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Why HR Leaders Deserve a Seat at the C-Suite Table

Editor's Note: Take a look at our featured best practice, McKinsey Talent-to-Value Framework (230-slide PowerPoint presentation). Curated by McKinsey-trained Executives Unlocking Business Excellence: The McKinsey Talent-to-Value Framework Toolkit In the dynamic world of modern business, staying ahead of the competition means maximizing the potential of your most critical asset – your people. The **McKinsey [read more]

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The C-suite has been traditionally reserved for critical business functions, such as finance, marketing, and operations. As a non-revenue-generating function, HR doesn’t always grab the attention of company leaders.

But here’s the thing – according to a recent IBM survey, while 74% of C-suite executives believed they helped their employees build new skills to work through the pandemic, only 38% of employees agree to that.

Also, while 80% of executives claim to support their workers’ physical and emotional well-being, only 46% of employees believe the same.

These findings highlight a significant gap between company leaders and their workforce. And that’s where HR steps into the picture.

HR leaders and managers are in direct contact with an organization’s greatest asset – the people. It puts them in a position to serve as a bridge between senior executives and ground-level employees.

With roles like “Chief People Officer” becoming more prevalent, companies are recognizing the importance of HR leaders in shaping business strategy. And that, in turn, makes them an integral part of the C-suite.

Redefining Performance Assessment

Annual performance reviews are a thing of the past. Modern employees expect constant feedback from their managers. It’s all the more crucial in a hybrid workplace where in-person interactions are limited.

HR leaders are familiar with every performance management best practice, from open communication and goal setting to optimizing compensation plans. They can help executives from various departments monitor and measure employee performance better.

Also, they can identify key challenges employees face and suggest suitable measures to improve productivity. They can even derive valuable insights from exit interviews to help various departments improve their processes. That, in turn, can help boost employee engagement and morale.

Simplifying Mergers and Acquisitions

Mergers and acquisitions (M&As) are often kept as a closely guarded secret until the deal is finalized. But it’s worth noting that M&As usher in significant cultural and organizational changes in both the acquired and acquiring companies.

Bringing HR leaders on board on the day of the deal leaves them with no time to plan a seamless transition for the acquired company’s employees. The lack of an organized approach can cause these employees to disengage and look for other jobs.

On the other hand, when HR leaders are kept in the loop from the start, they can analyze the acquired company’s culture and find ways to merge it with that of the acquiring company. They can even conduct surveys and host team-building events to bridge the cultural gaps between both organizations. That, in turn, ensures frictionless onboarding for new employees.

The role of HR leaders isn’t restricted to the post-merger phase. They can provide senior executives with key due diligence insights before closing the deal. For instance, they can help assess the target company’s stand on issues like diversity and inclusion and gender equality.

Also, they can evaluate the company’s existing process and determine the learning curve for its employees. That, in turn, can help leaders of the acquiring company decide whether they want to follow through with the deal.

Enhancing Employer Brand

The “Great Resignation” and “quiet quitting” are real phenomena that are far from over. Younger generations, particularly Gen Z, are calling out toxic work practices and looking for jobs that value and nurture them.

Attracting and retaining talent in such a scenario requires a rock-solid employer brand. HR leaders can enhance an organization’s employer brand by improving the overall candidate experience, from recruitment and onboarding to offboarding.

Also, HR can help C-suite executives communicate company values and mission to every employee. Similarly, they can identify employee needs and provide them with suitable learning opportunities. That, in turn, will give employees a sense of belonging to the workplace and reduce turnover rates.

Moreover, insights from HR leaders can help marketing teams choose the right style and tone of workplace-related content. They can help marketers highlight the right aspects of the company’s culture in various campaigns. That, in turn, can help build a strong and coherent employer brand.

Final Thoughts

One of the most significant changes during the COVID-19 pandemic was how organizations started focusing on their employees’ needs. It bred questions like “how do you protect remote workers from burnout” and “what can be done to make employees thrive in a time of uncertainty?”

As more companies recognize employees as their greatest assets, HR leaders will become indispensable to the C-suite. When properly integrated, they can provide C-suite executives with a host of valuable information to improve productivity and ensure seamless M&As. Also, they can help strengthen the organization’s employer brand.

Ultimately, all these factors contribute to the company’s bottom line, thus discarding the notion that HR is a non-revenue-generating function.

18-slide PowerPoint presentation
Following the success of Capability Maturity Model for Software, Carnegie Mellon University developed the People Capability Maturity Model (People CMM or P-CMM). The People CMM is based on best practices—in areas such as human resources, knowledge management, and organizational development—for [read more]

Want to Achieve Excellence in Human Resource Management (HRM)?

Gain the knowledge and develop the expertise to become an expert in Human Resource Management (HRM). Our frameworks are based on the thought leadership of leading consulting firms, academics, and recognized subject matter experts. Click here for full details.

The purpose of Human Resources (HR) is to ensure our organization achieves success through our people. Without the right people in place—at all levels of the organization—we will never be able to execute our Strategy effectively.

This begs the question: Does your organization view HR as a support function or a strategic one? Research shows leading organizations leverage HR as a strategic function, one that both supports and drives the organization's Strategy. In fact, having strong HRM capabilities is a source of Competitive Advantage.

This has never been more true than right now in the Digital Age, as organizations must compete for specialized talent to drive forward their Digital Transformation Strategies. Beyond just hiring and selection, HR also plays the critical role in retaining talent—by keeping people engaged, motivated, and happy.

Learn about our Human Resource Management (HRM) Best Practice Frameworks here.

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About Shane Avron

Shane Avron is a freelance writer, specializing in business, general management, enterprise software, and digital technologies. In addition to Flevy, Shane's articles have appeared in Huffington Post, Forbes Magazine, among other business journals.

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