Hi Rajat, I shall be obliged if you can provide more information on Dave Ulrich’s 4 part functional model. Regards Durga
From India, Coimbatore
1From India, Coimbatore
Hi Durga,
Am attaching herewith the interview of David Ulrich which clearly explains his views on 4 Roles of HR.
Happy Reading!!
Cheerio
Rajat Joshi
INTERVIEW WITH DAVE ULRICH
by DAVID CREELMAN OF HR.COM
DC- David Creelman of HR.COM
DU - Dave Ulrich
DC- Tell us about your views on the roles HR should play?
DU- There are four roles I talked about in the book, HR Champions. The key is to really be a business partner and create real value to a business. There are 4 roles you can play to accomplish this:
1. 1. a strategic partner role, where you help turn strategy into results by building organizations that create value;
2. 2. the second is the “change agent role”, where you help make change happen and, in particular, you help it happen fast;
3. 3. the third is the “employee champion role”, where you manage the talent or the intellectual capital within a firm; and,
4. 4. the fourth would be an “administrative role” where you try to get things to happen better, faster, cheaper.
DC- Let’s take these roles and apply them to a case study. Let’s say I am a bank manager and I think I do a pretty good job. I take my job seriously, I take people seriously, and I am selective with who I hire. Why on earth do I need any HR person coming in with their systems and forms to help me do my job?
DU- Well, if we look at this in terms of the roles (and I will do this rather erratically), with the “strategic partner role”, what the HR manager should help you do is figure out how to deal with the organization and brass to help you succeed. Are there things my branch needs to do? Are there things we can learn from other branches? Do we need to make decisions faster? Do we need a better work culture? And, how can we focus to help the branch be more efficient and effective at what I need it to do?
In the “change agent role” we have to ask: What are the changes going on in my branch? What are the customer expectations? What are the new technologies in banking and how do I get people ready and skilled to do it?
In the “employee champion role” where HR is looking at the talent, they need to ask: Do my people have the skills my customer’s expect? Do they interact the way the customers’ would want them to or when a customer comes into my branch are they getting their needs met the way the expected?
And the “administrative role”: Are all the administrative things relating to the 20 people in my branch being done? Are payroll, benefits, and work hours being done in a way that helps me succeed?
DC- As the branch manager I think I’m already managing the HR issues myself; I don’t really want an HR person coming in from HQ to tell me what to do.
DU- Well, the HR person has to explain I am from corporate and I am here to help. The reality is the branch manager has ultimate responsibility for everything that goes in and out of his or her branch, but what an HR person does is bring in a particular expertise. For example an HR person may say: “You have a turnover rate of over 140%, so something must be going on here because you are not able to keep the people in place and, therefore, you spend a lot of your time recruiting and re-engaging people. Maybe we could go do some research and see what we could do to get that turnover down to about 30% a year, so you could spend your time doing other things.” My job as the HR person is to bring some expertise and some knowledge to the table. I am not going to do your job that is silly; but I also may have some expertise that may allow you to do your job better.
DC- The role you just described sounds like a consulting role, as the HR people are trying to understand and help with the business issues. My experience with HR is that they come into a branch with some new system that they have, such as a performance management system, and they say, “We want you to implement this.” Any comment on that?
DU- Yes, I think what you are describing is the old HR, and the HR role is changing. The old HR was there to make sure you, the branch manager, do everything we ask you to do. In the new HR, there are still some of the administrative things to get done—hopefully through technology—you know, your people will be paid on time, benefits administration, all that stuff, but my job as the HR person is to figure out how I get your organization to do its best.
DC- Let me give you another situation: Our company has decided to open a branch office in Taiwan. Now, of course, we will hire a local HR person to do the hiring, deal with local laws and stuff, but how can corporate HR help with the opening of the office in Taiwan?
DU- Well, there’s really a whole series of organizational diagnostics you need to do. One would be, what kind of organization are we going to need? What will be the culture and the values? How will people work together and what will be the work environment? What kind of capabilities is the staffer going to need to be successful? Are we going to need to be fast? Are we going to have to have quality? What are the organizational characteristics that the firm will need to succeed?
Secondly, what are the HR systems that will help us achieve these capabilities? One system is staffing: Do we want to hire local or do we want to hire expatriates? Do we want to hire part-time or full-time? A second system would be training and development: Do we want to bring in people from other sites and have them on part-time to train the new staff? That’s what Nordstrom’s does.
A third organizational diagnostic is compensation: What is going to be our compensation philosophy?
A fourth would be the broader recognition of philosophy and rewards: Do we give flexible hours? Flexible benefits? And if so, is what we do based on strategy and/or geographic conditions?
A fifth would be communication: How do we begin to build a common form of communication and culture within the plant?
A sixth might be policies and procedures: What are the policies and procedures within this plant?
Again, all of those six things and the HR systems will build a set of capabilities that will allow the plant to succeed in Taiwan. And the corporate HR person there really becomes an organizational diagnostician, as what they are really doing is redefining the role of HR, redefining the view of HR. HR is not the person who comes in and says, “Let’s get payroll processed.” It’s really an organizational consultant or diagnostician who helps build the entire organization to help a business succeed.
DC- So if we talk of HR as a consultant or diagnostician/change agent, do you think some of the other staff functions play a similar role? For example, is a finance director also a change agent?
DU- Absolutely. In fact, what you often have are teams. If you are opening a plant in Taiwan (if that’s where you are going to), you probably have a team of people: a legal person who understands local laws and restrictions, a finance person, an HR person, probably a geographic person. What often gets talked about is creating centers of expertise in each of those areas, which come together in virtual teams to help a company succeed. HR is just one of the members of those virtual teams.
DC- Everyone I talk to likes being a strategic partner. Whether an economist at a bank or an IT specialist, they all want to be part of that team. Are you concerned about there being too many people crowded around the table?
DU- Actually, I would argue that every employee should be able to say how his or her work relates to the business and, in some ways, that’s what you are probably hearing from economists. They want to know that when they are doing economic analysis they are helping their business succeed and not just throwing out paperwork.
DC- That’s true. But if we go back, who should be around the table for a company that’s trying to grow whether it be in Taiwan, or in manufacturing or whatever?
DU- Whether it’s a new division or whatever, there are usually three resources that every business needs to have at the table in order to succeed: One resource is money, and that’s your financial person; the other is people—the talent and the people to do it—and that is HR; and the third, which is getting woven in there quite aggressively now, is data and information. Usually you need architects of those three resources, data, people, and technology to succeed. And, of course, you need to weave those together in a way to serve customers. So I see these resources as ones that would be around any table.
DC- Now this all sounds very exciting and interesting; it’s what people want, but imagine I am the “Comp and Ben” guy: I have “Comp and Ben” stamped all on my forehead. I am administering all these existing programs and there are always new programs to manage. Frankly, I don’t see my job changing.
DU- I think there is going to be a bifurcation in the HR job. If I am the benefits manager and all I see myself as is admin, passing on and disseminating information, I will be blocked out I think. Some of that information is going to put over the web, some of that will be outsourced. If all I am is a transfer of knowledge from A to B, we will find more efficient ways to do that rather than having people in that value chain. Disintermediation is the buzzword, and you’ll just disintermediate people in the transfer of knowledge.
Back to compensation and benefits and your branch example: What are the goals of the business? If they are productivity and our turnover is over 140% we will never meet our productivity goals. If I can change the “Comp & Ben” program 20%, I think this will assist with our retention-bringing turnover from 140% down to 80%. Based on my costs, I think this will add value. It is then that I bring value to the business.
So this is the bifurcation, the transformational part of HR versus the administering part of HR—which is where everyone’s mind goes; you know, show me an HR person and I’ll show you the great eyeshade guy. All of this administrative work is going to get handled by technology. The transformational part, where value is created for the business, is where I think HR will have to move. Some will be able to make that move some won’t.
Some of the traditional “Comp & Ben” folks are really computers with shoes, because they are really transaction people. If they can’t make that shift they very well could lose some of their opportunities.
BD- I teach a course in Labor Market Economics.
DU- Sorry to hear that.
BD- What?!
DU- It’s a joke.
BD- What would you see as a key role for teaching Labor Market Economics to future HR managers?
DU- Give me an example of what you teach.
BD- For example the hours of work/pay and individual decision making around it.
DU- It is hard to answer your question. I mean what should a good HR person know in the future? I think the whole question begins, and it is the question I would ask it if I was looking at all at your course, “What is the business requirement?” Labor economics data is wonderful and it is certainly good to know, but I don’t think it is necessary unless I can deal with it as a value equation for the business. You are trying to win on productivity. Your utility for northeast Canada is clearly a commodity business and if you can’t get your costs down, you’re in trouble. Clearly your biggest variable is labor given the fixed costs of materials and equipment. Some of that data around productivity numbers will be central to your ability to ensure your operation is competitive. The question to me as a labor economist is not what I know, but rather what would the business need to know in order to do the job more effectively.
IT- Mergers and acquisitions are all the rage today. What is the impact from an HR perspective?
DU- The buzzword I am hearing is “conversion”. Mergers and acquisitions create convergence on two levels: one is industry convergence, and the second level of conversion is cultural conversion. For instance, AOL is merging with Time Warner and there’s a convergence of the creation of entertainment and information with distribution, and the auto industry has converged all over the place.
The question is how do we put the parts together. Just because we put two pieces together doesn’t mean they are going to work. I think how HR can play a major part is not at the industry level (How do you become the global automotive maker of Jeeps?), but in the way you make these two parts that you have got work in an integrated and efficient way. This gets very much into the area of culture; how we make decisions, how we manage people, how we manage compensation.
The other level of convergence that I think is key is when you build a house, the electrical system, the plumbing system, etc.; all really work together to make your housework. If you didn’t have heating in a Canadian house, it wouldn’t be a very nice house. I think in a merger you really have two heating systems coming together. Now you have to bring together those two systems so they are invisible to the outside world, and that’s your HR system—payroll, benefits, staffing. All the administration systems in a merger need to come together in order to have a unified voice.
DC- You’ve done some important work in the past, what are you working on now; what issues are you interested in?
DU- Three or four things and I will get into more detail with them in a moment. One is a leadership role, and I am more and more intrigued than ever with the quality of leadership. Businesses succeed because they have a quality of leadership at every level of the hierarchy. You want to brand your leaders, like a firm brands its identity, like Nordstrom’s has a service brand and Harley Davidson has a brand. The leaders really embody those brands and make the companies better to work with.
The second thing we are working on is employee commitment: how do you ensure an organization has a high percentage (90-99%) of it’s workers identifying with the firm, giving discretionary energy, and giving what they can every day.
A third piece is an HR measurement or score card system. How do you know that HR is providing value, and the buzzwords around that seem to be getting around the intangible aspects shareholders seem to value. Two firms may have different stock values even though they make the same cash, and some of that is an intangible difference. HR creates those intangibles. So those are the areas we are working on.
IT- I would like to follow up on that. One of the people we are planning on following up with is Jac Fitz-Enz. Do you think that’s the direction we need to move HR (Jac’s kind of measurements) or are there other ways of assessing?
DU- The kind of work he was doing at the Saratoga Institute was related more to the transaction side of the job—how much does it cost to hire somebody. Jac’s now moving more into the strategic work of HR, and measures around that. I think he’s asking, “How does HR build value?”
DC- A lot of the academic research on leadership doesn’t amount to much.
DU- Agreed. I think what’s happened is we have been asking the wrong question. We have been asking, “What are the generic characteristics of an effective leader?” They have energy; they energize others. What we are now intrigued with is the concept of a brand. You don’t want a generic list of attributes. What you want to do is turn those attributes into results. The question we have been trying to figure out is that leadership is not just about character—leadership is about turning a set of behaviors into a clear set of business outcomes.
HR.com would like to thank David Ulrich for this interview. We all know his great work in HR but it seems that he’s a great driver as well: he conducted this flawless interview while driving to the university and never missed a beat coping with traffic and our questions simultaneously.
From India, Pune
Am attaching herewith the interview of David Ulrich which clearly explains his views on 4 Roles of HR.
Happy Reading!!
Cheerio
Rajat Joshi
INTERVIEW WITH DAVE ULRICH
by DAVID CREELMAN OF HR.COM
DC- David Creelman of HR.COM
DU - Dave Ulrich
DC- Tell us about your views on the roles HR should play?
DU- There are four roles I talked about in the book, HR Champions. The key is to really be a business partner and create real value to a business. There are 4 roles you can play to accomplish this:
1. 1. a strategic partner role, where you help turn strategy into results by building organizations that create value;
2. 2. the second is the “change agent role”, where you help make change happen and, in particular, you help it happen fast;
3. 3. the third is the “employee champion role”, where you manage the talent or the intellectual capital within a firm; and,
4. 4. the fourth would be an “administrative role” where you try to get things to happen better, faster, cheaper.
DC- Let’s take these roles and apply them to a case study. Let’s say I am a bank manager and I think I do a pretty good job. I take my job seriously, I take people seriously, and I am selective with who I hire. Why on earth do I need any HR person coming in with their systems and forms to help me do my job?
DU- Well, if we look at this in terms of the roles (and I will do this rather erratically), with the “strategic partner role”, what the HR manager should help you do is figure out how to deal with the organization and brass to help you succeed. Are there things my branch needs to do? Are there things we can learn from other branches? Do we need to make decisions faster? Do we need a better work culture? And, how can we focus to help the branch be more efficient and effective at what I need it to do?
In the “change agent role” we have to ask: What are the changes going on in my branch? What are the customer expectations? What are the new technologies in banking and how do I get people ready and skilled to do it?
In the “employee champion role” where HR is looking at the talent, they need to ask: Do my people have the skills my customer’s expect? Do they interact the way the customers’ would want them to or when a customer comes into my branch are they getting their needs met the way the expected?
And the “administrative role”: Are all the administrative things relating to the 20 people in my branch being done? Are payroll, benefits, and work hours being done in a way that helps me succeed?
DC- As the branch manager I think I’m already managing the HR issues myself; I don’t really want an HR person coming in from HQ to tell me what to do.
DU- Well, the HR person has to explain I am from corporate and I am here to help. The reality is the branch manager has ultimate responsibility for everything that goes in and out of his or her branch, but what an HR person does is bring in a particular expertise. For example an HR person may say: “You have a turnover rate of over 140%, so something must be going on here because you are not able to keep the people in place and, therefore, you spend a lot of your time recruiting and re-engaging people. Maybe we could go do some research and see what we could do to get that turnover down to about 30% a year, so you could spend your time doing other things.” My job as the HR person is to bring some expertise and some knowledge to the table. I am not going to do your job that is silly; but I also may have some expertise that may allow you to do your job better.
DC- The role you just described sounds like a consulting role, as the HR people are trying to understand and help with the business issues. My experience with HR is that they come into a branch with some new system that they have, such as a performance management system, and they say, “We want you to implement this.” Any comment on that?
DU- Yes, I think what you are describing is the old HR, and the HR role is changing. The old HR was there to make sure you, the branch manager, do everything we ask you to do. In the new HR, there are still some of the administrative things to get done—hopefully through technology—you know, your people will be paid on time, benefits administration, all that stuff, but my job as the HR person is to figure out how I get your organization to do its best.
DC- Let me give you another situation: Our company has decided to open a branch office in Taiwan. Now, of course, we will hire a local HR person to do the hiring, deal with local laws and stuff, but how can corporate HR help with the opening of the office in Taiwan?
DU- Well, there’s really a whole series of organizational diagnostics you need to do. One would be, what kind of organization are we going to need? What will be the culture and the values? How will people work together and what will be the work environment? What kind of capabilities is the staffer going to need to be successful? Are we going to need to be fast? Are we going to have to have quality? What are the organizational characteristics that the firm will need to succeed?
Secondly, what are the HR systems that will help us achieve these capabilities? One system is staffing: Do we want to hire local or do we want to hire expatriates? Do we want to hire part-time or full-time? A second system would be training and development: Do we want to bring in people from other sites and have them on part-time to train the new staff? That’s what Nordstrom’s does.
A third organizational diagnostic is compensation: What is going to be our compensation philosophy?
A fourth would be the broader recognition of philosophy and rewards: Do we give flexible hours? Flexible benefits? And if so, is what we do based on strategy and/or geographic conditions?
A fifth would be communication: How do we begin to build a common form of communication and culture within the plant?
A sixth might be policies and procedures: What are the policies and procedures within this plant?
Again, all of those six things and the HR systems will build a set of capabilities that will allow the plant to succeed in Taiwan. And the corporate HR person there really becomes an organizational diagnostician, as what they are really doing is redefining the role of HR, redefining the view of HR. HR is not the person who comes in and says, “Let’s get payroll processed.” It’s really an organizational consultant or diagnostician who helps build the entire organization to help a business succeed.
DC- So if we talk of HR as a consultant or diagnostician/change agent, do you think some of the other staff functions play a similar role? For example, is a finance director also a change agent?
DU- Absolutely. In fact, what you often have are teams. If you are opening a plant in Taiwan (if that’s where you are going to), you probably have a team of people: a legal person who understands local laws and restrictions, a finance person, an HR person, probably a geographic person. What often gets talked about is creating centers of expertise in each of those areas, which come together in virtual teams to help a company succeed. HR is just one of the members of those virtual teams.
DC- Everyone I talk to likes being a strategic partner. Whether an economist at a bank or an IT specialist, they all want to be part of that team. Are you concerned about there being too many people crowded around the table?
DU- Actually, I would argue that every employee should be able to say how his or her work relates to the business and, in some ways, that’s what you are probably hearing from economists. They want to know that when they are doing economic analysis they are helping their business succeed and not just throwing out paperwork.
DC- That’s true. But if we go back, who should be around the table for a company that’s trying to grow whether it be in Taiwan, or in manufacturing or whatever?
DU- Whether it’s a new division or whatever, there are usually three resources that every business needs to have at the table in order to succeed: One resource is money, and that’s your financial person; the other is people—the talent and the people to do it—and that is HR; and the third, which is getting woven in there quite aggressively now, is data and information. Usually you need architects of those three resources, data, people, and technology to succeed. And, of course, you need to weave those together in a way to serve customers. So I see these resources as ones that would be around any table.
DC- Now this all sounds very exciting and interesting; it’s what people want, but imagine I am the “Comp and Ben” guy: I have “Comp and Ben” stamped all on my forehead. I am administering all these existing programs and there are always new programs to manage. Frankly, I don’t see my job changing.
DU- I think there is going to be a bifurcation in the HR job. If I am the benefits manager and all I see myself as is admin, passing on and disseminating information, I will be blocked out I think. Some of that information is going to put over the web, some of that will be outsourced. If all I am is a transfer of knowledge from A to B, we will find more efficient ways to do that rather than having people in that value chain. Disintermediation is the buzzword, and you’ll just disintermediate people in the transfer of knowledge.
Back to compensation and benefits and your branch example: What are the goals of the business? If they are productivity and our turnover is over 140% we will never meet our productivity goals. If I can change the “Comp & Ben” program 20%, I think this will assist with our retention-bringing turnover from 140% down to 80%. Based on my costs, I think this will add value. It is then that I bring value to the business.
So this is the bifurcation, the transformational part of HR versus the administering part of HR—which is where everyone’s mind goes; you know, show me an HR person and I’ll show you the great eyeshade guy. All of this administrative work is going to get handled by technology. The transformational part, where value is created for the business, is where I think HR will have to move. Some will be able to make that move some won’t.
Some of the traditional “Comp & Ben” folks are really computers with shoes, because they are really transaction people. If they can’t make that shift they very well could lose some of their opportunities.
BD- I teach a course in Labor Market Economics.
DU- Sorry to hear that.
BD- What?!
DU- It’s a joke.
BD- What would you see as a key role for teaching Labor Market Economics to future HR managers?
DU- Give me an example of what you teach.
BD- For example the hours of work/pay and individual decision making around it.
DU- It is hard to answer your question. I mean what should a good HR person know in the future? I think the whole question begins, and it is the question I would ask it if I was looking at all at your course, “What is the business requirement?” Labor economics data is wonderful and it is certainly good to know, but I don’t think it is necessary unless I can deal with it as a value equation for the business. You are trying to win on productivity. Your utility for northeast Canada is clearly a commodity business and if you can’t get your costs down, you’re in trouble. Clearly your biggest variable is labor given the fixed costs of materials and equipment. Some of that data around productivity numbers will be central to your ability to ensure your operation is competitive. The question to me as a labor economist is not what I know, but rather what would the business need to know in order to do the job more effectively.
IT- Mergers and acquisitions are all the rage today. What is the impact from an HR perspective?
DU- The buzzword I am hearing is “conversion”. Mergers and acquisitions create convergence on two levels: one is industry convergence, and the second level of conversion is cultural conversion. For instance, AOL is merging with Time Warner and there’s a convergence of the creation of entertainment and information with distribution, and the auto industry has converged all over the place.
The question is how do we put the parts together. Just because we put two pieces together doesn’t mean they are going to work. I think how HR can play a major part is not at the industry level (How do you become the global automotive maker of Jeeps?), but in the way you make these two parts that you have got work in an integrated and efficient way. This gets very much into the area of culture; how we make decisions, how we manage people, how we manage compensation.
The other level of convergence that I think is key is when you build a house, the electrical system, the plumbing system, etc.; all really work together to make your housework. If you didn’t have heating in a Canadian house, it wouldn’t be a very nice house. I think in a merger you really have two heating systems coming together. Now you have to bring together those two systems so they are invisible to the outside world, and that’s your HR system—payroll, benefits, staffing. All the administration systems in a merger need to come together in order to have a unified voice.
DC- You’ve done some important work in the past, what are you working on now; what issues are you interested in?
DU- Three or four things and I will get into more detail with them in a moment. One is a leadership role, and I am more and more intrigued than ever with the quality of leadership. Businesses succeed because they have a quality of leadership at every level of the hierarchy. You want to brand your leaders, like a firm brands its identity, like Nordstrom’s has a service brand and Harley Davidson has a brand. The leaders really embody those brands and make the companies better to work with.
The second thing we are working on is employee commitment: how do you ensure an organization has a high percentage (90-99%) of it’s workers identifying with the firm, giving discretionary energy, and giving what they can every day.
A third piece is an HR measurement or score card system. How do you know that HR is providing value, and the buzzwords around that seem to be getting around the intangible aspects shareholders seem to value. Two firms may have different stock values even though they make the same cash, and some of that is an intangible difference. HR creates those intangibles. So those are the areas we are working on.
IT- I would like to follow up on that. One of the people we are planning on following up with is Jac Fitz-Enz. Do you think that’s the direction we need to move HR (Jac’s kind of measurements) or are there other ways of assessing?
DU- The kind of work he was doing at the Saratoga Institute was related more to the transaction side of the job—how much does it cost to hire somebody. Jac’s now moving more into the strategic work of HR, and measures around that. I think he’s asking, “How does HR build value?”
DC- A lot of the academic research on leadership doesn’t amount to much.
DU- Agreed. I think what’s happened is we have been asking the wrong question. We have been asking, “What are the generic characteristics of an effective leader?” They have energy; they energize others. What we are now intrigued with is the concept of a brand. You don’t want a generic list of attributes. What you want to do is turn those attributes into results. The question we have been trying to figure out is that leadership is not just about character—leadership is about turning a set of behaviors into a clear set of business outcomes.
HR.com would like to thank David Ulrich for this interview. We all know his great work in HR but it seems that he’s a great driver as well: he conducted this flawless interview while driving to the university and never missed a beat coping with traffic and our questions simultaneously.
From India, Pune
Dear Luma,
Welcome to the Forum.. :)
Haven't read the his book "HR Strategy – Business focused, individually centred" as yet. Please allow me sometime to go through it before i comment on the same.
My initial understanding of his subject from the net - is that we need to develop metrics to measure HR's performance to the Goals of the Organization and perhaps HR Scorecard is one step towards that.
Warm Regards,
Rajat
From India, Pune
Welcome to the Forum.. :)
Haven't read the his book "HR Strategy – Business focused, individually centred" as yet. Please allow me sometime to go through it before i comment on the same.
My initial understanding of his subject from the net - is that we need to develop metrics to measure HR's performance to the Goals of the Organization and perhaps HR Scorecard is one step towards that.
Warm Regards,
Rajat
From India, Pune
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