Ultimate Performance: Measuring Human Resources at Work

The Real Value

The central problem is that HR has not explained to its clients the true importance of its mandate. The conventional thinking about HR reflects the paradox facing line managers. If people are the ‘most important asset,’ why is the HR function often thought of as an administrative overhead? For the most part, this perspective has been justified by the role that HR has played in the past, emphasizing administrative efficiency and compliance. The term “HR police” is not an unjust characterization. The narrow-minded view of “climbing up the pyramid of value” strategy attends to the desire of HR professionals to work on something significant within their organizations, but it fails to address the critical need that companies have to improve the effectiveness of their workforce—a need that HR is uniquely qualified to address. A strategy that continues to focus on the details of administration aims in the wrong direction and will only continue to reinforce the belief that HR people in general just don’t understand, or have the capacity to address, the real business of the organization. This strategy of fixed/focusing on HR is doomed to fail because it addresses only a small part of a larger opportunity, and it attempts to deliver only a small portion of the solution.

Though HR owns most people-related functions, it is rarely true that HR is given real responsibility for the effectiveness of the company’s people and the company. HR typically has responsibility for people ...