The Problem with HR Strategy

[00:00:00] So most HR leaders will tell you that they have a people strategy. A lot of them are describing a list of programs and a budget and when they want to get it done by. Those two things are not the same thing. Hi, I'm Andrea Adams. Today on The HR Hub, I'm talking with Rania Nemez. She's the founder and CEO of Elevar HR Advisory and Executive Training.

[00:00:23] She's a senior strategist and author who's held HR roles at the OPEC Fund and the European Central Bank. She also lectures on HR and I met her when she was promoting a book with Dr. Peter Capelli. Hi, Rania. How are you? Hi, Andrea. I'm good. Thanks. It's a pleasure to be... Well, it's a pleasure to have you back. All right, we're talking strategy today and you wrote...

[00:00:49] What did you call it? A playbook. Yes. Yes, a playbook on HR. Strategy. And I thought that that was smart because strategy in HR is sometimes really not that accessible in terms of concepts anyways. So in your mind, what is a strategy supposed to do? Yeah. Well, I think in the essence, a strategy is actually meant to really just help an organization to achieve its goals.

[00:01:19] It's not a wish list though, and it's not a set of initiatives. What it is, is really, it should answer, I think, three questions. Which is, where are we going as a business? What capabilities do we need to get there? And what has to change to make that happen? And I think, you know, what I see is that the problem is that many people strategies tend to answer a different question,

[00:01:46] which is, what can HR realistically deliver this year? And that is not a strategy. So that is really an operating plan. So in your book, you talk about people, your playbook, you talk about HR and business speaking different languages. Why does that keep happening? Because like we in HR, we're not dumb people. We are definitely not dumb people.

[00:02:11] But often what I see is that HR is really rewarded for delivering HR programs. And the business is rewarded for delivering results. So HR, we are very good at talking about like engagement scores and completion rates and frameworks and so forth. The business, they're talking about growth, risk, productivity, revenue, speed, customer experience.

[00:02:36] So neither is wrong, but they're simply speaking different languages. So the moment I think that HR really starts to kind of translate people priorities into business outcomes, the conversation changes. Suddenly, it is not anymore, you know, about a leadership program, you know, should we do a leadership program? But it becomes really about like improving internal mobility because we have an external hiring problem. And this is better for productivity.

[00:03:05] So, you know, then we really start to speak a little bit more with the business language. And that's when HR becomes strategic. And surprise, Andrea, there's a very interesting statistic from the Harvard Business Review that shows that 58% of CEOs do not view HR as a strategic partner.

[00:03:24] So, you know, as an HR person, it's not very nice to hear, but it is very useful feedback because then, you know, it's really an opportunity for us to ask ourselves, why is this the case? Right. And usually it's not because we're not capable. It's simply a translation issue. It gets really hard for us to understand. Some of us to say, understand. Profit, let's say. I want we want to make more money.

[00:03:53] Just that idea alone, how do we translate that into our strategy? Well, and I think that is one of the issues, biggest issues that we see because usually we're not aligned with the business, with the business outcomes. So, you know, if of course it's profit, but then how do we get there? So that is the three questions. You know, it's like, where is the business going? What capabilities do we need to get there?

[00:04:21] And what has to change to make that happen? And if a people strategy does not answer that or is not able to answer that, then you already see that there's no direct link with the business. And that's already a problem. To me, I think the problem actually just becomes the fact that we are not translating what the business wants into what HR should be doing. That's what that's we understand where they're going. Do we understand?

[00:04:50] The capabilities and do we you know, maybe it's all of those questions. We're not getting it. I think you're right. It is a matter of translation. And it's also a matter of it's just not clear what the sometimes what the business outcomes are. And these are not translated either to HR. And that's where we see, you know, the discrepancy as well. I am going to leave that behind, although I think that's the core of it.

[00:05:20] OK, I'm not going to leave it behind. How do we get better at speaking their language? Because I don't think if we don't do this, we've already failed. Yeah. I mean, that's that's a that's a very good point. But in my view, and that's what I've also written in the playbook, that is actually one of four issues. The language part. OK.

[00:05:47] So there are other things which is like what we mentioned at the beginning, really, that some think they have a strategy, but they don't. You know, they have a list of tensioned initiatives, which never even look like a strategy. Hence, they can't they can't even begin to speak the language because actually they are not a strategy in themselves. Right. We also have really the agility problem.

[00:06:12] And what I mean by that is that, you know, businesses, they they are so in this constant. We have to be agile. We have to keep moving and changing and restructuring and reorganizing. And they think that this is like something really good for their organizations. But actually, it is having a detrimental impact because it's causing too many changes. People can evolve that quickly. There's so much change fatigue.

[00:06:37] And, you know, when you're that agile, what agility requires is also stability. And a lot of these organizations are not seeing this level of stability, you know, because of that and because of this constant prioritization like, oh, this is important now. And then they change it to, no, we need something else. How can you put that strategy? How can you put that on paper all the time? You know, you can't because by the time you're done working on an initiative, it's already passe and you need to work on something else.

[00:07:05] So I think that also is a big problem for a people strategy. Damn, I bet a lot of people are going to relate with that. It's so true. Even though I've been talking about this, it's like we've got to have some foundations upon which all this change can happen. And I think in so many circumstances, we're missing that foundation. Yeah.

[00:07:32] And this is, by the way, what I call the alignment, the, sorry, the agility trap. You know, it's this how do you balance the business needs for speed and being agile? But then how do you balance also what the employees actually need? Right. Which is stability and trust and communication and psychological safety. You know, all of these things which you actually cannot get when the organization is moving as quickly as so many are right now. Mm-hmm.

[00:08:01] But the organizations, like with the markets and everything changing so fast, do they have a choice? The organizations may not have a choice in terms of the speed, but I think they have a choice in how they do it. And in one article, actually, that we wrote with, that I wrote with Peter Capelli, it was about sustainable agility. So how can you be agile, but in a sustainable way? Which is, you know, communicate well and communicate clearly. Ah.

[00:08:28] You know, create awareness of the problems, involve employees, because I think people and employees, they do not, oftentimes they do not resist change, but they resist change that they don't know what it is or what's happening. Mm-hmm. So involve them in the process. I think it's a completely different way of operating then. All right. You also talk about people leaving even though our engagement scores are good. Yeah.

[00:08:59] What is that? How does that connect to strategy and what should we do about it? Well, honestly, I think that's one of my favorite questions because I think what people forget is that engagement surveys, they measure the sentiment of people, right? So they don't necessarily measure the conditions that drive retention or performance. So, you know, people can be engaged, but they can still leave.

[00:09:27] They may love their job, but they see no career path. They may, you know, enjoy the future, but they still are exhausted. They may like their manager, but receive better opportunities elsewhere. So I feel like all of these engagement scores, they really, they're looking at the symptoms, but they're not really digging into what are the issues, you know, what is really upsetting employees? What is really causing this dissatisfaction?

[00:09:54] I don't think you can get that properly from an engagement survey. So sometimes I think organizations become really obsessed with the scores and improving survey scores rather than actually improving the reality of what is happening. What information do we gather or is this engagement is just one of the pieces of information we should be gathering to understand how to improve the experience for employees?

[00:10:22] Yeah, I mean, we should be gathering actually, I think many different things like including, first of all, turnover rates to that we really have a picture happening. Maybe also internal mobility. It's a good indication if people are moving around or if they're not, if they're leaving instead. Of course, engagement scores, you can still collect them. You can still get them, but you should not form, you should not make them the main dashboard, right? So it's just one metric in addition to others.

[00:10:53] What is the role of the leaders in the organization, not the HR leaders, but the other leaders in creating an effective HR strategy? And how does the lack of their involvement become how our strategy fails? Well, honestly, I think, you know, the saying is true, which is people don't leave companies, they leave managers.

[00:11:21] Manager quality is, I think it remains one of the strongest predictors actually of retention, of engagement, of performance, of well-being, in my view. Because the leaders are the strategy. You know, you can have the best people strategy in the world on paper, but it takes one ineffective manager that can undo all of it, honestly. So culture at the end of the day is not created by HR. It's created by the leaders.

[00:11:50] The same with performance. It's not delivered by HR. It's delivered by leaders. And a people strategy really becomes real and successful when leaders discuss it, when they model it, when they reinforce it, and when they are held accountable for it. I think the biggest failure that organizations can do is, or that leaders can do, is when they view the people strategy as an HR responsibility rather than their own.

[00:12:18] Because it also should be, it's a collective, it's actually also an organizational, you know, one. And there was a very interesting statistics, by the way, from Gallup that shows that roughly, managers account for roughly 70% of the variance in team engagement. So we really see that engagement is often less about company-wide initiatives, but more about the person that you report to on a day-to-day basis. Okay.

[00:12:47] So if someone's listening to this and recognizing that their organization is producing an HR operational plan, and they would like it to be a strategy, what do you suggest? Well, I think the first question that they should ask themselves is, you know, can they clearly explain how their people strategy supports their business strategy?

[00:13:13] Because I think if the answer is not immediately obvious, then they really, they should start there. They should really look into maybe what is, why is it failing? You know, which one of these five perhaps root causes is it? You know, is it because of the alignment, as in the language, the translation? Is it because they don't actually have a strategy? You know, is it because of engagement issues?

[00:13:39] So you really have to dig deep and do your own audit of what is happening. And then really diagnose all of that and see exactly where, pinpoint where the issues are and then see how this can be fixed. And, you know, in the playbook, actually, I do mention some ways where they can look into fixing it depending on what the root cause is. Okay. All right. Where can they find the playbook and where can they find you?

[00:14:09] They can find me on LinkedIn. Happy always to connect with people. Also on my website, ranyanemmett.com. And the playbook, there's also a link that I'm happy to send to you, but it's also on LinkedIn as well. Okay. And I imagine that they can find a link to your playbook on your website too. Absolutely. Okay. Okay. All right. I'll put links to all that in the show notes. Well, thanks, Rania. That was great.

[00:14:36] I love the truth in there that managers are 70% accountable. You didn't use the word experience of employees, but that's what keeps coming to mind. And leaders are the strategy. Like, yeah, this is stuff we need to hear. Um, I referred to an episode that I did with Rania and Dr. Peter Kelly. The link to that is right here.

[00:15:04] There's so much high quality thought in that. Uh, thanks for watching out there and we'll see you next time. Bye. Bye. Bye. Bye.