The Five Pillars of Success for your CHRO: Wish List or Wishful Thinking?

This article pulls in pieces from previous articles written in conjunction with Michael Jenkins of Expert Humans.

Previous articles can be found here:

The Chair-CEO Relationship: Time to dial things up?

Is your CHRO a hidden-in-plain-sight resource for the CEO?

The Chair-CEO-CHRO Relationship – SuperTrio or is 3 a crowd?

When we look at the model of a world-class Chief Human Resources Officer (CHRO), you might be excused for mistaking this as five, or more, roles in one! After all, which other role in an organisation asks that you have such a top down – as well as – bottom up approach at this level? It’s usually one or the other with a gap in between.

That gap is often filled with the CHRO role and their corresponding functions.

But how realistic is this wishlist of desirable traits, functions and experiences all in one person? Or is this just wishful thinking on the part of leadership boards who want to be seen to be ‘doing the right thing’ by having all the puzzle pieces in place?

These high level pillars of success demanded of today’s CHRO includes an impressive array of skills and attributes that might see them, in a single day, taking part in stakeholder engagement meetings one minute, resolving an employee safety issue the next, attending the board meeting presenting the company’s approach to culture and diversity and wrapping up the day contributing to the financial forecasting model for the next quarter.

That’s quite a day by anyone’s marker!

Let’s take a deeper five into each of the 5 pillars of success for your CHRO to understand more…

1.Board’s Leader of Human Capital

Plan and support CEO succession
Build shareholder supported executive compensation
Surface and respond to external trends

2. Creator of Talent Strategy

Ensure critical role staffing
Design talent management processes
Direct strategic workforce planning

3. Enterprise Change Leader

Challenge the status quo
Plan strategic enterprise changes
Manage stakeholder
Advocate for employees

4. Driver of Culture and Purpose

Link purpose to culture
Measure and communicate the culture
Hold leadership accountable for the culture promise

5. Trusted Advisor and Coach

Advise and coach the CEO
Maximise the senior team effectiveness
Coach and develop key enterprise talent

Business Acumen

Business models
Financials
External markets
Customers

Business Strategy Development

Stage and influence business strategy
Partner with executive peers to move the organisation forward

Functional Business Leader

Create a future-focussed, financially disciplined team to run the HR function

What are some of the potential risks or pitfalls in attempting to box everything together in one CHRO role?

Not having a place on the board, yet expected to handle executive level ‘people’ matters
Consistently evolving and disruptive markets and labour force trends

Defining Moments for CHROs

There are a range of defining moments that are critical for any CHRO incumbent (as defined by the CHRO Global Leadership Board (CGLB)’s white paper):

Managing a CEO Transition
Managing Executives Through a Sensitive/Crisis Situation
Leading Independent Board Interactions (Engaging board members in meetings and individual interactions on sensitive issues that require navigating tensions between the CEO and Board (i.e. CEO performance conversations)
Driving Executive Decision Making Around a Key Trend Affecting the Enterprise
Delivering Capabilities for a Business Transformation or New Business Acquisition
Designing a Strategy to Enable an Organisation to Implement the Right Structure for Future Business Needs
Leading a Bold Experiment
Implementing a Large-Scale Change to Compensation or Benefits
Crafting a New Mission/ Vision/Values
Leading a Cultural Transformation
Managing Impact of Digitalization on Culture
Engaging Executives in Critical Dialogue on Leadership Needs
Courageously Advocating a Contrarian Position With the CEO

“The new CEO will find it easy to obtain strategic, operational, and financial data while getting up to speed, but will need someone to explain other executives’ personal backstories and interrelationships and why and how some of the company’s more idiosyncratic practices evolved. Ideally, a CHRO can also offer candid feedback on how the new leader’s early words and actions are perceived in the organization.”

[Ref: Ciampa, D. “After the Handshake, Succession doesn’t end when a new CEO is hired”, HBR, Dec. 2016]

Ciampa goes on to say:

“When a large retail company recruited an outsider to succeed the CEO, the company’s CHRO called him the next day and explained that although they’d spent time together during the search process, he wanted a meeting to discuss an onboarding plan and the company’s political structure. The CHRO travelled to the new CEO’s distant city, and they spent hours talking about the challenges of transition. The new leader found it invaluable.”

[Ciampa, D. (2016)]

As you cast your eye across those defining moments for a CHRO, it is not hard to realise that one would need to work closely with the CEO (and other CXOs) as well as the Board, including the Chair. This is one reason why many call for the CHRO to be on the Board – a call that has been out for decades now. And yet there has been little movement in this area. What has changed during these decades though, are the growing complexities around people issues that organisations face. So why has the call yet to be taken up?

Being on the Board, rather than just presenting to the Board every so often, would be helpful for many reasons. While being able to make compelling, timely and useful presentations to the Board is one important capability for a CHRO, being present as the Board considers, if not struggles with, “people-related issues” would seem sensible in many ways. However, this is all easier said than done. So in reality…. where are the CHROs (in the organisation)? How can they connect with the Board?

As we look at the organisations that surround us, more often than not, we find the equivalent to the CHRO organisationally in two places. They either report to the CEO or they are structurally under the COO or equivalent, given HR is frequently deemed a “service”. This means that they have a job to do if they are to reach or connect with the Board. It is going to require effort.

For their part, Boards are normally filled with former CEOs and the predominant background of directors is usually finance or law. Depending on the nature of the organisation, there may be some domain experts on the Board. So traditionally, directors tend not to have deep experience or a background in the “people side” of the business. A less-than-ideal situation can be made worse on the Executive side (where one might look for “people-oriented inputs”) by some CEOs who, lacking a strong financial component to their own professional skillset, will often bring in a strong CFO, but seldom be self-aware enough to recognise that they might lack a strong “people” aspect to their repertoire as well. This means a CEO is highly unlikely to bring in a strong CHRO to compensate for his or her lack of skill on the human side. It isn’t something that will come automatically into a CEO’s calculus for strengthening the company’s chances of success.

Few CEOs will ever admit that they might need help in that area i.e. working with human beings – with the result that for some CEOs, even considering CHROs as a resource to do just that – doesn’t get any headspace time at all. And this state of play, or attitude, is further strengthened by the lingering impression held by some that CHROs are first and foremost the custodians of rules and regulations and that if they happen to be compassionate and empathic – well then, that’s a bonus. All these elements conspire to make it really challenging for CHROs to be able to change attitudes and alter the status quo.

So how might these challenges be addressed?

Could redefining the nature of their human relationship with the CEO be one way of improving matters? Could this be one way of ensuring that CHROs don’t remain “hidden in plain sight”, as far as CEOs are concerned? Given that CHROs on Boards are thin on the ground (see quotation below) – perhaps it does fall to the CEO to champion the CHRO.

“According to DHR’s own research, only twenty-eight active CHROs are currently serving on the boards of Fortune 1000 companies.” (Magsig & McGrath (2019), “Why Now Is the Time to Have a CHRO on Your Board”, DHR white paper)

So for the CEO to champion the CHRO, the relationship needs to be strong and trusting. The CEO also needs a strong bond with the Chair. Anecdotally, we hear of situations where CHROs, tasked with taking responsibility around organisation culture and values, find it difficult, if not impossible, to lift the conversation to the Board level – precisely because awkward or flinty dynamics exist around the Chair/CEO relationship. The bridge just isn’t there.

Pillars of success for your CHRO: The bottom line.

So, as we review the five pillars of success for the CHRO, we are very mindful of the first criticism that emerges when thinking of the capability of the CHRO (or HR in general) – they lack focus on the numbers and a strategic mindset while getting too bogged down in rules and black/white thinking. The HR community also spends a lot of time upskilling themselves and finding ways to be more relevant within their organisations.

One of my favourite (and toughest) coaching questions to ask of leaders as they struggle with the performance of their people is “what are you doing that is contributing to the situation?”

Perhaps it is time for CEOs and Chairs to meet the aspiring HR leader by providing opportunities for them to step up, while also giving them the support they need in order to be successful. This is what good bosses do as they develop the talent needed in the organisation. Part of this is also providing developmental career path opportunities.

Perhaps it’s time for CEOs to become more engaged, play their part and invite their HR leaders to at least interact with the Board more often, as well as setting the tone in the senior management team as they participate alongside all CxOs.

CEOs, you can make a difference in the success of your HR leader, as well as lifting the quality of the necessary people-related discussions needed in the Board and Senior Management Team.

Robyn Wilson

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Dr Robyn Wilson focuses on helping leaders tackle the change and challenges they face and journeys with them as they, their teams and organizations navigate these with the aim of becoming stronger, gaining more clarity and with strengthened relationships and personal capability. She is the founder of Praxis Management Consulting.

Michael Jenkins