Musical chairs & the CHRO
With the increasing focus on specialization within the HR function, there is perhaps a shortage of true CHROs with enough business transformation experience
The success lies in choosing the right partner with shared values
In the last few months, corporate India has witnessed an incredible amount of churn in the Human Resources function, much to the delight of head-hunters like myself who participated in (and sometimes precipitated) these changes. While C-level changes in themselves may not be particularly newsworthy, the sheer level of activity after a fairly long period of relative stability in the function, perhaps merits a quick look at causes and lessons. The changing role of the CHRO in VUCA times has been well documented, so I am going to focus my comments on the nature and learnings from the couple of dozen very recent changes in the Indian context.
I spoke with a few of the recent movers and shakers, and their managers to get insights as to what was driving this activity.
Growth: To start with, with the global economic crisis, executive changes across the board went through a significant slowdown as managements went into crisis management or watch and wait mode. As a result, people stayed in their current roles for longer – partly because the ‘ask’ of the job had changed significantly, and by and large they had fewer opportunities to move to, both internally and externally. However, as green shoots began to appear, professionals across sectors started seeking growth opportunities both within and outside their current companies, leading to some changes.
Equally, as companies embark on their domestic and international growth agenda, the need for high performing CHROs has moved to the forefront again, with many conglomerates seeking experienced change managers who can help equip the group for the challenges ahead. And as we know, one move in domain-dominated HR roles such as in banking or IT, sets off a round robin of changes.
Change: In some cases, companies changed business models and structures globally. M&A, changing structures, global business divestments and splits, resulted in a change in the size and complexity of the job, or what companies were able to afford to pay the CHRO in the new rationalized environment, leading to movements across companies. In some cases, professionals literally being caught without a chair when the music suddenly stopped.
In some cases, a top management change led to sweeping changes in the C-Suite across all functions, and including HR. A new CEO or Chair, particularly one faced with charting a completely new course, will often bring in new blood to support the new agenda. A number of senior HR professionals have also recently retired or moved into advisory roles, prompting a need for replacements.
International moves have always been the norm in some functions, but were relatively limited in HR unless they were within companies with a long established base in India and well-established international HR programs – Unilever and Citibank are obvious examples. While moves within the specialised functions within HR were common, it is interesting to note the increase in CHROs who have moved both companies and borders, pointing to the rising acceptance of Indian managers as CHROs internationally.
Cause: There seem to have been a significant number of forced exits, driven by instances or allegations of financial fraud and sexual harassment/entanglement. An interesting debate ensued in our office after a very public firing of a state minister recently. The message was loud and clear – we will not tolerate corruption. Should companies take the same stance rather than offer “graceful exits”? But when there is doubt, companies should prove allegations without a doubt, rather than indiscriminate firing. In many cases, mis-hires could have been avoided by more stringent due diligence. And professionals who find themselves in the grey, may do well to be prepared to explain their situations to search firms and target employers – second chances may well be more forthcoming in the face of self- introspection and honesty.
Compatibility: Many people who we spoke to did not cite a lack of competency or intent, but a mismatch in expectations and deliverables, both from the promoter or CEO and the CHRO. Conflicts arose from the complexity of structures, as well as the pushes and pulls that invariably arise when the going gets tough. While intent is aligned at the start, short term business necessities often overrode long term HR transformation objectives creating friction. In some cases, it was cited that promoters interfered and promoters on their part, cited lack of understanding of business realities and style issues. I heard arguments about cost vs value, of future-minus and current-plus orientations, of the ability to apply analytics and of egos and empowerment. And so on.
In all of the conversations I had, one thing was clear. With the increasing focus on specialisation within the HR function, there is a shortage of candidates within the second layer in companies who are ready to step into CHRO roles with the requisite mix of functional and business partnering skills, particularly with business transformation experience. The desired experiences stated by potential employers have ranged from the usual functional backgrounds of IR, learning and organisational development, rewards, talent acquisition talent management, design and have increasingly included transformation work, digital and technology exposure, international experience, both MNC and Indian firm exposure. An appreciation for business value transformers and talent management is essential. Most employers viewed a stint in a business role as invaluable.
Much of the hiring process is about courtship. However, the success of the marriage lies in choosing the right partner with shared values, and the constant work that goes into making it work, not just everyday but particularly through bad times. Trust and empowerment form the basis of any successful partnership. No situation or person is perfect and it is well worth the time taken to analyse, as you would (or should) in a marriage, what value do you get? What quirks can you live with? Conflicts arise, and restraint and compromise are essential to weather these.
Clarity: Incoming CHROs would be advised to ensure there is some degree of clarity in a role that is inherently fluid. Recognizing that some pushback from the system is inevitable, a question we routinely recommend asking is what would not be included in the role. Apart from reporting lines, think about who internally will influence the role, who all the stakeholders will be. In these days of beef consciousness, it would be a good idea to identify the holy cows as well.
Competency vs. Capability: What does it take to succeed in this role in this company? Both sides would be well advised to think through the unsaid “way things are done” and test each other on this. Traditional hiring focuses on competency and experience. But the reasons marriages fail are more to do with how we get things done or how we communicate, rather than the what.
Diligence: This runs both ways. How successful was the previous incumbent/previous stint? Whose toes will you be stepping on? What makes this person tick? How did she perform in previous stints? What drove recent career changes?
Business alignment and focus: We now routinely ask hiring CEOs and CHROs to present business cases or run case study type conversations to ascertain understanding of roles and abilities of people to deliver on them. An understanding of costs and the ability to manage pressures arising from rationalisation is also essential.
As the dust settles, reinvention of the role – and soul searching and renewal of the all the players, the CHRO and the CEO is the order of the day. May the music continue to play!