Believe me, I know…you’re sick and tired of yet another “seat at the table” discussion focused on HR’s need to be more strategic in their organization.  I predicted that 2008 would end with HR still not gaining that elusive chair, but for the sake of argument, let’s assume they did.  Yes readers, the Chief Human Resources Officer (CHRO) has finally arrived and is ready to roll up her sleeves and provide highly strategic value.  What happens next?  

Enjoying the coveted view, she looks around and likely sees the CEO, CFO, COO, CIO, CMO and perhaps other executives discussing the current and future state of the business.  Given the significant influence that each executive exerts, what happens when the individual personalities change?  Put another way, how does C-level tenure impact one’s ability to drive value?

• CEO: A 2007 Harvard Law School study shows that a “manager CEO” of a S&P 500 firm averages 5.5. years of tenure.  Crist Associates’ 2007 Volatility Report also shows the majority of CEOs with less than 5 years of service.
• CFO: Crist has CFOs at just over 5 years and on the rise.  However, SOX compliance is still having a negative impact on longevity.  
• COO: Chief Operating Officer tenure is shrinking to just under 3 years, with the total number of Fortune and S&P 500 COOs diminishing at a perilous rate.  
• CIO: According to the 2008 State of the CIO poll results, a Chief Information Officer’s average time in seat is about 4.4 years, down from 5.1 years in the prior period.
• CMO: Spencer Stuart’s annual study shows Chief Marketing Officers at a mere 26.8 months, which is actually up from 23.2 months in the prior year.

Right.  So your COO and CMO will survive less than three years.  Your CIO is about four and a half and your CFO and CEO less than five and a half.  Suddenly it hits you - one of your most important tasks now that you have a seat at the table is to focus on a succession plan for those in the C-suite.  

This is an uncomfortable realization, yet an item that is often overlooked, even by market-leading organizations.  What’s perhaps more uncomfortable is the assessment of your own C-level survival, with Workforce Magazine’s analysis (and Corsello’s math) putting an average CHRO in seat for approximately 3.1 years.    

If all this executive rotation has your head spinning, grab some ginger pills, put on the motion sickness patch, stay calm, and let’s try and keep the conversation going.  

We’ve all been there at one time or another - the logical conversation that suddenly turns emotional.  The irrational leader’s flame consumes everything in its path, the spoken word oxygen that feeds the fire into a frenzied tempest of damage and destruction.  Dramatic enough for you?  You get the point.  And whether it involves negotiating a raise, a project, what you’re having for dinner, a movie choice or a business relationship, it helps to have a few pointers to help you get through those unexpectedly difficult times.

The Latz Negotiation Institute wrote a piece in December of 2000 entitled, Dealing With the Irrational, Real or Posed, Is Tough.  The article argues that one of the most critical (and difficult) pieces to assess is whether the other party is truly irrational or simply trying to appear irrational.  So how does one diagnose truth versus fiction?

“First, take a deep breath. This is not your garden-variety negotiation and it will require you to dig deeper than usual into your negotiation toolbox…. Then closely observe and evaluate the sincerity of your counter-party’s allegedly irrational actions. Listen carefully to what that person is telling you - verbally and nonverbally.  Are their actions consistently irrational, or is their irrational behavior limited to certain instances or episodic in nature? The more limited and inconsistent the irrational behavior, the more likely it’s a ploy.”

 And if they are faking their irrationality?

“Our natural response? Give him whatever he wants. He’s crazy, and he’s got his finger on the nuclear trigger. We can’t take the chance that he’ll push it, so we better concede. [Instead] find an opportunity to openly point out our knowledge of their acting talents. Then treat them like any other rational but tricky negotiation opponent.”

But what if they are truly irrational?

“Explore the reasons underlying their irrational behavior. Find out why they’re so consumed with anger that they can’t listen to reason. Perhaps it’s a personality conflict. Or perhaps an unrelated event has put them into this temporary state of mind… If it’s an emotional outburst or related to a recent traumatic event, take a break. Given sufficient time, individuals often will become more reasoned and reasonable.

And if none of this works, re-evaluate your leverage and your alternative to this agreement. How much do you really need or want an agreement with an irrational individual? After all, terminating the negotiation may be your only rational course of action.”

All excellent guidance.  Beyond Latz’ advice, look to organizations such as Vantage Partners to help with your most complex, global negotiations.  Keep your cool, and let’s keep the conversation going.

On Friday we discussed the origins and implications of the language barrier facing the HR outsourcing (HRO) market.  Given all the varied interests in this increasingly complex industry, how do we begin to break down HRO’s language barrier?    

Convergence Begins

It is only in the past eighteen months that we have seen the industry take note of buyers concerns surrounding language and taxonomy.  In 2007, two separate initiatives led by competing advisory firms (immediately following their failed merger) were announced:

• OpenDoor HRO: Launched in April of 2007 by the triad of EquaTerra, SAP and Arinso (now NorthgateArinso), OpenDoor was intended to offer best practices and supporting documentation to speed the sourcing process and ensure adoption of common standards.  Unfortunately, the closed-door origination was viewed to have disintermediated several dozen organizations that would have preferred to help shape the standards by which they would be measured.
• TPI HRO Standards Initiatives: Announced in May of 2007, TPI presented a new initiative based upon collaboration with ACS, Convergys, ExcellerateHRO, Fidelity and Hewitt.  Like OpenDoor, the intent was the derivation of a common taxonomy, including pricing norms and service levels.  TPI was recognized for being more industry inclusive, yet did not embrace the transparent presentation of OpenDoor.

The most promising initiative yet is the work of the Industry Standards and Practices Committee of the HR Outsourcing Association (HROA).  In April of 2008, the committee announced the publication of the first approved practices, acknowledged as the largely preexisting work of the TPI HRO Standards Initiatives.  In a mature nod to the best interests of the industry, OpenDoor HRO has joined with the committee to remove any angst or confusion surrounding competitive standards.  Although this signifies positive momentum, one should question whether interests are proportionately represented, for of the thirty one committee members, only six are buyers of HRO services.

Outcomes and Conclusions

Renowned critic and playwright Eric Bentley said it well:

“Ours is the age of substitutes: Instead of language we have jargon; instead of principles, slogans; and instead of genuine ideas, bright suggestions.”

Without overreaching, one such bright suggestion is for HR executives to get involved in this quest for standardization.  This language barrier will not come down in a means favorable to all parties if those who stand to lose the most participate the least.  This initial taxonomy represents only the United States and the English language, so rest assured that much debate remains over how and if each suggested metric could be applied to your countries of interest.

As an industry, we have yet to quantify the efficacy of these recent initiatives.  Although it is tempting to sit back and wait for others to clear a global path forward, we must work together to ensure that the language of the future of HRO is one we can all speak and understand.  Apply your skill, experience and immersion, for much remains to be done and it is this analyst’s opinion that the most difficult work is yet ahead.

Let’s keep the conversation going.

As all students of dialect are aware, interpreting another’s language requires a combination of skill, experience and immersion.  Literal translation may be eminently possible, but deriving intent involves a more detailed analysis of origin, region and culture.  Without such comprehension, mistakes will be made, time will be wasted and inappropriate conclusions will be drawn.  HR outsourcing (HRO) has faced and continues to face these same dilemmas, and clarity must be attained before interpretation is simply left to the intermediaries.

Origins and Evolution

Industry anthropologists do not dig very deeply for the lost ruins of HRO.  Many may discover the transactions consummated by Exult (now Hewitt) in the early 2000s as their only point of reference.  Others claim that such outsourcing has been around for decades, perhaps even centuries, citing the dependency that organizations have always had on external sources in support of the needs of their workers.

Despite its questionable origination, this market continues to evolve at an increasing pace.  Today we find over ten thousand service providers claiming to offer HRO, each with their own value proposition, return on investment and competitive differentiation.  It comes as no surprise that you, the human resources buyer, are faced with unprecedented market confusion precipitated and perpetuated by the lack of a common taxonomy. 

The Quest for Clarity

In April of 2008, attendees from around the globe arrived in New York City for the annual HRO World event.  A seemingly enlightened migration of consultants, advisory firms, analysts, industry press, service providers, association leaders, clients and pundits assembled for this sixth instantiation.  One might expect to see and hear all that is relevant to global HR outsourcing, perhaps uncovering the source of this semantic confusion.  In walking the show floor and visiting with vendors, specimens may be gathered with the hope of a great linguistic discovery.  

In examining the collective, one finds universities, commuter services, pet sitters, applicant trackers, pollsters, employee verification services, health clinics and retailers all speaking of their service to HRO.  Clients stand next to their outsourced providers and explain their often unique and unreplicable path to success.  Advisory firms count the number of transactions this past year, each with their own definitions and criteria for inclusion. And what of the HR executives?  Who represents their needs and answers this quest for clarity?  Who, pray tell, is to blame for such continued confusion? 

Divergent Interests

HRO World is not to blame.  Vilification does not belong to one firm, one person, one assembly or one industry body.  Beginning in 2000, the fervor of growth and determination to secure market share necessitated that each participant attempt to define the language of the HRO industry from their own perspective.  This included:

• HR Service Providers: They began to modify pre-existing price lists to support this new holistic version of end-to-end outsourcing.  Experience was strong in some areas, and weaker in others, resulting in depth but not breadth.
• Advisory Firms: A new category of consultant was born, and these firms had the unenviable challenge of ensuring that RFIs and RFPs were responded to in a common format.  With comparative analysis driving awards, service providers tried to influence any language gaps to their advantage.
• Legal Firms: Dealing with hundreds of pages of text, the lawyers attempted to translate intent into legally binding language that will last through significant changes in context and content over a multi-year period.
• HR Departments: Across a wide continuum of standardization, HR buyers did not have a common set of internal metrics and measurement by which to compare the outsourced solution.  What language did exist was country or region specific, causing strife in areas of global deployment.        

This frenzy erupted a mere eight years ago.  Some might argue that this represents ample time for resolution, and were we not addressing such a varied set of global interests, I would tend to agree.  However, with billions of euros, pounds and dollars poured into the HRO market, many have been either unwilling or unable to pause long enough to ensure that sustainability supersedes short-term interests.

On Monday we will explore the convergence of outcomes and possible solutions to this dilemma.  Let’s keep the conversation going.

The challenge to many HR executives is formidable - place an increased emphasis on Corporate Social Responsibility (CSR) while ensuring a connection to business results.  This is simple enough to state, but reasonable questions are often raised when preparing to execute a holistic CSR strategy.  Should HR lead by example or policy?  Is CSR participation optional or mandatory?  Does “good” CSR positively impact recruiting, retention and referrals, and if so, how?  What are the hard and soft benefits of a properly aligned CSR strategy?

As you can likely surmise, this is a broad topic with numerous implications.  In an attempt to narrow the conversation, I’ve captured three distinct perspectives for your consideration.

1) Linking CSR to MBA Recruiting: 

The Stanford Graduate School of Business reported on a recent study which found that, “the future business leaders rank corporate social responsibility high on their list of values, and they are willing to sacrifice a significant part of their salaries to find an employer whose thinking is in synch with their own”.  When asked to quantify their commitment to CSR, respondents said, “they would sacrifice an average of $14,902 a year, or 14.4 percent of their expected salary” for those organizations which embody caring for employees, caring for stakeholders, environmental sustainability, and ethical business conduct.   

2) Sourcing CSR via Incentives and Employee Engagement:

Elizabeth Seeger, Project Manager with the Corporate Partnerships Program of the Environmental Defense Fund, finds innovative organizations sourcing concepts from employees and linking compensation to CSR performance:

“In my conversations with companies, a lot of them are finding that their best CSR ideas and most of the motivation for CSR related activities are coming from their employees.  Many companies have set up hotlines or some way to get ideas from employees to management.

Also from the HR perspective, companies are starting to tie environmental (and perhaps) social performance to compensation.  I met with a company doing this the other day and they’ve been able to drive significant performance improvements and reduce costs through better efficiency.  This will become increasingly common, I think, as we enter a carbon-constrained world and start dealing with water scarcity and waste issues” 

3) CSR’s Impact on Brand and Brand Equity:

For those of you just getting started, consider purchasing Kellie A. McElhaney’s Just Good Business: The Strategic Guide to Aligning Corporate Responsibility and Brand.  As Executive Director and Adjunct Assistant Professor of the Center for Responsible Business at Haas School of Business at University of California, Berkeley, McElhaney emphasizes seven principles for building CSR into your brand, with two HR-centric examples below:  

“Get a Good Fit: It’s tough to select just one social or environmental cause to champion when every one is worthy, needed and critical. Your job is simple: Pick a social or environmental challenge for which you own part of the solution (or helped to cause it). For example, tackling homelessness and partnering with Habitat for Humanity, a nonprofit that builds houses, is a perfect fit for appliance-maker Whirlpool. It behooves Whirlpool to have as many homes as possible buying their home appliances. 

Work from the Inside Out: To employees who are educated about it, CSR is like a drug: Give them a little, and they’ll want a whole lot more. Start by educating your employees about your CSR strategy. Your employees are not only your biggest (and most efficient) brand ambassadors; eventually, they may come to you with better CSR ideas and strategies.”

Regardless of your current level of CSR competency, current and future employees will place increasing demands upon HR for answers.  Prepare yourself, study the literature, seek assistance from your peers and open up communication channels from within.  If done well, CSR can prove to be one of the most rewarding endeavors of your human resources career. 

Let’s keep the conversation (and CSR) going.

For those of you who read blogs on a regular basis, you may be familiar with the group-posting term “Carnival”.  The gist is that a topical area is chosen and a lead blogger collects the best and brightest postings from around the world.  The newest to hit the scene is the Leadership Development Carnival, a concept developed and led by guru Dan McCarthy at Great Leadership.    

This month’s Carnival presents a midway of advice and commentary from over 30 leadership development pundits, including our own humble Inflexion Point article describing Seven Tips for Managing Today’s Employee Population.  So click on over to Dan’s site take a look.  There is a lot of terrific content from some very intriguing authors, none of whom have professional Big Top training.

If you yourself would like to submit, you may do so by clicking here and filling out the requested information.  Dan will post the next Leadership Development Carnival on August 2nd.  

Happy reading and let’s keep the conversation going.

As I strolled to my local coffee shop and took in an uncharacteristically quiet morning in downtown Washington, DC, I began to wonder about the history of the fourth of July as a national work holiday.

Thanks to James Heintze of American University for his extensive research on the topic. Enjoy your day today everyone and let’s keep the fireworks going! Take it away James:

The act of Congress establishing Fourth of July as a holiday, but without pay, for federal employees and the District of Columbia occurred in 1870. Senator Hannibal Hamlin (Dem. Maine, and previously vice president under Abraham Lincoln) introduced a Senate Bill (referred HR no. 2224), issued through the Committee on the District of Columbia, Forty-first Congress, Session II, on 24 June 1870, and titled “Legal Holidays in the District.” Hamlin presented his rationale for the bill: “There are no legal holidays here, and this bill merely provides for what I think are the legal holidays in every state of the Union.” Apparently there was no opposition to the bill which “was reported to the Senate without amendment; ordered to a third reading, read the third time, and passed.” It was reported in the Congressional Globe, Friday, June 28, 1870, and was printed as Chapter 167:

Be it enacted by the Senate and House of representatives of the United States of America in Congress assembled, that the following days, to wit: the first day of January, commonly called New Year’s day, the fourth day of July, the twenty-fifth day of December, commonly called Christmas day, and any day appointed or recommended by the President of the United States as a day of public fast or thanksgiving, shall be holidays within the District of Columbia, and shall, for all purposes of presenting for payment or acceptance for the maturity and protest, and giving notice of the dishonor of b ills of exchange, bank checks and promissory notes or other negotiable or commercial paper, be treated and considered as is the first day of the week, commonly called Sunday, and all notes, drafts, checks, or other commercial or negotiable paper falling due or maturing on either of said holidays shall be deemed as having matured on the day previous. Approved, June 28, 1870.

On June 29, 1938, by joint resolution of Congress (HJ resolution No. 551; pub. res. no. 127), the Fourth of July was legislated as a Federal holiday with pay for its employees:

Resolved by the Senate and House of representatives of the United States of America in Congress assembled, that hereafter whenever regular employees of the Federal Government whose compensation is fixed at a rate per day, per hour, or on a piece-work basis are relieved or prevented from working solely because of the occurrence of a holiday such as New Year’s Day, Washington’s Birthday, Memorial Day, Fourth of July, Labor Day, Thanksgiving Day, Christmas Day, or any other day declared a holiday by Federal statute or Executive order, or any day on which the departments and establishments of the Government are closed by Executive order, they shall receive the same pay for such days as for other days on which an ordinary day’s work is performed. Section 2. The joint resolution of January 6, 1885 (U.S.C., title 5, sec. 86), and all other laws inconsistent or ion conflict with the provision of this Act are hereby repealed to the extent of such inconsistency or conflict. Approved, June 29, 1938.

On January 14, 1941, it was brought to the attention of Congress by Robert Ramspeck, Chairman, Committee on the Civil Service of the House of Representatives (see 77th Congress, House of Representatives Report No. 532), that the 1938 Federal holiday law failed to specify that employees of the Government of the District of Columbia also have the Fourth of July designated as a holiday with pay. Harry B. Mitchell, president of the United States Civil Service Commission responded back on April 7 that his office, as well as the Bureau of the Budget, had no objection to amending the 1938 law to include District of Columbia employees. On May 13, 1941, a “Holiday Leave for Per Diem Employees of the District of Columbia” amendment was enacted with the following change made to the 1938 law:

In compliance with paragraph 2a of the Rule XIII, of the Rules of the House of Representatives, changes in existing law are shown as follows (present law is in roman and new matter is in italics): (Act of June 29, 1938, 52 Stat. 1246) “That hereafter whenever regular employees of the Federal Government or of the district of Columbia whose compensation is fixed at a rate per day, per hour, or on a piece-work basis are relieved or prevented from working solely because of the occurrence of a holiday, such as New Year’s Day, Washington’s Birthday, Memorial Day, Fourth of July, Labor Day, Armistice Day, Thanksgiving Day, Christmas Day, or any other day declar4ed a holiday by Federal statute or Executive order, or any day on which the departments and establishments of the Government or of the District of Columbia are closed by Executive order, they shall receive the same pay for such days as for other days on which an ordinary day’s work is performed.”

On September 22, 1959, an act was passed by Congress (H.R. 5752, Public Law 86-362) that if the Fourth of July and any other established holiday occurs on a Saturday, “the day immediately preceding such Saturday shall be held and considered to be a legal public holiday, in lieu of such day which so occurs on such Saturday, (A) for such officers and employees whose basic workweek is Monday through Friday, and (B) for the purposes of section 205 (d) of the Annual and Sick Leave Act of 1951 (65 Stat. 681), as amended (5 U.S.C. 2064 (d)). The act also provided for a day of release for employees “whose basic workweek is other than Monday through Friday.”  (James Heintze, American University)

If you’re like me, you have heard many references over the years to a “revenue driven organization” or “client facing firm”, all code words for those cultures where sales rules the roost.  So what would happen if they ran your entire company?  For one, if revenues were down in a given quarter, it would likely be because:

• Engineering didn’t fully build out the feature set.
• Product management failed to properly scope to market need.
• Finance messed up the pricing.
• Legal made the contracts too onerous.
• Marketing had the wrong messaging.
• Customer service is poor.

…and the list goes on.  So imagine my pleasure in receiving a link to the following parody of A Few Good Men.  Your firm is Tom Cruise.  Sales is Jack Nicholson.  Enjoy the laugh and let’s keep the conversation going.  

(NOTE: A big shout out to Breanne Potter of Speaking of the MBTI for bringing this video to my attention!)

A senior human resources executive emailed me to ask whether I still see the term “personnel” floating about in today’s market.  She found the term to be a bit demeaning and old school, feeling it reflected an era of lesser value than today’s current HR function.  Which begs the question - is there really a difference?

University of Manchester graduate student Marco Koster took a stab at differentiation in his 2002 thesis, aptly titled Human Resource Management versus Personnel Management.  Says Marco:

“The view that there are more similarities than differences between personnel and HR management is shared by a number of authors. Legge, for instance, is tempted to say that there are “not a lot” (1989: 27) [of] differences between the two approaches, but nevertheless manages to detect some diverging aspects. These however cannot be qualified as substantial differences, but are rather a matter of emphasis and meaning (Legge 1995: 74). Torrington regards personnel management as a continuing process of evolution and growth, in which more and more fields of expertise are acquired and assimilated. Within this evolutionary process HRM is only adding “a further dimension to a multi-faceted role” (1989: 66), and is not at all a revolutionary concept. However, the effect of HRM should not be underestimated. Armstrong (1987: 34) maintains that although the procedures and techniques strongly resemble those of personnel management, the strategic and philosophical context of HRM makes them appear more purposeful, relevant, and consequently, more effective.

On the other side, authors like Storey regard HRM as a “radically different philosophy and approach to the management of people at work” (1989: 4). In this view, HRM provides a completely new form of managing personnel and can therefore be regarded as a “departure from [the] orthodoxy” (Storey 1989: of traditional personnel management.” (pg. 3)

The pundits at WiseGeek take a slightly different approach, whereby personnel management may be subsumed by the broader and more strategic focus of HR:

“When a difference between personnel management and human resources is recognized, human resources is described as much broader in scope than personnel management. Human resources is said to incorporate and develop personnel management tasks, while seeking to create and develop teams of workers for the benefit of the organization. A primary goal of human resources is to enable employees to work to a maximum level of efficiency.”

Confused yet?  Many state governments have managed to adopt a coexistence strategy, with the “State Personnel Director” running the Department of Human Resources Management.  The real question may be, does it really matter what we call the function?  The good folks at PersonnelToday.com tackled this dilemma in their May 2007 issue:

“By all accounts, in many circles the term ‘human resources’ is no longer in mode. When we published our union research earlier this year (Personnel Today, 30 January) - where unions bemoaned the demise of the personnel function, and complained that the term ‘human resources’ was too impersonal, implying that people were just a resource to be exploited - we were deluged with responses from readers in passionate defence of the term ‘personnel’.

But why this obsession with titles in HR? Other departments such as finance and operations don’t waste their time wringing their hands and wondering what title will get them more credibility in the business. At the end of the day, does it really matter what outfit the HR profession is dressed in?”

So what do you think -  Is Personnel making a comeback?  Should everyone move to Human Resources?  Does it even matter?  Stir the pot if you so choose or we’ll simply put the issue on the back burner.  

Let’s keep the conversation going.

Cupcakes.  Georgetown Cupcakes, to be precise.  The story was on the Today Show, chronicling how people were willing to stand in long lines for their favorite foodstuffs.  In this case, a choice of 20 frosting-laden varieties that may cost you an hour or more of your life.  And with the economy causing some to reassess their financial futures, perhaps we should not be surprised to find a burgeoning job market in “line standing”. 

The ad could read - “Are you either too lazy or self-important to support your own body weight?  If yes, operators are standing by with comfortable shoes and a waterproof parka.”  

Take this story from last fall’s Washington Post.  It seems that lobbyists have been hiring hourly workers to secure them the choicest seats in congressional hearing rooms.  Said the article:

“Washington has a lot of bizarre practices, and it often takes an outsider to recognize them. Line-standing has been around for 15 years, and by now people on the Hill hardly see it anymore — hardly see the people with folding chairs and blankets waiting outside congressional office buildings in the middle of the night, then lining up to shuffle into the building in the mornings, and setting up camp again outside hearing rooms, where they nap and talk (sometimes to themselves) and wait for their clients to arrive. And when the clients come, perky and caffeinated, having slept all night in real beds, they relieve the line-standers and nab seats in the hearing rooms — the closer to the dais of power, the better.”

But it’s not limited to our nation’s capitol.  We saw examples with the release of the iPhone last summer, an entrepreneur cashing on at the Vancouver passport office and even Comcast’s hiring of the homeless for a net neutrality hearing.  Heck, if you live in San Diego and are “reliable”, you can still earn $150 helping out a Comic Con fanatic who needs his beauty sleep.   

Not to deprive those in need of job opportunities, but in a time of war, a housing crisis and the rising costs of basic goods and services, it’s hard to believe that we citizens can afford to pour our hard-earned money into the simplest of activities - the line.  But don’t worry about my seemingly nonsensical rant…I’m not a cutter.

Let’s keep the conversation going (in an orderly fashion).