I recently read an article from the Harvard Business Review published in 1981, Managing Human Resources, by William Skinner. The article raised great points about the lack of respect human resource departments receive in companies at the time. The article is as timely as when it was published nearly 40 years ago. Skinner’s article really hit a nerve for me in that companies manage, measure results, and set long terms goals for their functional departments, but these same type of management tools are not often used in human resources. The article also illustrates that the issues existing nearly 40 years ago, are still persistent today. Here are the five key lessons for me from the article illustrating why human resources is such a difficult field to manage:
1. Obtaining employee commitment to a company is difficult
Aligning the long term goals of a company with the often short term goals of employees is difficult at best. Companies are working on 5 or 10 year plans, while employees are focused on the next year’s wages, job titles and potentially moving to another company for a better position. As Skinner points out, “it’s rosy idealism to think that every employee is going to turn on and perform with 100% devotion to a company and its objectives. Short-term economic interests are in clear conflict….Further, political factors such as Nader’s Raiders and the anti-big-business wing of the Democratic party exploit employees’ distrust of business, the corporation, and managers, whom employees often see as being out for themselves and siding with their corporate basses against the employee.”
So what is HR’s role to help with employee commitment? Executives in the company need to understand that HR’s role is a long-term function, and provide HR with the time to develop and execute goals over a 5 year period (or even longer as Skinner recommends).
2. As companies grow, they lose their competitive advantage
Larger the company, the larger the risks are in trying new approaches to HR or employment practices. Skinner points out that larger companies are inherently more conservative about innovation: “Decisions become more sensitive, have longer shadows, and, understandably, executives may become more cautions and may procrastinate or pass the buck when they can.” Small start-up companies have been utilizing their size and ability to adapt quickly has a competitive advantage in the technology industry for years now based on the same assumption – big companies are less likely to innovate because they are the established player. As the incumbent, the management team takes a defensive posture, not an innovative one.
3. Hiring is hard
Skinner sets outs that hiring is difficult: “Subtle differences in job and personal skills and in attitudes toward work and employers have made selecting an outstanding set of employees even more difficult.” Skinner cites “mass education” as an issue that makes selecting employees even harder. More of the population has a college degree, but this does not necessarily a good indication of how well the employee will do. This is especially truer today.
The hiring aspect of HR’s function needs to be more than getting new employees through a new hire orientation and providing them a parking card. HR needs to be involved in the hiring process to develop a process to ensure the best employees are hired, as opposed to simply filling empty seats. I strongly believe that having A employees will lead to brining in other A employees. Permitting B employees to pervade a company will result in only being able to hire C employees. Hiring is hard, but the selection of employees determines the success of the company.
4. Managing people is hard
The issues facing HR are different than those facing other departments in a company, such as finance or marketing. HR must manage morale, a HR manager’s decision are based in conflict, and each interaction with employees varies based on personalities. On top of this, there is also the ever changing legal landscape and legal obligations the employer faces, which often times the employees do not want to follow (for example getting tipped employees to clock out for an unpaid 30-mintue meal break when they are waiting to collect tips from a large party). HR managers that can navigate these issues, and do it while maintaining a positive employee morale are a very rare breed, but necessary to a successful company.
5. There is a natural gravity towards alienation
Skinner points out that there are many forces that if left unchecked, are driving employees to become alienated from the company. Therefore, HR must ensure that managers in the company are trained well on how to communicate with employees, able to listen to employee complaints, and when it is appropriate to involve HR in critical issues. Managers within the company are the tool to stop alienation, but they must have the tools and know-how to accomplish this. The process of having employees committed to the company, and trust the company, is a long-term process that can easily be destroyed by a single lawsuit or complaint. I also view employee alienation with a direct correlation with increase in employment lawsuits. Employees who are treated with respect, even when are confronted with their inadequacies for what the company needs, may not be happy with the decision, but they will be more likely to respect the decision.