Episode 51: The Future of HR with Dave Ulrich, Brigette McInnis-Day (Google) and Rupert Morrison (orgvue)
Welcome to the first episode of series 11 of The Digital HR Leaders podcast. As I wrote in my annual list of HR predictions for 2021, which we covered on last week's episode, the pandemic has thrust the Human Resources function into the spotlight. All eyes are on HR. Some have likened the pivotal role the CHRO is playing in this crisis to that played by the CFO in the global financial crisis. Undoubtedly HR has a unique role to play, but how does the function shift towards generating value for the business, the customer, the workforce, investors and the community at large?
We decided to bring an esteemed panel of three experts together to debate the topic.
Firstly, Brigette McInnis-Day Head of HR at Google Cloud, where she focuses on attracting and developing amazing talent and shaping the culture for business growth and transformation.
Secondly, we have Dave Ulrich, Professor at the Ross School of Business at the University of Michigan and co-founder of the RBL Group. With his colleagues, Dave has written over 30 books that have shaped the HR profession, defined organisations of capabilities and shown the impact of leadership on customer and investors.
Last but not least Rupert Morrison, who is leading the way in data-driven organisational planning as CEO at orgvue. He has also authored a Chartered Management Institute shortlisted book of the year on data-driven organisational design.
You can listen to this week’s episode below or by visiting the podcast website here.
In our conversation the panel and I discuss:
The impact of the pandemic on organisations, employees and HR
How HR can be more value and business focused
The skills that Google looks for in its HR business partners and how Google measures its culture
The impact of the pandemic on workforce planning, organisational design and people analytics
What HR can do in 2021 to capture more value for the business
This episode is a must listen for anyone interested or involved in HR and how it can create value for the organisation. So that is business leaders, CHROs and anyone in an organisation design, people analytics or HR business partner role.
Support for this podcast is brought to you by orgvue . To learn more, visit https://www.orgvue.com/.
Interview Transcript
David Green: Today, I am delighted to host a special panel of experts to kick off series 11 of The Digital HR Leaders podcast and get us up and running for 2021. Joining me to look at the future role of HR are Brigette McInnis-Day, VP for HR at Google Cloud. Rupert Morrison, CEO at OrgVue and Dave Ulrich, Co-founder and Principal at the RBL Group and Rensis Likert Professor at the University of Michigan Ross School of Business.
Dave, I am going to you first, believe it or not I think it was nearly a year and a half since you were last on the podcast, back in August 2019. You said something that really resonated with me and quite a few of our listeners actually, that the most important thing that HR can give an employee is a company that wins in the marketplace. So to kick us off today can you talk about where you see HR changing and how HR could move to creating, delivering and capturing value for the customer and the investor? It is great to say that is what HR should do. How does it need to change to do that?
Dave Ulrich: Well, first of all David, thank you so much for inviting me to the podcast and what a privilege to be with Rupert and Bridget. I look forward to learning with and from them.
Has anything happened since August 2019, that would change our world? You know, it just mystifies me that nothing's changed.
There is a French saying that says “plus ça change plus c'est la même chose” and I have to translate because my French is so bad “The more things change, the more they are the same.” Obviously we have faced the global pandemic, political crises, social crises and injustices, but the messages are still the same at a principal level. If HR doesn't help create market value to help us succeed with customers, with investors and now I would add communities, then there is no workplace. And so the value of HR is not what we do, it is what we do that creates value with our customers, with our investors and with our communities. Now what has happened is those three have all changed. Customers are different today. They are different than they were a year ago, they are looking for quick response, they are looking for digital access, they are looking for the ability to connect in different ways. Investors are looking and putting more intangible value on the ability to respond quickly, to be agile and communities are ever more rigorous, focusing on social citizenship, and the ability of a firm to succeed. So HR, to create success has to create value for the investor, for the customer and for the community through three things. Talent, how do we better manage talent? And I think the issue is becoming increasingly about talent about the experience employees have wherever they work. That work is not a place it is a set of values. I think second, the talent has to create a great organisation. We have found consistently in our research that the organisation has three to four times the impact on outcomes with customers, investors and communities than talent and third is leadership. And so when we create value in HR for the customer, the investor and the community, through talent, organisation and leadership, that is where HR steps up.
I just have to say, I think the crises of 2020 put HR centre stage. These are human crises. These are emotional crises. There is digital impact on it, but these are really about the emotional response that allows us to manage talent, organisation and leadership in an effective way.
David Green: Thanks Dave. Certainly I think a lot of the organisations that we work with and I have seen commentary in a number of studies, it is almost like the CHRO has almost stepped up as the CFO did in the global financial crisis.
So Brigette turning to you, you have worked previously at SAP SuccessFactors and you are now at Google Cloud. To build on Dave’s points, what changes have you seen that suggest HR is evolving towards being more value and business focused? And how do you think that this impacts the role of the HR business partner?
Brigette McInnis-Day: Thank you so much for the question and again, thanks for having me today. It is going to be a great time to be exploring this topic for sure. I want to think a little bit about this question and I saw HR very differently when I stepped out of human resources into the COO role at SuccessFactors. So I saw it in a very different view from an internal perspective, leaving the organisation that I had been part of for a long time in HR, but then going to be in front of the customers from an external perspective and what our HR customers needed as well.
And what I realised was there was so much more that HR has impact on that is rarely seen by leaders. I also think that HR is also too humble about the impact they deliver and struggle sometimes with the messaging and the impact, because they are just continuing to focus on the work. So those two things were reflection for me in terms of how to bring back and coming to Google, making sure that you are front and centre of how do you bring that value, what does it mean from a business leader perspective and show more of what those important things are.
So I think that evolution for me is see it to say, how are you as that strategic partner talking about what that means for progressive leadership at companies. I have seen and have had a lot of customers say that they didn't have to push their value as hard because they had much more progressive leaders, where as some of those leaders weren't so humble, didn't understand the value of HR and that's where they were on their curves.
So I think it is really about striking that balance and understand the trajectory that leadership is on as well as that company.
I think the other areas, you mentioned as well, that thinking about Covid or some of these big crises that we have had to face, if it hasn't been this time showing that HR is an area and a focus from a value perspective is key, not just from an HR functional perspective, but this is a CEO agenda. This is a topic that we get customers coming to us saying, how are you handling this? It is the number one thing our CEO's are worried about what will make or break their business and thinking about what that looks like. And for us, it was really about thinking about what does that leadership shift from a culture perspective and how does culture bring people together during times of extreme change and extreme growth. We need a centre to pull that together and that is what we have been focusing on. Bringing that culture and linking that from a value perspective to help us navigate through greater times of change. And that is where I see thinking about being much more agile in the moment and having much more inclusive leadership, is where HR is showing their value as they are coaching and driving through this change as well.
David Green: Great and actually as a follow-up, you spent some time outside HR and I was wondering what are the skills that Google looks for in HR business partners? And how has that changed over the last few years?
Brigette McInnis-Day: I think the number one thing that when I went into the COO role, what I focused on really was focus on learning a different work, even though I had supported business like that from an HR perspective, it is very different when you walk in the shoes and you are held accountable as well, versus coaching from a different angle.
So the business operational aspect and acumen is key. I think that is imperative from a human resource perspective because some of these groups pop up, they could be shadow HR, they can be org design transformation, all the areas that I think are quite strategic in HR, we have got to really own that from a human resource perspective and operating with the business by showing information, understanding the business strategy, linking it and helping the leaders transform. That is what I really felt was the key differentiators in an operating role and to bring that back into HR. It is not just about the employee life cycle aspects that are the things you do every single year, that is what employees and leaders see of you, but also those more strategic areas where you are adding the value and the impact as you are building out that organisation or taking it to the next level.
So those are the things I think, in terms of what I am trying to drive differently, is getting people with those skills to be more of an operating principle in the organisation.
What does Google look for? What do they look for in terms of people who are partners? We call them people partners at Google. One, is to really make sure they have led large scale transformation which is great, insightful, obviously from a growth business we're in, but also being able to operate. What I mean by that is moving away from gut-feel and having tons of analytics, gut feel and trying to coach from an arm's length, really get in there and be part of the team that is actually driving the expansion, driving the business change and leveraging a culture at work that has metrics and data behind it to be able to pulse and focus on the issues at hand, not the things that might have brought us here in the past.
David Green: So kind of bringing what Dave said about helping the employees and the company win in the marketplace effectively. And before I come to Rupert, Dave it would be interesting to hear a comment from you actually. You work with lots of organisations and you have written for years around the role of the HR business partner. What are the skills that you are seeing companies looking for in HR business partners now that perhaps they weren't a few years ago?
Dave Ulrich: Let me make a comment on Brigette’s exceptional comments because I thought they were so helpful. She used the term value, I think value has two definitions. I think it is the value we create for others, so did I do something that others got value from, the customer, the investor? Did my leadership training help customers have confidence, the investor have confidence?
The other part of value is values. What we are known for. Our identity. I think both value and values become critical in this world and I think Brigette made a very nice distinction, she did a beautiful job defining both of those. That HR has to create value for someone else by living the values that we have and what that means for example, when she talks her second comment, and I'm sorry to do so much here, about culture. Culture is not our values. Culture is the value we create for our customer and so the issue of culture is not living a set of values, that is kind of the roots of the tree. The issue of culture is creating value for the customer outside and that changes the whole definition of culture from an internal perspective to what we call outside in.
Now your comment about skills of HR. We are studying that, we have identified five possible skill sets HR may need coming out of this world. One is information asymmetry, how do we manage information better. Two, separating signal from noise. I am finding myself overwhelmed with noise and by the way this workshop is not noise, this workshop is a signal, this is the right workshop. But which of those noise elements are the ones I should pay attention to. Three, getting integrated solutions. HR is not piecemeal, we will do staffing Monday, Wednesday and Friday. Performance management Tuesday andThursday then on Saturday we will do career develop. No, you have got to get integrated. Four is social responsibility, probably more than we have ever seen before we live in a more transparent world and HR folks have to be social citizens. And five the one I am most passionate about and I won't go any further, we have got to move our analytics from dashboards and scorecards to guidance systems with impact. It is no longer good enough to have analytics that say, here is my scorecard and here is my insight. I want to know which insights will have impact on the things we create value for, the customer and the investor. That will help me with those others, I think that guidance agenda is so critical. We are moving from, the metaphor I heard the other day is “we are moving from dumb phones, traditional phones that just respond, to smartphones” A smartphone gives you guidance, it gives you information. And I think that is the fifth one that we are seeing.
Information, noise, social responsibility, guidance and integrated solutions. Those are the five things we are testing.
David Green: Great. Thank you Dave and Brigette, thank you as well. Rupert that has teed you up quite nicely because I know you are also passionate about moving away from dashboards and actually using data much more effectively within organisations. Like Dave, you work with a lot of different companies and their HR organisations on their org design and workforce planning challenges.
How should HR be thinking about roles and skills to support this future vision for HR? And how can HR start to get better at looking forward and predicting the needs for the future, as Dave outlined?
Rupert Morrison: Firstly, David, thanks so much for having me. It is great to be here. The thing is, actually on the last podcast, Dave Ulrich said to you “people can be champions but organisations win championships”
And he just said there were three components, talent, org and leadership, but the organisation is three to four times more impactful than the talent. And at some point I would love to get your source on that because it really resonates with me. And what it is, is understanding the organisation holistically and I think David, you just talked about the organisation, an integrated solution and holistic thinking and it is understanding all the components of the organisation. What that means, that the noise, is just looking at one element and the obsession with spans and layers and structure. That is very much a backward looking set of metrics and people talk about org health checks and backward looking, like the span of control, without actually understanding the work. It is important to understand the work and then the workforce. The work is there to achieve outcomes.
What are the outcomes you are trying to achieve? And a lot of the discussions being, what are the outcomes you are trying to achieve for your customers? What are the outcomes you are trying to achieve for your investors? Some of the customers are internal customers, if you are a service provider internally. Then it is about what are the skills required to be good at doing that work and having genuine mastery. The question around what skills should an HR business partner have? Well, that is one role, but organisations are made up of hundreds and in some cases up to a thousand, fifteen hundred different roles, if you are a big Bank. And so you need to understand each role in the context of what you are trying to achieve, the outcomes, what does the work, the accountability and giving the autonomy to people and then it is the skills and also the behaviours that you expect from them so you can execute the strategy and hit the goals that you are trying to achieve.
What I am really talking about is connecting all of this with the data. So you have a role dataset which creates a role grid and you have accountabilities. Those get broken into positions. Positions are different to employees and people, people sit in positions and they move around and people move around all the time. Positions are created and they're demised and the world is fluid and it is constantly evolving. And this idea that you can live in a as-is/to-be paradigm where here is my as-is situation now, I am going to transform and create a to-be and think that you are finished. Well, the world is not like that, it is constantly accelerating and so the role at the centre of all of that and how you manage that and design that is crucial.
And part of that thing and Dave you were talking about guidance, the guidance agenda, but it is not just guidance. I am not just looking for insight. You want to be able to do “what if” scenarios yourself, you want to be able to play with what if X versus Y? And we call it “what if analysis” or “what if analytics” What if we grew here? When you think about the work, you say, what if we would reduce the investment in this work so we can invest more in that work. What if we improve the efficiency through automation? What if we reallocated the work so that we could free up these groups of roles to do more of X, Y, and Z?
That is all what if’s, so you are using the data to inform your own decision making and run scenarios and by doing that, you are giving yourself confidence to really act with purpose and drive genuine change at speed.
David Green: Firstly, before we go on Dave, I am going to ask you to come back on the source for the organisations having three to four times the impact of individuals. Is that some research that you have done?
Dave Ulrich: Yeah, it has been done by a lot of people. The book is called Victory Through Organisation, we had 1200 businesses and 31,000 people and we looked at the individual skills, the talent, the individual competence and we looked at the organisational capabilities of those 1200 businesses. Then we did analytics. We did the statistics. Which one of those had the biggest impact on outcomes that we care about. We have replicated that in other settings, Charles O'Reilly has done some other work in that area as well. Rupert could I ask a question? What are the outcomes HR people should be focused on even more?
I love your “what if” question, that is what guidance is all about. But what are the outcomes that become the dependent variables that we in HR should focus on? The reason I ask that is I think traditionally in HR, the outcome is employee wellbeing, which is a great outcome. Nobody would ever disagree with that and if you do, you will have to ought to out of HR and go into finance, but are there other outcomes today that we should be focused on that you find in your work?
Sorry, David, I just am curious about that.
Rupert Morrison: So if you think about the organisation and organisation design, the purpose of the organisation is to execute the strategy and the strategy isn’t what is most important, the strategy is how are we going to win in the marketplace? How are we going to differentiate? The sort of how questions and the organisation is there to achieve that. Now that strategy gets broken into a whole range of outcomes and actually each role has a series of outcomes. So if you are an in customer support, your outcome might be a renewal, a net retention or net promoter score. If you are in product, it is executing against the product roadmap. If you are in sales, it is sales. If you are in HR, I would argue, it is ensuring you can do all of it and people can do all of these things and you are enabling that. So the outcomes are organisational outcomes.
You talked about the investor lens well, market capitalisation, growth, share price or revenue, those are all outcomes. And you talk about the business context, that is the business context, that is what people are there to do. Everyone gets up in the morning to achieve an outcome by doing work and I think you want to be as broad as that. Now the role of org design is to help you prioritise which outcomes are really most crucial and important because you can't do it all and getting people to understand the trade-offs. Because you can't do everything. And that is really the strategy question and too often people get confused. Language is important and so the word strategy is often used as a euphemism for “I want to be the best” but being the best is not a strategy, it is just an outcome in a market, in a context. Best at what? the strategy question is, how and then what do we need to do to achieve that? That is where organisational thinking is crucial and comes in to play.
Does that answer your question, Dave?
David Green: Thanks, Dave, that was a good question. This is the beauty of a panel, you see, as opposed to our usual way of doing the podcast. Brigette, I am going to come to you now.
When we think about org design and planning for the future, I think all of us have referenced the importance of leadership and culture and the essential part that it plays. Given that Google has a well-deserved reputation for being so culture focused. Can you share with us how Google has responded to the pandemic and how this has impacted how the company thinks about culture?
The reason for asking you this question is when we were doing the prep last week with all of us, you had a great quote that “you can't have a culture without a building” So I would be interested to hear more about that.
Brigette McInnis-Day: So thanks, David. And that was something that someone said and it really was intriguing to me to say, really, I would like to challenge that. I would challenge that because you can have a culture and is it walls that happened? Was it the building that happens? Is it the community? Right. So, let's take a step back. There is a lot in that question.
So, I just wanted to look back over how I used to think in terms of prior to 2020, there is a pre 2020 in terms of the things I believe that talent and leadership were key to successful business outcomes and I have learned a lot in 2020 and reflected a lot. Now I have to say that culture is probably at the heart of business success, especially during times of immense change or ambiguity. If I reflect on it, it is the number one question we get from a candidate in an interview process. It is the number one topic that our customers come to us for advice. What is Google doing or what are you doing from a people perspective on all aspects of the change and the culture? The number one topic employees ask us is how are we going to manage our culture during times of change? And then also too, it is, what does that look like from a culture perspective?
One of the things just reflecting on when the global pandemic hit, we slowed down some of our culture work. We really were focusing on behaviours, as David said before, it is not just about the values. I like the roots analogy there, but it is about what behaviours are we pulling, as part of the business strategy, to drive the culture and preserve the things that we are so proud of from a Google perspective.
In doing that, it was important for us to really look down and look at what was the important pieces of it. We thought about in terms of what that looked like, we pulled back and said we wanted to put together and think about what that culture is at the heart. And what types of leaders do you need during that time?
So for us, it was about inclusive leadership and agile leadership. Those are the things, I think, that keep permeating to build a strong culture and environment. That story I was telling about saying we slowed down on our culture work, focusing on customer empathy and the behaviours that drove us there. We slowed it down a little, we said our people have too much right now so we just slowed it down, let’s just hit pause for a little bit. A Couple of weeks later, we got a pulse in the organisation. During Covid we made all these changes, people are coming together making quick decisions, strong decisions, across Google for the betterment of the people, for the community and for the customers. And all of a sudden the pulse came, they needed something to bind them together and that was part of that culture work. So we saw a pulse happening in the organisation and that is why I say, I think it is the heart and focusing on you can't have customer empathy you must you have empathy for yourselves. That was number one.
So that is what we focused on and leadership that can build an environment that is inclusive, that can lead during times of change. I think all of us, I know Dave joked and Rupert was saying, all of us probably changed our leadership style in 2020 and our thoughts about what the future holds and what those attributes look like. So I think it is really around taking us to the next level and what it means to be able to handle whatever challenges come to us in the future through inclusion and agility.
I have been at Google now for just over a year and I was very, very impressed in terms of the scale of what Google could do in terms of a global pandemic, the response, this togetherness and we are still learning and listening and understanding what needs are happening from a global pandemic perspective.
So I don't think we are done yet, but I was pretty impressed at the ability for people to come together and focus so quickly and so deliberately and that has been a pretty proud moment. But putting this detail around how we focus on culture, I think has been a pretty key area for us to bring our Googlers along, provide some sustainability in areas where there isn't in other areas, in terms of what is happening in people's lives.
I think that is another way for us to think about in the future, how we are going to think about org design, talent, leadership and think through what those attributes are for the future.
David Green: Great, thanks Brigette. And certainly I think a feature of organisational response to the pandemic and the other crises of 2020 has been that focus on employee experience, that focus on wellbeing, that focus on our people that a lot of organisations have had, which I think is heartening and maybe a good thing that has come out of the crisis.
Certainly in the conversations that we have with organisations in the work we do at Insight222, I get asked a lot about how to measure culture. I would be interested how do you measure culture at Google?
Brigette McInnis-Day: So it was really around back to that, what are the business drivers? Everyone is talking about those business drivers and how you drive them in terms of where that outcome and value is and what behaviours do you need to change? So really looking at what are those key strategic drivers you need to yield to? Where do you have a match from behaviour perspective? Where do you have a mismatch and what are those levers? You can't do them all. And I think this is one of the areas for us in HR to just really focus on what are the two or three that are going to be the biggest levers to pull and identify those. So to get your lift in the organisation, to drive and shift or evolve a culture, especially during times of change or times of big, heavy growth. So we assessed those key business drivers we needed, we went to pulse to get sentiment, moments that matter, to our people. We wanted to hear it and we wanted to get it. We looked quickly, 10 questions, 10 minutes, every other month to pulse what is happening because every other month we were changing pretty fast, if you think about the last eight or nine months. What was it telling us? We quickly shared out the results globally with our employees, we are very transparent, we brought them on the journey. We wanted to articulate what culture meant. Everyone has a different definition of what culture is, to David's point as well earlier, and define it for what we are preserving and what is really strong from Google. How do we drive that from a Google Cloud perspective? The poll came and there were executive committees on culture, we are driving changing agents throughout the organisation and then we are also helping our customers as well from an overall culture perspective. So we have been able to pulse, take that data, be more precise and feed it back into our actions and deliverables in the organisation. And then also how it's also shaping where we can be more pinpointed on our deliverables.
So that is how we have been driving and measuring it. We don't have all the answers. I think we will know more as we go and learn from it, but I think those are some of the key aspects that have been helping us drive that culture shift. It is really about those behaviour changes that show up, not only with our customers, but with our employees as well.
David Green: I think that the key thing there is you feed it through to action and deliverables and also identify what are the biggest levers to pull them. Again going back to what we were saying at the start of this discussion, Dave. We're talking about the importance of actually focusing on the things that actually matter and add value.
Dave Ulrich: And again, let me go back, it is so great to hear Brigette talk about some of these insights. I am going to go back to the difference between value and values. I think most people in HR think of culture as values and I think what you just heard Brigette do, is it is not the values we have it is the value they create with customers.
So those two behaviours of inclusivity and agility are creating value for the customers. What does a customer get from our inclusivity? And Brigette said it beautifully, they get empathy, they believe that Google has more empathy for them because of our inclusivity inside. What does our customer get from our agility? They get our ability to respond quickly to changes in the marketplace. And I love that Brigette is defining culture, not as the internal values, not as our roots, but as the leaves and branches of the tree. What is it we are trying to create in the marketplace? I have been using the word lately, the right culture, because I think a lot of folks in HR get mixed up. The culture is just our values made real, no, culture is the right values made real for our customers and then we transfer that back into the organisation. So, Brigette, I thought that was a wonderful example.
And that's what I heard Rupert talking about, so brilliantly, “what if?” Well, the what if question is, what if we build that right culture?
What are the outcomes we are then going to get, not just inside in terms of behaviours, but outside in terms of customer, investor, reputation in the marketplace. I think Rupert's “what if?” question leads us to building the right culture for the marketplace where we live and work.
Brigette McInnis-Day: But, I think with Rupert just to add on to your point, if you think about traditionally doing org design versus always thinking about what the customer has to engage with the organisation. If you always start with customer first and then build from there, I think that is always another good way to think about it.
It is interesting, so many times I can't understand the organisation unless I know the engagement model and I know the business that it supports externally to understand how to give input or impact. So I think if we shift the lens and start there, it gives us a different view on how we do org design.
So I think Rupert, if you have got those “what if” scenarios, if you could take the external data and bring that in, that could be pretty powerful to think about. If it is a forcing mechanism for engagement and interaction from a customer perspective and then gives you a better way to look at gaps in terms of your engagement model and your org design as well.
David Green: And that is great Brigette, because you have almost anticipated my next question to Rupert. So kind of linking what Brigette said there, how much are you seeing the pandemic impact the way that companies are thinking around org design and workforce planning? Maybe also bringing in that context that Brigette added too.
Rupert Morrison: Yeah, if I could just directly go to that point. So when we say understand the work, we really want to understand the value chain. And one of the most critical value chains is the customer life cycle and so an example of that is, from awareness to advocacy. So how do you make a customer aware all the way through the consideration, the buying journey to implementation all the way through to advocacy, that they love your platform, your product, your service, whatever it is and that they are a referral and telling the world about you. So I call it, The A to A Value Chain, awareness to advocacy. A way of doing it is you map what are all the stages through that value chain, so what is all of the work. Actually a good exercise to do, we call it the moving house exercise.
So if you map out the work and you say, what things are we doing really well, if we are moving house, what do we want to take with us and what do we want to keep? Too often people throw the baby out with the bath water, I don't know if that expression translates into Americanisms, but what is the stuff you want to keep that is really important. I think you always want to start there. What is the stuff you want to stop and say, this is not working, this is dysfunctional and then what is the stuff you need to buy new? You are mapping that against that value chain and then it is understanding which roles are doing what against that. But more importantly, what is the interface between the roles because the work never really happens in isolation. A useful tool we use, we call it the give, get matrix because you want to know who is giving what outcome to whom and who is getting what along that value chain. You can see all sorts of things, if you have got too many different actors involved again and without clear accountability, you can see the customer is going to be really, really confused as there are just too many people involved or you have got the wrong people. So it gives a really important lens, to build on Brigette’s point, about understanding from the customer first and that value chain. And then you can do things like customer touch point analysis. So how often will customers be frustrated with the finance department or the legal department? Because they are touching the customers all the time and how do you manage that part of the process or the support component, there are so many different actors involved.
I am always nervous to venture onto the territory of culture because I am not sure it is my safe ground, but I do believe that culture eats strategy for breakfast. But that is about the work and how the work is done and how you help each other and that is part of culture. Understanding the customer value through that value chain is a lens and you can actually see it through the data. You can see when you do an activity analysis and you say who is spending their time doing what? I had an example of an HR value chain, I think I might have quoted this last time, David, I was on the last podcast, I had a client and he had 300 people in HR. The first question on the value chain was like HR strategy and so of the 300 people, 150 HR professionals were spending their time writing the HR strategy. And when I asked the Chief People Officer and the HR leadership team, where is your HR strategy? They said, well, we don't have one. I said, well, there you go and you have got 150 people trying to write it. Then what is that actually doing for anything, people are just wasting their time because it is not their build out and execute.
And so understanding the work and the fragmentation of the work, we have got too many people doing too many things is another example. I have seen instances where one person might be doing 60 different things, you can't be effective if you are doing 60 different things. It is just impossible. You need focus. So when I talked about reallocate, consolidate the work so that people can be really genuinely successful at what they are good at, the core along those value chains. So I think HR should be facilitating those conversations and that is a business conversation that is not a HR for HR conversation.
That is a business conversation because it is about the work you do and when you are talking about the value chain, I mean, everyone gets out of bed in the morning to try and think about how we optimise that and deliver value.
David Green: Rupert, obviously one of the features of the crisis, in fact the world we are living in frankly and probably the world we will be living in whenever this crisis ends, is that things are changing very, very quickly. So when we think about workforce planning, how do HR departments make sure that they are building processes that enables their organisations to react quickly from an operational and tactical perspective?
Rupert Morrison: Several components, one is having the data and structuring it in the right way.
Too often people just have people information, now you need to have role information, position information and clear definitions around what these things actually mean. So there is a big difference between a position and a person and people sit in positions and they change all the time. You create new positions and it is dynamic.
So it has been very clear that I am creating new positions here because of X and Y need or I am demising them because we don't need them or need as many anymore. Focusing on the positions and the roles first because that is not as political and focusing on the work. The thing that gets in the way is the politics because if you try and organise everything around people, you are just talking about loyalties and politics and power and that is just really time consuming and energy sapping. So you won't be adept at adapting if where you are focused is on the power struggle and what have you. So by having this data live and visually at your fingertips, so that you can do do the “what if’s.” That is what gives confidence because if someone, if it's a black box and there is an algorithm that tells you go left or go right, how do you know it is true? It is not going to help you, but if you think through the process yourself and you say, well, if we go left, what does that look like? And if we go right, what does that look like? And I am choosing to go right because of these reasons, but I understand these are the risks, the down sides, but that is fine.
Now, how do we mitigate those risks? So you are having a constructive conversation you choose to go right and what is the worst thing that can happen? You can then decide, you know what the world has changed, we are going to go left after all. But at least you are moving forward and you have done it. If you can be clear about why you have done what you have done logically, people buy into that, you will move much faster. Too often the world is made up of really bright people who are hyper talented, trying to drive things in different directions and that is really, really dangerous and very costly. So I would much rather have imperfect talent, driving in the right direction together, aligned. I am sure this is a big part of, Victory Through the Organisation, I am going to buy that book straight after this.
David Green: You don’t already have it?
Rupert Morrison: I know, shame on me.
David Green: Well, I think actually it was a good point to switch on to Dave because I think building on what you were saying, Rupert, Dave, what are some of the ways that you are seeing companies respond to the uncertainty caused by the pandemic?
And what impact does that have on HR capturing value?
Dave Ulrich: Let me just say, Rupert, thank you. That was really helpful again, to think about the idea of workflow and accountability. This reminded me and I will tell two quick stories then I will answer your question. I will try to be brief. I had the privilege, in org design, of working with Jay Galbreath, who was kind of the godfather of org design. We were working with a consumer products company that was selling into grocery stores and they had grocery stores back then. And he said, Dave, they have got to learn that we will work with the grocery store any way they want us to work with them. Option one, we will organise the consumer products company by specialty, frozen goods, vegetables, fruits and we will work with each area or option two. We will integrate our solutions based on what the customer wants. And I haven't thought about that story for decades, but Jay Galbreath was prescient and he was brilliant. He said, you organise a company against the customer desire and this consumer product company did it.
Second, quick story. A few weeks ago now, maybe a month ago, somebody came to me and said, you mentioned it, “I have the greatest solution ever for employee experience. I have got an app. It will measure stuff. It will test stuff. It's the greatest solution ever. I can Google stuff” that was meant for Brigette, “I can find out things that matter and it is the greatest solution in the history of the world.” They went through 10 minutes and they said “would you help us?” And I said “why should I?” And they said “because it is great at measuring employee experience", who cares? "But it is great. It is a great app. It's good. It takes us to the next step.” Let me tell you where I think we in HR have got to go. It is not about employee experience and that's an anathema, I think what I hear in this conversation from both Rupert and from Brigette is start with the outcomes, let me frame them the way we have done it. When you go in to meet with a business leader, don't start with employee experience. What is it you as a business leader, are trying to accomplish with your employees, productivity, with your strategy, that Rupert mentioned, with your customers, with your investors, with your market? Those are five outcomes you may be worried about.
And then as Rupert said so brilliantly, what are the rows of activity we could focus on? We have identified four rows. You could do things with talent, with your people. You could do things with your organisation, your culture, your capabilities. You can do things with leaders or you can do things in HR. Suddenly you have got a grid, you have got outcomes that matter to a business leader. You have got activities that will create them. Where do you now want to invest in that grid? Where do you want to invest? That is what we have done with organisation guidance. We have identified nine talent initiatives, 12 capabilities, six leadership actions and nine HR actions. We have 36 rows. We now can go online and I love Rupert's idea around data and information, and it is not just data it is data that leads to insight with impact. We have five outcomes, five columns, 36 rows, 180 cells. You are an HR person, can you sit down with a business leader next year and say, which of those hundred and eighty cells should I invest in next year?
You know, absent of that I think HR is just spitting in the wind. Rupert, you used an anachronism, that is even worse, but I had one that was even worse than that. I think in HR until we can link our rows and activities with the outcomes the business cares about, we are not adding full value.
I am going to go back to where Brigette started so brilliantly, value is what we create for other people and those stakeholders are who we create value for. So I feel really passionate about that in that guidance approach that we are after.
David Green: And I guess Brigette, those cells would be the levers that you were talking about, understanding which are the biggest ones to pull and obviously those will be different for different companies, I guess, so that is why your own organisation's data comes in so important.
Brigette McInnis-Day: It is and I think that one size doesn't fit all, but you could take the same approach, but you need to know your business well enough to know which levers are going to hit multiple things so you can be more productive.
David Green: We are coming towards the end of our conversation now, we have already been going for 45 minutes. So it is going to be a quick fire round to finish. The same question to everyone. This will be published in January 2021, so it seems pretty apt to say. Rupert, I will come to you first. What is the one thing that you think HR can do in 2021 to capture value for the business?
Rupert Morrison: Focus on the future and how to plan and execute against your strategy rather than just focusing on operational HR.
So operational HR is absolutely needed, you need to hire people, you need to move them around, you need to do L&D, you need to do payroll, but what is going to change the game for HR is doing organisational planning and analysis in the same way that finance does financial planning and analysis. Finance is sitting there pulling the levers of value and planning, budgeting and pulling the strings. HR needs to be joined at the hip, doing org design, organisational planning so that you can change the outcome of the organisation, rather than just operationally working. Something that is interesting is the finance function, 25% of the finance function does FP&A work and HR it is somewhere between zero and 2%. A lot of HR organisations have no organisational planning and analysis capability at all and the vast majority have limited capability. So how can you change the needle if you don't have that capability to influence the future?
Because that's where the executives are and that is what the business is constantly focused on. It doesn't mean the other operational parts aren't important, they are, you need to be able to bring people in, you need to be able to pay them, etc, etc in the same way that finance needs to do credit control and financial accounting and those backward looking operational financial aspects. That also means that you move away from just seeing HR as the chief employment engagement officer, which I think both Brigette and Dave were talking to. It isn't just making the lifecycle of the employee optimal from cradle to grave, it is ensuring that the organisation is fit for purpose to execute the strategies and get the outcomes you want.
And that requires forward-looking planning and pulling those levers. That has to be a core capability and that is not something that you should be outsourcing, which typically it is outsourced to third parties, you need to own that and have that raw capability in house.
So that is the one thing that I would say. Thank you for having me.
David Green: Great, well thank you for being a guest again on the show Rupert.
Brigette, same question to you?
Brigette McInnis-Day: Sure. I would say probably three things, if I go back to my experience when I was outside of HR. Bring forward to the leadership and to the business, the most strategic parts that you do in the work. Bring that forward, don't hide it below the iceberg, I think that is important. The employee lifecycle things, let's empower the leaders more to own their people aspects, move out, be more strategic and let the leaders really be empowered to drive that. And I think that the third thing I would say is stop admiring the problems. Add value with the outcomes and really be precise. I think Rupert you have said it, focus on the two or three things that are going to drive the business and have the outcomes. Not the 85 things that we could do and really make sure that that is how we drive the future.
David Green: Great, thanks Brigette. Dave, last word to you and then I will come back to all of you so you can just say how people can keep in touch with you. So Dave, same question.
Dave Ulrich: Thank you. I have got two pages of notes now, I will process those. I am going to tie into what was just said and take it in a way that you may not expect. I think the logic of Rupert and Brigette is the same, it is not what we do, it is the value we create. So with that outside-in logic, what is the value I see us needing and this may not be what you expect, given my background. I think the world is struggling at a very emotional level. I think we are seeing pandemic malaise all over, I see it in myself, I see it in my friends, I think we are seeing social justice issues with refugees and with black lives matter. I think we are seeing political chaos. I think the world is in need of a sense of wellbeing, a sense of comfort. What does that mean from the outside-in? I am going to take Brigette’s words and Rupert's words and add to them. I think we in HR should be focused even more on empathy, I think we should focus even more on emotion and on experience.
How do we help our employees find a sense in the organisation of an experience that helps them belong and become and be connected so that we can help our customers who are struggling with those same things. That is a very different answer, I mean it is not what you would probably expect because I love data and I love outcomes, but I think the world right now is in huge need of personalisation and caring for the individual, both inside the company, people are customers as well as employees. I think that personalisation for customers and employees is going to be an issue in the next year and companies that get that right, it sounds like Google is working that really well, it is not about “go get the good job and get the job” there is some empathy, there is some emotion, there was some building experience. If we can do that, both inside and outside with the employees and the customers, both as people, I think those are the companies that will have more success.
David Green: Great. Thanks Dave. Thanks Brigette. Thanks Rupert. Last word quickly, how can people stay in touch with you, Brigette?
Brigette McInnis-Day: Sure. I think the best way to would be on LinkedIn and also Twitter, but I think LinkedIn would probably be the best as well.
David Green: Brilliant and Rupert?
Rupert Morrison: LinkedIn or go to orgvue.com
David Green: Perfect. Dave?
Dave Ulrich: LinkedIn, I post new stuff every Tuesday. I just posted something recently on HR’s next generation. Every Tuesday.
David Green: I read it every week. So, Dave, Brigette, Rupert, thanks very much. I wish you all well in your respective lives and careers for 2021 and look forward to connecting again soon. Thank you.