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Disruptive HR

The future of the human resource profession may well depend on the abilities of its leaders to adopt innovative and entrepreneur-like approaches to its practices.

Wednesday, August 1, 2012
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Take a minute to search "disruptive HR" on the Internet. You won't find a single reference to how the HR function or HR professionals are taking disruptive initiatives to add value to the organization, its constituents and to the bottom line.

Hard to imagine, after all the years that HR professionals have been seeking the path to greater respectability as credible members of the management team, that someone wouldn't have coined the phrase disruptive HR to describe the solution. So, I'm claiming the right of first mover.

Curious, too, that the most common synonyms for disruption are all negative: troublesome, troublemaking, unruly, disorderly, unsettling, upsetting and disturbing.

In the entrepreneurial world, where I spent a good bit of my time, disruption is laudably synonymous with innovation, transformational change, displacement of the old with the new (products, processes or technologies) and creating new markets for goods and services.

In that context, disruption is a virtue to be encouraged and rewarded. The standouts who win against the odds are those who execute strategies that take solutions to a higher level, out of the realm of the tried and true, conventional, safe options usually employed by most people.

Come a Long Way

Three-quarters of a century ago, what we now call human resource management, talent management or people management had the brawny title of industrial relations. It was the era of the emergent -- and often strident -- organized labor movement.

Then came personnel administration, which garnered a bit more stature as a management function, but was used by many employers as a buffer between management and employees. I still recall, as a young consultant, the pungent smell of formaldehyde emanating from the basement research laboratory adjacent to the personnel departments of hospitals; the unremarkable personnel offices located in remote corners of manufacturing plants or otherwise sequestered on the sidelines of most businesses.

Today's human resource management function enjoys relatively more stature in the corporate hierarchy and is an amalgam of skills, functions and specialties that are gradually being transformed by technology. Indeed, in some cases, being replaced by technology. HR in a box.

Given the challenges employers face today and for the foreseeable future, it's time for more HR professionals to be disruptive -- to replace the conventional ways of managing human capital with innovative approaches that are measured in outcomes, not just output.

Over the past 25 years, I have pursued dual careers. As a consultant specializing in organization effectiveness and performance improvement, I have been retained by some of the largest and the smallest companies in the land, across all major industries.

As an angel investor and entrepreneur, I have worked with scores of aspiring and serial entrepreneurs and have partnered with many of them to push their fledgling enterprises beyond the gravitational pull of failure. The fusion of the two parallel careers has provided a special, if not unique, perspective on the caliber of HR practitioners many organizations need to compete successfully in an increasingly volatile, ruthlessly competitive environment.

Components of the Concept

As with any venture, disruptive HR begins with an attitude, guided by keen judgment and enabled by core competencies applied to a set of processes to achieve specific, measurable outcomes. The requisite core competencies include:

* Inquisitiveness and remaining open to new and better ideas,

* Critical thinking and the ability to quickly discard irrelevant information,

* Foresight to see the likely outcomes of various courses of action,

* Communication skills and the ability to engender excitement and confidence,

* Business acumen and a strong desire to continue to learn about the fundamentals of starting and growing a business, and

* Attracting and collaborating with others to execute an action plan.

The analogy for HR is the successful entrepreneur who is fanatically results-driven. Entrepreneurs live or die by their ability to create momentum and sustain it until they reach key milestones, whether it's developing and proving the concept, raising money or hitting revenue targets. Serial entrepreneurs see every setback as a learning opportunity, as markers on the path to eventual success. The word failure is not in their vocabulary.

Disruptive entrepreneurs are agile because they have to adapt to changing circumstances quickly. They are visionaries because they have to foresee market trends and anticipate threats. They are courageous because they have to be prepared to bet everything on their instincts, even in the face of opposition from respected, well-intentioned nay-sayers. They have to be collaborators because they know they need the talent and dedication of others who have complementary skills and experience. And they are astute risk-takers who are able to quickly calculate the odds and devise a plan to manage -- not necessarily eliminate -- the down side risk.

Seize the Day

The continual mantra that HR must shift from low-value transactions to higher-value strategy, combined with the nation's obsession with entrepreneurialism, creates an exciting opportunity for HR professionals to apply the principles and techniques of disruptive entrepreneurship to the management of human capital. In the truest sense, it's time to partner with other resource managers to create a competitive advantage in a fiercely competitive, rapidly changing environment.

The question is, Should HR professionals put themselves and their jobs at risk by adopting disruptive approaches to managing human capital, especially in a soft economy and a protracted period of cost reduction and cost control? I believe that, for many, the answer is a resounding yes, or face replacement or extinction.

I am not advocating recklessness or vocational suicide. Not every organization is a candidate for disruptive HR, nor does every HR practitioner have the instincts or desire to be a risk-taker. For those who are inclined, there is an approach successful disruptive entrepreneurs follow that HR professionals can emulate.

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First, plan the work:

* Identify a specific need (causes or symptoms) within the organization requiring an innovative solution.

* Gauge senior management's willingness to invest in an innovative solution that addresses the cause(s), not the symptoms.

* Define the resource requirements and assess the competition within the organization for the resources required to develop and implement an innovative solution. Don't compete for resources. Be creative in thinking of ways to share limited resources.

* Calculate the return-on-investment using reasonable assumptions and accepted financial models.

* Determine the probability of success and develop a contingency strategy if key milestones are not met.

* Define success beforehand and get agreement on the metrics that, when met, will be accepted as a win.

Keep an open mind about whether HR will continue to own the project, facilitate a handoff to another function or department, or outsource when policies and procedures are in place.

Second, work the plan:

* Prepare a concise executive summary using a format similar to the templates entrepreneurs use to introduce a concept and make the case for its viability and funding worthiness.

* Prepare a business plan -- again, using a format familiar to the other members of the management team.

* Raise capital (i.e., build alliances with internal support/investors).

* Consistently monitor and report progress against milestones.

* Be prepared to adapt to changes in circumstances and recalibrate based on new information.

An important point made previously is that disruptive HR begins with an attitude. Here are some tips on how to develop and nurture a disruptive attitude.

* Take the blinders off and get out of the human resource space periodically by attending meetings in your industry unrelated to HR and by making a special effort to learn about other management functions (I have found that the two most powerful sentences in building bridges and relationships are "Help me understand" and "How can I help?").

* Follow the trends in healthcare, economics, technology, social sciences and world affairs.

* Learn to use analytics to guide decision-making.

* Create a learning environment by requiring your staff to keep learning.

* Encourage and reward initiative and innovation.

My hope is that some time soon, I will see a seminar, web cast, conference, book or keynote speech with the title How HR Can Take Its Seat at the Management Table: A Guide to Disruptive HR.

Richard J. Anthony, Sr., is founder and managing director of The Solutions Network Inc., a Newtown Square, Pa.-based company specializing in organization effectiveness and performance improvement, and author of Organizations, People & Effective Communication. He is a member of the faculty at Villanova University, where he is also Entrepreneur in Residence at the Center for Innovation, Creativity and Entrepreneurship.

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