One of the most common complaints business leaders make about HR is that it seems disconnected from the business. It follows that one of the most useful things an HR professional can do is to become more business savvy. Let’s see how that can be done.
Not wrong, but not really right
The unfortunate thing is that many of the things HR does to appear more business savvy are, while not wrong, not really right either. The almost universal tact HR takes when trying to be business-relevant is to talk about engagement, diversity, and retention. These things do matter to the business and they can affect results, however, at heart, they are all HR measures. Worse, they are so overused that after a while they lose impact. We need to shift away from HR-talk to business-talk.
The second “not wrong, but not really right” thing we see in HR’s approach to business savvy is that there is a focus on justifying HR programs. HR wants to buy a suite of eLearning modules so it then thinks up all the reasons why that would be good for the business. The weakness of this is that it puts the cart before the horse—and business leaders notice. We need to shift away from justifying things that HR wants to finding solutions that business leaders want.
The heart of being business savvy
Leaders will feel you are business savvy when you help solve a problem that affects how their personal performance is scored. If a store manager is being beaten up by the regional manager because of undue shrinkage (i.e. theft by employees) and you help with that, then you are showing business savvy.
That one idea is worth underlining because it really is at the heart of being business savvy. You might think the business savvy HR pro is the one who has insights on increasing shareholder value, however, day to day, it’s addressing a specific individual’s business needs that will win you plaudits.
A related idea, but not quite as targeted, is to get to know the different parts of the business as well as the people who work there. Spend time in the warehouses, in the regional offices, with customers. Learn how the business works, the language they use, how the world looks through their eyes. The result of this will be indirect, however in everything you do you will be more business savvy because you truly understand the business.
The highest level of business savvy
The highest level of business savvy is offering strategic insights that other leaders didn’t see. Most HR professionals do not need to get to this level, however, if you have the capability to do so then it is worth shooting for.
The fresh strategic insights HR provides are often around pivotal jobs or tasks. These jobs, as defined by John Boudreau, are those where investing in an increase in quality or quantity will have the biggest impact on the execution of strategy. Everyone knows the C-suite is crucial and so it probably gets all the investment it needs. If HR notices pivotal jobs that are otherwise overlooked, perhaps a type of designer or IT specialist or mechanic, then investing in talent there can deliver great results.
Actions you can take
Here are some specific actions you can take:
Steer away from talking so much about HR outcomes. Promise yourself that you’ll talk less about HR outcomes like engagement, retention, and diversity and instead talk more about business outcomes like growing market share, revenue, and productivity. Deliver on that promise.
Avoid justifying HR programs. Take is a warning sign that you are on a sub-optimal track if you are justifying HR programs. If you detect this warning sign, then you should go back to business leaders and diagnose their real needs. After that, you can work back to see whether HR can help. Your pitches should start with the business need then work back to HR’s role in addressing it, rather than starting with something HR wants to do and justifying it based on business impact.
Learn how business leaders are judged. Talk to business leaders about how their performance is judged (even if you think you already know). If you can help them with those factors, then you’ll be seen as business savvy.
Immerse yourself in the business. Spend more time with business leaders and on the front lines to get a better feel for the business. Learn to see the world through their eyes and speak in their language.
Identify non-obvious pivotal jobs or tasks. Aspire to understand which jobs have an outsized impact by speculating what would happen if you changed the quality or quantity of people in those roles. Think about how those jobs affect the whole system and you may discover some whose importance has been overlooked.
When HR’s work was mainly transactional HR pros didn’t need to be business savvy. Those days are ending. It’s a challenge for HR functions because they are part of a discipline that has not been trained to be business savvy, has not been expected to be business savvy, and if often populated with people who are not business savvy. The good news is that the actions to become more business savvy are not difficult—it’s time to protect your relevance by developing this competency.