Monday, 29 June 2015

Value your Human Resources

A recent article in Harvard Business Review proposes that the role of Chief Human Resources Officer should be elevated in line with a CFO and CEO and more focus placed on the value of its workforce. ‘Businesses don’t create value, people do’ (HBR Jul/Aug 2015). Human Resources is often seen as an administrative function rather than strategically important to growth of a business.

How does this translate to a small business where the HR function is often combined with the CEO role (along with many other roles). Firstly, it pushes you to consider your workforce in a strategic manner.  Look at the potential of employees and what they can add to the business rather than expecting employees to fit into a certain role. People want more than just a job in life, they want to feel inspired and part of something bigger. Viewing your human capital as a strategic element in your business model allows them to be part of that.

The article suggests that people should be paid what they contribute to the company. The finance and hr functions should work together to decide what is the value of the job and examine what the person filling it is adding to it. If your business needs to change in some aspect or is perhaps adding a new product or service then the finance element will have strategic goals and targets to reach but a business owner should look at each job in the business and break it down to set targets and timelines for the employee to achieve their own changes. Involve your employees in the process, ensure there is a good employee fit and you will achieve buy in much faster than without.