From Admin to Strategy: : The Changing Face of the HR Function

Citation

Tamkin, P., Barber, L. and Dench, S. (1998), "From Admin to Strategy: : The Changing Face of the HR Function", Managerial Auditing Journal, Vol. 13 No. 2, pp. 139-141. https://doi.org/10.1108/maj.1998.13.2.139.2

From much that has been written on changes in the HR function in recent years, it might be expected that everything has been resolved. HR has completed the transformation from administrative “doer” to strategic facilitator, but the reality is that many functions are still grappling with the changing role. This report brings together findings from a number of sources: the literature, a series of case studies and consultancy work with organisations, to examine the reality of how the HR function has had to change itself in helping organisations deal with change.

The trends

There have been numerous changes in the world of human resources (HR) in the past few years. The function has been intimately connected with helping organisations achieve cost reductions through downsizing and the consequent changes in the way jobs are structured: delayering, devolution and decentralisation. The changes were caused by the need to react quickly to severe pressures for survival which left organisations in crisis and necessitated radical solutions.

Some organisations thought through their proposed solutions better than others; some had little time to consider the impact of their proposals, but were forced into being reactive to the pressures they were experiencing. The outcomes too were variable, but the trends are similar. The initiatives that were born of the need to survive, created their own problems which we are now beginning to see all too clearly. The delayering of hierarchies created stasis in career progression. As career opportunities were much reduced, so the jumps between jobs now seemed so large that for many bridging them appeared impossible. The steady round of downsizing left most of the workforce feeling insecure and consequently demoralised. With the traditional expectations of the deal with employers shattered, individuals were left feeling angry and distrustful; not the best environment to rebuild a successful thriving enterprise.

These changes pushed HR units to being as reactive as their organisations. For the lucky few there may have been close links with the business and its attempts to avoid catastrophe, but for many HR departments it must have felt as if they were constantly sticking their fingers in the holes in the dike. Holes that were not of their making as well! It seems premature to suggest that those days have gone, when so many organisations are still struggling to survive in the face of increasing competition and growing customer demands, but there are signs that there is a growing reflection on the impact of change. Organisations are awakening to the need, not only to do things differently, but also to understand better what the impact of these new ways of working might be.

In all this, the role of HR has been subject to its own pressures. HR needed to prove its contribution to the bottom line of the organisation, it needed to raise its profile and be seen to add value. This meant moving away from much of the day to day, which it seems no‐one else wanted, but for which no‐one gave credit either. The function has been badgered by many commentators to become more strategic and help shape the organisation. Despite all this advice, the transition has been far from easy and there is a long way still to go for most HR units. In this report we look at evidence from a mixture of sources: some from academics and management gurus, some from organisations that we specifically spoke to as part of this study, and some from organisations that we have already helped address some of the issues.

Key themes

HR and strategy

Despite all the rhetoric, it would seem that HR finds the transition to a more strategic role a difficult one. There are pressures on HR to carry on doing what it is doing from both within itself and from the line. There is the comfort of the familiar, the pleasure from doing well what you know how to do, the desire to retain the professionalism of the function, to make decisions with a weight of knowledge and a corporate perspective available to the decision maker. From the line there has been much reluctance too. The line can feel very pressured, and be unwilling to take on additional responsibility. There can be a natural reluctance to assume a role that is frequently uncomfortable and where there has traditionally been the comfort of HR being there to accept the buck.

From those organisations that we have observed we have seen the full range of strategic involvement, from setting strategy for the organisation through to creating strategy in the absence of a firm business strategy.

HR as consultant

As popular as has been the desire to move to a new strategic orientation, there has also been an equally strong move to a more consultative way of working. Of all the role changes for HR, this has been one of the most marked. The move itself stems from the growing emphasis on meeting the needs of the customer, and the devolution of responsibility to the line. HR could no longer hope to tell the organisation what it could do, but had to find more influential ways of working with the line to promote best practice. The roles of consultant and strategist do not necessarily sit very comfortably together, as many of the line issues can be short term in focus. For HR to safeguard its strategic direction, there needs to be senior level debate and the freedom to operate corporately as well as at departmental support level.

Devolution

Despite the fact that there has, for many years, been a move to devolve responsibility for people to the line, the issue shows no signs of diminishing in importance. This can partly be attributed to some of the difficulties encountered with this deceptively simple concept: how does the organisation maintain consistency, how should line managers be prepared for their role, how do you deal with managers that cannot make the transition? Devolution also takes place on several dimensions, there is the devolution of operational responsibility to the line, but there is also an internal devolution within the function from corporate centre to periphery. As organisations fragment and departments become more autonomous, so aspects of the policy making role move with it. In a number of organisations, the central corporate HR unit is losing aspects of its role.

The HR unit itself

With all this change going on in organisations, and all the responses that HR has needed as a result, we were keen to find out if the function had taken its own medicine and changed itself in the process. Certainly most of our units spoke of being smaller. This is in contrast to previous observations that have noted that the central unit may have downsized while the peripheral HR support to managers had grown. Complementing the slimming down, there has been a refocus on the needs of the customer. In some cases this has been a formal review of structure and function, in others it has been more evolutionary. As a consequence of such a review there was a tendency for HR to align itself more directly to serve the needs of the customer.

The most common organisational structure was to concentrate the strategic function and roles within a corporate centre, with operational support being delivered to the line through divisional support units. In some organisations, these divisional units reported back to the Head of HR thus maintaining a professional link and overview; in others the units reported to the divisional director and maintained only a “dotted line” relationship to the head of HR.

In local government, legislation on the tendering of professional services had led some councils to further split personnel into a client arm and a contractor arm. The client arm would specify policies and strategy, and the contractor unit would develop such policies in consultation with others in the organisation as necessary. The associated need for payment for services causes tensions of its own and can lead to a loss of influence for the function. Some of the private sector organisations that we spoke to had recognised this difficulty, and had deliberately avoided internal charging mechanisms.

Summary

From this review we see some key tensions for the function that it is seeking to resolve:

•Devolving responsibility to the line can feel like a loss in professionalism and in the variety of mixed practice.

•The line are frequently unwilling to assume any greater responsibility, or accept a role that is obviously difficult and frequently contentious.

•Less direct power puts the function in a position of asking permission to act. Where the standing of HR is high, then influence can be strong; where the function is more peripheral and not well thought of, influence can be minimal.

•The market nature within which some units operate adds a further barrier to meaningful partnership. Charging for services may persuade some line managers to try elsewhere.

•Increasing devolvement to the line and the adoption of a consultancy model where the primary role of HR is to support the line, means that the function becomes less strategic. Inevitably the horizon of the line tends towards the immediate issue, whereas a strategic role requires a more long term perspective.

•As units devolve, the centre may become increasingly isolated and seen as peripheral. If the trend of devolution to the line continues and becomes more accepted by the line, then it may be that what we have seen happen to the centre in some organisations could happen to HR itself. As managers become comfortable with their new responsibility and freedom, the HR support unit may be seen to be redundant.

From Admin to Strategy: The Changing Face of the HR Function, P. Tamkin, L. Barber, S. Dench. IES Report 332, 1997. ISBN 1‐85184‐263‐2., £19.95