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HR Leadership Column

Silence is Golden

Public acclaim may be lacking for HR leaders who are influential in their organizations, but their advice and guidance are crucial to the success of their companies. The achievements of an organization's talent-management program will lead to respect for the HR function. It won't happen the other way around.

Monday, March 22, 2010
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Two articles in Fortune magazine recently caught my eye. They were on different subjects, but each related to HR. What caught my eye wasn't what was covered and reported on in the articles. It was what was left out of each.

The first article was published in November entitled "CEO Swap: The $79 billion plan." It was a story recounting the succession-planning efforts at Procter & Gamble that led to the smooth leadership transition last year from A.G. Lafley, who retired as CEO, to Robert McDonald, the current CEO.

The transition was a textbook case of how it should be done, with years of talent assessment, full board involvement, a detailed communication plan flawlessly executed and minimal disruption to the business.

In the article, A.G. Lafley is quoted heavily, and given credit for his leadership efforts to ensure that succession plans were in place, that the transition went smoothly and that he left behind an organization that has great bench strength to carry the company into the future.

The second article was the feature story in Fortune's 2010 annual "The 100 Best Companies to Work For!" issue.

The article featured SAS, the company selected as the No. 1 "Best Company to Work For." SAS is a statistical software company of about 11,000 employees, based in Cary, N.C. It's been on the Best Companies list for years. It doesn't pay above the market and doesn't offer stock options, but it has a list of employee benefits that most HR executives would love to be able to offer: on-site child care, 90 percent of health-insurance premiums paid by the company, unlimited sick days, a medical center, a lending library, a fitness center and much more.

Unlike Procter & Gamble, SAS is a privately held company, mostly owned by CEO Jim Goodnight. Holding a Ph.D. in statistics, Goodnight is described in the article as "the unlikely architect of this rare corporate culture," who "says the 'wonder' isn't that his company is so generous, but why other presumably rational corporations are not."

So, what was missing?

In the P&G article, there was minimal reference to the role that HR played in making succession planning and talent management part of the DNA of the organization. While the current global HR officer, Moheet Nagrath, is mentioned in the context of maintaining the binders that hold the information on the company's top talent, there's no mention of the extraordinary effort that I know went into ensuring that the organization developed this talent intelligence and remained focused in its talent-assessment efforts.

Having a CEO like Lafley, who viewed it as a priority certainly helps, but HR execs know that there's much more to it, especially in a company the size of Procter & Gamble. It takes an extraordinary amount of communication, cajoling and collaboration across the enterprise.

Similarly, the article about SAS focused on the unique culture, with no reference to HR's role in building the culture. Here too, having a CEO/owner like Goodnight may have made things easier for the HR executives to push something, but there's also no doubt that Goodnight isn't a social engineer -- he's a smart businessman/owner, who wouldn't have agreed to any employee benefit if a case wasn't made to him on the return on the investment.

Of course, I have the benefit of insider knowledge to be able to state with confidence that there were talented HR executives making these stories possible through the great work they were doing for years.

Dick Antoine was a long-time executive with P&G, the last 10 of which were in HR, before retiring in 2008. During his HR tenure, he worked closely with Lafley to ensure there was a talent-management program in place and that the CEO succession would go smoothly.

I know that his advice and guidance was critical to the overall success of the transition. (A.J. Lafley thought so too -- he sent a letter to the reporter after the Fortune article was printed making that point, but few probably saw it posted.)

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At SAS, David Russo spent nearly 20 years as the head of HR, and was one of the key players in building the DNA of the company -- helping it earn a place on the Best Companies list for more than a decade.

He recognized the type of knowledge workforce that SAS would need and built an HR infrastructure, from recruitment and selection to retention benefits, that has enabled the company to increase revenues every year and remain profitable.

The result is employee retention averaging 10 years, with turnover in the single digits. And remember, this is a software company, where turnover is typically high.

But the failure to mention these HR executives isn't a bad thing. Skilled HR leaders such as Antoine and Russo understand that HR doesn't need to be in the forefront in order to play a critical role in an organization's success.

HR executives who constantly plead for recognition ("Why don't they respect me?", "Why can't I get some credit here?") are misguided in thinking that public accolades should be the focus of their efforts. After all, the success of an organization's talent-management program will lead to respect for the HR function. It won't happen the other way around.

HR professionals just need the credibility and the leadership competence to work closely with their CEOs and other executives to develop a shared vision for where the company needs to be and how it needs to get there.

HR's role is to guide, advise and execute the talent strategy for the organization. It's the CEO's role to take the credit when it works.

Susan R. Meisinger, former president and CEO of the Society for Human Resource Management, is an author, speaker and consultant on human resource management. She is a fellow of the National Academy of Human Resources.

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