Rebooting HR

Over at MiX, (here), Luc Galoppin posted an excellent blog that succinctly summarises some of the inherent problems and contradictions present in most HR departments. These can be summarised by HR’s ongoing desire for a seat at the top table and to be seen as a key driver of organisational strategy and change that have been top of the HR agenda since the publication of Dave Ulrich’s 1997 book Human Resource Champions (here).

One of Galoppin’s key assertions is that rather than an agent for change, which many HRD’s like to see themselves as (being able to design, implement and promote organisational change programs). HR is in fact naturally much better placed to act as a stabilising force within the business, as he states an agent of continuity during periods of change. Galoppin states:

“In short, HR does not posses the skills that are required to manage change initiatives. Instead, HR’s strength is that of a ‘Continuity Agent’, a stabilizer if you will.”

This makes sense when one considers HR’s traditional strengths such as developing systems and outlining processes and best practice. On the other hand, to be an active proponent and driver of change requires a much more disruptive and experimental approach, not natural attributes one would think of when describing most HR professionals.

The Ulrichian logic that the best way for HR to increase its influence is by being at the heart of decision-making and having greater influence over strategy and decision-making is according to Galoppin the wrong way for HR to think about its position within the business.

All is not lost however and Galoppin charts a three-step process that could help improve matters. By focusing on developing credibility and embedding HR within the business rather than an independent support function, things can change:

“The third step for HR is empowering the business by outsourcing the core part of their activities … to the business. Whereas step 1 may include the outsourcing of administrative tasks to a shared service center, this step will require a handover of activities to the business. That way, HR processes get managed where they live and exist: on the shop floor among the people.

Only by abdicating power and embedding HR practice directly within the business can HR prove its value. For many HR professionals still committed to the idea of a seat at the top table, this is unlikely to go down well. Many HRDs argue that to be influential they need to have control over all these people issues, when in actual fact the opposite is true. For HR to be seen to add real value to the organisation, the HR department needs to devolve as much control as possible.

It is however important to emphasise that the current predicament is not solely down to the inability of HR departments to demonstrate value. In many cases senior executives are guilty of failing to appreciate the complexity and importance of human behaviour, relationships and collaboration when it comes to organisational performance. As Galoppin puts it:

“The attitude in most projects is exemplified by this statement: "We’ll take care of the process re-engineering and the technical stuff; HR will do the soft stuff."”

The compartmentalising of the “soft stuff” is a very damaging attitude to have and highlights why many change projects are doomed to failure from the start. What many senior executives fail to appreciate is that it is actually the intangible people-side of things that is the hardest and most complex element of any change program that cannot be effectively sub-contracted to HR. In fact it can be argued that people-based issues represent the greatest risk to the success of any project. For this mindset to change, arguably it is going to require more than HR to prove its value, instead it will require senior executives to prioritise the naturally intangible, woolly and complex issues that surround the behavioural aspects of change.

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Steve Jobs – Culture and Innovation

Amidst all the comment about last week's announcement from Steve Jobs, many commentators have been in a rush to speculate on the future for Apple and the key elements of Jobs’ legacy.

Although it is far too early to fully appreciate how Apple will deal with the departure of it’s charismatic chief executive, amidst all the chatter and hyperbole there are some interesting viewpoints emerging that have focused on Jobs’ ability to achieve what so few leaders ever manage, the ability to develop and maintain a strong organisational culture.

In fact it can be argued that Jobs’ greatest achievement has been his ability to meld Apple’s organisational culture and commercial strategy into a clear set of core values that are well understood by everyone throughout the organisation.

A couple of excellent blog posts from HBR have touched on this. Firstly a post by Horace Dediu (here) and a second piece by James Allworth, Max Wessel, and Rob Wheeler (here) both discuss the importance of Apple's consistent culture.  

Unlike many CEOs, Jobs has not been afraid of placing something as intangible and tricky as culture at the heart of his decision-making at the expense of the more tangible metrics and quarterly numbers that cause so many other CEOs to lose sleep. It doesn’t matter how you feel about some of Apple’s practices and they certainly polarise opinion, they are consistent and crucially innovation has come about through a willingness to experiment internally and seek disruption that may come at the expense of existing product lines.

Jobs has also been able to take advantage of his position of company co-founder in being able to dictate Apple’s culture. There is no doubt that this has helped Jobs habituate his own behaviour into the mindset of Apple employees.

The paradox is that by making his own personal imprint on the culture so absolute, Jobs has probably gone as far as possible to ensure that Apple is in the best shape possible to prosper in the future. In fact the key danger facing Apple in the medium term is likely to come from events that may dilute the existing culture. For example, a large acquisition may hold more dangers than would ordinarily be perceived. For the medium term however, it would appear that Apple is well placed to flourish, not because of Jobs' brilliance as an individual but the collective values he has been able to instill in the organisation.

 

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Gary Hamel – Reinventing Management

For those not familiar with Gary Hamel’s work (there can’t be that many), there is a great short presentation over at HBR (here). This makes a good listen, touching on many of the ills inherent in early twenty-first century organisational behaviour.

Hamel is nothing if consistent in his criticism of traditional management practice, particularly its potential for negative impact in today’s knowledge based economy. I believe that he is right in his assertion that management by command and control inevitably leads to a “race to the bottom” at exactly the time when long-term prosperity is going to require a move in the opposite direction with the emphasis on innovation and agility.

I have no doubt that Hamel is right in his assertions. However with all structural changes, things are easier said than done. This is especially true for any initiative that looks to change organisational culture or values. Furthermore, the lack of credible change agents (I’m thinking about you HR!) make Hamel’s vision all the more difficult to achieve. Thinking about it, radical change is also unlikely to come from senior management in organisations, who in the majority of cases owe their success to these outdated methods that are by now hard wired into their brains.

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Getting the Right Numbers

The trailer came out recently for a new Brad Pitt movie (here), Moneyball, an adaptation of Michael Lewis’ book about the rise of the Oakland A’s baseball team, where General Manager Billy Beane was temporarily able to use innovative statistical analysis of players performance to gain an advantage over the opposition. Unfortunately for the A’s the benefits lasted only until the other teams caught on and started using Beane’s methods.

The use of data and statistics to understand performance in professional sport is not new and as technology improves the options to develop a sophisticated insight into performance increases. This has led to more and more teams hiring professional statisticians to develop a deeper understanding of the fundamentals of success on the field. At the forefront of this trend English football teams are making significant investment in technologies that enable the breakdown of the minutiae of the action on the pitch, this trend was recently documented in the Financial Times by Simon Kuper (here).

Whereas applying statistical analysis to baseball is a relatively straightforward process, the nature of the game makes it well suited to breaking down into to easily digestible chunks. Clearly, football is more complex, there are far more variables involved and the outcomes of different actions are less clear cut, however this increased complexity doesn’t mean that statistical analysis can’t work. Interestingly, what the analysts at football clubs are discovering is that the most obvious indicators of individual performance have little bearing on outcomes. Instead, a more sophisticated understanding of the game is required.

Kuper discusses this in terms of the evolution of statistics and analysis over the past 15 years, where clubs have moved on from looking at the more obvious indicators such as the distance covered covered by a player over the course of a match, where there is little correlation between the amount of running or effort a player puts in and results to more subtle but perhaps more meaningful indicators such as the amount of distance covered at maximum speed, which may have a greater correlation with positive outcomes.

Furthermore, there are many more variables in football that are harder to measure such as the ability to run into and find space and other aspects of positional awareness that are much more intangible than a completed pass or tackle which can be easily catalogued. For me the most important development cited by Kuper is a short sentence that indicates a potentially very interesting new avenue of analysis;

“And football’s data revolution has only just got going. Fleig thinks there is an exciting future in sociograms: who passes to whom, who tends to start a team’s dangerous attacks?”

By analysing the interaction of players and the role of team composition on performance, we can begin to move away from focusing on individual performance or excellence and instead begin to understand the much more important role of collaborative performance. What is really important in a team sport such as football is not who your best individual players are but what combination of players is best suited for a particular game. It is easy to measure who scores the goals, who has the hardest shot, who has the greatest athletic ability, makes goal saving tackles etc. What is key is to understand the effect of different players playing together has on the overall performance. For me, this understanding goes way beyond the football pitch and ultimately to the heart of organisational behaviour.

If Moneyball has taught us anything it is that it is possible to punch above your weight and compete against bigger, better funded and more powerful competitors. What this boils down to is the ability to create teams that perform at a far greater level than the sum of their individual parts.

Unfortunately the current reality is that most organisations are still tied to measuring performance in terms of individual behaviour and actions, what they need to do is take a leaf out of these football clubs and begin to analyse the social element of performance. By continuing to focus on the individual rather than what factors govern collective performance, organisations will remain stuck with the numbers that have little or no correlation to success. Unfortunately as has been proven on the football pitch, having a team of highly paid superstars is no guarantee of success.

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Creating Sustained High Performance

Ilaria Vilkelis gave us a nice write up on her blog yesterday when she spoke about success in an uncertain economy. The part of her piece that really struck a chord with me was this section on exploring the space that exists between people.

At the end of the day in a very uncertain environment the most important asset of any organization lies within its team; and the team’s commitment and sense of mission, its resilience and especially the chemistry between team members: for sustained high performance the space between people often matters most than people themselves.

In the past these inter dynamics where hard to predict and you could benefit only from the wisdom of hindsight. Experience and gut feelings were possibly all we could count on. Thankfully we have new tools coming on the market that can help.

Thanks to Ilaria who has put her finger on the gap that we try to address at Four Groups. As we have often said ourselves, the quality of people's relationships can account for anything between 20 - 40% of performance. In a startup situation (Ilaria's speciality), one suboptimal relationship can spell disaster for a fledgling venture.

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The Apprentice: A rocky road ahead?

Those in the UK will no doubt be aware that last Sunday saw the finale of The Apprentice, where the nerdy inventor Tom Pellereau triumphed over the hyper-organised and arguably more capable Helen Milligan (here).

In contrast to previous series’, where the winners were “rewarded” with a job at one of Lord Sugar’s subsidiaries, this time round the prize was the opportunity to go into business with the peer as a 50/50 partner.

Out of curiosity, let’s see what lies in store for this particular partnership:

Starting with the 4G profiles, although there should be a caveat that we cannot say for sure what someone’s profile is without first taking the 4G questionnaire, we can make an educated guess in this case.

Tom’s profile would seem to be 1Ti, this means he is naturally curious and innovative, likely to be at his best when given freedom and few organisational constraints. He is also analytical and enjoys acquiring specialist knowledge of subjects. Furthermore, Tom is likely to seek out situations which are undefined or where the variables and outcomes are unknown.

This contrasts with Lord Sugar’s likely 4G profile of 3Se. This means that he is primarily focused on the here and now. He is also likely to be much more drawn to dealing with practical and tangible issues as well as searching out for quick and tangible returns.

From first glance we can see that both individuals are quite distinct from the other and for many this would indicate that both individuals bring contrasting yet complementary skills to the table. So what happens when 1Ti and 3Se come together to start a new company?

We know by using 4G that this gives us a Relationship of Discovery. The key aspect about this particular relationship are the high expectations of productivity at the beginning of the relationship, yet as time goes on it becomes harder for both partners to reconcile their own interests and motivations.

It is these high initial expectations that often lead to problems as both partners exert more and more energy in terms of trying to understand and effectively collaborate with their colleague. Inevitably this can lead to a certain level of dissatisfaction as the relationship fails to yield the productivity that was initially envisaged.

In terms of specifics, within this relationship problems are likely to come if Tom feels under pressure to compromise or not fully develop his ideas because of time or other pressures. Likewise he may find that Lord Sugar is making decisions in a hasty or rash manner.

From Lord Sugar’s perspective, his frustration is likely to come from situations where he believes Tom fails to seize the commercial initiative or takes too long to develop or perfect his ideas. A further source of frustration may also arise if Lord Sugar believes that Tom has not done all that is imaginably possible to maximise the returns from a certain product or service.

In terms of contextualising this information, clearly there is a seniority dynamic at play here which means that the pressure will be on Tom to adapt more to Lord Sugar’s natural working style than the other way around. Likewise a key issue is the amount of contact between individuals on a daily basis. Close personal contact is likely to result in frustration and disagreement, whereas a more “arms length” relationship may in the long-term prove more productive.

In summary, here is what we would suggest to Tom and Lord Sugar; firstly don’t expect too much from the personal relationship, this means that the composition of the team is likely to be particularly important in terms of making this venture work. Finally, both partners need to be aware of the natural dynamics of this relationship and understand that it will be very difficult for either individual to fully adapt to their partner’s natural working style.

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Leadership, Intangibles and Talent Review Q4 2010

Welcome to the final round-up of 2010. In this issue we have brought together an assortment of provocative articles focusing on;

Featured in this issue are articles from: Steven Johnson, John Hagel, Peter Senge, Richard Donkin and examples include HCL, the NHS, Minnesota public schools and the Roman Empire!

Leadership, Intangibles & Talent Q4 2010 - Four Groups.pdf

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Leadership, Intangibles & Talent Q4 2010 - Four Groups.pdf

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Social Cognition Research Initiative

Stowe Boyd is starting a long-range research initiative into Social Cognition. The main thrust seems to be around;

  • Clarifying the elements of social cognition like learning, performance, decision making, affiliation, sense making, and others.
  • Assimilating research from anthropology, sociology, cognitive science, linguistics, behavioral economics, media studies, education, and basically anywhere else that sheds light on social cognition, and interviewing the researchers to get them to extrapolate on their results, especially in the context of the social business.

It will be interesting to keep an eye on it. Good luck Stowe!

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Prediction is important, if not vital

Being able to predict things, in business and elsewhere is critical. We don't always get it right, but understanding the variables and relationships between 'inputs' and 'outputs' goes a long way to creating a positive outcome.

In terms of Enterprise 2 and related Social Business software, this point is key and is the subject of a post (and a good few comments) by Keith Swenson, entitled Social Has No Future (Yet). Here's the opening paragraph.

This provocative title simply means: In general, social software systems record what is happening now and in the past, but for the most part completely lack any representation of the future. Enterprise Social Software, or Social Business Software, will succeed only if it has some representation of goals or other future activities.

While Keith goes on to talk about other aspects of social software, this initial point is the critical one in my mind. Without the ability to make predictions, the range of problems that can be solved is dramatically reduced.

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2011, a Year of Relationships?

Ross Dawson has a view of both next year and the next decade. Amongst the trends, relationships are becoming more and more significant (if they weren't already!) and given the increased use of social media tools, this is only likely to increase.

The two relational extracts from the post;

GLOBAL TALENT. Talent is everywhere. As organizations shift to networks, transcending workplaces, success will be driven by how well they can attract the most talented, those who can choose where, how, and why they work. Real-time translation software will enable true multi-cultural teams. Wealth will flow to the talented, wherever they are.

ORGANIZATIONS TO NETWORKS. By the end of this decade close to half the workforce will be working independently, often across national boundaries. Companies will function on social networks and gaming platforms, professionals will work for many clients, and many of today’s companies will be supplanted by networks of experts.

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