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This responds to The Future of HR

Monday, March 7, 2011
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This article was dead on. "Hiring, retention and development -- the focus of HR executives here -- are age-old concerns. They are also quite tactical, as opposed to strategic issues." 

Even with the somewhat optimistic news that we are finally turning the edge of this recession, our focus in HR still remains tactical. That focus is not by our choice, but is due to the continuing dismal financial statements.

I don't see that changing in the near future, alas. Companies that had to slash the strategic portions of their budget probably are going to remain wary of adding extra "overhead expenses", while they are rebuilding their credibility with investors.

Judith Hummel, SPHR

Regional HR Manager

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Attached is my feedback to Human Resources Executive and Peter Cappelli regarding the article on "The Future of HR." In doing so, I offer a way for HR executives to shift from tactical to strategic issues:

It is not surprising to me that HR executives today, as it has been in the past, are concentrating on tactical issues rather than strategic ones. Though this fact reflects the reality of the current economic environment, it is inherently due to lower-power position that HR executives have in the corporate power hierarchy, in comparison to their line-oriented peers. They are typically in a support role because their work has not been seen as critical to or driving the business.

The lower-power position typically stems from the HR executive's insufficient business acumen regarding his/her company's business issues on important board, financial (income statement, balance sheet, cash flow and cost control), line department (R & D, marketing, sales, operations, manufacturing, service, I.S., materials, etc.) priorities.

A thorough knowledge of such matters allows the HR executive to interact with the CEO and his/her peers on an equal footing, while also being able to identify many key business issues of a tactical and strategic nature that the HR department can provide leadership in resolving. Even with such knowledge, it is an uphill battle because of the typically "soft" nature of many of the HR services but it is one that can be won.

To shift from tactical to strategic, HR executives should seize this opportunity to acquire the needed knowledge of the company's business issues and cultivate a more business-like relationship with the CEO and his/her peers.

In doing so, he/she understands these business issues in some detail. In the process, he/she can be identifying the specific business issues in which HR can provide some tactical services to help overcome the issue. In doing so, line and HR metrics can be used to demonstrate ultimate success.

In today's economic environment, identifying cost control and productivity improvement projects in most or all of the above line departments seems appropriate.

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While the tipping point is probably at hand and much of the HR innovation coming from HR vendors, this may be the HR executive's last big chance to make the shift from tactical to strategic because of the importance of these tactical issues to achieve improved profitability and cash flow during a difficult financial time. With improved tactical results and a better business-like relationship with the CEO and his/her peers, more strategic HR thinking can occur in the future that is perceived as valuable to all.

In my view, the most important strategic issue for any company, whether in a mature or developing country, is to provide a pragmatic pathway for executive-management continuity and development. Individualized-development plans and executive-management education on the key line-management functions (market/product planning, financial management, risk management, customer retention, etc.) -- not leadership training -- is sorely needed and desired by executive management with upward potential.

This matter is strategic in nature because it must be pursued continuously over a number of years before a sufficient supply of qualified executive management personnel exists, e.g. GE.

The biggest question is whether the current cadre of HR executives across the country is up to the challenge, both collectively and individually. If they are not, HR is doomed to an existence of support and insignificance.

Jack Bucalo

Retired CHRO for a Fortune 500 company

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