Do We Need HR? Repositioning People Management for Success

Citation

Muhammad Faisol Chowdhury (2016), "Do We Need HR? Repositioning People Management for Success", Employee Relations, Vol. 38 No. 2, pp. 304-306. https://doi.org/10.1108/ER-11-2015-0209

The book Do We Need HR? Repositioning People Management for Success is written by Paul Sparrow, Martin Hird, and Cary Cooper which is based upon their own research and interviews with HR professionals. The book addresses a series of strategic performance drivers that organisations continue to grapple with. The drivers they review include people management through innovation and customer centricity; lean management and its affect on organisational effectiveness, and strategic talent management for creating value in HR. The main argument of the book is that HR needs to understand the implications of these important performance drivers if it is to make the wisest and most effective choices about the capabilities it needs and where it should invest its resources.

The book contains eight chapters which lay out the argument and discussion on involvement of HR with people-centrism, innovation, lean management, and talent management which are intertwined with organisational effectiveness, sustainability, and growth. The opening chapter discusses “research and innovation” and “business model innovation (BMI)” processes, and challenges associated with managing these processes. BMI is viewed as especially valuable in times of organisational instability. It can provide companies a way to break out of intense competition under which product or process innovations are easily imitated, competitors’ strategies have converged, and sustained advantage is elusive. However, this process of innovation is highly people-centric, and HR has to develop appropriate organisational design and culture to manage innovation and subsequent changes. The authors have thereby suggested six component HR strategies for innovation. The following chapter discusses “Customer centricity” as another performance driver. It is a relatively new term that suggests doing business according to needs, wants, and resources of individual customers rather than those of mass markets. “Customer-centricity” means to focus on the right customers for strategic advantage, to look at a customer’s lifetime value, and to focus on the marketing efforts appropriately. In the world of customer-centricity, on one side there are good customers, and on the other, there is pretty much everyone else. This “good customers” segment is the “high-value” customer that drives profit. Being “customer centric” is often confused and debated with being “customer focused” which means offering a consistently great and relevant experiences to customers, or used in parallel with similar fads like “service quality”, or “customer is always right”. In this argument the authors have skilfully attempted differentiating “customer centricity” with other types of customer service-oriented discourse to further aid the devalued concept to regain its position. They also have suggested six elements of “customer centricity” that may have significant implications for the delivery of HR. Although challenging, the authors poised that HR can provide broader support to the organisations’ multiple stakeholders by being a critical success factor in implementing a customer-centric strategy.

Discussion on HR’s link with lean management in chapter four shows that lean systems cannot be practiced without carefully attending to a number of HR issues. For example, lean management is closely intertwined with people management, and so, sustainability factors of lean management greatly depend on proactive HR practices and appropriate knowledge management. It is perhaps correct to regard knowledge management and intellectual capital as twins – two branches of the same tree. HR has to establish specific knowledge portfolios about lean management that it then has to manage. There also needs to be a significant change to the HR architecture in order to assist the organisation in the pursuit of lean thinking. Similarly, HR needs specialised knowledge about people management challenges that have to be addressed when implementing lean management. Another view is suggested in the following chapter, which says that HR functions need to move from managing the employment relationship in the owned entities to which they belong, to managing the quality of people and organisational management across the whole network of strategic partners. Thus comes the considerations of “servitisation”, where manufacturers add services to their value-chain to develop more integrated solutions; “networked organisation”, where different categories of connections among firms are established; “projectification” of firms, and “inter-dependence” of HR across many organisations and sectors. Nevertheless, all these arrangements are complicated and problematic to manage, perhaps sometimes impossible to attain, or may not be feasible for many organisations. With some examples the authors have made an attempt to show how HR can examine these complications and challenges. A trust-based governance and learning and knowledge sharing culture across all partners can offer a collaborative business model through which organisations create, deliver, and capture economic, social, or cultural value.

Chapter 6 highlights some perspectives of organisational fairness which address organisational justice, equity in executive pay, involvement of women on boards, pension problems, and stress management issues. Although it is sensible to read, the discussion appears to be a little inadequate and ordinary in times. Moreover, many studies in the past several decades have demonstrated that employee stress and organisational well-being, engagement, and fairness have profound impact on organisational productivity and performance. A wealth of materials is already available on these topics where numerous researchers have provided their opinions and suggested various models based on empirical studies. From this angle, this chapter does not seem to show an essential HR guideline, or suggest something new about these topics.

Perhaps “talent management” is the most widely discussed HR term in today’s hyper-competitive and increasingly complex global economy. Wide variations exist in how the term is defined across different sectors, and how organisations may prefer to adopt their own interpretations rather than accepting universal or prescribed definitions. The authors, in the last two chapters, define and discuss talent management in a much broader sense, so that it becomes evident that managing and retaining talents becomes the only true competitive advantage any organisation can possess. Talent management has always been an important concern for organisations. However, the authors believe that organisations must be careful not to rush into implementing initiatives or programmes that are more about taking action than about implementing a well-crafted solution. A careful blend of “people” and “practice”, culminating in a sound talent strategy that is tightly connected to the organisation’s overall business strategies and business needs, is required for talent management to become ingrained in an organisation’s culture and values.

We know what HR does, but what does it deliver? In answering this the authors have posit that much of the “strategic” element no longer needs to belong to HR. There are six performance challenges organisations need to solve: productivity, innovation, customer centricity, lean delivery, global capability, and data-driven analytics. These are all cross-functional problems and sit above the HR function. The authors demonstrate the present picture of what new lean HR structures might look like, arguing that in the tough current environment, HR could be facing diffusion or even disintegration as a result of new types of organisational design, business knowledge, and cross-functional networks. However, the authors’ attempt to change and reposition the current nature of HR through these six specific performance drivers could perhaps be argued or debated by those who subscribe to some other long-lasting and established HR models (e.g. by Ulrich or Lepak and Snell). The book also seems to be a little bit overly-focused on talent management issue, repetitive in places, and overly concerned with explaining the benefits and challenges of people management and linking talent management with the performance drivers. Besides, the readers may feel that the book somewhat confines the functions of HR within these performance challenges, whereas, there are other factors and functions dealt by HR that can also steer the business performance, which have been left out of the discussion.

Do we need HR? Yes, of course, if value becomes the bellwether for HR. But at the same time it is to remember that, HR value creation requires a deep understanding of external business realities and how key stakeholders both inside and outside the company define value. From that angle, the authors indicate a HR shift away from silo roles to a hybrid model which seems practical. The book contains many thought-provoking questions, practical examples, and solid recommendations throughout, so the content is highly applied and relevant to the contemporary HR and business practices. The discussion also transitions over the chapters seamlessly and cohesively. In conclusion, this book can be a strong source of wisdom and foresight for people to understand the current and future need of HR to ensure organisational success. Indeed, Do We Need HR: Repositioning People Management for Success is undoubtedly an interesting read, not only for the HR researchers and practitioners, but also for university students, non-HR business managers, or anyone who appreciates a good book!