When you think of Human Resources, do good thoughts come to mind?
It is something Evan Wittenberg, SVP People at enterprise content management platform company Box asks whenever he speaks at conferences. And unsurprisingly, the response tends to be the same.
One person, maybe two raise their hand sheepishly, and the rest keep their arms pinned to their sides as though they had been duct taped.
Your Mom was in HR wasn’t she? Evan says to those with their hands up.
They always nod back nervously.
A good ice breaker maybe, but it paints a sorry state of affairs for the Human Resources profession. Its innate focus on record keeping, workplace safety and wage management proved to be invaluable last century.
And given that for some organizations little has changed, many now question the place of Human Resources in the modern business organization altogether.
The negative connotations conjured by the word, forced Wittenberg to get rid of the dead weight, re-branding it the ‘People Department’ in an attempt to shed the name and negativity once and for all.
“We wanted to escape the old HR,” Evan explains, as he gets ready to provide his three key reasons why.
Old HR was not business focused enough
“I think of myself as a business leader first, and an HR professional second.”
“That may sound slightly odd, but if you think about it, should I really be willing to do anything in my function that doesn’t directly help the organization succeed?”
“Take employee happiness as an example, which I get asked whether I care about a lot. Research shows very clearly that there are amazing benefits to businesses whose employee population is happy.”
Economists at University of Warwick in the United Kingdom for example have found that happiness among employees led to a 12% spike in productivity. Conversely, unhappy workers surveyed were 10% less productive.
Performance, retention and the attraction of great talent are influenced too, says Wittenberg and “so I dedicate significant resource to ensuring all Box employees are happy.”
“Now, regardless of research, of course I do care very deeply whether our people are happy. It matters a lot to me, but I wouldn’t spend an ounce of organizational resource on it unless I knew that it very clearly aligned with business success.”
It is such an approach, Wittenberg believes, that constitutes the new HR. Business centric, value driven and atypical to the old HR.
Old HR doesn’t use data to its fullest capability
The second reason that old HR doesn’t provide enough business centric value is because data and metrics aren’t underlying everything they do.
“Google pioneered this side of HR and I was fortunate enough to see it first hand,” explains Wittenberg, who spent 4 years at the Internet behemoth as Head of its Global Leadership Development team.
“Google broke down the barriers between academia and actual organizational life through the department’s aim of bringing the same level of intellectual rigor to people decisions, as they do engineering decisions.”
Interestingly it doesn’t call the HR department an HR department either.
Instead, its VP and HR leader Laszlo Bock prefers People Operations.
Justifiably, he demands data-based decisions on every aspect of the people side of the business. But what’s more is that Bock has shared Google’s approach to hiring and managing the very best talent with others.
It is part of the reason he wrote the best-selling Work Rules! So that others can borrow, tweak, and adapt what Google have already done.
There’s no denying that Google’s approach to data has been a real eye-opener for the rest of the field.
It does however; only make up one part of this piece.
That other side is metrics, or, the figures providing an insiders perspective on businesses through easy to measure tangible data that doesn’t require custom written algorithms to provide value.
Wittenberg explains how when he started at Box for example, he spent a large proportion of his opening few weeks speaking to Boxers [employees] about their likes and dislikes about the place they work at.
“Interestingly, the number one recurring complaint among Boxers was a concern that open jobs were being filled by people from outside of the organization rather than those internally.”
“And we wanted to use metrics to help quash these concerns, deciding current employees would fill 20% of our open head count.”
The approach satisfied that particular piece quite easily, Wittenberg recalled.
“So we figured why stop there?”
Having individuals take up management roles from within an organization can be incredibly beneficial.
It has a positive impact on culture by ensuring the same values permeate throughout, as well as a demonstrating inward mobility.
When employees are able to see that those around them are being promoted it will spur them to work harder too.
“We decided then and there that 50% or more of our people manager roles would be filled by current Boxers too. And just a year ago in 2015, we decided to do the same with our executive roles too.”
“These metrics are all measured every 6 months and so far we have consistently been on track. It is then reported to the rest of the company.”
HR has historically been known as the enforcer
The third and final reason old HR is problematic, is because the function has traditionally had a tendency to share Thomas Hobbes‘ view of human nature.
That means assuming that employees are inherently ‘bad’, misbehaved and unless watched, pre-disposed to do wrong. That view creates a necessity to build a function to enforce procedure and ensure employees didn’t do the inevitable.
“It meant that old HR came to be known as the function that says ‘no’. And such a view on human nature,” says Wittenberg, “is an awful and fundamental flaw. Because when you put in place measures to control the 1% of people who might do wrong, unwittingly you handcuff the 99% that won’t.”
Instead, employees need empowerment, trust and autonomy if they are going to be able to reach self-actualization and do their best work.
“And handcuffs unsurprisingly aren’t the way to do it.”
“I think it’s a fundamental shift in people functions born out of Silicon Valley companies, but not yet quite understood by traditional businesses.”.
The success of new HR, inevitably will help bolster the case, and be an example of how, when properly applied and executed, HR or the ‘people’ function, can have a significant and measurable impact on a company.
It’s important to note that success in this instance will have little to do with what is classically considered core HR work such as payroll, benefits administration, staffing, and recruiting.
“Instead,” Wittenberg suggests, “the work will be strategic in nature and lay the foundations for businesses to succeed.”