See What You’re Saying. How Can We Help?

This is where it gets interesting.  First let me acknowledge that there is no free time that anyone in leadership has these days.  During the great recession, HR took a beating, and while it is recovering in many firms, it remains highly tasked relative to its team size.  That being said, there is so much in the daily demands of the HR leaders work that can be biased to equip the firm for growth.  

I’ll give you a set to start with, and I’m sure there are many more:

  • During succession planning, set up your talented leaders for rotational assignments into zones that will build cross-functional muscles.  Be sure there is supportive mentoring to set up learning and not frustration.
  • Establish progressive opportunities to interface with both customers and suppliers.  There is much to be learned in doing the heavy lifting of creating new relationships and resolving problems that will pay off in resilient capability down the road.
  • During performance reviews, make sure there is an evaluation on lateral management and relationship building.  Consider bringing some outside training and diagnostics work to the table.
  • When putting together new position specifications, add some emphasis on the ability to build bridges with closely-aligned organizations.
  • Help your C Team to see the need to create structure aligned with their intentions, rather than assigning existing leaders to do it “in their spare time.”
  • Highlight amazing cross-functional work with customers and suppliers in your newsletters and videos.

So if I do some or all of the above, what can I expect?  

In working with firms, when we first get high-functioning teams in place, the management team quickly sees a reduction in escalations and boundary squabbles.  The next wave of benefits start to accrue when spontaneous lateral work is accomplished which allows a team to accomplish significantly more by accessing the full richness of the backgrounds of the team members.  By allowing more work to get done with less resources, the balance sheets improve and customer satisfaction takes off.

If you sense that there is too much vertical focus in your firm, and you’d like to optimize your role in HR to get after that, we should talk.  To get started on that journey, please give me a call at 847-651-1014 or use this link to set up a 20-minute (no strings attached) consult.

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