HR is a Consulting Function not Shared Services
During my interview with Josh Bersin, Principal and Founder, Bersin by Deloitte; I asked him, ‘Do companies really need to rethink about having an HR department. Why do some companies say ‘No’ to having an HR department and what are some of the negative impacts of not having an HR department?
Here is what he responded.
HR’s job is not just to keep the company out of trouble or keep people happy. But to figure out how to reinforce the things that make our company unique and find things that drive our differentiation between other companies.
People have been complaining HR from long before I got involved. And the reason is that what HR does in many cases seems optional or something that you think you can do yourself. So many of the things that HR is supposed to be good at like Recruiting, Management, Compensation, Benefits etc. the average Joe might say that, ‘I can figure that out on my own’. We are not going to bother having any professionals do it we are going to have all the managers do it. Now ofcourse the problem with that, most managers move into management usually accidently. They are promoted and they don’t have the time to learn all the things that HR professionals know. So they are learning on the job and they are making a lot of mistakes in the process.
One of the important thing HR people do is they prevent managers from making what you might consider to be sort of stupid mistake. For example: Hiring the wrong person, saying the wrong thing, making something unequal or unfair by accident. The reason it is the more urgent issue now is that we believe that the typical organizational model of HR which is often called the Ulrich model which is the shared service model- is broken. It is not a shared service function. It is a consulting function.
It does have Shared Services in it. But if it isn’t consulting with business leaders and pushing back and not doing innovative things by leveraging data and technology in an innovative way then we will lose the competitive advantage of having an HR department.
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