We sat down with Paul Swain from Ultimate People. He dissects outdated views of the HR profession and explains why the pandemic caused organisations to rethink HR’s inherent value.
How did you find yourself in this profession?
I used to work in financial services as a salesperson at first and then a sales manager. It’s a long story of how I moved into learning and development, and it doesn’t really matter, but what I’ll always remember is a family member asking me, “Why are you going to work in HR? That’s where managers who can’t make decisions go to die.”
I’ve had that ‘feedback’ from well over 20 years ago on my mind at least once a week for the entirety of my professional career. When I work with new people, I assume they will see me as a manager who can’t make a decision because our profession is still full of those people. So it’s a bit of a truism.
Too many HR professionals have the mindset of: “I’m here to support you people who are at the sharp end of the business. You make all the decisions and I’ll just support you in that.” Whereas my view of the world is that I need to be forthright and decisive. I need to come up with concepts and strategies that people can get behind that drive the business.
I think it’s a challenge in this profession. I’ve made myself quite unpopular from time to time at industry conferences by standing on stage, addressing senior HR professionals and telling them that they need to relinquish this “seat at the table” concept. If you were to read through human resources publications from the last few years, all of them have got these stories about why doesn’t HR get a seat at the table? Why do businesses not value HR enough to give it a seat at the table?
Well, why is that – or was that – the case, and how did COVID-19 shift that mentality?
To be clear, HR having a seat at the executive table is essential. In the past couple of years, we’ve seen quite a bit of reporting around how the “seat at the table” problem has been fixed. Why? Apparently, it’s because during COVID businesses finally saw the value of HR.
To be clear, HR having a seat at the executive table is essential.Paul Swain, Ultimate People
Here’s what I believe. I don’t have a lot of evidence to back this up, so it involves some joining of the dots. But for the first time in memory – of my generation, at least – businesses had to come to HR to make their decisions for them.
So, I was working in the retail sector at the time COVID hit. My CEO was coming to me and asking about whether we were legally allowed to let our staff come to the shop. HR was making decisions about whether we could trade and how we could do that. There were lots of other shops closing, but did the law – the emergency powers especially – have anything directly relevant to us? A lot of it was open to interpretation, and we had zero case law to go on.
Suddenly HR was being asked to make all the decisions. They were decisions that required you to understand how to read hastily drafted legislation, understand how your business operated and how your people were likely to respond. There was huge ambiguity and the business, at all levels, was looking for decisiveness and leadership. Of course, some rose to it, and they’ve been able to take huge strives forward in educating their business on the value of HR.
So rather than “a seat at the table”, is it more about having a relationship with the C-suite where you can influence their decisions?
There are definitely examples of HR professionals struggling to break the entrenched mindset of CEOs and the C-suite more generally. Remember that much of the C-suite sees people as a cost. When a CFO looks at a profit and loss (P&L) statement, the most important thing they often see is that people are the largest controllable cost in the business. Any MBA grad will tell you that’s true.
And it is objectively true. It’s very hard for me to rapidly bring down the cost of goods or our general overheads like rent, energy costs etc. But I can rapidly bring down the cost of people in the business. If I really need to, I can quite quickly make a whole bunch of people redundant. You don’t want to, but it’s objectively true that a HR Director can do that if they need to.
So that’s how HR has been seen in the past, controllers of cost, guardians of policies and procedures, risk managers. And it’s still a problem to this day. A CFO who is 50 years old and has been in the accounting profession for three decades will most likely see people as a cost, not an investment. They are a product of their generation, training and conditioning. Which is not wrong. You have to understand that whilst the primary stakeholder focus of HR professionals is people, the primary stakeholder focus of finance professionals is the shareholder.
When COVID happened, there were HR professionals who decided, “I’m going to show the C-suite what it’s all about, because I’ve got an opportunity I’ve never had before.” Those who grabbed that opportunity and ran with it absolutely have continued to stay elevated in the minds of the C-suite, even post-COVID.Paul Swain, Ultimate People
But I think those people are in the minority. And they were probably not the people who were complaining about not getting a seat at the table in the first place. They were already engaged and trying to answer questions like: “How do I take my CEO on this journey? How do I make this a game of inches so that I can slowly get them to understand what people are all about?” They’re in the minority.
Those who were in the majority were the ones worrying about having a seat at the table. When COVID arrived they said, “Thanks, world! Thanks, pandemic!” But they are the ones who are now receding back into the dark corner of the executive boardroom, where they came from.
Interested in hearing from a panel of Executives on the topic? Watch the recent webinar, Does the C-Suite value HR Leaders? where Paul Swain hosted a dynamic discussion about what the C-Suite really think about HR Leaders owning a seat at the executive table.