The role of Human Resources Can be Traced back to the Days When the First Relationships: HR Business Partnering Assignment, UrL, Singapore

Introduction

The role of human resources can be traced back to the days when the first relationships existed between employers and employees, although it was not officially characterized until the late 1800s (Keegan and Francis, 2010). In fact, the first official classification of the human resource function was referred to as the “Personnel” department based on the need to control and direct employees during the Industrial Revolution (Cohen, 2015).

It was not until the 1980’s that the HR function really transformed from being a, largely, administrative maintenance function to a core business function (Ulrich and Dulebohn, 2015).

This was the period when personnel management (PM) was replaced with human resources (HR) identifying the view that employees were seen as an asset rather than a cost (Marchington, 2015). Interestingly, it was described as an inside/outside approach with the primary purpose being to add value (Ulrich and Dulebohn, 2015).

After WWII, it took an inside only approach being maintenance and administrative oriented. Then, beginning in the 1980’s HR progressed through one of it’s biggest transformation phases, as shown in Fig 1, below. Wave 1 is the legacy of the PM era where HR performed the traditional administration functions. The second wave is typically where HR was able to design and deliver innovative HR practices.

The third wave is the strategy wave where HR practices are connected with business success and the final wave is connecting HR to the business, fully participating in the development of strategy and with the ultimate goal of adding value.

Ulrich and Dulebohn (2015) conclude that the ultimate mission of HR is adding value and extend this to where the profession should be headed. The approach should be outside/inside i.e. HR is engaged with external stakeholders, but also meets the expectations of external stakeholders, customers and the broader community.

2. Key Issues.

In considering the challenges faced by HR today and it’s leadership we set out to review the key issues identified in the case study by Charan, Barton and Carey (2015). They identify several issues around transitioning the HR role to a true business partner role which will be discussed in more detail, and where possible, link their assertions to the context of the Asian business environment.

It is important to note that the current research in human resources and management in general, has assumed that culture, geography and social styles are universal constructs, particularly leadership style (Koo and Park, 2017). Hofstede (2007) alludes to the fact that management literature has not really been concerned with whether there are particular, “geographically distinct”, management styles.

A management philosophy used in one culture may not be appropriate in another country. In reality, most of the HR models and HR competencies were developed in the USA and the United Kingdom and may, in fact, have limited application in the Asian HR landscape.

The HR Business Partner Model.

The need for HR to “reinvent” itself is well documented in HR research (Aldrich et al, 2015; Aldrich & Pullman, 2019; Pritchard, 2010; Sheehan; 2014; Ulrich and Dulebohn, 2016). In order to evaluate the challenges of such a transition, we must first define the HRBP model and its key assertions. Most practitioners seem to have implemented some version of the Ulrich three-legged stool model as it became the most widely publicised and researched (Gerbott, 2015).

The most recent version as cited in Caldwell (2010:42) states, “..they are now expected to operate in six competence domains as a credible activist, cultural steward, talent manager/organizational designer, strategic architect, business ally, and operational executor”. Keegan and Francis (2010) point out that HR business partnering requires, or implies organisational redesign and fragmentation of certain activities that were formally integrated into the HR department.

This is also suggested in the case study (Charan, Barton and Carey, 2015). The authors suggest assigning the administrative and transactional functions to the CFO although there is little evidence of that being implemented in practice. Keegan and Francis (2010:875) stress that, “Practitioners are urged to take on a narrow set of proactive roles defined along two axes: strategy versus operations, and process versus people”.

The need to improve organizational efficiency i.e. minimise administrative tasks in implementing the HRBP the model has given rise to the concept of a “shared service” function (Gerbott, 2015; Keegan and Francis, 2010; Pritchard, 2010).

A survey of 416 companies worldwide (CIPD, 2015) showed only 21% of companies reported that human resources had transitioned to be a full partner in developing and implementing strategy. The definition of a full partner has various interpretations.

More recently, Freidrich and Rajshekhar (2018) concluded that many organizations have attempted the implementation of the HRBP role but, have failed to fully implement the role. Ulrich and Grochowski (2018) surveyed 100, global 500 organization’s across industries and found that many companies had focused purely on re-organizing their HR departments which was a short-sighted approach. Gerbott (2015) argues the adoption of the business partner model is not in line with an evidence-based approach to management.

Indeed, the model is not without controversy as the model has been changed many times since the 90’s and critics argue that the changes reflect the fact that the model has limited applicability across all industry types (Keegan and Francis, 2010).

3. Discussion.

3.1 The Changing Nature of Work and Predicted Changes in Roles and Responsibilities A number of authors have attempted to explain the paradox for many organisations and have highlighted that the HR function has been too focused on administrative duties thus preventing them from contributing to the strategic side of the business

(Pritchard, 2010; Sheehan et al, 2016). Cohen (2015:206) commented that, “HR’s role as a business partner is still aspirational because not everyone views the HR function as strategic”. Ulrich and Dulebohn (2015) argue that the HR profession is held up with the “administrative” or traditional issues they face on a daily basis in performing their duties that they fail to have the time to develop new skills.

Indeed, Ulrich & Brockbank (2005) outlined the need for a redesign of the original model where the model relies heavily upon a shared service approach to relieve HR of administrative activities. It is interesting to note that there is a myriad of research on the HRBP model but very little research on how the model actually plays out in practice nor how it evolves over time (McCracken et al, 2016).

3.2 Struggle for legitimacy/credibility

A key issue that has been identified by many authors, and is also highlighted in the case study, is the need for legitimacy or credibility in the HRBP role (Aldrich et al, 2015; Brockway, 2007; Caldwell, 2010; Sheehan, 2005; Ulrich et al, 2015 and Ulrich Moving from the role of traditionalist to a more strategic role requires a completely new skill set.

HR business partners have been, generally, successful at establishing personal credibility despite the fact that it has been shown to have a minor impact on business performance (Caldwell, 2010). Ulrich and Brockbank (2005), elaborated further on this element, arguing that HR practitioners have failed to develop the strategic competencies that have a significant impact on business results. Aldrich et al (2015), provided insight into the factors that contribute to the credibility of HR as

summarized in Table 1, above. Trust was agreed upon by both sets of participants in this study and also in agreeance with Ulrich’s 2008 updated model (Aldrich et al, 2015). It is also evident that in establishing the support of the CEO and their line manager counterparts, HR business partners must establish credibility and trust, to enjoy greater influence over decision making.

Brockway (2007) highlighted one of the main issues in establishing credibility and thus, success for HR i.e. the requirement for change has been largely the responsibility of HR. In organizations where the transition has been considered effective, it was endorsed and driven by the CEO and line managers (Sheehan, 2005). Direct access to the CEO through a formal reporting relationship was also a

key determinant of the success of the HRBP model. Again, as reported earlier, there is another influential force, the role that senior management plays in the implementation of the HRBP model. Nonetheless, the HRBP model is, now, well embedded and we discuss some of the key challenges below.

3.3 The Challenge of People Management for CEO’s.

In the case study report, Charan, Barton, and Carey (2015) comment that CEO’s rank the HR function as the eighth or ninth most important function in an organization. This assumes that CEO’s, at that time, believed HR lacked competence. Research conducted in 2012, did indicate that CHRO’s themselves blamed lack of HR competence for not meeting CEO’s objectives (Cohen, 2015). In the same study, it showed that only 36% of CHRO roles were filled from within the organisation. Lack of HR competence is certainly an issue, hence the shift to HR leadership and behavioural competency models in recent research studies (Cohen, 2015; McCracken et al, 2017).

The second key issue highlighted in the case study, is the challenge of people management for CEO’s and leadership. Leadership is one of the most critical factors in determining performance and strategic outcomes in organisations and the fact that leadership cascades throughout an organisation gives it considerable context in this case (Hambrick and Quigley, 2014).

McCracken et al (2017) highlight the role of organizational culture as key factor given the importance of partnerships and building relationships between HR managers, line managers and functional managers.

The potential changes in the HR structure that is assumed in HR transformations such as the implementation of shared service models, and smaller units of functional experts also implies the potential turbulence that may occur (Pritchard, 2010).

The key outcome of HR should be to build leadership throughout the entire organization (Ulrich and Dulebohn, 2015). Leaders guide the behaviour of others where leadership is defined as an organisations capacity to build future leaders.

Yes, individual leadership counts, but, an organisations leadership matters more over time. Ulrich and Dulebohn (2015) have identified 5 things that HR should implement to augment an organisations leadership capabilities. Firstly, it will be necessary to build a strong business case for why leadership leads to higher financial performance.

Secondly, take an outside/in approach to leadership effectiveness. i.e. aligning leadership behaviour and expectations with the external brand of the company. Third, establishing leadership standards and extending the evaluation of leaders to external stakeholders such as customers and suppliers. Fourth, leadership investment. Changing the formula of leadership investment to 50% job experience, learning 30% training on new skills, and 20% life experience. Fifth, leadership measurement. Leadership in the future should be measured against how it equates to shareholder value (Ulrich and Dulebohn, 2015).

3.4 Asian Leadership style

Koo and Park (2018) suggest that indigenous leadership styles specific to Asia do exist. Asian leadership emphasizes a hierarchy based upon paternalism such that leaders are expected to play an authoritarian role, and subordinates are expected to respect their decisions.

These traditional contexts can create significant differences between western leadership style (Koo and Park, 2018). Hence in the Asian context, leaders have greater discretion and control and subordinates are unlikely to question their decision-making.

Hubris (defined as extreme self-confidence and pride), has been shown to be more inherent in many executives in Asia, with the effect being amplified in the Asian work environment (Koo and Park, 2018). This may have both positive and negative effects but the likelihood is that it is negatively related to a company’s socially responsible activities.

3.5 The impact of Culture, Social Movements and Regulation on People Management.

As mentioned above, there is a distinct absence of literature about the role that culture plays under the HRBP model. Charan, Barton and Carey (2005) in their commentary about redefining the role of HR, fail to mention this as an important consideration.

We argue that culture, as it relates to organizational transition and the role of HR in transition, is possible, a highly relevant consideration. It follows that the changes in HR structure implied in Ulrich’s model such as the creation of shared service models and the advent of centralized functional experts and its implementation must be heavily influenced by an organization’s culture (McCracken, et al, 2017).

Hofstede (2007:413) defines culture as “the collective programming of the mind which distinguishes the members of one group or category of people from another”. In order to outline the key cultural differences that may be most relevant in this analysis we utilized Hofstede’s Cultural Dimension classification We compared Singapore, as representative of modern Asian culture, to western culture represented by the USA and UK (Fig 2. Below).

Using this methodology, we can see that the greatest difference between Asia (i.e. Singapore in this case) on the one hand and Western countries on the other, is along the dimensions of Uncertainty Avoidance, Individualism and Power Distance (Hofstede, 2020). This is consistent with the view that Asian culture is largely defined by two primary constructs, power distance and collectivism owing to Confucianism origins (Koo and Park, 2018). What are the implications for HR?

Power Distance Individualism Masculinity Uncertainty
Avoidance
Long Term
Orientation
Indulgence

Figure 2. Hofstede’s Cultural Dimension. Source: hofstede-insights.com (2020) Power Distance. Asian societies typically have a Confucian background which is based on unequal relationships between people, so managers rely on rules, and employees expect to be told what to do. Attitude to managers is formal. High power distance cultures could also be referred to as respect cultures (Hofstede 2007). Here, communication flow is selective. The idea that the CEO needs to drive the transition of the HR role would be more supported in high power distance cultures. Individualism.

In an Individualistic society, people are supposed to take care of themselves and their direct family members. In Collective societies, people belong to groups and harmony is maintained by suppressing individuality. Politeness is favored over honest feedback.

The challenge in the organizational context is getting honest feedback because the face of others has to be respected. When operating in collective cultures, organizations should use group work as a way of getting work done, which improves job satisfaction because employees feel they are contributing to the organization as a whole (Andreassi, 2014).

Uncertainty Avoidance

This dimension deals with the way society deals with ambiguity, uncertainty and risk. Singapore scores very low on uncertainty avoidance so in a business context, there are many rules and regulations in place and decisions tend to be made by consensus.

Traditional gender roles are likely to be evident. In Korea and Japan for example, it is well-known that there are very few females making it to the ranks of CEO. In Japan, females make up only 5% of senior roles, in South Korea it is 2.7% In the rest of the Asia Pacific region it has reached 23% (Rowley, Oh and Jang, 2019). Also highlighting that the Asia Pacific region is not a

4.0 Implications/Recommendations.

Our analysis has shown that Ulrich’s HRBP model has gained wide acceptance by HR practitioners and consultants facilitating significant changes in the design of HR departments despite the fact that it is, ultimately, a theoretical construct. Recent findings support the position that we need to be more cautious, since Ulrich’s mandate may promise more than the HR profession can deliver (Heizmann and Fox, 2019).

During all this change, competency models have been revised, HR functions have been re-routed and outsourced and the perception of the HR profession has been dramatically, elevated (Cohen, 2015). Indeed, HR has definitely transformed itself from the days of being welfare custodians.

However, has HR become too short-sighted in the pursuit of short-term performance goals and satisfying the interests of senior management, shareholders, and boards of directors. Have the other goals of long-term sustainability and the obligation to other stakeholders in society been missed? Does the list of stakeholders extend to the broader community and society in general? Several themes are introduced below.

4.1 HR Ethics

Several authors have identified areas of concern, where HR practitioners are required to position themselves as strategic partners many of their historical roles have 9
ENVIRONMENT
SOCIETY &
CULTURE
ORGANIZATION
FAMILY
INDIVIDUAL
EMPLOYEE
gradually disappeared or dropped further down the list of priorities (Keegan and Francis, 2010; Marchington, 2015; Van Buren, Greenwood and Sheehan, 2011).

These authors contend that employee goals and organizational goals remain in conflict and transitioning to HRBP has “marginalized employee-focused HRM responsibilities and ethics activities” (Van Buren, Greenwood and Sheehan, 2011:209).

Keegan and Francis (2010:895) state that, “for example, the distancing of HR from employees and their front-line managers, segmentation of HR roles, fragmentation of HR work and an emerging imbalance between people-oriented and business-oriented HR roles” is contributing to greater tensions. Sheehan, (2014) sees HR business partners as traditional custodians of employees who have now, found themselves in conflicting roles with the move to business partnering and they find themselves straddling conflicting interests.

In attempting to provide allegiance to both groups the role has a paradox (Marchington, 2015). We conclude that the strategic partner role has seriously challenged HR’s capacity to maintain its traditional role as an employee advocate and needs to be re-balanced. What about employee welfare? This topic is hardly mentioned by the mainstream HR gurus. In the modern HR world, there is no employee welfare function (Van Buren, Greenwood and Sheehan, 2011).

4.2 Society

To take a humane perspective of HR infers that a wider group of stakeholders needs to be considered in evaluating and improving the effectiveness of organizations as shown in Fig.3, (Cleveland, Byrne, and Cavanagh, 2015). The diagram depicts the employee as the key construct of the HRM/Respect for Humanity approach.

Here we see that the employee is embedded in multiple layers of context and proximal environments are direct and reciprocal. Thus, there is a growing argument for the recovery of human empathy, which could be facilitated by taking an ecological approach to HRM.