From HR to the Front Lines

However connected to the business an HR leader may be, transitioning to a line-management role presents challenges that all human resource executives must consider before making such a leap.

Tuesday, June 17, 2014
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Between December 2010 and December 2011, EarthLink Inc. closed on the acquisitions of seven different companies.

"It was a very acquisitive time for the company, to say the least," says Stacie Hagan, then the Atlanta-based IT services, network-and-communications provider's chief people officer.

Hagan previously spent four years as EarthLink's vice president of human resources. Throughout her tenure in HR with the organization, she "always reported directly to the CEO, and I always knew I wanted to get deeper into [line] management," says Hagan, who is now EarthLink's executive vice president of customer operations.

She also served as an officer of the company and as a key member of an executive-level steering committee assembled to direct and oversee the work of all functional areas throughout the acquisition process, she says.

"We did not intend to run any business as an independent business unit. We organized functionally, and adopted the ELNK name [Earthlink Holding Corp.], etc., upon the day of close in each case. So, my role involved guidance and oversight of operational and tactical decisions as we brought the companies together."

For instance, she oversaw the effort to integrate thousands of new workers as the company's employee base mushroomed seemingly overnight.

"We went from 550 employees to about 3,300 in about four months. We had massive integration issues to look at, and it became very apparent to me that we needed to address process functions. So, the first thing I did was develop a process-improvement function. That got me deeper into the business."

While still in HR, along with the small team of Six Sigma-certified process experts reporting to her, Hagan set about defining and documenting a new and consistent process for filling orders, from creating quotes for customers to order management and invoicing. 

Hagan's HR expertise was a chief reason why she was selected for the steering committee, and to lead the process-improvement effort. And, upon stepping into her current role last year, she quickly found her human resource experience and her close connection to the EarthLink leadership team had prepared her well for leading the customer-operations unit.

"I was lucky," she says, "because I always reported to the CEO. And I always enjoyed understanding the business and the execution of our strategy. So [HR] was a good bridge for me; I learned a lot about being a better business person."

Overall, Hagan considers her transition to have been a relatively smooth one. But, while the strengths of a quality HR leader may closely mirror those of a business unit leader, any HR professional can expect to encounter a host of new challenges -- and develop new skills -- in making the leap to line manager.

Transferable Skills

A good HR leader is "really a general manager," says Lauren Doliva, a San Francisco-based global managing partner of Heidrick & Struggles' human resources officer practice and managing partner of the firm's Chief Advisor Network.

"Anyone going from HR to a general-manager or line-manager role should come with certain areas of depth and experience," says Doliva. "The CHROs need vision as they anticipate future direction and build the business through the shape of the talent. Most often, the biggest expense in business is the cost of acquiring, compensating and retaining employees, so understanding the financial impact and budget implications of ensuring [you have] the best talent is critical."

Line leadership requires "baseline competence" in a number of areas, says Dave Ulrich, professor of business at the Ross School of Business at the University of Michigan in Ann Arbor, Mich. 

For example, "success requires financial, marketing, operational and analytical disciplines," he says. "While HR professionals may never become [masters] in these areas, they have to be fully conversant."

That said, "line managers get derailed less by technical inadequacies than by social ineptness," says Ulrich, who adds that these "social failures" may stem from a lack of self-awareness and social-networking skills.

"Top HR professionals should have a predisposition for these skill sets," says Ulrich. "If and when they move into line-management roles, they bring personal and social skills that should help them succeed."

Hagan, who oversees approximately 1,100 employees, recognized one particular area she needed to improve in, but quickly found the network she had established in HR was handy in finding a source for the necessary knowledge.

"We sell and install network service. We provide IT cloud services," she says. "I have a very technical group of people in installation and repair. So I needed to learn enough about the technical [nature] of our unit to speak the language.

"So, early on I called our vice president of network operations, Greg [Collins], and said, 'I need Network 101 class.' So, now we have this conversation [about new technological developments] from time to time, at increasingly deep levels of detail."

And, from an HR standpoint, "understanding effective organizational design, [and] how to assess skills and match the right people to the right jobs," have been invaluable in her new position, she adds. "All those skills are very applicable to leading a group of people this size."

Financial Know-How

Human resource executives' core strengths should, indeed, serve them well in a line manager position, but there are still hurdles to overcome.

Lisa Calicchio knows how daunting those challenges can seem.

Calicchio, vice president of flexible solutions at Covance Inc., a Princeton, N.J.-based biopharmaceutical-development-services company, has held that role since February of this year.

In the new role, Calicchio oversees a $100-million-plus unit that provides resource- and deliverables-based services to clients globally, and comprises nearly 1,000 employees in more than 45 countries.

Before that, she spent nearly two decades as an executive coach and HR leader, including roles as Covance's vice president of corporate partner HR, vice president of HR generalist services, vice president of global recruiting, and leader of the organization's HR Employee Relations Center of Expertise, which encompasses more than 50 HR generalists across 15 countries.

While she had managed budgets and resources in that capacity, Calicchio was initially concerned about her lack of deep financial acumen going forward in her new role.

"The first thing that hits you in the face is, when you have margin and revenue targets to meet, it's very concrete," she says. "You meet them or you miss them.

"It's very real and it's black and white," she adds. "The pressure is there, and it's there every day.

"I understand profit-and-loss basics," Calicchio says. "But when you're running a business unit, the amount of numbers and metrics coming at you can be overwhelming."

Indeed, this adjustment is typically one of the most difficult in transitioning from HR to line manager, says Kim Shanahan, senior client partner and managing director of Los Angeles-based Korn Ferry's Human Resources Center of Expertise. "Many HR executives have an M.B.A.," she says. "They have the basic business foundation. They just haven't necessarily walked into a profit-and-loss role."

Building on that foundation requires spending a lot of time with the cross-functional team, asking a lot of questions, and relying on the talent-evaluation skills honed in the HR suite.

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"Hire a very strong team to complement your skill sets," she says. "This may include talent, operations, sales, and financial planning and analysis [professionals]."

Ask the Experts

Scott Hutzler, former executive vice president of HR for personal, workplace and investing services at Boston-based Fidelity Investments, brought a solid financial background to his new position as executive vice president of workplace-participant services at Fidelity, which he has held since June 2011.

Before joining Fidelity, for example, Hutzler had worked in various Six Sigma and merger-and-acquisition roles at GE Capital, the financial-services unit of General Electric, which provides commercial lending and leasing.

Strong, relevant experience aside, financial services is a highly regulated industry, and Hutzler essentially had to "learn a whole new language" as he settled into his current position, he says.

For instance, he earned FINRA Series 7 and Series 24 licensure, and spent significant time with ERISA and various regulatory bodies and experts.

Nevertheless, he says, the bigger challenge has been to not revert back to "HR mode" when talent- and other HR-related issues arise, he says.

"I currently have an HR leader [who] works for me. And I have to allow her to do her job, and make sure I don't default to a purist HR role."

The first 90 to 120 days of his tenure as executive vice president of workplace-participant services, for example, "was a real assessment period," he says, during which Hutzler and his team have begun to revamp the unit's approach to training and development as well as compensation and rewards, he says.

"As these things were happening in the organization on a daily basis, I found myself wanting to become more involved than would have been appropriate.

"I have to be careful about that," he says. "I've made a conscious effort to spend a third of my time with external clients and business partners, a third with our internal team in operations and a third of my time with internal leaders. I have to maintain discipline on that [front], and I didn't expect [having to do] that.

"At the end of the day, you do have to make decisions, whereas -- in an HR role -- you may, more often than not, be in a consultative mode, which allows you options. That doesn't necessarily apply when you ultimately have to make the final decision."

Of course, line managers must still embrace a collaborative approach, and the top HR person should be just one of the leaders relied upon to provide counsel, says Rita McGrath, associate professor of management at the Columbia Business School in New York.

McGrath recommends "assembling something an advisory group of experienced managers to advise on key decisions and other matters," she says (see sidebar). "Then, carefully plan the transition in 'chunks' rather than trying to take on too much all at once."

Before moving from Covance's HR department, Calicchio made sure she had a support system already in place to help guide her through the transition period -- and beyond.

"I spoke with my manager about who would be in my informal circle of support," she says. "I did and still spend a lot of time with finance partners, and they're very patient and they entertain even the most basic questions."

Hutzler considers himself lucky to have had such mentors, but ultimately finds the tools he developed in HR to be equally valuable in readying him for his current role.

"The more I experience in this job," he says, "the more I realize the vast majority of a good line manager's day is spent on things that are critical to the HR professional."

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