The role of Business HR in the new High-Impact Operating Model
HR has a mission: High-Impact. Business HR—the HR functions residing closest to business units—is at the heart of delivering High-Impact to the business. Here is a look at the three biggest factors differentiating Business HR from a traditional Business Partner approach with Deloitte’s recently updated High-Impact HR Operating Model.
Business HR in the HIHR Operating Model
The High-Impact HR (HIHR) Operating Model places HR customers—candidates, employees, leaders, contingent workers, and alumni—at the center, with Business HR positioned to drive strategic business objectives and enhance business performance. Business HR is responsible for defining and deploying solutions and advising leaders to drive workforce engagement and performance. Business HR uses workforce insights to refine and deploy solutions that assist the business in achieving its strategy. Working in teams with CoEs (Communities of Expertise), HR Operational Services, and external partners, Business HR provides a holistic set of capabilities to deliver services that are relevant to the customer.
The HIHR Operating Model defines the role of Business HR in the overall operating model, yet it’s far from a “one size fits all’ solution. Organizations that are achieving High-Impact HR have an HR operating model that contains foundational elements, plus elements that are tailored to align and support their unique business strategy, business environment, and people strategy. We call this designing a “fit for purpose” model.
New era. New challenges. New role of Business HR.
Three significant changes differentiate the role of Business HR in the High-Impact Operating model:
1.) Embedded in the business. Business HR roles must operate day to day as part of the business leadership team and take responsibility for driving and owning business outcomes. How do they do this?
- Focus on services. Business HR needs to articulate “what it does” through the lens of its stakeholders. For example, Business HR does not simply do headcount planning and budgeting for a particular business unit. Business HR offers a service of aligning the workforce capabilities and required capacity to the ever-changing demands of the business.
- Measure with business metrics. Business HR professionals home in on the metrics that matter to the business and view their performance in light of the impact to those metrics. If an organization aims to drive sustained revenue growth and gauges this by revenue per employee, the High-Impact Business HR professional is constantly evaluating how to increase revenue and productivity. HR initiatives are evaluated and prioritized by their impact on revenue per employee, and the Business HR professional engages with the other components of the HR operating model to design, implement, and monitor the effectiveness of those solutions.
- Drive the business. From an organizational structure perspective, Business HR resources should be aligned with the P&L structure to help ensure they can operationally support the business in the way it operates financially. The number and level of the Business HR resources is based on the complexity of the business units and the workforces in those areas.
2.) Part of the whole. Customers of HR often do not know, or care, which part of the HR organization is responsible for the services they receive. It’s up to Business HR to demonstrate its value by helping to ensure HR solutions are designed, implemented, and delivered to meet business needs. How do they do this?
- Communities of Expertise. Business HR professionals are active, vocal, and committed teammates with the Communities of Expertise to first design solutions collaboratively that meet business needs and then deploy those solutions to the organization successfully. Business HR professionals are not passive participants in a few design workshops, who then show up to receive change management deployment material for new solutions. Equally, CoEs do not design in an ivory tower and then serve up solutions for Business HR to deploy in its parts of the organization. Instead, Business HR actively participates in solution design to craft outcomes that will enhance the business and ease “selling” to stakeholders. Outside of solution design efforts, High-Impact Business HR participates in Communities of Expertise to identify new initiatives to address workforce challenges the business faces.
- HR Operational Services. HR Operational Services, through its accountability to deliver services across HR processes, brings interaction insights and an understanding of opportunities to improve the effectiveness of solutions. High-Impact Business HR collaborates with HR Operational Services to identify ways to enhance the employee experience, identify and address workforce trends, and shape how HR delivers to achieve business needs.
3.) Completing the picture. When Business HR is embedded in the business, delivers relevant and impactful services, and effectively teams with the other parts of HR to drive the business, what else is needed?
- Expanded capabilities. Many organizations that implemented a Business HR function merely changed titles, but did not assess the new capabilities required to deliver more strategic services to the business. To build credibility with the business and deliver the services that are “sold,” Business HR needs a core set of capabilities:
– Consulting agility—the ability to align HR solutions to business imperatives
– Business fluency—financial and business operations acumen
– Visionary leadership—successful advancement of ideas and solutions
– Emerging malleability—adaptability to future workplace dynamics
- Workforce insights. For Business HR to provide effective services, meaningful leadership and consulting to the business, it should apply workforce insights to each business challenge. Information about the workforce—both internal and external factors—enables Business HR to influence and drive organizational decisions to advance business goals while balancing the realities and needs of the workforce.
These three defining characteristics represent the “what” of High-Impact Business HR. In our next post we’ll discuss the “how” of transforming Business HR.