Article: Can HR be an entrepreneurial venture?

#HRInsights

Can HR be an entrepreneurial venture?

If HR were to sell its services, there would be aspects separating a good consultant from a bad one
Can HR be an entrepreneurial venture?
 

What if business teams had a choice of engaging HR entrepreneurial teams or somebody from outside?

 

You will be the most talked about, preferred and patronized if you have a positive impact on your customers business

 

As organizations tighten their belts irrespective of economic cycles, a question decision makers are asking is, ‘What is the ROI (return on investment) of people practices’?

I do not think they are questioning the need for people care. They are questioning if our practices produce the desired effect, which is to enable support for business results. I ask the same question to all of you HR practitioners – Do our services achieve the above?

Answering this question in our current avatar of a support function will be defensive, intuitive and unsatisfactory. But here is the big IF- what if HR teams saw themselves as entrepreneurs? What if business teams had a choice of engaging such HR entrepreneurial teams or somebody from the outside, choosing whoever brings the best value for money? The business now has a choice of you or somebody from outside!

It definitely sounds exciting especially considering that everybody from the uncle, aunt and their neighbors’ dog wants to jump this bandwagon! We are at least in step with the latest fashion trend.

There is no magic formula or secret that makes one HR consultant more successful than another. But there are aspects that separate a good consultant from a bad one. In order to ensure that we do not figure in the latter bracket, let us start with fundamental questions an entrepreneur would ask themselves when they set up their business:

Who are my customers?

What major business problem am I solving for my customers or what opportunity am I creating for them?

How much are they willing to pay?

What would make me the best solution provider to my customers over my competition?

Let us start with addressing each of the above.

Who are my customers?

Is it the CEO and his management team? Is it the employee or is it the delivery head? An easy way to answer this is whoever approves your bills is your customer. Will that then be the COO? Or will it be the Delivery Head who tells your COO that this money is well spent as he hears from his directs that HR is really adding value. Interesting question, wouldn’t you say?

What business problem am I solving?

In short, this question helps you get an answer to what your business is. The answer to this will ensure you do not put the cart before the horse.

Actually, this is a ‘Why do we exist’ question. Facebook, for instance, defines it as “Our Company exists to give people the power to share and make the world more open and connected”. Google defines its existence as “Our Company exists to organize the world’s information and make it universally accessible and useful”.

What will the world miss if your business no longer existed? I am sure each of us can’t imagine a life without Facebook and Google today.

In the HR context, this would read as “Does HR exist to hire, to retain, provide expert advice, design processes to manage people”? Why? Why?? Oh my friend do you need HR at all???

How much are they willing to pay?

Ooo! This question is dangerous, especially in India where the prevailing buying behavior is “I would like a Rolls Royce for the price of an Alto maybe with free car accessories built in”! So, for HR, let us look at how much time your customer is willing to spend on your services? The logic is that a business leader will prioritize it when they see that this will help them reach their goals.

Moving on to the crucial question: Why would the customers buy from me and not my competitors?

I believe this is rarely a function of size but is based on impact. You are considered over your competition either because you are the best, cheapest, fastest, or the first to venture into the space you have.

Do something that matters to the customer. Think, act, be different as you make a difference. You will be the most talked about, preferred and patronized if you have a positive impact on your customers business.

To cut a long story short, purpose first, profit second! If you have a philosophy that the only metric that matters is your customer, that is when you win over competition. Create a business love affair with your customers by building credibility.

Now that is not the last of questions, let me ask you another one. When we make important purchase decisions what is the decision process we go through? We may think we are being rational all the time, but my primitive research supported by data from Google on Behavioral Economics says that there is far less logic and much more predictable irrationality and emotions.

We follow trends as our intuition fools us in a repeatable, predictable way. We get overwhelmed with choices, we take decisions based on anchors, what other people tell us. My suggestion read up on Behavioral economics and Marketing basics. Your brand is key to entrepreneurial success.

Phew! Being an Entrepreneurial HR is a unique, interesting proposition. But this clearly leaves us with more questions in my mind than answers.

I am also aware that I have raised probably more questions than answers. I will, over the next few columns, pick up each one of the questions. As always, let’s make this journey of learning together, do read on and leave your comments/opinions.

Topics: #HRInsights, Strategic HR

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