To become true business partners, HR practitioners have to ‘change the rules’. Gordon Barker outlines how HR can better engage people during change and drive sustainable performance.

The economic downturn has created new priorities for HR, with the core emphasis on recruitment needing to be replaced by a greater focus on organisational performance, according to our 2009 Employee Engagement and Retention Survey of HR teams in 336 organisations*. The challenge for HR is that it is one thing stating you have a new focus, it is another to successfully execute on it.

If HR practitioners are to become true business partners, they need to transform their own capabilities and transform how their business manages performance. To genuinely support organisational performance, HR practitioners need a greater feel for what the business is trying to achieve.

This starts with changing your language when talking to the business. Senior managers are rarely measured and rewarded on HR’s goals; indeed HR often ends up being a dumping ground for goals the business should own, such as attrition targets. So if HR wants to engage senior managers in meaningful conversations, it needs to articulate an understanding of the business goals, the challenges being faced and an appreciation of the potential solutions to these challenges that are wider than HR’s traditional remit.

How clearly can HR articulate the business’ strategy for the next 12 months? What are the quarterly/half year goals and how are you doing against these? Which areas of the business are over and underperforming, and why? What are the biggest threats to business performance this year? The answer needs to be more than just the credit crunch and global recession.

The next step is to be brave! HR practitioners are all too often reactive, responding to the wants of business leaders rather than helping to shape and define their needs. HR can make a huge impact on driving organisational performance by asking more challenging questions of the management team. Well positioned questions will ensure that a more holistic view of the business is taken.

For instance, what is the real cost of cutting a top talent programme, e.g., the risk of increased turnover in this group and the subsequent impact of this on customers? What capabilities are required to execute the strategic goals successfully? What are the main threats to this execution, how can these be mitigated? How do we create greater performance clarity and alignment across the business? You’ll be surprised at how much they’ll value this, but still expect some defensiveness at first!

Get ahead of the competition

Today’s organisations have been in a state of perpetual change, even before the credit crunch. Those that embrace and navigate these changing economic times most effectively will steal a march on the competition, and be the future market leaders. The number one development priority for HR practitioners needs to be their capability to facilitate business change more effectively, including gaining a deeper understanding of the realities of change, of how to engage people during change, and minimise its disruption on business performance.

How then can HR transform how an organisation manages business performance? At present, organisations are far better at managing their measures of performance, rather than those that create performance – i.e., their people. Whilst redundancies will give organisations the opportunity to remove some of their lower performers, this will not create a better performance management culture? HR’s priority needs to be on ensuring that management teams are able to make the best people feel valued and that underperformance is removed quickly from the business.

The restrictions on the ability to buy-in new talent means that HR is being tasked with providing enhanced ways of identifying, developing and retaining high performers. Similarly, where a healthy bottom-line can afford managers the luxury of avoiding the more difficult conversations with employees, underperformance can no longer be tolerated. It needs to be improved or managed out.

HR has the opportunity to change the rules of the game in the current climate, away from the traditional ‘address the symptom’ approach towards creating a clearly joined-up strategy that drives sustainable performance.

HR can take three steps to change the rules. First, create or revise the organisation’s Employee Value Proposition (the value employees get from working for the organisation and how this differs from competitor organisations), to ensure it truly encapsulates what current and potential employees perceive as the value of being part of, and contributing to the success of, the organisation. This needs to align with and support changes in the organisation’s vision and business strategy.

Second, HR needs to assess its priorities and budget allocations against this (redefined) EVP to ensure it is driving the most critical initiatives and that any cuts are not false economies. Under pressure, organisations all too often make the easiest/quickest cuts rather than ensuring they are the right ones.

Third, HR needs to be driving the business to manage its core performance capability, i.e., its people, more effectively. For senior managers, this needs to include being more visible around the business, ensuring they are keeping people informed and are spending time talking to key individuals to help them make sense of what is happening.

With the wider management population, it is about ensuring they are regularly reviewing individual and team performance and providing feedback, ensuring people are clear about priorities and have what they need to deliver their goals. Managers need to be recognising and appreciating good performance (this isn’t about money, it’s about valuing people’s achievements), whilst having the tougher performance conversations earlier to rectify or, after due warning and intervention, remove underperformance from the business.

If HR can do of all of this, then perhaps it will be able to add a new KPI for 2010 reading: ‘90% of managers refer to us as their business partner, not HR’.

Gordon Barker is director of consultancy at TalentDrain, the employee engagement and retention specialist.

* The full survey report and/or an executive summary of TalentDrain’s Employee Engagement and Retention Survey 2009 can be downloaded free from: www.talentdrain.com