Earning a Place at the Table
Upgrading Your Job to “Business Partner”
By: David Madison, PhD, Guild Director

The following article is based on a panel presentation at the June 9, 2003 meeting of the 'HR Network' at the Marsh headquarters in Manhattan. The network is co-sponsored by Marsh and the Five O’Clock Club, and is a venue for HR professionals to meet informally and hear discussions of important issues of the day. The  panelists on June 9th included Steve Atamanchuk, VP Human Resources for Sithe Energies, who has over 25 years of HR experience within various industries; Eric Jacobson, CEBS, who is a Senior Vice President for Marsh. He is the New York Office Leader for the Marsh Advantage business segment; Wendy Murphy, Partner and Global HR Practice Head for Heidrick and Struggles.

A nyone who wishes to build a successful career must be guided by big-picture thinking: How do I help my company capture market share? If you think of your role as minor, it probably will be. While the following article is written with HR professionals in mind, it is primarily about strategy. There are lessons here for people of any specialty who want to get ahead, achieve influence and be considered leaders in their field.    

Most HR professionals would probably admit that they were drawn to the calling because they love people. For most, a primary reward of the job is being mentor, nurturer, facilitator, advocate and expediter, i.e., helping people do better in the workplace, the setting in which they spend most of their waking hours. The HR officer who gets poor marks for people skills probably came into the profession by the back door—and the reputation of any HR department whose tone is set by such a person suffers accordingly. HR is supposed to show the kinder, gentler side of the company. Being nice is a sine qua non of the discipline.

But, under the pressure of a much more rigorous business environment, the HR discipline itself is evolving. No one would argue that the people-friendly aspect of HR ever will be, or should be, slighted. However, many HR professionals—sometimes following the lead of visionary CFOs and CEOs, sometimes on their own initiative—increasingly see themselves as businesspeople. HR has commonly accepted low status as a one of the maligned non-revenue-generating departments, at best on a par perhaps with auditing, or at worst as a necessary evil. Finance departments have looked with suspicion or resentment at HR because the latter is seen as a drain. HR holds the reigns on the revenue outflows that can be the most difficult to control: compensation, benefits and pensions. More than one CFO has sought to gain control of HR only to be defeated by the complexities of the people aspect of the function.

But the evolution of HR in the direction of a full business partner is not a given, nor is it necessarily welcomed even by many HR professionals themselves. Whether deservedly or not, HR is commonly viewed as one of the most conservative and risk-adverse areas of an organization. It is, after all, custodian of the corporate rules and is usually concerned that everything be done by the book. One HR consultant estimates that “80 percent of HR professionals are not bold, not courageous, proactive, or anticipatory—they’re not any of these things. They’re always looking for affirmation.”

“Business as usual” isn’t good enough for anyone who wants to play a role in the organization’s survival.

However, as we move toward the middle years of this troubled decade, the opportunities for HR are probably unprecedented. For one thing, business as usual isn’t really good enough for any corporation or organization—or for any department that wants to play role in the company’s survival. There’s too much pressure on the bottom line everywhere. Companies need all the wisdom and all the help that they can get in fashioning strategies to weather the bear market and the sluggish economy.

Can’t HR step up to the plate and be part of the team seeking to make a difference? Also, the legislative climate certainly is working in HR’s favor. The requirements of the Sarbanes-Oxley Act of 2002, in terms of mandating the right talent for the right jobs, mean that companies will need HR as a fully functioning business partner. (Note: Sarbanes-Oxley will be covered in a later issue of The Five O’Clock News.) It’s not as if the infrastructure were missing: HR now touches all departments and divisions of any company—everything from sales and manufacturing to IT and auditing. It recruits for all, handles the benefits, compensation and performance evaluations for all. What may be missing to move HR to the next level of power and influence are ambition, insight and the will on the part of HR people themselves. They need to break the predominant mold, and become bold, courageous, proactive and anticipatory.

You Know You’re at the Table If ...
What does it mean for HR to be a true business partner, and occupy a place at the table? It was perhaps stated best by a new CEO who had fired the resident HR manager whom he characterized as an administrator. He called in an HR headhunter with the mandate: “Find me an HR manager who is involved in the business, who is pushing the business forward and is challenging everyone at the table.”

This CEO’s modus operandi includes having an HR manager who sits on the board of directors and key executive committees in an advocacy role, helping to create, review and execute corporate strategy. This assumes that the HR officer will know a lot about the business—more about that later—but also that the HR officer will always have one foot planted firmly in the HR realm. No matter how much the HR manager may be valued for her big-picture perspective and grasp of strategies, she will also be master of her own domain. As one high profile HR manager put it: “No plan is approved without my signoff that the people resources are there and at the appropriate levels.”

The HR manager as full business partner will also be viewed by the CEO or CFO as an advisor and resource. According to one HR specialist, “You’re ‘at the table’ if you’re sitting at the right hand of the CEO, helping to grapple with the relevant issues surrounding performance and rewards, and looking at accountability within the organization.” And this will be the perception throughout the organization. It’s one thing for the HR department to get calls about benefits or retirement plan options, but if the phone isn’t ringing as well for advice on policy and strategy, chances are the HR department hasn’t broken out of its traditional role—and hasn’t really earned the confidence of the CEO, let alone a place at the table. HR has reached a different level of credibility and trust when the operations VP asks for a meeting to review strategies for enhancing productivity.  

How to Earn Your Place
at the Table
One authority on the evolving role of HR states the case bluntly: “How do you seize the power? You seize it be earning it—there’s no other way.”  Earning it requires a combination of knowledge, positioning and determination. 

The following would appear to be some of the basics for establishing HR as a business partner.

Start with What You Know
Employees think that they’ve been going through the perfect storm in recent years because raises and bonuses have been minimal, and retirement accounts have eroded dramatically—they are getting squeezed at both ends. But if they’re feeling bad, and the CFO and CEO are feeling even worse, they might be tempted to blame—or even shoot—the messenger. As mentioned earlier, the HR department is sometimes viewed with suspicion and resentment because, as the custodian of payroll, benefits, retirement plans and pensions, money seems to hemorrhage from this department.

If your phone isn’t
ringing for advice on
policy and strategy,
you are not a player.

HR managers can’t change the market or the condition of the economy, but they can become masters of the areas they’re supposed to know—and help senior management address the crises that the economy has spawned. HR can become a business partner in the struggle for bottom-line stability. HR officers should make it their business to help create solutions—don’t assume that “it’s the CEO’s job.” There are conferences that offer presentations on topics such as “HR by the Numbers: Getting Maximum Return on Investments,” and “Communicating Effectively with Your CEO.” Such seminars should be part of your continuing education.

As one HR consultant put it: “Your job is to understand how the areas over which you have responsibility ultimately impact the bottom line. You have to be a very effective communicator in order to get the message across, to speak the language of the CFO and CEO. You don’t want surprises. CFOs and CEOs don’t like surprises.” In other words, be on the lookout for ways to deepen your knowledge and understanding of benefits, and find out how other organizations are coping. HR must take the lead in helping senior management design ways to cope with the ongoing benefits/retirement funding nightmare.

A proactive, bottom-line conscious HR officer will work by the numbers in analyzing all departments, trying to enhance revenues simply by implementing sound policies that are considered HR’s realm in the first place. One senior HR officer undertook a careful analysis of payroll patterns in a retail sales environment. He found that there were 30 percent more sales during one period of the day, and budgeted more payroll dollars for those hours—while cutting back on others. This turned out to save the company $900,000 during the next six months —creating a happy surprise for the CEO, without cutting staff. The department manager hadn’t been on the ball to catch the drain on the corporate treasury, but the HR manager was a payroll specialist, and used his knowledge to make a difference and strengthen his own standing.

The aggressive, business-partner role for HR will be a foreign concept for some CEOs and CFOs. One consultant estimates that 25 percent of these officers “just don’t get it, and probably never will. Of course there are the 25 percent who do get it”—the CEO who fired the traditional HR administrator comes to mind. “So the 50 percent in the middle are your challenge. You can educate these leaders about the role that HR should play in contributing to corporate strategy.”

Tune in to the daily reading routines of your corporate leaders. Follow their lead.

Build on What You Know
Another key factor in earning your place at the table is expanding your horizons. A recent Society of Human Resource Management (SHRM) catalogue included 53 pages of books on human resources, including Human Resources Kit for Dummies. There’s no argument with the need to keep up in your field, but to move into a business-partner role, you also should be reading what the CEOs and CFOs are reading—and, chances are, their reading list won’t be found in the SHRM catalogue.

It’s a given that executives read the Wall Street Journal and The New York Times, no matter where they live. They also read the Harvard Business Review and CFO magazine. And if they travel a lot they read USA Today.

It’s a good idea for HR officers to tune in to the daily reading routines of their corporate leaders, and follow their lead. One website that will serve you well in this respect is www.ceoexpress.com. On the homepage you’ll find dozens of links organized by categories, e.g., Daily News, Business News, International News, Business Magazines, Business Knowledge, Newsfeeds, Online Television News, and many more. Both www.cfo.com and www.www.knowledge@Wharton.com have Human Resources as a category.  

It’s impossible for anyone to take all of this in, of course, but www.ceoexpress.com is a good way to make a quick daily survey of the information streams that business leaders rely on. It’s hazardous to your health if you miss things —and at least a cursory glance at some of the news and information links can be invaluable. If you’re focused primarily on HR journals and just a few major newspapers, you can be blindsided by articles noticed by your CEO. A search on the Inc. magazine website reveals that it carries a lot of HR related articles. For example, “Benefits: Taming the Health Care Monster.” You’ll have more credibility with your CEO if you know about this article before she brings it to you attention.

It is the responsibility of the CEO and CFO to know the big picture for your industry and the economy in general—that’s why they read as widely as they do. Your goal is to achieve some understanding of the big picture as well. The Department of Labor has been predicting for some time that the current rate of high unemployment is not a predictor for the remainder of the decade. The war for talent will heat up again as jobs are created in the years ahead—creating a labor shortfall. Keeping a watchful eye on the big picture will be vital for HR managers whose CEOs will rely upon them for imaginative recruiting, retention and succession planning. When someday the executive committee becomes obsessed about the war for talent, HR should have the strategies and options in place.

Look at www.ceoexpress.com. Make a quick daily survey of the information streams business leaders rely on. Otherwise, it’s hazardous to your health.

Which also brings us back to a point made earlier: If you have shown leadership and mastery in the fight to keep benefits costs in check, management is more likely to pay attention to HR when the war for talent has resumed. HR will need to be able to strongly defend those programs and initiatives that attract and retain the right people. According to one expert: "The most valuable asset any company has is its people—they provide the intellectual capital. If we skimp on benefits, how can we be competitive in the market place? We must be able to bring qualified, motivated, competent people to the office every day."

Keeping an eye on the big picture also means the big picture internally. HR people are not expected, of course, to be accountants, marketing specialists or IT experts. But HR managers who aspire to the business partner role must be conversant in finance, sales, marketing, manufacturing, distribution—in order words, in all of the key areas of that support the goals of the business. This can require taking survey courses in all the vital disciplines, volunteering for projects in business areas such as finance and IT, and sitting in on management meanings. One HR officer with a sound understanding of sales and compensation strategies was able to rescue a sales team that appeared hat-in-hand before the CEO, hard pressed to explain a year in the doldrums. With the help of the HR manager, the team worked out a sales incentive formula that ended up driving both revenue and market share. The more an HR manager can distance himself from the common assumption that “HR’s business is HR,” the more likely he will be seen as having a place at the table.   

Making It Happen—from the Start
If you’re asking yourself the first day on a new job, “What do I have to do to take my seat at the table?” you’re probably too late. Any HR leader with a business-partner frame-of-mind will begin the process of moving into a power position during the interview process. Of course, a clear picture about politics and personalities will emerge when you’re on the job. But a tremendous amount can be learned about any organization and its power players before you show up for the first interview. If you have been interviewing extensively within the industry you will probably know a lot about competitors and the major issues facing everyone. A key to being perceived as an insider and as a potential power player yourself is being able to demonstrate an awesome knowledge of the company, its products and services, its problems, challenges and successes—and how it stacks up in the industry. You will come across as a strategic thinker who doesn’t have to be taught about bottom-line accountability.

Demonstrate an awesome knowledge of the company, its products and services, its problems, challenges and successes.

But once you’re in the door—that first day on the new job (or soon thereafter)—you can make moves to demonstrate that tending to human resources does not define your role. Of course you’ve read the wonderful things the company says about itself on its website, and you’ve probably spent hours during the interviews talking about company goals and visions. But early on a new HR manager should huddle with the CEO, to review the company mission statement and to firm up a to-do list: as the person responsible for the human capital in the organization, what steps can you take to maximize that capital? Your understanding of your role should reflect GE’s Jack Welsh’s philosophy: “If human capital is the most important product in a company, then why isn’t human resources the most important discipline within the business?”      

Partnering with department heads is also a vital move. Attend operational meetings across the organization to get a feel for what’s happening in all departments and divisions, but also meet privately with heads of manufacturing, marketing, finance, sales, operations, IT, and so on. One senior HR officer has made this a practice: “I grew up in HR, I made sure I had those meetings. I was out with the sales force. I did things that connected me to the business. I do that with my team as well. I make sure they’re taking rotations in other departments—they’re on projects with other parts of the business. My CEO didn’t say, ‘Go spend time there.’ I have to find ways for connecting with whatever parts of the business I need to, and I make sure my junior staff members are getting that exposure, so that they can come to the business of doing the business and have the HR skill as the biggest one in the toolkit.”

Speak the language of the CFO and CEO. And remember that they don’t like surprises.

You need to find out what the various department heads want from you—you need to let them know what kinds of help you’re prepared to offer them, beyond routine HR matters. You need to find out what kinds of problems they might have had with HR in the past. There might be festering grievances that you would do well to uncover and address. Active listening skills can help to build important partnerships with the department heads. With a lot of peers on your side, respecting your help and input, you will be building the political capital for securing a place at the table.

Be aware that, as good as you may be, you might encounter obstacles and challenges that would swamp lesser mortals. There may be troubled political waters, or problems that you’ve never encountered before. Avoiding setbacks or defeat may simply be a matter of getting help. Hire an HR consultant for 5 or 10 hours to help you brainstorm solutions, even if you have to foot the bill yourself. There are seasoned executive coaches who have seen it all, done it all—treat yourself to their expertise.

A Checklist of Questions for Anyone
If your goal is winning a place at the table, if you want to have impact on the bottom line and play a role in the formulation of strategy, you need to take inventory on a regular basis—the inventory of your skills, accomplishments and techniques for fashioning the HR role as you want it to be. The following questions can help you gauge the impact of your policies and personality. But no matter what your role, function or department —you don’t have to be in HR to ask most of the following questions—and boost your status and influence.

Help senior management address the crises that the economy has spawned.

My Performance
· How well am I performing?  And how do I know how I’m doing?
· What do the board, the executive committee and my peers say about me?
· How do I test how I stand in my organization? Do I really want to know how I stand?

Get help. Hire a consultant for 5 or 10 hours.

Education
· How do I keep myself informed about new business ideas relevant to the business?
· How do I maintain knowledge about my organization and its competitors?
· How well do I and my staff keep informed about what’s going on in our company?
· Do I acquire and demonstrate knowledge of customers? What contact do I have with customer needs and issues?

Recruiting
· What am I doing to bring in the brightest and the best? How do I measure and calibrate talent?
· Am I helping the Board of Directors identify appropriate talent for the Board?

Attend meetings across the organization to get a feel for what’s going on: manufacturing, marketing, finance, sales, operations, IT, and so on.

Leadership
· Do I foster teamwork and facilitate conflict resolution?
· Am I making proactive decisions in a timely manner?
· Am I exhibiting visionary leadership? Am I creating and communicating a clear and compelling view of the future of the business?
· Am I delegating properly and empowering my staff locally and globally? Am I supporting my people?
· Do I create buy-in for new initiatives? Do I encourage open discussions of new ideas?
· How well do I recognize developmental needs, to coach for improving performance?
· Do I demonstrate confidence in myself, especially during challenging times when HR might face criticism and be assigned blame?
· How do I align myself with my peers up and down across the organization?
· If I’m in a power position, what kind of power is it?

Setting an Example
· Am I exhibiting moral and ethical leadership that promotes exemplary behavior? What do I look like to the rest of the organization?
· Am I seen as fair and upright?

Strategy
· Is my phone ringing, not just about benefits, but about strategic issues?
· How well do I recognize trends and events outside my organization that impact its performance?
· Do I think critically and quantitatively about business problems?
· How do I remain on the forefront of innovation?
· How much time do I devote to building positive business relationships, and enhancing personal and business success?
· Do I use new information to enhance my organization’s performance?
· Do I demonstrate knowledge of customers? What contact do I have with customer needs and issues? Without customers, there is no business.

The Best Offense is the Best Defense
The HR officer who manages to earn a place at the table is, in fact, establishing a solid foundation for his or her own career. Earlier we alluded to the CEO who asked an HR headhunter to find someone "who is involved in the business, who is pushing the business forward and challenging everyone at the table." And, presumably, the headhunter began the search for an HR officer with the right résumé. You want to be one of people that the headhunter calls. Whether or not you’re interested in a new opportunity is beside the point. The point is you want to get those calls. Any career-minded professional in any field is always concerned about staying marketable, is always concerned to stay at the top of his game and be recognized as a leader and mentor—as a sought-after resource. To be seen as a business partner, fully involved in corporate policy and strategy, is your own best defense in the game of career management.