Are HRDs More Effective After a Stint in the Wider Business?

Exposure to a range of business functions may benefit the individual and organisation, making for better equipped HR and business leaders. Page Executive’s HR practice explores further.

The standard route to the number one HR role is fairly straightforward; work your way up through the ranks from HR adviser, with some time spent in an HR specialism like ER or reward, gain line management experience and impress the big bosses while doing it all. But would, say, a couple of years in a business unit leadership role or a secondment to the finance department not only equip HR execs better for HR leadership roles, but potentially for overall business leadership positions too? The lack of HR representation at the highest levels, and suggested reasons why, are well documented. Is it simply because HRDs don’t want the role or because they lack the required commercial and financial nous? If HR execs don’t aspire to business leadership, that’s an individual choice, but if their route to the top is blocked by a perceived lack of wider business awareness, could this be addressed by a formalised programme of exposure?

The benefits of wider organisational exposure

“A broader background allows you to understand problems from more than one angle. It encourages a breadth of thinking and enables people to understand how to get things done more effectively,” according to Lorna Clarkson, HR transformation consultant at TFL who previously held a variety of different functional roles within Royal Mail including senior marketing, innovation and HR roles. Richard Burdon, HR director - corporate at the BBC whose background includes business systems and marketing exposure, extrapolates: “But it’s not just about doing a non-HR role; you need to perform a line management position. Don’t get involved in a stand-alone role or project-based work. It’s when you step into a line management role outside of HR that this wider exposure becomes really valuable, when you need HR’s support as a manager.” It was the initial move from HR to another business function that caused Richard to first see the value in such a move. His perception was that his HR function was doing a great job, but looking at it from outside of the function didn’t present the same view. “It’s important to work in a line management role and go and be a client of HR. You can’t perceive the real issues unless you’re a client,” he said. Additional benefits to the organisation of facilitating cross-functional exposure can include:

• New viewpoints. HR leaders have first-hand knowledge of the complexities of the whole organisation and can add a valuable differing viewpoint to the new departments in which they operate.
• Commercial awareness. HR functions operate best when their priority is the business first, HR second. By HR leadership gaining hands-on exposure to P&L, financial processes etc, not only to they develop their own commercial skill set, but develop first-hand knowledge of the broader business agenda.
• Greater understanding of HR. Likewise, line managers spending time in an HR role would only boost their understanding of the value of the function to the overall organisation.
• Succession planning. If an organisation is growing rapidly or going through challenges, there is a group of employees able to turn their hand to more than one function, allowing risk to be managed more effectively.
• Increased engagement and retention. Key employees may become discouraged by a progression route that seems inhibited, either by the size of the business unit or function, or simply that their manager doesn’t look like they’re going anywhere. This can be eliminated by cross-functional exposure.
• Leadership potential. Chief execs often come from the functional area in which an organisation excels. Thus for companies whose main asset is their people and associated knowledge and intellectual capital, appointing a CEO who’s able to combine the requisite commercial and strategic influence with the proven people skills of an HR background can be of value.

The benefits to both the individual and organisation seem obvious, yet few people actively seek this type of exposure and even fewer businesses have formal programmes to promote it.

It’s down to the individual

Some HR execs perceive that they may be less attractive in a leadership position if they ‘dilute’ their skills and track record, that technical depth is more valuable than functional breadth. Additional exposure may stand an individual in good stead for business leadership roles, but for those looking for progression purely through the HR function, accepting a secondment may be viewed as a risk. Lorna agrees that occasionally this is the case, resulting in a catch-22 situation: she’s recognised as a ‘non-typical’ HR person, broadening the range of opportunities she could excel at, but considering pure HR leadership roles, her track record is sometimes deemed too varied. But, in general, this is down to individual business preference for technical expertise over general management know-how. “About 80% of these cross-functional moves have to be driven by the individuals themselves,” according to Richard. Lorna believes that it’s also about pushing for a move from a current employer, “it’s hard to change organisations and functions at the same time,” she said. Both agree that it’s important to ‘do it early’ – exposure to different functional at all levels is more effective than a single secondment quite late on in someone’s career.

When the organisation gets involved

Many businesses haven’t developed programmes that deal with this in a formal, sustained manner, according to Richard. In order for development initiatives to succeed, they have to be part of the business philosophy where behaviours are recognised, rather than necessarily functional skills. Lorna agrees that it’s crucial to ensure this development is part of the culture and doesn’t upset people in other functions when someone is parachuted in from HR to assume a leadership position. Educate staff that this is a formal growth programme for everyone’s benefit and make sure that the function that people are seconded to isn’t always the same.

From a practical point-of-view to instigate this type of programme, Richard suggests to “start small…look at your top 5% talent pool and then specifically focus on about a fifth of that. Make sure that there is a clear, defined plan in place for individuals and that it’s all planned and executed properly. Sell the benefits for the overall business.” Like most career and employee development initiatives, actively pursuing wider business exposure relies on personal and organisational drivers. To discuss if such a move could add value to your career or development and retention activities, get in touch.