What Do The New Human Resource Managers Do? (Gary Dessler)

For much of the twentieth century, “personnel” managers focused mostly on day-to-day activities. In the earliest firms, they took over hiring and firing from supervisors, ran the payroll department, and administered benefits plans. As expertise in testing emerged, the personnel department played a bigger role in employee selection and training. New union laws in the 1930s added, “Helping the employer deal with unions” to its list of duties. With new equal employment laws in the 1960s, employers began relying on HR for avoiding discrimination claims.

Today, employers face new challenges, such as squeezing more profits from operations. They expect their human resource managers to have what it takes to address these new challenges. 

Let’s look at 10 things today’s HR managers do to deal with these challenges.

THEY FOCUS MORE ON STRATEGIC, BIG PICTURE ISSUES First, human resource managers are more involved in helping their companies address longer-term, strategic “big picture” issues. We see that Strategic human resource management means formulating and executing human resource policies and practices that produce the employee competencies and behaviors the company needs to achieve its strategic aims. The basic idea behind strategic human resource management is this: In formulating human resource management policies and practices, the manager’s aim should be to produce the employee skills and behaviors that the company needs to achieve its strategic aims. So, for example, if you want the CEO to focus on boosting profits, tie his or her incentive plan to the company’s profitability.

We will use a model to illustrate this idea, but in brief the model follows this three-step sequence:

Set the firm’s strategic aims → Pinpoint the employee behaviors and skills we need to achieve these strategic aims → Decide what HR policies and practices will enable us to produce these necessary employee behaviors and skills.

THEY USE NEW WAYS TO PROVIDE HR SERVICES To free up time for their new strategic duties, today’s human resource managers deliver their traditional day-to-day HR services (such as benefits administration) in new ways. For example, they use technology such as company portals so employees can self-administer benefits plans, Facebook recruiting to recruit job applicants, online testing to prescreen job applicants, and centralized call centers to answer supervisors’ HR related inquiries. IBM’s employees use its own internal social network site to “create personal profiles similar to those on LinkedIn . . . share files, and gain knowledge from white papers, videos, and podcasts.” Table illustrates how employers use technology to support delivering human resource management activities.

THEY TAKE A TALENT MANAGEMENT APPROACH TO MANAGING HUMAN RESOURCES With employers pressing for improved performance, one survey of human resource executives found that “talent management” issues were among the most pressing ones they faced. Talent management is the goal-oriented and integrated process of planning, recruiting, developing, managing, and compensating employees.42 It involves putting in place a coordinated process for identifying, recruiting, hiring, and developing employees. For example, we saw that IBM split its employees into three groups, to better coordinate how it serves the employees in each segment.

THEY MANAGE EMPLOYEE ENGAGEMENT Improved performance means you need your employees to be engaged. The Institute for Corporate Productivity defines engaged employees “as those who are mentally and emotionally invested in their work and in contributing to an employer’s success.” Unfortunately, studies suggest that less than one-third of the U.S. workforce is engaged. Today’s human resource managers need skills to manage employee engagement.

THEY MANAGE ETHICS Regrettably, news reports today are filled with managers’ ethical misdeeds. For example, prosecutors filed criminal charges against several Iowa meatpacking plant human resource managers who allegedly violated employment law by hiring children younger than 16. Behaviors like these risk torpedoing even otherwise competent managers and employers. Ethics means the standards someone uses to decide what his or her conduct should be. Many serious workplace ethical issues—workplace safety and employee privacy, for instance—are human resource– management related.

THEY MEASURE HR PERFORMANCE AND RESULTS Perhaps most notably, the pressures of global competition forced human resource managers to be more numbers oriented. Several years ago, IBM’s Randall acDonald needed $100 million to reorganize its HR operations. He told top management, “I’m going to deliver talent to you that’s skilled and on time and ready to be deployed. I will be able to measure the skills, tell you what skills we have, what [skills] we don’t have [and] then show you how to fill the gaps or enhance our training.” Human resource managers use performance measures (or “metrics”) to validate claims like these. For example, median HR expenses as a percentage of companies’ total operating costs average just under 1%. On average, there is about 1 human resource staff person per 100 employees. To compare their own companies to others, human resource managers obtain customized benchmark comparisons from services such as the Society for Human Resource Management’s Human Capital Benchmarking Service.

THEY USE EVIDENCE-BASED HUMAN RESOURCE MANAGEMENT Basing decisions on such evidence is the heart of evidence-based human resource management. This is the use of data, facts, analytics, scientific rigor, critical evaluation, and critically evaluated research/case studies to support human resource management proposals, decisions, practices, and conclusions. Put simply, evidence-based human resource management means using the best-available evidence in making decisions about the human resource management practices you are focusing on. The evidence may come from actual measurements (such as, how did the trainees like this program?). It may come from existing data (such as, what happened to company profits after we installed this training program?). Or, it may come from published research studies (such as, what does the research literature conclude about the best way to ensure that trainees remember what they learn?).

THEY ADD VALUE The bottom line is that today’s employers want their HR managers to add value by boosting profits and performance. Professors Dave Ulrich and Wayne Brockbank describe this as “The HR Value Proposition.” They say human resource programs (such as screening tests) are just a means to an end. The human resource manager’s ultimate aim must be to add value. “Adding value” means helping the firm and its employees improve in a measurable way as a result of the human resource manager’s actions.

THEY UNDERSTAND THEIR HUMAN RESOURCE PHILOSOPHY Peoples’ actions are always based in part on the basic assumptions they make; this is especially true in regard to human resource management. The basic assumptions you make about people—Can they be trusted? Do they dislike work? Can they be creative? Why do they act as they do? How should they be treated?— together comprise your philosophy of human resource management. And every personnel decision you make—the people you hire, the training you provide, your leadership style, and the like—reflects (for better or worse) this basic philosophy.

How do you go about developing such a philosophy? To some extent, it’s preordained. There’s no doubt that you will bring to your job an initial philosophy based on your experiences, education, values, assumptions, and background. But your philosophy doesn’t have to be set in stone. It should and will continually evolve as you accumulate knowledge and experiences. For example, the personnel philosophy at Hon Hai’s Foxconn plant seems to have softened in response to its employees’ and Apple’s discontent. In any case, no manager should manage others without first understanding the personnel philosophy that is driving his or her actions. One of the things molding your own philosophy is that of your organization’s top management. While it may or may not be stated, it is usually communicated by their actions and permeates every level and department in the organization. For example, here is part of the personnel philosophy of the founder of the Polaroid Corp., stated many years ago:

To give everyone working for the company a personal opportunity within the company for full exercise of his talents—to express his opinions, to share in the progress of the company as far as his capacity permits, and to earn enough money so that the need for earning more will not always be the first thing on his mind. The opportunity, in short, to make his work here a fully rewarding and important part of his or her life. Current “best companies to work for” lists include many organizations with similar philosophies.

For example, the CEO of software giant SAS has said, “We’ve worked hard to create a corporate culture that is based on trust between our employees and the company . . . a culture that rewards innovation, encourages employees to try new things and yet doesn’t penalize them for taking chances, and a culture that cares about employees’ personal and professional growth.” Sometimes, companies translate philosophies like these into what management gurus call high-performance work systems, “sets of human resource management practices that together produce superior employee performance.” For example, at GE’s assembly plant in Durham, high-precision aircraft parts.

THEY HAVE NEW COMPETENCIES. Tasks like formulating strategic plans and making data-based decisions require new human resource manager skills. HR managers can’t just be good at traditional personnel tasks like hiring and training. Instead, they must “speak the CFO’s language” by defending human resource plans in measurable terms (such as return on investment). To create strategic plans, the human resource manager must understand strategic planning, marketing, production, and finance. (Perhaps this is why about one-third of top HR managers in Fortune 100 companies moved there from other functional areas.) He or she must be able to formulate and implement large-scale organizational changes, design organizational structures and work processes, and understand how to compete in and succeed in the marketplace.

Source : Gary Dessler. Fundamental of Human Resource Management. Third Edition. Pearson. 2014

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