It’s rare to find a corporate human resources function that accelerates change by actively finding ways to help drive new strategies. Most HR groups sit back and wait for requests from the business for administrative people transactions. In their role of stewards of policy compliance, they can tend to be a brake on change.
But not at IBM. Its HR function has been instrumental in the $100 billion company’s metamorphosis from a floundering computer manufacturer in the 1990s to a prosperous software and consulting services company today. HR has helped the organization absorb more than 125 acquisitions since 2000, and integrate globally, saving $6 billion since 2005.
When Randy MacDonald arrived at IBM in 2000 as senior vice president of HR, he felt the function was too focused on administration. “I have a fundamental belief that it’s important to decide what is core and non-core,” he told me recently. “Administrative responsibilities, such as getting paychecks out on time, are not core. Attracting, retaining, and motivating employees are all core. In HR, we need to focus on what is important and get out in front of issues—not just be reactive. HR should look at the direction of the company and say, ‘We need to be here right along with the business.’ ”
Over the last decade, HR at IBM took a number of steps to help drive operational improvement: Read the full article originally posted on The Harvard Business Review for Bloomberg Businessweek here.
As in most businesses without effective succession planning and talent management in the NFL, you fail. Many great coaches have said that without great players, they would not have been successful, and in the NFL, that means having effective General Managers and Player Personnel operatives. They are the HR pros of the NFL, and the best HR pro in the NFL today is the Wizard of Oz; Ozzie Newsome of the Baltimore Ravens. When you think about Oz’s role in relation to players (employees), coaches (managers), and executive staff & owners, there are many similarities to the HR role being provided by many of us today.
Oz began playing in Leighton, AL, with the hope of playing for the University of Alabama. That dream was realized when he went on to star for the Crimson Tide under Bear Bryant from 1974-77. In 1978, Cleveland selected Newsome in the first round of the NFL Draft. Playing 13 years for the Browns, he had the most productive career for a tight end in the history of the game. A three-time Pro Bowler, his 662 receptions for 7,980 and 47 TDs stood as NFL records by a tight end until 2001.
So Newsome starts out working for Art Modell in Cleveland in 1991 as a scout, is then promoted to Director of Pro Personnel, and then in 1996, VP of Player Personnel. Oh, and while he’s doing that, Modell decides to move the franchise to Baltimore. Ever manage the shut-down, start-up, relocation of a $1.1 billion dollar firm from an HR perspective? Not easy, let alone doing it under a microscope of a very upset Cleveland fan-base, and very skeptical Baltimore fan-base.
In addition to his knack for evaluating talent on the field, Oz has also mastered the ability to develop and share insight with the scouts who work under him. The Ravens boast a methodical and disciplined draft process, one that’s foundation is laid years in advance. The “process” includes 15 full-time members of the personnel (HR) department, but also has feedback from Ravens coaches (Line Management). Amazingly, the Ravens do not belong to the NFL Scouting group, which provides member teams a log of reports on players eligible for the draft. Instead, they make their own list, and that means looking at every player on a collegiate roster.
In the Ravens’ first-ever draft, Oz drafted OT Jonathan Ogden and LB Ray Lewis who have combined to produce 21 Pro Bowls since then. Since drafting Ogden and Lewis, Oz has consistently compiled impressive draft classes, and in the team’s first 13 drafts Baltimore selected first-rounders who have earned a total of 39 Pro Bowl honors. That is talent acquisition.
Oz just doesn’t miss. Of the seven players chosen in the top 10 by Baltimore, five (Ogden, LB Peter Boulware, CB Chris McAlister, RB Jamal Lewis and LB Terrell Suggs) have earned Pro Bowl nods. Additionally, Baltimore has picked in the bottom half of the first round with uncanny success: Lewis has twice been named the NFL Defensive Player of the Year; TE Todd Heap, chosen 31st, has been to two Pro Bowls; Ed Reed, the 24th pick, went to Hawaii five times and also earned NFL Defensive Player of the Year in 2004.
It’s not just players (employees), but the securing of top flight leadership (coaches) that Oz has a penchant for as well. Oz has created a synergy that manufactures success among the scouts, coaches and players. As a result, Baltimore has had many of its assistants move on to become head coaches on the both BCS and NFL levels: Jack Del Rio (Jaguars), Kirk Ferentz (Iowa), Marvin Lewis (Bengals), Eric Mangini (Browns/Jets), Rick Neuheisel (UCLA), Mike Nolan (49ers), Rex Ryan (Jets), Jim Schwartz (Lions), Mike Singletary (49ers), Mike Smith (Falcons) and Ken Whisenhunt (Cardinals).
What’s the secret?
- Continuity is key as most of Oz’s staff has been with the team since the franchise started in 1996 or has graduated from the “20/20 Club,” which is a group that includes members who began with the Ravens as young assistants and grew into evaluators with more input. The term “20/20” refers to hiring “20-year-olds for $20,000.”
- “We do a lot of cross-checking,” says Ravens director of player personnel Eric DeCosta, a graduate of Newsome’s “20/20 Club.” “A number of us look at everyone, and then we have the area scouts look at certain players from other regions so we get multiple grades and opinions on all the players.”
- Sharing of strong opinions is encouraged by all scouts and coaches. Oz wants to have strong opinions, noting specifically that he wants to hear what everyone in the room has to say. Because of this philosophy, Ozzie believes the biggest strength of the Ravens’ personnel team is that “we respect and listen to each other.”
- Credibility. “Ozzie’s credibility is what stands out the most,” Ravens head coach John Harbaugh states. “And it’s not just about what he has accomplished. To me, it’s his commitment and focus while striving to do more.”
- Building from within. “What sets us apart is that we have guys who cut their teeth right here in Baltimore, learning the way we do things,” Newsome affirms. “And we have had some great guys with Phil Savage, ‘Shack’ [James Harris], George Kokinis, Eric DeCosta and other people who were helping these young scouts along the way. I think that’s the secret. It’s not Ozzie. It’s the way we do things, and the way these guys gravitate to the process of the Baltimore Ravens.”
- Hire passionate professionals. “[Ravens] players believe, and that’s the beauty of it,” states Ryan, who worked with Newsome from 1999-2008. “Ozzie brings in the right kind of players, and one thing we’ve always talked about is we don’t want to coach effort. And that’s the thing – we don’t. [Ravens] guys love to play the game, and those are the guys you surround yourself with. That’s why you have a chance to be successful [in Baltimore].”
- Walk the talk. Really, go to work. Newsome’s motivation and work ethic are also reasons many people respect him. One specific way that devotion shines through is in his everyday routine. If Ozzie’s not in his office or out on the practice field, he can be found on the treadmill in the Ravens’ weight room. Exercising daily (and often putting in two-a-days), Ozzie says his workouts are just another way he tracks the pulse of the team.
- Stay engaged. “By being around the coaches and players out at practice,” Newsome states, “and being in that weight room around those players, I think I get a chance to build some things in my mind of how I’d like the makeup of our football team.”
OK, so now I’ve justified watching football for the next five months all in the name of Human Resources research.
If you think this applies to the role of the CIO, held back by the purely technical needs of the operation that impede the opportunities for strategic management, you’d be right. But you might be surprised to learn that this judgement was not written for IT management, but for human resources (HR).
In a recent research paper titled HR on the Line, author Dr Paul Gollan, associate professor of the Department of Marketing and Management at Macquarie University, says that line managers within both large and small organisations see the HR function as good at meeting operational goals, but 60 per cent believe that HR limits their ability to meet business goals.
“A startling statistic,” he says, “but one that supports the traditional role assigned to the function of HR — that of being an administrative paper shuffling rather than a business driven strategic development.
“Some organisations still perceive the HR function to be lower in the management hierarchy, and due to lack of clear financial outcomes, it is often not taken seriously.”
Substitute IT for HR, and “routine technology operations” for “paper shuffling”, and you probably have a scenario that sounds horribly familiar.
Marketing, operations and even finance are seen in many organisations as those departments that are at the cutting edge of organisational strategy and forward vision — the rest are there to keep the wheels turning.
But if HR and IT share a similar reputation, how well do they get on with each other? Do they work in partnership, and can they help each other step up through the ‘management hierarchy’?
Most organisations at least espouse the mantra of ‘people are our greatest asset’. And in an environment where there might be a skills shortage, especially in IT, you would think these two departments would work very much hand-in-hand to ensure they keep the best they have (and the intellectual property they hold) and attract the best that might be available.
Many large IT departments have their own HR function, with staff holding an HR background rather than IT. Others, however, have to rely on the skills and understanding of a department distinct from their own operations, with priorities that may be as much about developing a strategic role for themselves as it is doing the same for other departments.
Joe Perricone, IT manager for the Cerebral Palsy Alliance, says he is “in contact with our HR management team ‘virtually’ daily for all matters, such as breaches of conduct, management decisions and impact to team performance, and most importantly maintaining the integrity of human resources and IS systems”. He adds that “the HR team ensures any changes and business needs are in consultation with IT.
“It simply makes our job easier when support is needed.”
A positive relationship, then.
But, according to Robert Yue, vice-president of recruitment management software supplier SuccessFactors Australia, “Historically the relationship between CIOs and HR has never been close. Both departments had different objectives and were responsible for running different areas of the business.”
Harking back to Gollan’s assessment, Yue says “HR for many organisations was not typically a strategic player at the boardroom of the business. It has often been known as the department responsible for the back office of the company such as handling administrative tasks such as payroll and healthcare benefits.”
He adds, however, that thanks to advancements in technology, HR is becoming empowered to play a pivotal role in business execution, allowing it to see the “death of the three-ring binder”.
Perricone agrees, and takes it further: “HR’s reliance on IT is of upmost importance and highest priority. For example, pays need to be on-time, every time and correctly.” Whether dishing out the brown envelopes can be seen as strategic, it is certainly an important part of business execution. Unpaid employees are, by tradition, not a happy lot, so anything IT can do to ensure this process runs smoothly is bound to be appreciated by all. Then again, if IT fails to deliver, everybody in the company knows who’s to blame.
Peter Acheson, CEO of recruitment firm PeopleBank Australia, says this awareness goes right to the top. “CEOs say: I have a real interest in the CIO because IT is the one thing I can get fired over.”
One need only look at recent events concerning IT issues which have led to some senior executives losing their positions to see how importantly management regard IT — as a department that keeps the wheels turning.
There’s a pressing need from the top levels, therefore, for HR to understand the needs of IT, and help it achieve the best performance possible. Source: Tim Mendham, CIO Australia.