CIPD Podcast 45 - Building HR capability

Date: 03/08/10 Duration: 00:20:36

In this podcast Stephanie Bird CIPD's Director of Capability, Sue Swanborough from General Mills, a global food manufacturer; Jeremy Swain, CEO of Thames Reach, a homeless charity and Julia Clapham from BT discuss how you can prepare today to deliver sustainable organisational performance for tomorrow.


Philippa Lamb: Hello and welcome to the podcast. 

Building HR capability to maximise organisational success is an ongoing challenge. In this podcast we want you to take a step back from your day to day workload and ask how can you prepare today to deliver sustainable organisational performance for tomorrow? Not only does this need you to take time to think about how to build the best team but also to decide where the HR function will sit in the coming years. 
Is there a conflict between the transactional day-to-day work of HR and the role it plays in strategic thinking? What opportunities might there be in the future to add more value to the business? What more will HR need to do down the line? We’ll discuss these questions with Sue Swanborough from General Mills, the global food manufacturer, Jeremy Swain, the CEO of Thames Reach, the homelessness charity and Julie Clapham from BT. First though Stephanie Bird, the CIPD’s director of HR Capability explained how she sees the profession changing.

Stephanie Bird : It’s an evolving shift from focus on practice and process through to much more around insight, so how do you really add insight to the organisations that you're in? How do you really work on the sustainable organisation and sustainability so building an organisation that's not just fit for today, but fit for tomorrow? How do you build your own HR capability, not just fit for today, but fit for tomorrow? So it’s really focusing on much more around the future.

PL: So how can the CIPD help us assess whether, as HR professionals, we are fit for the future?

SB: We’ve build what we’re calling the HR Profession Map and that's really come out from some very wide-ranging research with a range of organisations to really articulate what it is that HR professionals need to do now. It has what they need to know, what they need to do and more importantly, how they need to do it, in order to be successful in HR today and that's building on somebody’s experience right from the very early days in their career, right through to the most senior levels. So we’ve broken it down into something that's very simple for people to actually get a grip of intellectually and to see what they really need to do in being successful today and in plotting their careers for the future. 

PL: And your thought it is that people at all levels should be benchmarking themselves against this?

SB: I think they really should be yes. I think it’s an articulation of what best practice looks like today.

PL: But that's not all, regular listeners will know that the CIPD has been investing a lot of energy into the Next Generation HR project. To build HR capability fit for the future we need to know what that future might look like.

SB: It’s all very well saying, “Oh here’s an articulation of what best practice looks like today,” and that's aspirational for a number of people so it already gives people a direction of travel and something to really go at but we can’t be a static profession, the world isn’t static, things are changing in the global environment, it’s affecting business, so what good practice and best practice looks like evolves all the time and what we’re trying to do with Next Generation HR is really provide some provocative thought pieces about the direction that that really might be going in and the challenges that people are finding there. So that, if you like, will feed into the profession map and evolve it on.

PL: BT is one organisation that's really grabbed the bull by the horns. Three years ago they sat back and took a good hard look at the future of their HR function and they decided that they needed a clearer vision. Julie Clapham is BT’s director of HR transformation and organisation effectiveness.

Julie Clapham: That's when we came up with, you know, we need to be at the heart of change because the company’s transforming. We need to help them to change as well as change ourselves and then we realised well what’s our key focus, it’s people. So we do need to have that expertise around people and we need to make sure that we’re using that to help people to change and help the business to change.

PL: So were really alive to the need to be change ready years ago before all this avalanche of change that we’ve seen?

JC: We were actually yes years and years ago.

PL: Which is encouraging but what’s it actually meant on the ground for you as an HR.
department rather than the wider organisation?

JC: It’s meant the difference between being there, taking calls, doing transactional work and handholding line managers to actually moving to be part of senior leadership teams as a business partner but in the true sense of business, so much more commercial, helping them, helping the business to change, helping the business to succeed and that's a completely different conversation. It’s a conversation around, you know, your P & L, around your business, your customers, how do you get the right people to service those customers? It’s not about well we need to discipline that person, we need to… you know there are the basics still there but the business partners are much more on that strategic agenda of helping a business succeed. 

PL: We’ve heard a lot about how HR is aligning itself to the commercial needs of the business and most people see this single point as the biggest shift in HR over the last decade. So HR has evolved to become a more strategic and business-minded function but what about the day to day work of transactional HR? Isn’t there a danger of that being sidelined? At BT they made sure that didn’t happen.

JC: We took the conscious decision many years ago to outsource our transactional side of HR. So a lot of that transactional stuff isn’t done within BT any more. Now the challenging area is where do you say, “That is transactional and that bit isn’t?” So business partners do have to know what’s happening within the areas they’re looking after so if there are a lot of issues with people, sick absence, discipline cases, they do have to know those but they won’t manage them. So there is a difference. So we still expect our business partners to have that overall oversight but not to actually be handholding on the day to day.

PL: So BT has split the transformational from the transactional. At General Mills, the sixth largest food company in the world, with brands such as Nature’s Valley and Häagen-Dazs under their umbrella and with a global workforce of 30,000 they manage to share good practice across borders and cultures but for them the future of HR doesn’t involve such a clear structural split as at BT. Sue Swanborough is HR director, UK and Ireland, she told me about the benefits of being a small arm of a massive company.

Sue Swanborough: So HR is a great place to be within General Mills because not only can we leverage the global benefit of the massive corporation we’re a part of but we also have the opportunity to partner very closely with the business in the UK.

PL: What’s your thinking about the divide between your strategic role and your day to day process role?

SS: For me where HR really adds value is about learning and change, you know, you need the process part in order to gain the credibility. So you need to make sure people are paid on time, that policies are followed, that you have consistency in order to give you the credibility within the organisation to then deal with some more of the strategic stuff if you like and I think it will just be more of that actually and better equipping ourselves to be even better and better HR leaders within the business. So it starts with understanding the organisation, where is it going? What’s happening to our consumers? What’s our ambition in terms of growth? So it’s all the standard stuff that you think about when you’re defining a business strategy and thinking about the vision and the goal and then actually you translate that to say, “Okay so what does that mean we need for HR?” So what are we thinking about in the global business in terms of HR and actually what’s called for in terms of our business and then pulling that all together if you like into a plan for HR and continually doing that, not just ticking a box and saying, “Okay we’ve got a plan,” but actually continually challenging and asking ourselves, “Is this meeting what we need?”

PL: Do you see a clear divide between the people who do strategy and the people who do process? I mean is it essentially two departments in your head if not on the ground? 

SS: It’s not two departments in my head, absolutely not. I think in practice, you know, everybody can’t do strategy so I think you just need to think about what roles do you have and how does that pan out. It sometimes feels like the sexy bit is the strategy but actually for me the really important conversations are what happens day to day in the business when you’re discussion the real business issues and that's how you can shift and evolve culture and help people to learn and grow.

PL: Even though at BT there's been a clearer distinction between transactional and strategic roles than there has been at General Mills Julie still sees a total split as both unlikely and unhelpful. However she does think there may be a need to review the traditional approach of the Dave Ulrich model.

JC: I think that there will, within the next three years, be a review of the actual model. We’ve used the Dave Ulrich model in terms of business partners, transactional, sense of expertise and I think there may be a shift in some of that to relook at the model because I think there's some elements that seem to be missing which is a bit like the fudgy areas between a business partner, the transactional and actually there's almost like a middling piece where you need people you can translate the transactional stuff, keep that running and be between, if you like, the very strategic senior players and the very transactional piece.

PL: So a whole new layer. Does HR need a position at the top table in order to have real impact? I put that to Jeremy Swain, CEO at Thames Reach.

Jeremy Swain: Thames Reach is an organisation with now a big turnover of £22m and 430 staff and we work with homeless people in different settings and when I started at Thames Reach in 1984 there were seven staff so the organisation has changed dramatically over a long period of time.

PL: And you’re now how many again?

JS: 430 staff.

PL: 430 okay tell me about your HR team?

JS: It’s a function that covers all the nitty gritty parts of the job, getting people in, recruiting them. The formal disciplinary side of it is covered by HR as well, although lots of that work now is devolved quite appropriately down to managers across the organisation. It’s got a training function. It’s headed by a great confidante of mine, somebody I trust immensely and very, very straight with me. There's a view sometimes that the HR person has to be a director in the senior team. We have a senior team of four people and Beau is not one of those four.

PL: Why not? 

JS: Because the credibility of HR at Thames Reach doesn’t depend on them being in that senior team. You gain your credibility through the role you play and what you deliver and the confidence that the leader has in you, not necessarily by the position that you’re placed informally within the organisation.

PL: Now the work that CIPD’s been doing about the future of HR I think identifies HR having a role as a guardian of any business its associated with, offering an independent perspective, acting as a provocateur, and from what you've told me your HR manager does that for you in the course of private conversations but you still don’t feel that even though the role is growing and it’s certainly gone beyond the housekeeping personnel duties we’ve all known from 20 or 30 years ago into a much bigger strategic role, you still don’t feel that that role which is central to business performance merits a place at the top table? 

JS: No I don’t. She is one of my most trusted confidantes but no I don't think she should be, or that role should be within the senior team. You know you earn that respect and that position in the organisation through your behaviour and through your delivery in my view and what I'm not prepared to have is a senior team of eight people. I think a tight senior group is what works for us and I suspect for most organisations too actually.

PL: In fact CIPD’s Stephanie Bird thinks the debate over the top table is a red herring which detracts from the most important thing which is roles not job titles.

SB: For me a lot of that's actually quite a sterile debate and I think there are some things in it that they’re easy shortcuts to actually describing, you know, sort of HR must have a seat on the board. I think actually with board structures that's quite an interesting one to look at now because board structures are now much more around the non-executive, the number of executives on the board is actually much narrower, it’s very common just to find a chief exec, the finance director, maybe a chief operating officer or a head of one of the businesses so if like in a numbers thing it’s becoming much more difficult to get a seat on the board as they’re now currently constructed, so that lessens the opportunities anyway. I think though what it is important to still focus on is HR’s seat at the executive team and you have to be able to play effectively there. So I think if you’re not playing a key role on the executive team then I think there's probably something wrong. So that I think is the seat you need to go for but I think there's another interesting emerging issue I think here for me which is that I think that senior HR people now and increasingly in the future there is a role around the stewardship and some of the formal governance roles and I think there's an increasing trend that the governance agenda needs to move away, and is moving away from a more just, if you like, form filling, box ticking. The latest FRC report, for example, actually recognises that there are things around leadership behaviours and culture that make for board effectiveness and that's not been fully explored enough and those are the issues that HR should really be at that table on championing. We should be doing some work on how do we do that. I think that sits again and sort of for me actually really chimes with some of the things we’re finding out of next generation HR research about the stewardship, guardianship role of HR. So I think there's a very neat circle coming round that. 

PL: But it’s being the voice that brings forward these rather nebulous, less tangible but crucial issues and brings it to the attention of whoever else there is.

SB: Yes it is and it’s having the courage to hold up that mirror to people and to ask those questions which may be difficult and the good people do that regardless of whether they’re on the board or in the executive team. That's the skill they need to bring.

PL: Of course if HR’s role is changing then so too will the skills that are needed and this notion of HR as provocateur is exactly what BT’s Julie Clapham and her team are aiming at.

JC: What they do is they look at the whole effectiveness of an organisation. So what I mean by that is looking at it holistically so is the organisation functioning in the right way with the right people? Do they have the right structures actually to deliver the strategy for the business and that does mean that things are much more fluid. You need to change, you need to be adaptable to change because it isn’t, well this is how we’re structured, this will deliver the strategy and that's it. It is a continual change that needs to be happening. So this is why we’re now training our HR business partners through our OE, organisation effectiveness programme and then pathway, to help then to build the confidence, they develop consulting skills, how to deal with their clients, how to challenge senior people when they’re quite happy with the organisation they’ve got or they may be quite happy with it and you’re going to challenge them that they could do it a different way or a better way to achieve their business goals.

PL: So in terms of getting people into your HR departments who are capable of these very challenging tasks, what sort of people are you bringing in? They are more, I'm guessing, business orientated people from a business background are they?

JC: There is a move to that but we are upskilling and developing our existing HR people because they do have that grounding then in HR but what we are doing alongside that is bringing people in from the business and we’re doing some rotation so we bring people in with no HR experience.

PL: You second them in and out?

JC: Yeah and in some cases we actually move them in completely and then we have a way of, we say, “Work for two months we’re going to put you into this part of the organisation for you to learn, do, you know, proper objectives, you've got to achieve things and then we’ll move you to another part, another part,” and so we’ll move them around and then they bring that commercial perspective but also pick up the HR piece and the other thing is then we have to help them to understand the basic HR information and transactional services as well because a lot of them are coming in at a senior level and don’t have that basic information. So that's the challenge on the other side is helping them to have that understanding whereas for HR business partners it’s the challenge is to help them to understand the business.

PL: What’s the advice then for HR practitioners hoping to further their careers and prepare for the future? Sue Swanborough.

SS: So for me it’s about continually learning and growing. So looking externally, you know, what are the skills and capabilities I need, my technical or functional skills, what is it that I need to learn whether I'm going down the route of a specialist or whether I'm going down the route of a generalist? There's also a key thing for me is about how aware am I of myself because that for me is a life journey, so actually how effective am I as a leader at influencing as a line manager, whatever it might be and how can I be even better and the best way to go on that journey is by becoming more and more self aware.

PL: So this is very much the CIPD’s own thinking about preparing yourself in terms of skills and capabilities and monitoring.

SS: Yeah.

PL: At all stages of your career?

SS: Absolutely yeah.

PL: Future gazing is an uncertain business but for the next 12 months at least Julie Clapham feels clear about her goals.

JC: From HR perspective for us is bringing about more and more change and transformation and doing it in a much more seamless way, a smoother way, and actually embedding change. By that I mean making it stick. So where we want to change things within the business, in an organisation such as BT it quite easily reverts back so it’s not just taking people through the change it’s actually then it sticks and people work in a different way and I think with large organisations, you know, getting that to happen is quite a challenge for us and I think there is going to be much more change, we’re going to be sort of reducing our cost base even further, so I think there's a lot more to do and a lot more around getting people to understand why the change is important to them.
PL: As for General Mills it’s a company that's driven huge growth in recent years. I talked to Sue Swanborough about how certain she is in her own vision of the organisation’s future? We’ve talked about where you see General Mills going and where the aspiration is for General Mills to go in the coming years obviously it’s been a very high growth company hasn’t it in recent years?

SS: It has yeah.

PL: Obviously we hope it will continue to be so but it may look quite different, I mean economically we’re in interesting times, it may look like quite a different company are you preparing for the vision you’re pretty convinced the company will be or do you have options?

SS: So for me if you don’t really believe the vision and have options you shouldn’t have the vision and talk to people about it.

PL: So that's…

SS: So yes absolutely, totally committed, totally believe in the direction we’re going and we will achieve it.

PL: And that's what you’re fitting your HR team to provide and service?

SS: Absolutely.

PL: Absolute confidence and clarity from Sue Swanborough there. That’s all for this time. You can find out more information about this podcast, the HR Map, and next generation HR in the show notes at If you’re a CIPD member why not try my CPD Map which is a personalised and completely private assessment of your own skills. 
Next month I’ll be exploring workforce planning. Join me then


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