When does HR Devolution lead to HR Evolution?

Introduction
1) The traditional model of HR involves some tasks and activities that are in most cases better off performed by line managers; Recruitment, Selection, Discipline and Counselling, Performance Appraisals, Training, Career Development, and Managing Diversity. 2) HR has always been seen as a necessary cost centre, with declining importance in the eyes of the senior management. Yet, as Cascio et al (2008) demonstrates that HR has a definite role to play in contributing to cost effectiveness and bottom-line performance. In a stretched manner, it can also be said that the talent within the company contributes directly to top-line performance, showing that effective SHRM is necessary. 3) HR Evolution will only occur when HR Devolution takes place successfully. For that to happen, 3 major conditions must be ripe: a) HR Managers needs to become a strategic partner. b) Line Managers must be well equipped to take on the devolved roles from HR. c) The CEO must recognise that HR possesses a strategic role to play.

Background
4) Traditional HR functions tend to be more transactional. The department functions more as a facilitator, messenger boy, or order-taker. While the status quo is not quite desirable, there are many hurdles to cross for that situation to change. Some companies still dont realise that this change could lead to cost savings, better planning and anticipation for growth and a stronger competitive advantage. 5) For those companies who do realise this, there is another question to be answered: How is this achieved? HR Evolution within the company is not an overnight miracle. It takes quite a bit of internal marketing and a little bit of time to pull it off. 6) IBMs Bruce Anderson (2005) cited business-model specific challenges HR must face, such as the demands of a talent-intensive, high attrition rate service business. Our business has shifted from ten percent services to sixty percent services, explained Anderson. Its just staggering when you think of bringing all those folks in, getting them into the culture, making them productive. HRs key challenge, he said, is getting aligned with the business strategy so were not looking for yesterdays people, were looking for tomorrows people. 7) With this vision frame worked in objectives, devolution must occur to allow HR evolution to take place.

When will HR Devolvement lead to Evolution?

HR Managers Need To Take On a More Strategic Mindset.
8) Ulrich (1997) stated that HR Managers must position themselves to be able to take on the roles of being a Strategic Partner, Employee Champion, Administrative Assistant and Change Agent, to be able to value-add the HR Role in companies. Thats obviously easier said than done. Considering HR has always traditionally been about the soft-side approaches to a company, HR Managers have fallen into a comfortable trap of performing their roles as messenger boys and order-takers. They need to break that mold and transcend if they expect to be taken seriously as one or more of Ulrichs proposed roles. 9) According to Bach (2001) HR Managers are traditionally associated with operational issues and removed from core functions of senior management. The problem here partly lies with the creativity, initiative and collective intellect of the department. a) Non-strategic thinking HR departments might not include environment surveys for salary ranges on an active basis; the company would risk losing their best talents to competitors who could be paying more. b) If they see themselves as merely a facilitator for recruitment and selection, and keep their doors closed, disgruntled talents might have no avenue for venting and leave should their own Line Managers not be capable of constructive counselling. c) If they dont support line managers with up-to-date knowledge on company HR policies and government employment acts, they would not contribute very much to the recruitment process. If they dont keep their hands on the pulse of the employees, they would not be able to manage the companys culture and climate. 10) When tasked with a more strategic focus, Dharmasiri (2009) says that most HR managers in the banking industry researched demonstrate personal factors as a hindrance to achieving a Strategic Mindset rather than Organisational Factors. Issues such as having a low level of interdepartmental relationships of the HR team, less business awareness in the HR team and the need to understand the complexities of the industry emerged as reasons to why HR Managers in South Asia had problems with going strategic when trying to identify the personal factors that contribute to the strategic orientation of HR Managers in South Asia. Much of the roles of HR Managers in the banking industry were of transactional functions as opposed to strategic ones mean that the mindset in the industry is not so easy to change. 11) HR Managers need to understand that HR activities and their results should be ultimately quantifiable. Cascio et al (2008) said that HR matters are increasingly central to strategic success in an attempt to demonstrate how HR can substantiate

their roles as Strategic Partners. As talent is now recognised as a key internal asset and investment in a company, HR measurement is valuable to the extent that it improves vital decisions about talent and how it is organised. Ulrich et al (2009) has stated that real HR transformation begins by responding to the general business conditions and specifically serving key stakeholders. 12) HR must be seen as a Decision Science not only by senior management, but by HR executives themselves. HR must equip themselves with the necessary skills to be able to derive data that can influence selections. Fitz-Enz (Losey et al, 2005) demonstrated that scientific analysis in retail can ensure that firms have front-line sales personnel who deliver performance efficiency. 13) Furthermore, in addition to being able to adopt a strategic mind set and skill set, HR managers need to also learn to speak and read the language that other core departments do. According to Petrone et.al (2010), the ability to speak in business terms as other core departments do will translate into the ability to influence, which is a key ingredient for a successful strategic HR function. One easy question to ask when assessing strategic HR capability is whether the HR executive in question understands how to read and analyze a balance sheet. By being able to do so, HR executives would be able to better translate the current state of affairs in the company, its financial condition, and better understand the targets it must meet. How this would really help the company, in in being able to assist the Line Managers in effectively and constructively crafting staff KeyPerformance-Indicators as many of these today are revenue or profit based. 14) HR executives also need to form broad networks, especially internally. Strategic HR executives must be sufficiently connected within the organization to have a deep understanding of the business. So, in todays company environment HR Managers need to do more than their core functions if they want to be taken seriously and invited to the meeting table of Senior Managers.

Line Managers Must Be Well Equipped to take on Devolved Roles from HR

15) In the book The Living Company about how companies can remain sustainable over time, author Arie de Geus made reference to a 400 year old Japanese company called Mitsui. The founder or the company, Takatoshi Mitsui left behind a set or rules, part of which related to personnel management: In order to select for Managers, keep an eye on the young men and train promising young candidates. (deGeus, 1997) While talent recruitment is key in a companys survival, talent development is equally instrumental in achieving medium to long term goals. There must be an effort to train and develop line managers for the roles they are employed for. If HR devolution results in an addition to these roles, then the line managers must be adequately trained. 16) Considering Line managers are closer to the operational ground, have knowledge on operational performance levels of the staff and have a deeper understanding of the job. They are most suitable to define their own criteria for recruitment, and carry out selection of candidates for employment. Recruitment, Selection, Discipline and Counselling, Performance Appraisals, Training & Career

Development and Managing Diversity are roles that can be carried out by line managers. 17) However, in most cases, Line Managers are inadequately prepared for such roles as highlighted by Brown (2008): many line managers, under pressure to meet operational targets, often struggle to fulfil their people management duties. This is partly because they are not equipped with the tools, skills and knowledge they need to be effective. 18) Line Managers must take ownership of these roles or it wont work. While HR can provide the necessary training and settings for the Line Manager to perform these roles, it is still the willingness to perform those roles that matters more than anything else. Egan (2011) says that Line Managers must be able to build a good working relationship with their staff they need to lead, listen, ask, communicate, be fair, respond to suggestions and deal with problems, help and support employees to take more responsibility for how they do their jobs by coaching and guidance and build effective teams. 19) Consider the Line Manager who is only interested in achieving targets to satisfy his own superior. The only emphasis this manager will place on his staff is to ensure they perform their work well. Any other issues the staff might have would be brushed aside or diverted to HR.

CEOs Must Recognise That HR Has A Strategic Role.

20) Across the board, many CEOs interviewed perceived HR as being instrumental in successfully negotiating economic downturns. This was demonstrated in a report published in 2011 by the Human Resources Professionals Association (HRPA) of Canada. Talent Management and Employee Communication were instrumental in negotiating difficult times. 21) Asia Pacific companies have been found to regard experience in creating human capital strategies as the 2nd most desirable experience in potential CEOs. Tseng, (2008) states that the apparent lack of local talents is seen as one of the key challenges CEOs face in Asia Pacific companies due to the booming economy in Asia Pacific coupled with the lack of specifically skilled individuals. CEOs themselves have been taking on the roles of being a HR strategist with plans ranging from 3 to 5 years in Human Capital Strategies and sending their key personnel overseas to gain experience before importing them back into the Asian environment. 22) One of the key reasons for such moves is possibly that local employees would have lower retention costs in the long run compared to foreign expatriates. CEOs here are playing the role of a change agent. This is necessary for the evolution of HR to take place. 23) One of the critical initiatives for a successful implementation of strategic HR programs is the investment in an effective HR Management Information System. Burnett et al (2009) has shown that such a system is indispensable and needs quite a bit of work to implement, especially if that company is sizable. Usually, in

companies of certain sizes, such a large task would meet quite a bit of resistance from other departments. 24) Any changes in direction for the company to adopt HR as a strategic partner must also come supported strongly by the CEO and pushed top-down.

Conclusion
25) Only when all 3 key conditions listed above are ripe, can HR devolution lead to HR evolution. Without the CEO to take the lead, none of this can happen, and efforts without leadership will only end up with increased costs, poorer work efficiency, talent drains and short-sighted planning.

References:
1. David Ulrich, (1997) Human resource champions: the next agenda for adding value and
delivering results. Boston, MA: Harvard Business School Press

2. Bruce Anderson, (2005), Gaining Competitive Advantage through Human Resource 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14.
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