Ram Charan recently published an article on Harvard Business Review entitled, It’s Time to Split HR. As you can expect, it is the typical article that demonstrates to business leaders the Human Resources function is nothing more than transactional, it doesn’t provide CEOs with the sounding board they need, business acumen is lacking and people and numbers are not connected, and the end result is there needs to be a split of the department.
While I agree there are opportunities for the HR function, I would also throw that same agreement across all departments of the organization. I have had the opportunity to experience many Operations, Marketing, Finance, and Accounting professionals who may get the numbers, but they do not get the people. Therefore creating yet another broken link that HR becomes responsible for fixing.
Which brings me to the question I always have for authors of articles such as Mr. Charan’s, Do CEOs really provide CHROs with the opportunity to be a business leader? I am sure the typical answer to this question would be yes, but I ask it because I believe many people simply assimilate with HR on dealing with people and not getting how the numbers incorporate the people. Therefore, when it comes to speaking about Finance or Marketing, they can be classed as business leaders because what they are producing yields a number. This gap in my opinion is a lack of understanding on business acumen.
Wikipedia defines business acumen as: keenness and quickness in understanding and dealing with a business situation in a manner that is likely to lead to a good outcome.
What I love about this definition is it is all encompassing. When it comes to dealing with a business decision, it isn’t just about numbers. It is the numbers, people, abilities, decision making, understanding how decisions affect the entire organization, risks posed, and so on. Now take a peek in every organization, there are gaps with “business acumen” across the board – not just HR.
What is Needed
To continue to close the gap on business acumen, there are three areas I feel leaders and contributors can focus on.
- Self-Awareness: self-awareness is something I greatly believe is lacking in today’s workplace. Part of this is attributed to a society which has begun to shift blame and not take ownership where it is needed, but the other part is people don’t care or they don’t want to know. Wake up people! Self-awareness is what helps drive strong business acumen. If you don’t have the capability of analyzing your impact, where you have opportunities, or how to improve, then you will never make progress.
- Develop: If you find you are not as strong in the numbers, leading employees, or identifying gaps within the organization (to name a few), ASK for assistance or an opportunity to learn. Asking for assistance is not a means of weakness – if you think it is, then please do not expect to move up any time soon. Part of knowing when to ask for help is part of your ability to self-reflect on your capabilities. The more you allow your skillset to fall backwards, the less effect the organization as a whole becomes!
- Influence & Build Partnerships: Partnerships are crucial to success in an organization. One group cannot lead the charge to make the entire business successful; therefore, embrace partnerships. Stop hoarding or controlling duties because you are afraid someone else is going to take them. Educate and influence people with your knowledge and incorporate those people into your projects to make it even stronger. Sure, we all want to be recognized for the work we do. But keep in mind, when we start excluding key partners in decisions or projects which will impact others, is when you open yourself to situations where recognition many not come into play, rather failure.
While these three areas are not the end all be all, they are a starting point. Is there much more that can be addressed in the way of business acumen? SURE! But without the framework, you will not formulate a building. Numbers are something which are very black and white, but the means to get a number is not. People are who make numbers happen and people are more complex than simply adding a zero on a spreadsheet. Intelligent business acumen is the ability to educate, influence, and lead people to get the best out of them. And in some situations, understand when a change needs to occur and how to handle that effectively.
So, Mr. Charan, the next time you want to say HR needs to split up because they lack business acumen, take a look in the mirror and understand that same split from your words, may need to be the entire organization.