The best HR teams today work alongside senior management in formulating and cascading strategy such that it creates widespread understanding and acceptance.

Rajeev Peshawaria

The key question about HR is, whether or not it is keeping up with the changing world and responding effectively to the business leaders' cry for help. On average, when asked about HR, most business leaders say something like, "I like my HR personnel, but I hate HR overall." Judging by this response, I believe the answer is a big NO.

So what can HR leaders do differently? The first step might be to completely re-align HR's work to focus almost exclusively on the three challenges, which I sometimes refer to as B-B-N: the brains (strategy), bones (organisation design) and nerves (culture) of a business. The next would be to challenge some so-called best practices because they may have outlived their usefulness.

HR as B-B-N coach

The best HR teams today work alongside senior management in formulating and cascading strategy such that it creates widespread understanding and acceptance. However, such teams are rare because most HR departments are still focused on administrative tasks and are not involved in strategy formulation at all.

The bones of a business refer to its organisational architecture. This means having the right people on the right jobs, and creating supporting systems and structures that enable peak performance in a rapidly changing landscape. It also means developing leaders who are fit for the brave new world of technology and information. Unfortunately, most recruiting development programmes still use competency models as their basis.

Another "best practice" that merits a re-visit is succession planning. GE and other great companies popularised the nine-box grid to map employees based on current performance and future potential. The idea was to identify high potential future leaders and give them an accelerated development diet. This practice served many companies well for a long time. In today's scenario, however, it is almost impossible to predict who will succeed five years from now because we don't know yet what the demands for leadership will be in five years.

Leadership is a choice, not an appointment

Real leaders choose to lead because they feel strongly about the inadequacies of current reality and decide to do something about it. Apointing someone a member of an elite future leadership group is no guarantee for effective leadership. So, instead of structuring the usual high potential development programmes, it might be time to give people equal opportunity to show their proactive leadership.

Finally, if used correctly, HR can help companies in strengthening the only lasting source of competitive advantage - corporate culture. Culture is the nerve centre of the business. Here again, a lot of culture change initiatives are misguided and do not produce results. The fact is that creating a desired culture is less about organisational theory and more about seriousness of intent on the part of senior management. If senior leaders can communicate the elements of the desired culture in terms of clearly understandable behaviours, are they willing to walk the talk and set the right example every day by their own behaviour, and reinforce it by aligning reward systems to the cultural elements, they can change culture every quickly. The key is to keep it simple and honest, and HR can be a big help.

The bottom line - is your HR function capable of a lot more?

- - Rajeev Peshawaria, CEO, International Centre for Leadership in Finance (ICLIF)