Holding HR Accountable

 With evolving tools and processes that improve HR service quality and benchmarking, can HR leaders become indispensable to the day-to-day running of the business?
 
As an editor and writer, I lament not having the capability to exactly measure the effectiveness of my work. You can say that some yardsticks might be circulation, reader comments, and industry response. My counterparts on the advertising sales side, however, have more concrete gauges in the form of revenues. Most of the time, you can’t fudge the numbers.
 
Thinking about this, I recently reflected upon the dilemma of HR executives everywhere, who also struggle from time to time with measuring the effectiveness of their leadership, on the decisions they’ve made around service delivery and, of course, around their choices about outsourcing (whether to embrace HRO, how to go about doing it, the selection of vendors, etc.). Like editors, I suppose, HR leaders must rely much more on anecdotal evidence than their business partners when it comes to answering the question of effectiveness. The business partners, on the other hand, have clear P&L expectations that, most times, can’t be fudged too much either.
 
In both instances, however, both professions are evolving to give us a clearer picture of effectiveness. In publishing, the Internet allows us to track readership more precisely and quickly by tallying page views, click-throughs, and other readership indicators. In HR, evolving technology enables process owners to better measure utilization of learning technology, enrollment levels in benefits, recruitment and retention of top talent, and many more factors that ultimately—and this is key—have an impact on the business. In some ways, I’m envious of our HR readers because they have more tools that can go into their kits, and being that HRMS continues to be a profitable segment of the software business, those capabilities will grow in the future.
 
I’m envious only in some ways because with better tools, HR leaders are also more accountable to the business. The days of counting on HR strictly for payroll processing and benefits administration are long gone in most sizable organizations. Today, as our readers are well aware of, business partners and the C-suite look to HR for support on strategic initiatives—whether to staff up as part of a product launch, to reduce headcount as part of a restructuring, to move a business group as part of globalization, or simply to perform long-term succession planning. So getting that seat at the table is not without a price.
 
But hasn’t this always been the goal of HR executives—to help their organizations meet their business objectives? Now that they’ve arrived at the table, they’re also learning that they have their own kind of P&L obligations. The difference is that their currency isn’t counted in dollars and cents but in customer satisfaction, time-to-fill for job vacancies, payroll accuracy, and the like. Some of these metrics will be important to the board; others will not. What HR leaders must do is cull out only the most relevant HR data—those measures that actually affect revenues and costs—to share with business leaders so they can better understand the role of HR, assess its impact on their lines, and provide input to HR to improve its effectiveness.
 
I believe organizations that have outsourced HR services are in a better position to do this. They’ve done the heavy lifting, established service level requirements and metrics, implemented remediation processes, and are engaged with provider partners who are accountable—in the way that HR is now accountable to the C-suite. They can easily leverage this kind of process rigor to further its relationship with business leaders and make themselves an indispensable part of the day-to-day business.