HAVE YOU CONSIDERED? Is HR Necessary?

My management team keeps asking why we need an HR manager. They believe they carry out all the essential people management functions and are accountable for their people. They see HR as an unnecessary barrier that makes them do things they don’t think are necessary. What do you think?

The good news is your managers clearly want to take responsibility for their people. Managers often want to leave the more operational people aspects to HR which then brands human resources as an operational support function. The HR, profession has been questioning its role since the early 1950s but they are still there. There must be reason for their existence or organisations would have dropped them long ago.
Managers manage four resources: money, equipment, information, and people. The money side has been with us since day one. Without the money organisations can’t operate. Equipment is the stuff that makes the product. And this gives the manufacturing manager key place in the management team. Information is essential. The arrival of sophisticated integrated computer systems raised awareness of the importance of good, up-to-date information. That leaves the fourth resource – people. The world is beginning to discover that this might just be the most important resource of all. But because each manager is accountable for his or her “own” people they often don’t see the need for an overall “people” function in the organisation.
Managers should plan for the numbers and kinds of people they need in their area of operation. They should also link them closely with the business plan through performance management processes and by providing proper recognition, reward, and development. Managers will, however, often focus on delivering outcomes and sometimes take short cuts with people that don’t benefit the whole business. An example would be where manager has high performing employee who is ready for more complex role. manager under pressure might be tempted to keep the employee toiling in their current role. The employee becomes disillusioned and resigns.
Generally organisation size dictates whether it needs an HR manager or not. In small business, say 20 people or less, it’s more likely that the CEO and HR manager are rolled into one. The general rule suggests an organisation needs one HR person for every 100 to 120 people employed.
Consider this when you are thinking about the issue. Do you need common systems across your organisation for recruitment, induction, performance management and remuneration? If yes, who has the experience and time to develop and implement these? How does your organisation grow and develop its people? Is it better to leave it to each manager or, is there cost and efficiency benefit having someone bring this together across the whole organisation?
Ask yourself: do your managers understand their legal ‘people’ obligations? Mistakes can be costly both from legal and business point of view. Who has this experience in your organisation? And who in your organisation drives the debate about how the enterprise should be structured to deliver the business needs and behaviours that build business capability? If it is you that’s fine, but an HR manager will often have the experience required to understand these issues and bring them to the management table.

I hear lot about leadership this and leadership that at the moment. I have successfully run my business for the past 20 years. I have 120 staff and, to be honest, have never really thought about being “leader” as such. I just get on and manage the best I can and it seems to work. Why am I being urged to focus on leadership now?

I understand your reservations. Management theory is littered with fads that come and go. However, I don’t think the current interest in leadership is just passing phase. Leaders manage people and managers manage things. Both skills are necessary, often in the same person, and need to be appropriately in balance. Given the success you’ve already had with your business I suspect you are already delivering both leadership and management but may be not aware of it. You might, however, want to consider recognising the importance of the leadership role and its potential for adding increased value and reducing risk. Managers tend to be good at planning, budgeting, organising, staffing, implementing, and problem solving.
Leaders, on the other hand, communicate vision and direction, motivate and inspire people. They capture the hearts and minds of their people. Why the sudden interest in leadership? Well, New Zealand needs to generate export earnings to maintain and develop its standard of living and needs good balance of both leadership and management skills to achieve it and we don’t have very large population to drawn on. We also tend to lose talented people overseas. With the upcoming retirement of the “baby boomers” there is likely to be even greater shortage of talent around.
That’s some of the reasons why there is so much interest in developing more leaders. But have you considered how you are working in your own business to develop the leaders you’ll need to come after you?
Have you identified individuals who could take over as chief executive and other leadership roles? Have you given them the opportunity to develop their management and leadership experience and skills? Successful senior people like you need to think about developing tomorrow’s leaders.

• Kevin Gaunt, FNZIM, is CEO of NZIM Auckland and has been senior executive with, and consultant to, some of New Zealand’s largest companies. Address your problems to Kevin Gaunt or “my problem” at: [email protected]

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