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Wednesday, April 30, 2008

Increasing the Value of HRD

Overhead cost or Human Capital?

To whom does your Head of HR report to? The General Manager? the Head of Operations? The Finance Director? Does the HR Function stand alone or clustered or chunked with other administrative functions like facilities administration, accounting or finance? How much of their work involve transaction processing? how much involves facilitating strategic HR activities?

Where you put your HRD and the amount of empowerment you give says alot about how your organization value your human resources.


While many companies say that the human resources are their most important resources, not so many put their money where their mouth is. This is why many really see their human resources as overhead cost that needs to be controlled and reduced as necessary rather than a capital that returns on investment if treated the right way.

There was a fear that the machines will replace humans and that humans will have less use. But what really happened is that to a certain extent human responsibilities now require less muscle work and more brain work. Automation in some HR transactional activities now require less time and human involvement. It, however shouldn't just lead to the reduction of complements in the HR Department,it shouldn't be made an excuse to relegate what's left of the HR function to the administrative manager or the finance manager. It should allow HR to take on the more complex tasks of enabling employees to become more creative and productive in their jobs, manage their own performance and that of others, and motivate them to invest their time and commitment to the organization's goals.

At this time, I opine that organizations with the help of HRD should do their best to automate as much of the HR transactions and have HR face the more important and challenging tasks inherent to their jobs. This includes, coming up with the best strategy in hiring people, providing the necessary training, creating interventions to improve employee motivation and organizational effectiveness. The organizational leaders should look at the head of HR as an important partner in all these. If it is a battle HRD should be participating in choosing the armaments and involved in enabling the warriors to use the tools.

In order to be trusted with these new requirements, I believe that HR practitioners must step up and evolve their capabilities and get out of their transactional comfort zones. HR Managers must improve their understanding of business and make intervention proposals that do have impact on business results. They need to find the time to look at new concepts in recruitment, training, performance management, knowledge management and employee retention to have a more meaningful contribution to the organization. But first, the organizational leaders must allow them by giving them the mandate to do it.
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1 comment:

  1. Dear Ed,

    i'm agree with you. Most CEO/director said that employee or HR are the best asset of company. in action,they placed HR function under finance department, or administration department, or event general affair division.
    I think HR Practitioner have contribution in this condition. they failed to proof & convince top management about their strategic function.

    ReplyDelete

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