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When I was at Harvard Business School, one of the most scoffed-at courses we were required to take was “organizational behavior” or OB. We envisioned ourselves creating audacious strategies and new financial instruments — not dealing with mundane “HR issues”.
We couldn’t have been more wrong in our misplaced focus.
You can concoct the best strategies, or invest in the best financial instruments, but it all comes down to a leader’s ability to inspire members of the organization to change, shift, adapt and align around a singular effort. At Altimeter, our research found that the biggest obstacle to digital transformation is culture. Winning in the digital era isn’t about having the right technology — it’s about having the right leadership and team that can execute what is often a constrained and flawed strategy in the face of daunting competition.
That’s why at Altimeter we’re very focused on the role of the Chief Human Resources Officer (CHRO) or its equivalent within organizations. We found that HR is often not sitting at the strategy table, or it plays a tangential role as an afterthought. That’s because HR has traditionally been involved in two areas: 1) Recruiting talent, and 2) Mitigating risk of underperforming or rogue employees. For most organizations — as it was for me and my business school classmates — these are ‘keep the business running’ priorities, not necessarily strategic.
HR’s Influence Extends Outside the Organization
What’s changed is that employees are now empowered in the digital era. They are connected not only to each other but also to a broader ecosystem and network outside of your company. Like it or not, they have power because of their ability to leverage mobile, social, and digital technologies, regardless of whether it’s provided by the company or not.
These empowered, connected employees can tap their influence on behalf of their company, and increasingly, they are choosing to work for organizations where they can contribute in a meaningful way to a shared mission and outcome. Or they can vote with their feet and go to a competitor.
I believe the digital transformation of HR and employee engagement will be a competitive advantage for organizations over the next five years -- if you can harness the enthusiasm of great employees, it will be reflected in the bottom line. Our research found that 63% of organizations cite culture as the biggest barrier to digital transformation. This means digital strategies are more of an HR issue than a technology issue. And yet, we treat culture as if it were an afterthought, rather than a starting point.
Issues around talent, culture, and the nature of work not only extend throughout the organization, but also externally. The landscape for CHROs has expanded exponentially to become strategic in nature -- and it’s up to the leaders of an organization to start working in a new way that reflects this reality.
How to Make the CHRO Role Strategic
Given the challenges of modern organization, it’s time to think differently about the role of the CHRO. Here are some of the organizational challenges where HR should play a central, strategic role -- it’s up to the CHRO and other members of the C-Suite to ensure that this happens.
The CHRO Digital Toolkit
In order to support and accomplish these strategic goals, CHROs must have the right digital tools and the team skilled to provide insight and take action. While every organization will need to assemble the platform that will best support their unique strategies, here are some guiding principles to consider:
If your organization wants to become more customer-centric, then developing talent that is focused on customers will be a key strategic asset that CHROs must bring to the boardroom table. Ensure that your CHRO has a place at that table, and the tools and resources to be able to execute on that strategy.
It’s time companies brought HR into the C-Suite.
In a late 2013 study, Gallup found that only 13% of workers actually feel engaged at their jobs. What’s worse is that 63% of the workforce is not engaged at all.
Digital Darwinism is a fate that threatens most organizations in almost every industry. Because of this, businesses not only have to compete for today but also for the unforeseeable future.
Five years ago, I started a company. At the time, it was simply just me deciding I wanted to do something different. I learned it was by far the hardest professional decision I have ever made, to strike out on my own.