HR PerformanceDossier made for L'Oral Human Resources, June 2007
P3HR, Creators of BusinessPerformance
P10Can HR PerformanceBe Measured?
P19What Process for WhatPerformance?
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HR, CREATORS OF BUSINESS PERFORMANCEp.4 The HR Value Proposition
Based on the book by Dave Ulrich and Wayne Brockbank, HBSP, 2005
p.7 More Confident and Credible HR, at the Heart of BusinessInterview with Alastair Imrie, Group Human Resources Directorat BAE SYSTEMS (UK)
p.9 Perception of the Value of the HR FunctionBased on the article by Dirk Buyens and Ans de Vos,Human Resource Management Journal, 2001
CAN HR PERFORMANCE BE MEASURED?p.11 Why Human Resources Need to Evaluate Their Performance
And to What EndInterview with Jean-Louis Dufloux, associate with Equinox Consulting
p.13 LOral Managers Talk About HR PerformanceInterview with Valrie Chapoulaud, managing director Europe 5, LOralLuxury Products Division, Alvin Hew, president and managing director, LOral Taiwan, and David Greenberg, senior vice president of Human Resources, LOral USA
WHAT PROCESS FOR WHAT PERFORMANCE?p.20 The HR Scorecard
Based on the book by Brian Becker, Mark Huselid, Dave Ulrich, HBSP, 2001
p.24 The Eight Essential Phases of ROI in HRBased on The ROI FieldBook, Patricia Pulliam Phillips, Jack J. Phillips, Ron Drew Stone, and Holly Burkett, Butterworth-Heinemann, 2006
Human Resources is currently finding itself at the core of an increasing number of serious problems. Just to name a few, there isthe war for talent, employer image management, constant reorganization, peoples need for close support and individualattention In such circumstances, the notion of HR Performance seems to have little to do with the job.For some managers, HR performance can be summed up as the ability to attract and hire the best people. Others primarily expectHR to provide transactional services, i.e. recruitment, administrative management, etc. Still others would like HR to be atransversal actor in change and to contribute largely to organizing such initiatives. Then, when it comes to workers, many wonderexactly what role HR plays and how much power it has. People also worry about HRs ability to protect or influence their destinyin the companyIt is true that the job of human resources involves a delicate balance between initiatives that are measurable in the short term(i.e. recruitment, job transfer, employee turnover, training budgets, staff supply, etc.) and others that are expected to pay off in themedium term (i.e. effectiveness of succession plans). And one mustnt forget factors that are hard to quantify, especially issueslike proximity and time spent listening to company members. This last point brings to mind Jean-Paul Agons message to the HRcommunity at the beginning of the year: You are the only ones who have the word human on your business card, and above all,I would like you to get close to people and to make up for the friction generated by our way of working.Between calculating everything and purely qualitative assessment, how can HR performance be measured? This is thequestion that we wish to explore in this dossier. Group leaders have been questioned about their expectations, and human resourcepractices have been closely examined. Generally speaking, LOral has never explored this subject extensively. But it is time to think about these issues, because that iswhat it is most likely to take to not only improve HR performance, but also to earn recognition for all of HRs contributions. Enjoy!
Rmi LugagneHuman Resources Development Director
LOral 2007 - 3
HR, Creators of BusinessPerformance
The role of HR as business contributors today consists in aligning human resources processes with the companys strategic interests,and doing their utmost to facilitate the work of teams in the field. HR professionals may have acquired the status of business partners,but they have yet to gain in stature by becoming involved in strategy and by bringing in value. David Ulrich has already contributedgreatly to the transformation of HR with his reference work, Human Resource Champions. He now co-authors The HR Value Propositionwith Wayne Brockbank and explores the ways of transforming HR professionals into business contributors, more involved in thebusiness environment and present at the core of the business.
This is a change with impetus, especially for BAE SYSTEMS, as HR Director Alastair Imrie explains. Alastair Imrie called upon WayneBrockbank, co-author of The HR Value Proposition, to present a HR function of a new caliber. Based on both HR fundamentals and onthe companys core business and external environment, and implemented throughout the company, the new HR model finally has allthe weapons necessary to be a credible contributor to the company strategy.
Based on The HR Value Proposition, Dave Ulrich and Wayne Brockbank (Harvard Business School Press, 2005), the interview withAlastair Imrie, Group Human Resources Director, BAE Systems (UK), and the article Perception of the Value of the HR Function, byDirk Buyens and Ans de Vos (Human Resource Management Journal, 2001).
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indeed able to better assess thecreated value than its producer. In a land where the customeris king, Human Resources had better stay on its toes!
THE PREREQUISITESTO CREATING VALUE
Until recently, HR professionals have been cooped up in theirivory towers. Now, however, they are increasingly dealing withthe demands of parties outside the company. Ulrich andBrockbank predict that HR personnel must, first and fore-most, be open to others demands and raise the right ques-tions: which of the players involved deserve their attention?What do they expect of the company and the HR departmentin particular?
Proving their legitimacyEach sector has its key people in the creation of value: thefinancial analyst in an investment bank, the geologist in theoil industry. These people do not wonder if they are truly busi-ness partners because they are a business in themselves. ForHR professionals, things are not as clear. They must provethat they are contributing true added value to the companysoperations and that their service provides a competitiveadvantage. Why would a CEO invest in human resource poli-cies if he or she does not see their benefits and how theyimprove the companys productivity? To prove their legitimacy,HR professionals must thus show evidence of their usefulnessand have a perfect knowledge of the market in which theircompany operates, the prerequisite for answering the follo-wing questions. What are the skills the company needs toadapt to demand fluctuations? How should HR departmentsbe set up for more global results?
Considering external parametersThere are many external parameters that influence a compa-nys activities: new technologies, market regulation by thestate, or demographic changes. To maintain their credibility,HR professionals must not only be on top of all of thesetrends, but also assess their impact on the company. Newtechnologies, for example, have revolutionized HR practicesby automating some tasks, but HR must also know their
Business partners: that is how HR professionals nowlike to define themselves. Indeed, their role todayconsists in aligning human resources processes withthe companys strategic interests, and doing their utmost tofacilitate the work of teams in the field. According to DaveUlrich and Wayne Brockbank, co-authors of The HR ValueProposition, HR does not yet have everything it takes tobecome true strategic players. More than just guiding mana-gers and employees internally, to be a strategic player meansknowing what clients and investors need. Clients, the compa-nys target audience, are in the best position to judge the realvalue of the product or service provided. The final user is
The HR Value Proposition
HR Directors have begun to gain stature as strategic partners. The next step is tobecome not just partners, but major players in strategy and creators of value. Thisposition implies a change in practices as well as attitudes.
#The AuthorsDave ULRICH is a professor at the
University of Michigan. His
research focuses on companies
capacity to build value-creating
HR policies that are consistent
with the global corporate strategy.
He has written many works on the
subject, most notably Why the
Bottom Line Isnt!, published by
John Wiley, April 2003.
Wayne BROCKBANK, a professor
at the University of Michigan, is
the director of the Michigan
Executive Programs in Hong
Kong, Singapore and India, and
Visiting Professor at the Instituto
de Altos Estudios Empresariales
in Argentina and at Mt. Eliza
University in Australia. He is a consultant for
international groups (GE, Motorola, Cisco and Goldman
LOral 2007 - 5
impact on production. The fact that BMWs customers, forexample, can now choose a car model on an Internet portaland order directly from the factory has definite implicationson human resources management. 80% of BMWs sales inEurope now go through this channel. HR professionals are thefirst to be affected and must rethink the organization andtask distribution.
Similarly, HR professionals must be aware of labor marketchanges in the count