Thenew economy and the era of knowledge workers have produced a new breed ofsenior directors with dynamic job titles and roles. But is this the natural evolutionof HR or a threat to HR as we know it? Jane Lewis looks at six examples of thenew HRIf you laughed when you first heard job titles such as “talentchampion” or “transformation director” then the smile might endup on the other side of your face. Many of these new titles are grounded inmodernity signalling a new-wave approach to management, a recognition thatstructures are flatter and previously distinct boundaries between departmentsare breaking down. Even the more far-fetched terms conceal a serious intent. Byfocusing both the holder of the position and the wider company on the brasstacks of what a position really entails, a real cultural shift is possible. Some of the new roles are simply evolutionary, emerging as extraresponsibilities were gradually added to an existing role. Others mark theculmination of a long and varied career, in which all past skills were broughttogether under one umbrella. In some instances, it is impossible not to discerna modern form of empire building. The emergence of the new roles is no laughing matter for the traditionalHRpractitioner, not least because often the roles deliberately bypass theHRfunction. So are these HRroles and can HRpeople do them? And how can theyequip themselves for the roles and gain the credibility with the board to getthem? Two distinct traits seem to unite many of these new-breed practitioners.First, they seem to share a strong belief in the power that people can exertover the success, or otherwise, of any organisation – several of thoseinterviewed had experienced a kind of epiphany on this score in a past project.Second, they all look to the future. Many of these new roles were born of adissatisfaction, irritation or frustration with the way the existing HR modelwas being run in their company. So how much of a threat do these new roles pose for HR as a profession? Youneed only look at the way Microsoft’s financial director Steve Parker stormedthe fortified castle of the company’s HR department, decimated it andrefashioned it his own way, to get the point. The message that many of thesecombined “people roles” throw up – often taken up by professionalsfrom other disciplines – is that there’s no resting on your laurels these days.With people seen as the most important asset in the service economy, there’s noshortage of candidates from other disciplines queuing up for a slice of theaction. In the final analysis the message is clear – reform or prepare to beannexed. 1. The Transformation DirectorAt the height of the new economyfrenzy two years ago, the ability to change was seen as the single mostimportant characteristic that any company could possess, often even surpassingthe ability to run profitable product lines. Such was the perceived threat of thenew business models championed by the dotcoms, that any traditional company,however powerful, could not be seen to be standing still. It sometimes seemed,to the cynical at least, as though change for change’s sake was the order ofthe day. “There is now an irresistible fashion for perpetual corporatemodernisation, however disastrous its consequences,” wrote the columnistAlexander Chancellor at the time.This was the era that saw the birth of the transformationdirector. The new role was a tangible sign that a company had recognised thenew paradigm of horizontally structured, customer-centric, project-ledorganisations – and intended to do something about it. In recognition of thepivotal role played by the Internet in this shift, the post was frequentlytaken up by progressive IT directors. But when the e-revolution hit HR, a newbreed of eHR/transformation experts began to emerge.At first the remit of most eHR managers was relatively narrowin scope. The brief was to make maximum use of the new tools available toupskill the capability of the HR function. The unofficial brief was often toreduce costs – a feat that eHR accomplished in spades, producing dramatic savings and headcountreductions among many of its early practitioners.The arrival of eHR outsourcers such as e-peopleserve and Exultoffered the possibility of even bigger savings, converting a fixed costembedded in the business into a variable cost. Companies that outsourced foundthey could increase or decrease the volume of activity according to businesscircumstances.Deployed wisely, it soon became clear that eHR was also apowerful transformational agent for the HR function itself. By effectivelyfreeing HR professionals from the drudgery of business administration, itopened the door to new roles at the heart of the business that had previouslybeen denied them.But the full scope of what eHR could achieve on the widerbusiness only became apparent when it was linked with mainstream businesstransformation. Indeed the success or otherwise of the new technologies hingedon a revolution in business. You couldn’t expect to make radical changes withe-enabling tools, without altering the systems and processes that underpinnedthem. It was this recognition that propelled many eHR practitioners to theforefront of their company’s drive to redefine and upskill the organisation asa whole. If you want to get involved in strategy with a capital “S”,this is the role for you.eHR/transformation roles call for a raft of skills that may beunfamiliar to many HR professionals. Clearly a knowledge of what technology canachieve is critical to the role, but even more important is a thoroughunderstanding of corporate structures and processes: how they work, how theyinteract with each other and how they can be best optimised to drive thebusiness’ strategic aims. Moreover, if the outsourcing model is pursued, youwill need to acquire new skills in defining and managing third-partyrelationships. Finally, you will needreal drive and commitment. Business transformation is a tough process and youwill need a skin to match.Case study: Martin ReddingtonDirector of eHR transformation at Cable & Wireless In the crisis-ridden telecoms sector, Martin Reddington is thekind of manager you want on your side. Clearly an individual imbued withunusual drive and determination, Reddington believes the ability to moveforward is a discipline in its own right. During his comparatively brief tenureas director of eHR/transformation at Cable & Wireless he has certainly madehis impact felt. Appointed director of eHR transformation last year by C&W’sgroup head of HR, Martin Hayton, Reddington’s immediate objective was toachieve cost savings in the HR function. But his remit also included the widerbrief of creating the kind of internal structure that would help propel C&Wfrom its status as a traditional telco to that of a multinational data andInternet services provider. An important part of Reddington’s job was to shoreup international practice – to spread uniform processes across C&W’soffices in Japan, the US and Europe. “When we began we were 80 per cent local and 20 per centglobal. The situation now is the inverse of that.”The sharp wind of change has also been felt within the HRfunction itself, where both staff levels and the budget have been slashed by 40per cent since Reddington arrived. “The original intention was to go for a20 per cent budget reduction,” he says. “We’ve been able to take amore aggressive attitude to head count reduction.” Survivors in the department have also felt his impact.”We’ve been putting them through a series of capabilities workshops,change management, project management and consulting. Most are now businesspartners or specialists.” The change has created a much more positiveatmosphere in the department, he says. “Freed from the murky swamp ofadministration, they can now practice HR as a higher level skill and can reallyinfluence the performance of the management units they have responsibility for.”Underpinning this transformation is a fully integrated HRservice delivery model based on SAP software, with bespoke C&W toolslayered on top. As far as Reddington is concerned, “the jury’s stillout” on the question of outsourcing. But having studied the outsourcingmarket for almost a year, C&W is now at the “detailedsolutioning” phase of negotiations with one supplier.With a career that spans nuclear engineering, marketing, brandspecialism and project management, Reddington is the first to admit, “I’mcertainly not an HR man”, though having designed a whole range of newprocesses for the function he says,”I now understand a lot more about HR”. He sees himself primarily as a transformation specialistleading programmes from “the point of view of what the business isattempting to do”. Having begun as an engineer with National Power, hemoved into telecoms with Nynex, which was later combined into C&W.Reddington played an important role in launching the combined company’s new brand,before moving to head up global communications in C&W’s millenniumprogramme.Following his appointment to the new role, a timely three-dayconference on eHR helped Reddington get his bearings. “It became veryevident that eHR is not a journey dominated by technology. It should be seen astransformational, but not driven by technology.” He believes that thefailure to recognise this important distinction has led to many programmesstalling in other companies.”We produced a business case which took ages, but has beenworth its weight in gold. It covered a whole raft of intangible benefits ofwhat could be achieved if the business was e-enabled using systems.” Butit also concentrated on the hard-stuff: costs saved, costs avoided and revenuegeneration.”I don’t think I am very popular in certainquarters,” he says. “But because I cannot be labelled an HR person,I’m seen to be impartial – I came with a very fresh open mind.”Nonetheless, an important mainstay has been the “unswerving resolve”of C&W’s general HR management to see the programme completed. “Ifthat hadn’t been demonstrated – if there’d been even a whiff of weakness orsquidgy-ness – this discipline of moving forward would have been severelyimpaired.”Is this a transitional role? Reddington firmly disagrees.”The journey never stops – there are always refinements to be made.”And he now hopes to take the eHR processes and systems that have been developedat C&W to market. “I would like to convert what we’ve done and offerit to other customers.” All things considered, the eHR transformationprogramme “is one of the most interesting things I’ve done in mycareer.”This combined role personifies the belief that the way you treatpeople as individuals not only defines the ethos of an organisation, but alsosends an important message to its target markets. Indeed, in some companies,particularly those at the sharp end of the service sector, it is noexaggeration to say that these values are the main marketing message,inextricably caught up in the wider brand and service offering.2. The head of organisational changeThis combined role personifies the belief that the way you treat people asindividuals not only defines the ethos of an organisation, but also sends animportant message to its target markets. Indeed, in some companies, particularly those at the sharp end of theservice sector, it is no exaggeration to say that these values are the mainmarketing message, inextricably caught up in the wider brand and serviceofferingThe title director of people has been frequently ridiculed in some circlesas no more than a trendy new name for existing functions. What’s wrong with HRdirector? they ask. Well, quite a lot. Exponents of the new role are the firstto point out that people and organisational development is in fact an entirelydifferent discipline from traditional HR with its emphasis on procedures,processes and competencies. Indeed, in many companies it exists in parallelwith the HR function.In others, however, the term has come into use as a reactionagainst established HR practice – a desire to break free of the perceivedlimitations of the past with its endless red tape and bureaucracy, andconcentrate on the talents and mindsets of individuals. The essence of the newthinking is that each employee is much more than a cog in the corporatemachine. For better or for worse, it is the individuals who shape companies.The best organisations, according to Gallup’s senior European vice-president,Graeme Buckingham, are underpinned by “a very passionate beliefsystem” springing from the collective articulation of individual goals. Inthe companies he studied, the main priority of the best managers was to find”fulfilment for the individual”. Writ large, this meant “astrong belief in the importance of HR to the future of the organisation”.Traditionalists also miss the point when they consign”development” to the old-style training category. Organisationaldevelopment is much more than training (though constant reskilling forms alarge part of its remit). Its most important function, however, lies intranslating an often unarticulated and sketchy set of values into the kind ofpolicies that can drive business growth. As such, it can be compared to aconjuring – to magic a substance out of thin air.What kind of skills do you need for the job? Certainly, theability to “think out of the box” is likely to be critical to anyprocess of translating intangible values into practical policies. And you willalso need an in-depth knowledge of the business, its aims and purposes. Aboveall, you need to be able to understand the often complex relationship betweenindividuals and the structures they operate in. Many practitioners believe thatnothing less than a full degree in organisational psychology will cut themustard these days.Case study: Chris Goscomb Head of people and organisational development at easyJetDespite its recent travails, easyJet remains the epitome of acompany whose success is interwoven with its corporate ethos. In the earlydays, its value system seemed to mirror the personal characteristics of itsfounder Stelios Haji-Ioannou: laid back in style, yet rigorous about detail.And above all imbued with a certain kind of passion.But as Chris Goscomb explains, the formulation of easyJet’snow-famous employee brand was no casual evolution, but a deliberate strategicplan. As with many other aspects of its operation, the company took much of itsinspiration from the pioneering no-frills US carrier, South West Airlines,which had long had a strong “people policy” in place. But when Goscomb joined the company four years ago as a servicestandards manager (he says his current role just “grew” over theyears), many of the key elements of the easyJet’s ethos were as yet undefined.Certainly, the company knew which direction it wanted to take – “that itwould have a flat structure and involve people” – but these were largelyunstated aims. The main challenge he faced was “to make it happen, to makeit real”.Goscomb, whose background includes stints as an operationsmanager with Eurotunnel and London Underground and more latterly as amanagement consultant specialising in leadership and crisis, learnt the valueof people early. “My initial post-university training was focused onlogistics. But I learnt that if you want to make a difference, you had toinvolve people implicitly.” The basic tenet of the easyJet ethos he has evolved is”that everyone makes a difference”. He considers this particularlycritical in the current environment of turmoil in the airline industry, where astrong employer brand and ethos can have a substantial impact on sales.Goscomb, who also handles internal communications andmanagement development, works in parallel with easyJet’s acting head of HR,Deborah Woodward, who presides over a department handling policies, practices,procedures and deployment. “We do work incredibly closely together. But welook at the world from a different perspective,” he says. “If youreally want to wind him up, try calling his remit ‘soft’. Much of what we do is subliminal, but I personally view it asthe harder stuff,” he counters. “It’s the bits and pieces that sitbelow what people see. It’s the bedrock”. And while the HR department is certainlyinvolved in many “tough” areas, “it tends to be looking here andbackward – we’re looking here and forwards”.There are some tensions and conflicts to overcome. Goscombadmits there can be a conflict between applying good business practice and maintaininga strong people ethos. “It’s easy to do one or the other. The tricky partis combining them.” He has established what he calls a Paradox Model tocounter the problem.Is organisational and people development a luxury likely to beswept away if the hard times hit? Absolutely not, says Goscomb. “It’s sokey to what we are doing, it would be like cutting the heart out of thecompany.”3. The HR and IT consultantDespite obvious appearances to the contrary, IT and HR have a lot in common.Both are departments whose perceived value to most businesses has leapt frombeing, at best marginal 30 years ago, to a current status in which they areviewed as pivotal to future success. Both have had to struggle to achieve thisrecognition. And both have come under constant criticism for being slow atcoming forward. If you think HR gets a bad press for not understanding thebusiness properly, you should see some of the criticism that’s been meted outto IT over the years.In many companies the first joint effort between IT and HR wasthe payroll system. But as personnel applications became more pervasive andambitious in scope it became clear that the relationship wasn’t working –largely as a result of ignorance on either side. While most HR practitionershad little idea about how advances in technology could help improve their lot,even fewer IT specialists possessed the kind of business knowledge necessary toregister the transforming impact that a well-designed system could have on HR.All too often the resulting systems, while possibly excellent in terms of theirtechnical prowess, bore very little relevance to the kind of tools that HRpeople actually needed. Out of this frustration the IT/HR hybrid was born.The main role of the IT/HR hybrid, therefore, is to act as akind of bridge between pure business and pure IT. Not only do they understandthe business needs of the HR function, but their technical knowledge enablesthem to interface with what one expert calls the “deeper” technicalstaff.This fusion of roles was certainly accelerated by changes intechnology. The move to distributed systems in the early 1990s helped create anew breed of HR super-user, quite capable of specifying and occasionallysupervising, the creation of systems tailored to meet specific needs. In recentyears the level of IT literacy within HR has come on in leaps and bounds. AsRay Leighton at IBM points out, “The 16-year-old computer whizzkid hasmatured into a 25-year-old who works in HR.”More recently, a further change in approach has driven the needfor people who can straddle both disciplines. During the glory days of ERP(enterprise resource planning) software, there was a fundamental assumptionthat the processes specified by software giants such as Peoplesoft, SAP et al,were best of breed. If a company’s existing processes didn’t fit thosespecified by the software vendors, it was up to that company to re-engineer itsbusiness to make the match. But thisone-size-fits-all theory has been repeatedly called into question. Apart fromraising obvious questions about competitive advantage, it is now establishedwisdom that really effective systems are made by matching software to processes– not the other way round.Thus the need for individuals who understand both the mechanicsof the business and the possibilities conferred by IT has never been higher andIT/HR hybrids are in big demand.Casestudy: Ray Leighton Executive consultant at IBM’s eHR consulting practice”If you’re going to combine HRand IT, it helps to work for the world’s largest IT company,” says RayLeighton. “There’s always someone expert around who can help you.”Leighton’s background is pure HR. He began his career as apersonnel graduate at Scottish & Newcastle Breweries before joining IBM’smanufacturing plant at Greenock, where assignments included training,communications and salary bench-marking work. Following a move down south toIBM’s Portsmouth head office, he became a job evaluation expert, before movingon to the company’s labs near Winchester to cut his teeth on more generalist HR– managing both HR administration and operations.Leighton is the kind of chap who likes to keep on the move, soit wasn’t long before he made his first foray into systems strategy. In 1990 hejoined a team to develop an internal pan-European HR system and this soon ledonto another technical project defining a new HR product with another leadingUK software supplier. Although the resulting product never came to market, theexperience proved invaluable to Leighton personally. He spent a lot of time definingrequirements, modelling data and mapping processes. “It gave me anin-depth understanding of what not just one, but a lot of other companieswanted, out of an HR system.”It was time for a complete change. Leighton was chosen to runIBM’s career transition programme, part of a mid-90s downsizing exercise thatsaw Big Blue’s UK head count drop from 20,000 to 9,250. The broad breadth ofknowledge he had already amassed from his varied background with the companystood him in good stead. He was breathtakingly efficient, reducing the timebetween someone choosing to accept voluntary retirement and talking to anoutplacement consultant from three weeks to three days. Meanwhile, internalsurveys showed a dramatic increase in customer satisfaction with the process.For Leighton, this was a salutary exercise, it showed him the very real impactthat good systems based on solid processes could have on the welfare of individuals.But the success of this project also highlighted Leighton’sgrowing dissatisfaction with IBM’s HR function, which he increasingly viewed astoo administrative in outlook, too inefficient in service delivery, andover-concerned with hierarchies. Frustrated with this state of affairs, he quitHR and retrained as a salesman, taking up a position in general sales. Soonafter, however, a position that would enable him to make maximum use of bothhis HR and newly acquired IT skills came along. When IBM announced it woulddevelop and sell a specific HR suite of applications, Leighton was clearly theman for the project. He joined a team of five that spearheaded the company’spush into HR and payroll applications.After a long journey, Leighton appears to have found his realmetier as a supercharged IT/HR hybrid. He operates as a consultant advising organisationson how they can transform their HR function to the new e-business model for HRservices. His remit covers everything from strategy, through businessmodelling, to advice on outsourcing and self-service.He sees the trend towards a greater marriage between HR and ITas inevitable and predicts the rise of many more IT/HR specialists. A growingnumber of HR professionals, he claims, have already become more than aware”that IT is a tool that they can use to leverage their position within theorganisation”. Those who either fail to see, or refuse to take thisopportunity could well find themselves consigned to oblivion, he warns.4. The human capital directorAccording to one management thinker,the very expression human capital encapsulates just how far the HR professionhas evolved over the past 40 years. During the 1960s and 70s, the mainchallenge facing many HR departments lay in bringing together the warring sidesof management and the workforce. Later, at the height of the Thatcher era, the key preoccupationwas rationalisation and downsizing. Within a few years the focus had moved onto quality – TQM – and an obsession with process-driven activities. Humancapital, he argues, reflects the latest metamorphosis of the profession as a hard-nosedbusiness partner, responsible for nurturing, managing and extracting maximumfinancial reward from a key corporate asset – intellectual capital.The notion of the workforce as a capital asset is often thoughtto derive from new economy thinking, which frequently sought to elevate manyother so-called intangibles on to the balance sheet – a company’s ability toform customer relationships for example. This impression is quickly confirmedif you conduct an online search. According to Brett Walsh, head of humancapital at Andersen UK, in 1998 there were no less than two million Internetsites mentioning human capital – a figure that has undoubtedly grownconsiderably in the intervening three years.But as Walsh points out, the term was first used much earlier.Indeed its originator, the US economist Theodore Schultz, the so-called”father of human capital”, won the Nobel Prize for Economics for hispioneering work on the subject as far back as 1979.Nonetheless, it took the bombshell of the neweconomy to put human capital firmly on the corporate map. You could tell howseriously the concept was being taken when even an outfit like Stern Stewart,formulators of the EVA value assessment tool (as hard-nosed a financialmeasurement tool as any) began attempting to factor human capital into itscalculations.The problem with the notion in its purest sense, however, isthat despite extensive attempts no credible means of measuring the financialvalue of people has yet emerged. Indeed, there is a growing school of thoughtthat maintains the quest will remain forever fruitless on the simple groundsthat however much we may hope to the contrary, it will always be impossible toevaluate “soft” assets in the same precise terms as their”hard” equivalents.It might be argued that this quest to put a financial value onhuman capital misses the point anyway. The real value of the term lies in therevolution of perceptions it has wrought. The human capital movement proved tobe the last nail in the coffin of the previously widely held belief that peoplewere a draining cost on companies. The fact that so many organisations nowclaim, with varying degrees of credibility, that their “people are theirmain asset” shows just how far-reaching the movement has become.Casestudy: Brett Walsh Partner and head of Andersen Human Capital UKBrett Walsh believes the term human capital is highly symbolicof the journey HR has taken from its role “as a policeman to personnel, toa strategy function that talks the same language as the financialdirector”. He believes there has been a major shift in how the marketsview human capital. “The whole concept has taken on a much sharper focus.More organisations are quoting a market value that’s higher than their bookvalue on the basis of people value, knowledge and networks – they are realisingthat the people asset leads to profitability.”On this basis, Walsh maintains, the main remit of any directorof human capital is to invest as much as possible in the resource. For him, thereally compelling truism is that “people are the only asset in anorganisation that increases in value the more you invest in it”. Moreover, several macro-economic factors now combine to makethe argument even more pressing. In the teeth of an economic downturn, the”war for talent” between companies is likely to become even more hardfought. And the long-term picture of a declining birth rate and ageingpopulation should focus the minds of companies even more strongly. As Walshsees it, the main priority of HR function in the current climate should besimple: to do as much as possible to attract people to the organisation, andthen work hard to retain them. He believes the greatest HR challenge at presentis global talent management.Walsh’s own journey into people management took a circuitousroute. He began his career as a chartered civil engineer. After studying for anMBA and a part-accountancy qualification, he became a manufacturing consultant.His people epiphany took place while he was working on a project in Italy. Hewas brought in to help a US organisation that had lost confidence in itsability to turn round a failing southern Italian factory. Walsh’s discovery was that the real problem lay “with thepeople not the process”. “There were enormous differences between theshopfloor and management in Italian culture,” he says, which were impedingproductivity. This realisation was the starting point of reform. “I wentin and turned it around in six months.”After stints at both Hay Consulting and Accenture, he joinedAndersen, where he now heads up the Human Capital practice. Walsh’s role isboth inward-looking and outward-facing. Although the practice frequently offersits expertise to internal groups (human capital is a line function atAndersens), the main focus of effort at present is in building up the externalpractice. In a nutshell, Andersen HumanCapital aims to provide all the services any HR director may need from adviceon strategy and outsourcing through to compensation, pensions and internationaltax advice.According to Walsh, this dual remit gives the practice realedge. It allows it to draw on new ideas and best practice from a wide varietyof sources. “Both sides inform the work of the other,” he says. Asfor his own future plans, Walsh is determined to stay with human capital.There’s no reason to move, he maintains. “This is a real growth area.”5. The head of knowledgemanagementIf you were asked to name the twomost powerful new forces in business over the past decade which would you choose?Odds are that knowledge management and communication would rank highly on anylist. And many would argue that, as essentially people-centric activities, bothfall squarely under the banner of HR.But surveys show that in practice very few HR directors havemanaged to land direct control of either of these vital new forces. The problemis clear, both knowledge and communication are considered so central to thestrategic heartbeat of the 21st century organisation that everyone wants apiece of the action. In fact, the twin areas of knowledge and communicationcould be described as the corporate equivalent of the war zone – an area ofterritory fiercely contested by candidates from a variety of disciplines,including finance, marketing and IT.Some claim that HR’s failure to seize the initiative in theseareas is just another example of the profession’s lack of gumption when itcomes to seizing the main chance. If you take control of internalcommunication, for example, “The opportunity was there for HR, but itdidn’t leap through it”, says Owen Hargie, professor of communication atthe University of Ulster. “There’s not a tendency to be proactive in HR,to identify the potential niches they might influence.”According to a survey of 235 internal communications expertsconducted by Collinson Grant, just eight per cent of those operating at asenior level in this area hailed from an HR background, the majority had beguntheir careers in either marketing or PR. Yet the report’s author Tony Green claims thesefindings go against the grain. “The implication from the research we didwas that HR was the preferred route for managing [internal] communications –and my experience supports that.It’s a similar story when it comes to knowledge. Studies show thatthose companies which have acknowledged the crucial contribution of theirknowledge-base to the bottom line – by creating a new category of ‘knowledgeofficers’ for example – rarely go recruiting in the HR department. Heads ofknowledge are far still far more likely to spring from the engine room, from ITand finance, or from hybrid general management specialists than they are fromthose with an expertise in people.There are signs that this is beginning to change.Responsibility for internal communication, in particular, is beginning to gaina wider recognition as an specialism – particularly within companies whose HRdepartments have actively championed new means of communication such asintranets. Moreover, many HR professionals will argue that, contrary to whatthe studies say, they are closely involved in both areas on a day-to-day basis.If this is the case, it’s time to articulate it. More HR people should follow the example of Dr Anil Kumar (seebelow) and insist on the inclusion of these attributes in their titles if theyoccupy an important chunk of their working lives. As he says, “My originaltitle was just people and knowledge. But I wanted communication to be explicit.It’s symbolic of what we do.”Case study: Dr Anil Kumar Head of people, knowledge and communications at the Chemical IndustriesAssociationWhen Dr Anil Kumar saw his current job advertised at theChemical Industry Association, he knew it was made for him – combining elementsof his highly diverse past career in a unique integrated way.The Chemical Industries Association represents the UK’s leadingchemicals and pharmaceuticals companies including GlaxoSmithkline, BP, Shell,Exxon, as well as some small- to medium-sized companies. “Our overridingmission is to help members sustain profitability, and improve recognition oftheir contribution to society,” says Kumar.His own directorate has a gargantuan brief. In all, Kumar isresponsible for setting standards on education, training, science andtechnology, as well as employment and and communications, to a total of 250,000people in the industry. More immediately he is responsible for 30 people in hisown directorate.The communication aspect of Kumar’s role is outward as well asinternal. “We are the interface between the industry and the CivilService”, he says. And that means that strong lobbying skills arerequired. But Kumar is also responsible for maintaining a dialogue with tradeunions and a raft of NGOs (non-government organisations). Indeed, he has spentthe past 18 months devising a communications strategy that encompasses allthese groups. “It’s a virtuous circle,” he says. “Reputationbuilds trust and that in turn builds business.”The developmental aspects of the job are equally far-reaching,encompassing innovations in people management as well as technology andtraining development opportunities. “People across the industry are notjust multi-skilling, but continually upskilling,” he says.Much the same could be said about the progress of Kumar’s owncareer. After several years acquiring a raft of scientific degree and doctoratequalifications, he joined Glaxo as a scientist and chemist. Within a year,however, his people skills were recognised and he was poached by the HRdepartment to take responsibility for graduate recruitment. From there he roseto join Glaxo’s senior management team with a brief covering training andskills implementation, before switching his attention to science policy. Atsome point in this hectic career, he also managed to fit in an MBA.Between 1998 and 2000 Kumar got his first taste of publicpolicy when he was seconded to the DfEE under Baroness Blackstone, as head ofhigher education policy and research. On returning to Glaxo he rounded out hisportfolio with a stint in corporate communications, as manager of scientificpolicy and public awareness.Despite this intensive career path, he concedes that his roleat the CIA “is a lot bigger and more demanding than I could haveguessed”. But that suits him, he works better under pressure. Nonethelesshe has learnt the importance of delegation. “I’d have a nervous breakdownif I didn’t.” He says he enjoys the “people side” of the jobbest, although he also “relishes” employment policy.These very different roles don’t conflict, so much as balanceeach other out. And a key benefit of being responsible for so many areas isthat you get a very good overview, he says, adding, “But when I’moperating I don’t think in terms of putting different hats on – it’s allamalgamated into my head.” When it comes to juggling so many differentroles, he argues, MBA training was invaluable. “It keeps things simple. Itforces you to start thinking. I’m very good at questioning assumptions that aretaken for granted. I like asking ‘why?’” 6. The HR and finance briefAny corporate historian will tell you that the relationship between financeand HR has never been particularly easy. Indeed, in many organisations a strongsense of mutual antagonism is taken for granted. As far as many financialdirectors are concerned, HR, with its policies, procedures and bureaucracies,frequently acts as a brake to imaginative deal-making and restructuringopportunities. From the point of view of HR, meanwhile, finance, with itsperennial obsession with bottom line values and cost-cutting, often appearsshort-termist in outlook and gripped by the narrowest set of aims.In recent years, however, it has become noticeable that many ofthe rifts that previously divided these two highly disparate functions arebeginning to be breached. To a large extent, this can be attributed toreforming voices within the HR profession itself. Proponents of reform have long argued for a betterunderstanding of the wider strategic business aims of organisations and haveattempted to remodel the function as a viable business unit capable of addingreal value in its own right.But there is also strong evidence of a softening of attitudeswithin the finance department. Pivotal to this has been the rise of the human capitalmovement. From the moment that share prices began to be influenced by such”soft” values as knowledge, relationships and the ability to attractand retain talent, you can bet that most financial directors began to sit up.The onslaught of harsher economic times, however, is likely totest this frail truce to its limits. How will HR with all its new values about employee stakeholdersand the importance of long-term human capital management, react to possiblepressure from the finance department for a renewed outbreak of slash and burn?To some extent you can already see trouble ahead in the growingadoption in the UK of US people management practices like forced grading, aka”rank and yank”. From the point of view of most financial directors,any scheme that gets rid of the chaff while encouraging excellence in highachievers is surely worth its weight in gold. But seasoned HR practitioners may well point to some of thetroubling long term, decidedly “grey” implications of such a policy.What effect, for example, would such a blunt instrument have on issues likecorporate loyalty, staff morale and perceptions of corporate fairness?The solution may lie in the emergence of a new kind of manager,capable of taking on the concerns of both groups and reaching a viablecompromise between the two. Step forward the hybrid HR/finance manager.Case study: Steve Harvey Director, people profits and loyalty, at MicrosoftThe competitive spirit that defines Microsoft has been inevidence ever since a teenage Bill Gates tried to sue the company’s co-founderPaul Allen while they were both at high school. For evidence that it is a liveand kicking in the UK, you need look no further than the company’s director ofpeople, profits and loyalty, Steve Harvey – a man who left school with oneO’level.Harvey joined Microsoft as a financial manager in 1990, havingpulled himself up by his bootstraps, attending first college and then puttingin a 10-year stint at the Central Electricity Generating Board to compensatefor his disastrous education. Five years ago, he was made finance director –and immediately found himself in conflict with the company’s UK HR department.”I was a typical finance guy I used to get very frustrated with HR”.He loathed the invisible policies, the bureaucracy, the fact they never seemedto know their numbers, and, worst of all in a company like Microsoft,”they didn’t understand the technology”.The HR department, he adds, was stuck in its ways andunresponsive to outside stimuli. “It had created little kingdoms foritself and turned the UK into an island. There was great work going on in theUS, yet the UK was isolated. It was crazy.”Harvey’s solution for dealing with this intractable departmentwas simple – he would simply annex it. “I went to David Svenden (UKmanaging director) and said, ‘I can do this’ and he agreed. There followed a major purge. Harvey scrapped the department,which then consisted of 12 people, and fired about half of them, incorporatingthe rest within his own newly devised empire of people, profits and loyalty. Harvey also took over responsibility for internalcommunications, but decided against including it in the title on the grounds itwould “make it a bit long for every day use”.He then set about transforming the people function. The wholething was “really haphazard” with processes all over the place.”We found 15 different offer letters,” for example. “But whatreally did my head in was that the department had been spending all its timeworking on poor performers.” As far as Harvey was concerned this was completely the wrongapproach. “You need to concentrate on the winners,” he said.Much of the inspiration for his subsequent transformation ofMicrosoft’s HR function came from a book published by Gallup entitled FirstBreak All the Rules. Harvey found italigned with his own ideas so neatly that he called in Gallup to help formulatethe new policy, which he calls “A strength revolution”. He translatesthis as creating the kind of environment which “lets people do what theydo best every day”. The new order is based on another Microsoft HR totem – theabsolute pursuit of excellence. Harvey endorses the company CEO Steve Ballmer’s remark that”sometimes the best hire for Microsoft is no hire”.True to Harvey’s financial roots, performance management isplays an important role in Microsoft’s new-look people management programme.While steering clear of an outright rank and yank programme, the company gradesits employees on an annual basis through a programme called Strength Finder.The top percentage group – “the stars” – are offered extra coachingand mentoring, the bottom 10 per cent are left to their own devices.”Non-performers tend to move on anyway.”Harvey denies the practice is divisive. “It’s not aboutemployee satisfaction, it’s about showing where we are going and what can beachieved – and that’s what makes people want to stay.” The link betweenprofits and loyalty, he believes, is clear-cut.How does he combine these two very different roles? “It’sa bit like talking to your left brain and your right brain at the sametime,” he says, conceding that sometimes there can be conflict between thepeople argument and issues like short-term revenues and profitability.”But on the whole you can see the balance between the two.”Nonetheless, Harvey, who combines his many talents with anexceptional sense of self-belief, is adamant that his “complete passionfor the people side” is a rarity among most of the financial profession.He would never give the job “to 90 per cent of the accountants Iknow”. 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