Evidence-Based HR

CHRO Challenges

A new survey reveals the top three challenges facing HR. Advice on how to turn them into opportunities.

By Paul Mandell

Chief HR officers (CHROs) of today’s global businesses have more on their plates than ever before. From new laws and regulations that differ by jurisdiction to an evolving international labor supply, the challenges of
HR management seem to multiply and become more complex with each passing day. Consero Group’s Chief HR Officer Data Survey set to gain the perspective of senior corporate executives with the goal of identifying their most significant challenges. The survey results point to three top concerns -but with proper planning and advice, they can be overcome.

1. Challenge: Competing for resources. Managing the HR function of a large operation is no easy task. As the labor market evolves, CHROs need a strong team in order to recruit, hire, train, and retain a productive workforce. While 62 percent of survey participants felt that there are enough professionals available in the market for hire, 55 percent report that the department in which they work has insufficient talent to achieve its goals. In addition, 55 percent of those surveyed report that their department is generally under-resourced. While any number of factors can impact an HR department’s ability to scale, a lack of resources certainly does not help.

To address this issue, CHROs may want to consider making a more concerted effort to get buy-in from the rest of the C-Suite to procure the staff and other resources needed to support the HR function properly. Given that every other department at the business is competing for the same resources, CHROs must be proactive and advocate for the necessary support – budgetary and otherwise -to serve the company’s best interests over the long term.

As a starting point, consider pursuing support from colleagues in other departments -the senior executives managing sales, marketing, and finance, among others. With the right vision of the HR department’s full potential to transform other teams, these corporate leaders can be your most powerful allies as you work to influence the CEO and other senior leadership.

2. Challenge: Lack of succession planning. The survey data also raises the issue of succession planning. A total of 44 percent of the CHROs surveyed report that they have not identified a successor to replace them. In addition, 38 percent indicated their organization has no succession framework in place.

The absence of a clear succession plan for any important role carries risk, and the issue is compounded when it comes to the CHRO. As the in-house experts on hiring, retention, and general staff planning, HR executives should lead by example by establishing a clear succession plan for their position. By taking succession seriously, they give weight to the long-term vision and goals of the organization, as well as minimize the disruption caused by unplanned departures of senior executives.

Perhaps just as important, having a clear succession plan in place offers significant atmospheric value to the CHRO. As CHROs compete for valuable resources, they must ensure that others appreciate the importance of the HR function to the success of the entire enterprise. One clear way to demonstrate this importance is to ensure there is a plan for replacing the person at the top in the event of an abrupt departure. By the same token, the absence of a succession plan risks trivializing the role in a way that can be counterproductive in the effort to secure more resources.

3. Challenge: Wellness programs lagging behind. When it comes to wellness programs, the survey results indicate that companies are not seeing a significant return
on investment in monetary terms. Fifty-six percent of participants find that they have not achieved a significant reduction in healthcare costs through their wellness program. In addition, an alarming 48 percent of respondents report that they do not believe their wellness program is effective.

Such findings may prompt some organizations to question the relevance of these programs. However, a lack of significant reduction in healthcare costs does not necessarily indicate that wellness programs lack value. Organizations invest in wellness programs for a variety of reasons -increased productivity, company morale -other than to improve the bottom line. But the cost of wellness programs is worthy of analysis since dollars for such initiatives could be used for salaries and other benefits that appeal to employees. As a result, CHROs should consider these findings and think critically about the purpose and direction of the corporate wellness program.

Of much greater concern is the data on wellness programs apart from the impact on healthcare premiums. The fact that nearly half of the repondents question
the value of wellness programs is a sign that they
require more analysis. Given the many health-related challenges present in the modern world, it seems unlikely that corporate wellness programs have outlived their relevance. Instead, it appears that, in large corporate organizations, wellness programs have evolved in suboptimal ways.

The CHRO can play a critical role in tailoring wellness programs to the current needs and interests of the workforce. In overhauling an existing program or developing a new program, CHROs should consider first the short- and long-term goals of any such initiative
and ensure that they are aligned with the most recently stated priorities of the business. Next, CHROs should look carefully at the specific elements of the wellness program and determine whether those elements advance their goals in a satisfactory way. As with any other successful corporate initiative, both the strategy and the execution must be sound.

As we head deeper into 2015, CHROs should take a long-term view of the HR function and the institution as a whole, focusing on developing infrastructure for sustained growth. With any new initiatives, CHROs need to focus the execution based on the vision in order to achieve an outcome that can justify the investment. This will help turn challenges into opportunities.

Paul Mandell is founder and CEO of Consero Group.

Consero Group’s Chief HR Officer Data Survey


Tags: march-2015

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