HR Business Partnership Workshop for Ernst & Young and Kuwait Petroleum Company Dr. Terry Rodriguez June 7 & 8, 2011 Introduction • Terry Rodriguez, EdD Leadership – Assistant Professor in Organization Behavior and Human Resources – 9 years as Senior HR/OD Consultant, Principal, TRL & Associates – 14 years+ in HR in Fortune 50 companies, Director • You! – – – – – Name Position Years with KP Years in HR What you enjoy the most about being in HR 2 Workshop Outcomes - 1 Day Human Resource Business Partnership • Explain why the HRM process is important. • Discuss the environmental factors that are driving a changed role in HRM. Identifying Best Practices in HR Business Partnership • • • • Define and assess relevancy to KPC. Describe the positive impact of HR Business Partnership. Discuss the major sources of resistance to a changed role in HR. Identify key HR internal customers Key Competencies for HR Business Partners-beyond technical HR knowledge • Discuss leadership values and impact on HR services • Understand need for change management skills • Explain role and importance of “Knowledge of the Business” Next Steps in Transition to HR Business Partnership 3 What Does “HR Business Partner” Mean to You? 4 • We believe deeply that human resources are very important in building, creativity and development process. Therefore, we give them our top priority, and allocated intensive programs to upgrade and improve national cadres and future leaders, with a budget matching the achievement of this goal. We will spare no effort in supporting human resources morally and financially, with following up their performance to ensure our progress. Farouq Al-Zanki Deputy Chairman & Chief Executive Officer 5 The Importance of Human Resource Management (HRM) • As a significant source of competitive advantage – People-oriented HR creates superior shareholder value • As an important strategic tool – Achieve competitive success through people by treating employees as partners • To improve organizational performance – High performance work practices lead to both high individual and high organizational performance. The HRM Process • Functions of the HRM Process – Ensuring that competent employees are identified and selected. – Providing employees with up-to-date knowledge and skills to do their jobs. – Ensuring that the organization retains competent and high-performing employees. Arabian Society of Human Resource Management-2010 Conference • Conference theme for the 10th ASHRM International Conference & Exhibition: “HR is Business”-- Themes: • “What does HR bring to the table to help advance organizational capability?” – Driving operational efficiency & effectiveness – Strengthening leadership capabilities – Creating an adaptable workforce investing in critical talent 8 HR’s Traditional (Transactional) Role is Changing • Critical mass of changes in the competitive landscape: • • • • Globalization Growing operational complexity Ongoing scarcity of talent Greater workforce mobility • Need for HR to play a greater role • Technology use and outsourcing • Reduced HR’s traditional—transactional--role. 9 Corporate Leadership Council 2007 “Building Next-Generation HR–Line Partnerships” • Based on analysis of more than 17,000 line managers, 3,000 HR business partners, 101 CHROs, and more than 100 interviews-global study • Council identified the HR business partner(HRBP), and specifically the strategic partner role of the HRBP job, as the key to HR strategic effectiveness. 10 Describe the Difference Between Transactional HR and Strategic HRBP • What KSA’s are needed? • Does the organization culture need to change to support strategic HR? If so how? • How comfortable are you with new responsibilities? – What things do you like? – What components do you dislike? 11 How Do You Currently Rate Your Services? • Confidential • Your perceptions count! 12 Effective HR–Line Support Drives Talent and Business Outcomes • When business units receive effective support from HR, business unit revenue and profits increase: • HR effectiveness positive impact on: – – – – Employee Performance: 21% Employee Retention: 26% Revenue: 7% Profitability: 9% • For a business unit with 100 million KD in revenue, effective HR support translates to an increase in revenue of $7 million KD. 13 Four Roles That HR Business Partners Play HRBP activities include: • • • • Strategic partnering --33% -highest impact Operations management—11% next Employee mediation Emergency response 14 What Do You Think Strategic Partnership Includes? HRBP Strategic Partner Activities • Adjusting HR strategies to respond to changing needs • Developing the next generation of leaders • Identifying critical HR metrics • Identifying new business strategies • Identifying talent issues before they affect the business • Prioritizing across HR needs • Redesigning structures around strategic objectives • Understanding the talent needs of the business 15 The Challenge: It’s Both the Person and the Job • Person-KSA’s and competencies: 54% • Design of Job: 43% • HR Function Structure and Budget: 3% Focusing on the person in the HRBP job is critical, but incomplete. WHY? HR must (re)examine the design of the job and the interactions with the line to improve 16 Impact of HR Knowledge on Strategic Effectiveness The most important knowledge is business acumen: 21% maximum impact on strategic role effectiveness. Business acumen: “…a deep understanding of an organization’s internal and external business environment.” 17 Work in Teams of 4 • Work on the two items and chart your answers • Select a spokesperson 18 Dynamics in the Middle East • The 2009 Arab Human Capital Challenges Report : “Exceptional economic growth in the Arab region over the past decade has not coincided with equally buoyant labor and human resource development, raising obvious concerns for sustainable and balanced growth”. • Only 38% of Arab CEOs believe there is an ample supply of qualified national labor, – Heavy reliance on the recruitment of expatriates. • 90% of Gulf CEOs value their expatriate senior management • Only 68% shared similar views towards their national senior management. Dr. M. M. Mahmoud, Executive Director, Madinah Institute for Leadership and Entrepreneurship (MILE), Madinah Knowledge Economic City, Madinah, Kingdom of Saudi Arabia 19 Root Causes: Arab Human Capital Study • Limited availability of experienced national professionals. • Historically the older generation in the Gulf region has had lower labor force participation rates. • Lower levels of education • The older age cohort is less accustomed to a modern day competitive environment • Arab world has one of the lowest labor productivity growth rates. • How does this affect HR’s responsibilities? 20 Most Important Development Experiences Are on the Job • • • • On the Job—66% Rotation—10% Training—23% Coaching and Mentoring—3% 21 Ideas for Development-- Which Are You Doing? • Modify work to adapt to changing circumstances • Persuade senior managers to take difficult actions • Engage in business forecasting or planning • Work with vendors or consultants to deliver services • Make decisions that could satisfy customerscustomize HR solutions • Make the business case for specific HR programs or initiatives 22 Ideas for Development-- Which Are You Doing? • • • • • • • Work on change management initiatives Gain exposure to global operations Work on cross-functional teams Work on mergers and acquisitions Presence of a development plan Effectiveness of development plan Work with line managers to understand business needs • Customize and deliver HR strategies 23 A Relationship Set Up to Fail • PBG found that even skilled HRBPs were often undermined by low quality HRBP–line interactions – No shared accountability – Incompatible goals • Skill sets in building successful interactions help: – CONFLICT RESOLUTION- 24 Self Assessment • How do you evaluate yourself? No wrong answers—this is a learning process!!! 25 Skill Sets • Innovation – Identify a major problem within a business that requires critical trade-offs between objectives, then develop and propose a solution -----24% • Business Acumen – Work with a line manager to identify and implement a new line program that solves a business problem -----14% • Leadership – Lead the development and implementation of a new HR initiative that solves a critical business problem----- 19% • Metrics Use and Development – Work with an expert who can teach how to apply metrics and measurement to solve business problems----- 12% 26