HR - From the Gate to the Boardroom

The role of HR has changed over the years, from being workforce ‘controllers’ to assuming pivotal and strategic roles in the business, facilitating employee success, and through them organisation success. So much so that they have literally moved from the company gates into the boardrooms

During the industrial revolution, human resource managers were called employment managers. With the changing role of HR, they have moved beyond just keeping their workforce under control. Today, they are facilitators of employee success and they utilise technology and big data to get there.

Just to look at the past... during the 1920s, jobs with the titles of ‘Labour Manager’ or ‘Employment Manager’ were introduced in the engineering and other industries which had large factories. The role involved handling employee absence, recruitment, dismissal and queries over bonuses.

During the 1930s, the economy was beginning to pick up. Big corporations in the newer sectors saw value in improving employee benefits as a way of recruiting, retaining and motivating employees. But older industries such as textiles, mining and shipbuilding were hit by the worldwide recession.

The Second World War brought about welfare and personnel work on a full-time basis at all establishments producing war materials.

By 1945, employment management and welfare work had become integrated under the broad term ‘personnel management’. Experience of the war had shown that output and productivity could be influenced by employment policies. The role of the personnel function in wartime had been largely that of implementing the rules demanded by large-scale, state-governed production.

“With the changing role of HR, they have moved beyond just keeping their workforce under control. Today, they are facilitators of employee success, and they utilise technology and big data to get there”

In the 1960s and 1970s employment started to develop significantly. At the same time personal techniques developed, using theories about motivation and organisational behaviour from the social sciences. Selection testing be-came more widely used and management training expanded. During the 1970s, specialism started to develop with reward and resourcing, for example, being addressed as separate issues.

Around the mid-80s, the term ‘Human Resource Management’ arrived from the USA. The term ‘Human Resources’ is an interesting one; it seemed to suggest that employees were an asset or resource-like machines but at the same time, HR also appeared to emphasise employee commitment and motivation. At Consensus HR, we always emphasise to clients the importance of making the most of one of your most important business assets and resources: your people.

We found many companies having HR departments at the gate or at the entrance because they needed to control the workforce and their in and out movements.

From the gate to the boardroom now... it has been a very interesting journey for the HR department and for HR professionals.

Now HR managers are often called HRBPs. HR managers are becoming business partners and their contribution and support are required by top management in business planning. The role of the HR business partner is to make sure human resource policy and procedure throughout the organisation fit the needs, goals, and aims of the organisation and its top leadership. The HR business partner ensures that HR strategy fits into the organisations’ over-all business strategy. HR professionals take an active role in helping employees advance their careers instead of simply grading employees on a checklist of performance points.

Now we will see the thin line between HR Managers and HRBP.

HR managers ensure that new hires are placed to maximise their skill sets, among other important employee management tasks. One of their most important functions is to meet with company or organisation executives to focus on strategy and planning. Meeting with top executives is useful for their important task of linking management with employees. HR managers also make sure that many important HR tasks are completed, such as managing benefit programmes, consulting with managers and sorting out staff issues.

The HR business partner’s goal is to support the business structure of an organisation by collaborating with the HR department. They have knowledge about where to place employees to their best advantage as well as have consulting advice for different members of business leadership. HR business partners have a strong knowledge about as well as experience with the business they work for, making them suitable for effective business communication.

HR in the Boardroom

HR’s role in the boardroom should be just as important as the Chief Financial Officer, Marketing Officer and Operations Officer. If you look around at some of the best companies today, you will find that they have used their HR department as strategic partners. Decisions are made by boards on the direction of the business, which impacts both employees and the future work-force requirements to support them in reaching these goals. Equally, more board directors have begun understanding the importance of having ‘people’ experience within the boardroom.

“If you look around at some of the best companies today, you will find that they have used their HR department as strategic partners. Decisions are made by boards on the direction of the business, which impacts both employees and the future workforce requirements to support them in reaching these goals”

How HR Professionals see themselves in the Boardroom

HR leaders should transform the human resources department: The human resources function must move from being viewed as merely a processing mechanism to being accepted as a key activator in sourcing and development. A new and stronger human resources function must assume the responsibility for identifying, preparing and evaluating tomorrow’s top executives, future CEOs and directors. By transforming the department, HR executives will also be transforming their own roles and highlighting that those roles should be brought into the top levels of decision making.

HR leaders should demonstrate that human resources planning is required as an intrinsic part of corporate strategy: Board members consider overseeing strategic direction as one of their primary responsibilities. Addressing human resource issues must be an integral part of any company’s strategy.

HR leaders should become key members of the top management team: Senior human resource executives must work closely with their CEO and have a deep understanding of corporate culture, plans and policies.

HR leaders should think like business executives: Human resource leaders must be more than specialised technical professionals with merely passing understanding of the corporation’s products, strategies and objectives.

HR leaders should understand market conditions: Human resource professionals can help define the executive skills and aptitudes that will be most compatible with the new markets, and the associated problems the corporation has to encounter.

HR leaders should develop international skills: The human resources executive must be capable of assessing the costs and benefits of recruiting executives on a global basis and must be skilled at international executive development.

There are many examples in the Industry where HR Professionals have reached the highest position of the organisation. But it needs to increase; they have a strong stake in getting the highest position as they deal with and develop the most valuable asset of the organisation, Human Resources.